World Wrestling Entertainment (WWE) Misses Q4 EPS by 6c, Revenues Miss

World Wrestling Entertainment (NYSE: WWE) reported Q4 EPS of $0.24, $0.06 worse than the analyst estimate of $0.30. Revenue for the quarter came in at $238.2 million versus the consensus estimate of $245.69 million.

Fourth Quarter 2020 Highlights*

* (All comparisons are versus the prior year period unless stated otherwise)

• Revenue was $238.2 million, a decrease of 26% or $84.6 million, reflecting the absence of the Company’s large-scale event in Saudi Arabia and ticketed live events
• Operating income was $36.2 million, a decrease of 64% or $63.6 million
• Adjusted OIBDA1 was $51.2 million, a decrease of 52% or $56.4 million
• WWE transitioned Raw and SmackDown to Tropicana Field in Tampa Bay (December 11), and continued to deliver a spectacular interactive experience, WWE ThunderDome, to fans
• WWE Network average paid subscribers2 were 1.5 million, an increase of 6%

2021 Business Outlook4

On January 25, 2021, WWE issued guidance for 2021 Adjusted OIBDA. As previously indicated, management expects restrictions related to COVID-19, particularly related to the cancellation, postponement or reduced capacity of ticketed live events, to continue at least through the first half of 2021. Additionally, management anticipates a significant year-over-year increase in WWE’s expense base due to the return of employees from furlough and continued higher expenses associated with the production of its weekly Raw and SmackDown television content at the WWE ThunderDome from its stadium residence at Tropicana Field. The Company estimates it can achieve 2021 Adjusted OIBDA of $270 - $305 million as revenue growth, driven by the impact of the Peacock transaction, the gradual ramp-up of ticketed live events, including large-scale international events, and the escalation of core content rights fees, is offset by the increase in personnel and production expenses.

Management estimates that the stated 2021 Adjusted OIBDA guidance range would be 15% - 20% higher without the ongoing impact of COVID-19, which includes the loss of ticket and merchandise sales at live events and the increased investment in production to further fan engagement. Estimates of future performance beyond 2021 will be impacted by the return of these businesses and various other factors.

Although the Company continues to adapt its business to the changing environment, the timing and rate of returning ticket audiences to its live events remains subject to significant uncertainty, and as such management is not reinstating quarterly guidance at this time.

Management continues to believe that WWE has significant long-term opportunities and is well positioned, particularly given its substantial cash and liquidity, to deliver on its strategic initiatives and to drive long-term shareholder value.

For earnings history and earnings-related data on World Wrestling Entertainment (WWE) click here.

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