WWE held their Third Quarter Earnings 2020 conference call today. Michael Weiss opened the call and announced that Vince McMahon, Nick Khan and Kristina Salen will be on the call.

Vince McMahon said that he has never felt as confident as he currently does about their upper management and it is extraordinary what they have done for the business, stating that there is a new energy and optimism and that when you look at where they go in the future and their resources, this is a fun and exciting place to be. Vince put over Nick Khan for his work and then put over Stephanie McMahon, noting that she has more responsibilities and said that he really feels great about the new management team.

Nick Khan spoke for the first time on a conference call and gave some background on his work prior to joining the WWE. Khan stated that WWE Studios are in development on new shows, put over the return of Total Bellas as well as the upcoming Quest For WWE Treasures series on A&E, noting that they are also working with A&E on documentaries on Steve Austin, The Ultimate Warrior and many others. Khan said that is not the only thing they are working on, as he can confirm that they are working on a multi-part docuseries on Vince McMahon, which will be on Netflix, with Bill Simmons as the Executive Producer. Khan then discussed the WWE Network and said that even with potential partners impacted by COVID-19, they have returned to talks with potential partners to license the WWE Network, but do not have a timeline on that, noting that away from those talks, Network subscriptions are up, despite the pandemic, with WWE Network viewership and consumption also up 60% and that the average paid subscribers is up 6% and now at 1.6 million. Khan said that they are working on developing localized programming and noted that they are working on an event in 2021 in partnership with Sony India that will feature local Indian talents, with the show to air on Sony platforms in the country and be distributed in the United States on a platform not announced.

Stephanie McMahon made an appearance on the call and discussed her role as the Chief Brand Officer and praised how the WWE were able to pivot during the pandemic. Stephanie put over the creation of the WWE ThunderDome and the re-christening of the Capitol Wrestling Center, as well as the reboot of WWE NXT UK, putting over the production teams in London, Stamford and Orlando for all working together. Stephanie then talked about their changes to digital strategy, which has led to a 20% increase and noted that they have surpassed 50 billion views on YouTube. Stephanie then discussed virtual visits for their community outreach partners, such as UNICEF and others and said that their advertising and sponsorships have outpaced industry trends. Kristina Salen made an appearance on the call and broke down the numbers, noting that the company are currently evaluating their financial and strategies for 2021 and that the continued effect of COVID-19 has kept everything understandably uncertain. Things were then turned over to the Q&A session.

The first called asked about the television ratings remaining where they are and if there was any concrete plans on improving the ratings, questioning if the ratings stay at the level that they are at currently, would they hurt the rights fees when they come up down the line. Vince McMahon said that the WWE have more fans than they have ever had, but their total audience is much bigger than just the television audience and said that you can’t hang your hat on viewership is down, noting that you have to have a mothership, but that in today’s world, they are never off the air. Vince said that you could say that they are down, but you need to consider the overall viewpoint in that they are doing everything that they can, noting that the WWE ThunderDome brought some fans back and that they want better writing and better execution. Nick Khan said that the television medium has lost eyeballs, but the WWE viewership overall has not as consumption of content is up considerably and said that they are confident that their television rights will go up and that their rating exceeded the Stanley Cup in the demo and that they had ratings increases against the LA Lakers winning the NBA Playoffs recently.

The next caller asked about the television rights in the MENA region. Vince McMahon said that they are still negotiating their television rights and that they are still in contact, noting that it will happen one day, but right now, he does not know what that day is. The next caller asked about the potential changes for the WWE Network. Vince McMahon said that they are looking at anything, except the sale of the WWE Network, meaning that they are looking at licensing and are in constant dialogue about potentially licensing it domestically, as well as globally, noting that they are continuing to work on ideas internationally, with the idea to develop local content for international territories.

The next caller asked about viewership and consumption on the free version of the WWE Network. Nick Han said that some of the hours spent on the WWE Network that they touted included the free tier and said that there are no current plans to add advertising to it, but that could always change. Stephanie McMahon said that they are testing different technologies to use them in whatever strategic way that they determined they would like to do. The next caller asked about the potential cost structures for future years. Kristina Salen said that they are waiting for the return of live touring and that they may have to adjust the business model, noting that they have employees on furlough, which is a short-term financial cut and that they are still going through their 2021 financial plan and how they will execute things for next year and advised everyone to keep those in mind. Nick Khan said that they are looking for the right talents and the right structure for the India event in 2021, so it makes sense for all parties involved.

The next caller asked for Nick Khan’s perspective on ratings, not just for the WWE, but for sports in general and how the ecosystem impact who the company partners with and how the content needs to adapt. Nick Khan said that if you look at the traditional conglomerates structures, they are all getting there with changes, as they realize that it is about content first and that they have to place it where consumers can easily access it, questioning if it would be shocking if Disney for example said that they have great intellectual property, films and sports right and questioned if they could be competitive and beat Netflix. Khan said that if you look at Universal’s move, it is indicating the same things and that the important thing for their fans is that the current partners are happy with the product first and then look to the future and that if things turn into a streaming-first world, they are prepared for it.

The next caller asked what it would take to significantly grow international rights. Nick Khan said that it can be seen how Amazon has an appetite for the NFL and that if you look at their recent executive hires, you don’t make those hires unless you are planning to prepare and make some changes. Khan questioned if Netflix could be testing to go live, noting that they are all going that direction and that WWE could be there with them, with their current partners first, as Peacock grows or with future potential partners going forward. Kristina Salen said that the hope for WWE is that furloughed employees will be back by the end of the year and noted that while the company could return to live events, it will be for lesser earnings due to the limited capacity in venues, but that right now, it is too soon to even know if they can do that. Salen said that they are diligently working on the 2021 strategic focus and will discuss more in the next quarter, including whether the company are able to return to Saudi Arabia for an event, pending COVID-19 travel restrictions. Kristina Salen said that they will be somewhere similar to the Amway Center, the current home of the WWE ThunderDome going forward and that there are lots of potential places for them to go to, since there are no real live events utilizing the arenas.

The next caller asked about WWE NXT on the USA Network. Nick Khan put over Triple H and the team for the ratings last night for a great show and said that they enjoy the USA Network relationship. Khan declined to comment on the length of the USA Network deal, but noted that it is a long enough deal for the WWE NXT team to grow the brand and said that they have seen WWE Network subscriptions growing, even with WWE NXT now on the USA Network. The next caller asked if there was something that WWE NXT does that could be used to help either WWE RAW or WWE SmackDown. Nick Khan swerved away from that question, praising how the WWE RAW and WWE SmackDown ratings have helped up in the recent months.

The final caller asked what Vince McMahon and the WWE wanted to see before he is willing to open the doors to the fans once again. Vince McMahon said that he was part of a panel conference call with other executives and that was the extent of his discussing the issue with Donald Trump in the past. Vince said that with COVID-19 restrictions right now, when it is safe for fans and performers, that’s all that he can tell you in terms of when they will return.