WWE Ends 2014 on High Note as Future Rests on Shoulders of WWE Network
February 13, 2015 - WWE
People who buy batch in publicly traded companies generally don’t like risk. They cite companies that have groups that siphon out arguable numbers entertain after quarter. But WWE has taken a large risk given Feb 2014, when it launched a WWE Network, a over-the-top streaming use that creates all of a pay-per-view events and other programming accessible for a prosaic monthly price of $9.99.
While analysts freaked out that WWE would take a large strike — charging $9.99 a month for 12 PPV events, including “WrestleMania,” rather than a roughly $50 per eventuality it did in a past — a impact hasn’t been as disastrous as expected.
WWE astounded Wall Street on Thursday when a association reported better-than-expected formula for not usually a fourth entertain though all of 2014.
Revenues during a fourth entertain rose 19% to $140.5 million, while it posted a net loss of $1.6 million — an alleviation over a detriment of $7.9 million during a year progressing entertain that finished Dec. 31.
For a full year, revenues rose to $542.6 million from $508 million, nonetheless a association was forced to news a net detriment of $30.1 million vs. net income of $2.8 million in 2013.
The detriment signals only how most of a strike WWE has taken to launch a WWE Network final year. But a fourth-quarter sum should have WWE’s investors respirating a small easier.
Subscriptions for a network are on a arise as a network rolls out in some-more unfamiliar territories, and experiments to boost sum have paid off by a offer of giveaway months to viewers who wish to representation a service. Its abroad rollout started holding place in August. At year-end, WWE Network had approximately 44,000 general subscribers, signaling a poignant an area of expansion for a association in a future.
The network finished a year with 816,000 subscribers, WWE said, adding 85,000 during a fourth quarter, representing a 12% boost from Sept. 30. It surpassed a 1 million mark in January, 11 months after a launch.
During a holiday quarter, a network generated $23.3 million in income formed on an normal of 721,000 paid subscribers over a quarter, due to shake rates, now that a network is accessible but a formerly compulsory six-month commitment.
A giveaway membership promo in Nov attracted 242,000 hearing subscribers. The company’s charity a identical giveaway subscription this month.
As a result, PPV contributed $3.9 million in revenue, a decrease of 62%, with approximately 271,000 buys as 3 events were constructed during a quarter.
During a quarter, any multiplication during WWE saw gains, with revenues from a company’s media multiplication adult 26% to $89.5 million, driven by a ramp-up of a WWE Network and a escalation of radio rights fees.
Advertising and subscription sales from a WWE Network and PPV events increasing network revenues 64% to $27.2 million during a quarter, with a streaming use accounting for most of that figure, or $23.3 million.
Television revenues increasing 20% to $50.5 million due to aloft placement fees for a shows around a globe, including flagships “Raw” and “SmackDown,” that atmosphere on USA Network and Syfy in a U.S.
Home party posted sales of $7.8 million, adult from $5.1 million, due to a approval of a $2.1 million smallest pledge compared with 2014 sales, nonetheless section shipments declined 47% due, in part, to a switch of a homevid placement understanding from Cinedigm to Warner Bros.
The accessibility of WWE’s PPV events took a fee on a digital media division, with revenues during $4 million compared to $7 million during a before year quarter.
Live eventuality income increasing 6% to $26.9 million essentially due to a entertainment of additional events in North America and aloft assemblage sum in general markets. There were 82 sum events during a fourth quarter, compared to 78 final year.
Consumer product sales increased 23% to $20.4 million, as a association has increasing a chartering activity. That area increased 26% to $9.1 million due to increasing video diversion revenues. Venue sell revenues increasing 6% to $3.6 million, and the WWEShop increasing sales by 28% to $7.7 million, due to holiday present giving.
The company’s film division, however, took a $1.5 million strike from film spoil charges essentially associated to a approaching opening of a film “Oculus,” that was expelled theatrically in Apr 2014. While “Scooby-Doo: WrestleMania Mystery” achieved improved than expected, a multiplication generated a detriment of $400,000 in a entertain compared to boost of $100,000 in a before year. For a full year, WWE Studios generated $10.9 million in revenue, adult somewhat from $10.8 million in a before year.
As it kicks off 2015, “We trust that a 2015 highway map provides poignant opportunities for growth, as we continue to govern well, innovate faster and enhance WWE Network, a singular biggest event to renovate WWE’s business model,” said WWE chairman-CEO Vince McMahon.
That’s mostly due to splendid spots for a association via 2014. TV ratings for WWE’s weekly array “Raw” and “SmackDown,” by that WWE hypes a WWE Network, rose 2% and 3%, respectively, and consumption of WWE calm on YouTube increasing some-more than 80% to approximately 3.9 billion video views, while a social-media participation grew some-more than 80% and recently surpassed 450 million followers.
“We trust that we have reached a financial rhythm point,” said George Barrios, WWE’s arch plan and financial officer, with a association awaiting a WWE Network, aloft TV rights fees and a rest of a company’s groups to boost year-over-year expansion during any entertain in 2015.
The formula lifted WWE’s batch via a day, shutting adult 6.7% to $14.26.