WWE CEO Nick Khan, Chief Content Officer Triple H, President & Chief Financial Officer Frank A. Riddick, and Senior Vice President & Head of Investor Relations Seth Zaslow hosted the Q1 2023 Earnings call today from WWE headquarters in Stamford, CT. You can check out coverage of today’s press release at this link. Below are highlights from the call:
The call opens with Zaslow giving the introduction. Khan took over and said 2023 is off to a strong start. He touted the WWE – UFC merger with Endeavor and said they are working to finalize the deal in the second half of this year. Khan said they are now focused on the RAW and SmackDown TV deals, and have entered into talks with NBCUniversal (USA Network) and FOX, both of which have been terrific partners. He said the increase in ratings and viewership tells them they are well-positioned as they enter these negotiations. They remain focused on WWE’s day-to-day growth. He touted the WrestleMania 39 success and how this was the most-watched and most-profitable event in WWE history. He mentioned a number of new records from WrestleMania 39 that highlight WWE’s strength – record attendance at WrestleMania, record gate revenue, record domestic viewership, record sponsorship sales, record venue merchandise, and multiple social records. WrestleMania was seen by over 35 million viewers internationally. Khan said WWE’s growth is not limited to WrestleMania. He touted the highest-grossing Royal Rumble in history, and how Elimination Chamber set new event records. Elimination Chamber was strategically hosted in Canada, where their next TV deals will come up, and the success shows WWE’s popularity in the region.
Khan said WWE fans are watching RAW and SmackDown longer than ever in the history of the shows. Fans spend on average 73 minutes watching RAW, a three-hour show, and they spend 42 minutes on average watching SmackDown, a two-hour show. Khan touted the success and the future of the Fanatics merchandise deal. He said WWE is about to embark on their biggest run of international shows with Backlash in Puerto Rico, Night of Champions in Saudi Arabia, and Money In the Bank from London. WWE is in talks with a number of local governments and groups about the economic impact WWE brings when it comes to town.
Khan reiterated how WWE is pleased with where they are, they are excited about 2023 and see record revenue with Adjusted OIBDA. They are well positioned for the future, and that includes the Endeavor deal. Khan said it’s an amazing time for WWE as they remain extremely excited for the longterm future.
Riddick spoke next and went over the numbers from the press release. While Triple H is on the call, he did not speak during the initial remarks as he usually does. It’s now time for questions from investors.
Khan said they are in productive TV talks with FOX and NBCUniversal. WWE believes their TV partners see the growth and impact of the product in the right way, and WWE is optimistic. Khan said he can’t give a timeframe on when the TV deals might close, but they remain bullish on RAW and SmackDown.
A caller asked about possibly extending the Peacock deal. Khan said they will see what happens with the Peacock situation but the deal still has a few more years on it. Khan said they are not taking offers from other networks right now, they are staying respective to the exclusivity that FOX and NBCU have.
They were asked about how they were once so focused on India and saw it as a top market for the future. Khan said COVID-19 paused their efforts in India, as did the Sony TV – Zee merger in the country. Khan said the merger is waiting on regulatory approval, and the deal is up in late 2024 so until then they are hyper-focused on the U.S. media rights, then they will shift focus back to India. They are in constant talks with Sony and they feel good about where things are there, and where it can go in the future.
They were asked about the Endeavor deal and being prepared to be part of a new structure and the management transition. Khan said they are excited for everything that can and should happen. He talked about how Endeavor and UFC are not interested in changing how WWE handles business and creative. Khan said Endeavor doesn’t do this with UFC, and UFC President Dana White will probably back him up on this in that Endeavor isn’t telling him which fight to do. Endeavor are experts at building businesses internationally, and they are excited about this. Triple H reiterated and said the level of excitement is really high for Endeavor. He said creatively they look forward to doing what they do, he himself is incredibly excited for what Endeavor brings to the table and how WWE can use them to expand their efforts, and in growing what they do across the globe. Triple H thinks Endeavor will be incredibly helpful.
They were asked about the increase in RAW and SmackDown numbers, and what are some of the things they’re now doing to drive viewership. Triple H reiterated how they are extremely excited. He touted some of the numbers and said it’s all about having the right team assembled, across the board. He said they have world class Superstars on the roster, which they continue to grow every day through developmental, NIL, domestic and international recruiting. He pointed to all the talent in the Draft. He said the WWE writing team is world class, then he praised WWE Executive Producer & Chief of Global Television Distribution Kevin Dunn and his production team, saying there’s nothing like them in the world. He commented on how there’s nothing else out there that does what WWE does, puts out the product they do with the look/feel, and nothing else that engages fans like WWE does. He said they are focused on character development, which we see across the storylines, and with fans engaged in talent. He pointed to The Bloodline and Undisputed WWE Tag Team Champion Sami Zayn, and how storyline development reached a whole new level, with fans invested and being excited for the content like they haven’t been in a long time. Triple H said it’s also about looking out year over year, seeing where they want to be, then backtracking so they’re always ahead of the curve. He pointed to better planing, trying new things outside of the box. He said something not working isn’t a failure, but a lesson learned. He is excited about the future and where they can take all of this.
Khan said FOX and NBCU have an exclusive window of about one month when it comes to negotiations on the TV deals. In regards to the increase in sales and sponsorships, Khan said it’s all about having the right leadership in place. He said they have been focused on signing more longterm deals, and getting out of the business of one-offs, and into the business of longterm partnerships. They believe when the Endeavor deal is finalized, it will ignite their sponsorship sales even more.
They were asked about potential acquisitions outside of the United States. Khan said they are focused on building the existing business with the current product, closing the deal with Endeavor, and the TV deals, so they are not having acquisition talks right now but once things settle, they will see what people want to do, and they are excited about that as well.
A caller asked about international WWE Network negotiations, specifically in the UK. Khan said they are having talks about their core content rights and the WWE Network with buyers in the UK. Part of the reason for hosting Money In the Bank in London was so that buyers can see the product live. They did something similar with hosting WrestleMania 39 in Los Angeles with the TV deals coming up. Khan said they are open to business in terms of WWE Network and core content rights.
They were asked about the ongoing Hollywood writers strike and if it impacts WWE, or the WWE product on A&E. Khan said there is no impact whatsoever as WWE writers are not a part of the Writers Guild of America. There is also no impact on the A&E product. Khan said they are supportive of the Guild and are hopeful a deal can be reached.
They were asked about receiving the seven-figure subsidiary from Puerto Rico to host WWE Backlash. Khan said this is something they kicked off last year with WWE Clash at The Castle and the local government in Wales. They are now replicating this domestically and internationally. They are in talks with other cities in the United States and abroad about what WWE can do for them.
That’s it for the call.
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