WWE held their third quarter earnings conference call earlier today with Michael Weiss welcoming everyone on the call and noted that Vince McMahon and George Barrios are also on the call and will talk the financial aspect before they open it up for the question and answer session.

Vince McMahon opened the call and said that the results exceeded the guidance and analysts’ expectation and that RAW ratings are up 3% and SmackDown ratings were up 2%, which he noted was amazing and said that WWE Summerslam’s Nielsen social media numbers were huge and tha tthey have a 71% increase in WWE Network subscribers compared to the previous quarter. Vince said that the company have changed the pricing of the WWE Network to remove the commitment because it was the way to go and that the WWE Network has some remaining big countries that they will be launching in in 2015 and that they are making the move in the United Kingdom in November. Vince noted that November will be free and compared that offer to services like Hulu Plus who often give away a free month and said that they will have limited advertising on the WWE network.

George Barrios took over the call and ran down the numbers from the release and then talked about the International roll-out of the WWE Network stating that they will get the U.S. version of the WWE Network, however they will eventually localize it in the native languages. Barrios noted that WWE Network revenue was up 68% from this time last year when it would have been pay-per-view revenue and then pushed the increased viewership of WWE’s pay-per-view events and that they will continue to invest in programming and technology for the WWE Network. Barrios noted that licensing was up due to a higher-royalty rate for the WWE 2K15 videogame, however live events were down due to fewer events in international markets and that average attendance internationally was up 15%, but domestically there was a 7% decline in attendance.

Barrios said that as of September 30th, 2014, the company has $69 million and cash and investments and they have a credit limit of $150 million and in October, they received a $50 million advance for a new TV deal that is not reported in this current quarter, but will be recognized over the term of that deal. Barrios then pushed the long-term plans for the WWE Network as a way to help them grow. Barrios then talked about the TV rights and noted that they have locked in key deals in the United States, India, the United Kingdom and other countries and that the new deals will show a significant increase in those revenues in 2015 and that TV revenue will go to $235 million a year by 2018 and that WWE has experienced a $40 million growth in just the last year alone. It was then announced that there would be a question and answer session.

Barrios was asked about some of the numbers and said that some of the initiatives that they put into place to cost-cut went better than expected and that moving forward, there will be some motion forward. The next question asked about the feedback they have received from WWE Network subscribers that have disconnected and what the company is doing going forward to help prevent that. Barrios said that they are thrilled with how they engage the audience and that the viewership for pay-per-view events are more equal for secondary shows, compared to the major shows and that the video-on-demand content drives the majority of the non-pay-per-view viewership and that material becomes more valuable to the subscriber as they add more. Barrios was then asked about the international subscribers and said that the ramp rate internationally was always expected to be slower than in the United States. The next question asked about the television revenues, which Barrios said that they only give overall guidance and that they have contractual revenue growth of $105 million in major markets over the next several years. They were then asked about the free month in November, which Barrios noted that those who maintain the subscriptions will be counted as new subscribers for the next quarter.

They were then asked about the balanaces of international and domestic subscriptions, to which they noted that it’s too early to predict and they really are only in the eight month of operating the WWE Network. The next question asked about an Equity Investment that wasn’t broken down in the Earnings that was recorded as an impairment. Barrios said that sometimes the company makes investments in companies and didn’t want to mention which investment it was, but changes made in the company made the WWE decide that they didn’t want to continue to be involved going forward. They were then asked about the WWE Network in Canada and said Rogers Communication were working on getting other distributors in Canada for the Network as they currently only have 20% clearance in Canada, so they have a long way to go to get to 100%. The next question asked about the TV deals, to which Barrios noted are not longer than 5 years. The next question asked about how the penetration amongst Rogers and United States subscribers compare, to which Barrios said that the ramp rate doesn’t feel to disimilar to the United States, however the United States had WrestleMania to push the subscriptions. They were then asked about what percentage of subscribers were watching specific programming, which Barrios said that he didn’t want to get into, but that the best performing shows were the live shows that were formerly on pay-per-view and said that being live works. Barrios said that the video-on-demand library allows the company to program to a broad fanbase, allowing them to watch and view what they want to see, whether it is older material from when they were a kid or a show that they liked that they want to binge watch and that it allows the viewer to program for themselves. They were then asked if creative is the reason for subscribers leaving, to which Barrios noted that churn is 8% and that the company expected between 4-8% and that’s just part of a subscription-driven business.

That ended the call with Michael Weiss thanking everyone for their questions.