WWE held their First Quarter Earnings 2021 Conference Call today. WWE’s SVP of Financial Planning and Investor Relations, Michael Weiss, welcomed everyone to the call and noted that Vince McMahon, Nick Khan, Stephanie McMahon and Kristina Salen were on the call.

Vince McMahon thanked everyone for joining them on the call and said that they were in survival mode due to COVID-19, much like everyone else, but that they are opening the WWE Treasure Chest with the best management team in WWE history, noting that they are poised to take advantage of new revenue streams, new opportunities, new platforms and more. Vince said that he has never been as excited about the business as he is now, and that he has always been excited.

Nick Khan said that there have been significant changes to the media industry and talked about the changes in the right fees in media, which shows the importance of live content and noted that the NFL and the NHL have seen big raises in their rights, even with linear ratings down and that deals like that are indicative of the media marketplace, as well as where it is heading. Khan said that the overwhelming majority of media networks are buying the rights to linear and streaming rights together as opposed to splitting them apart and said that they are confident that their rights portfolio is in the right place to take advantage of that, noting that they were thrilled with the results of Peacock hosting their first WrestleMania and the promotion from their partners with FOX and NBCU leading into it and coming out of it and said that they are excited about replicating the licensing of the WWE Network to potential partners internationally, similar to how they licensed it to Peacock. Khan talked about the success that the company has had in India, the United Kingdom and China and said that they are looking at ways to grow those. Khan said that they dropped their first-ever NFT (non-fungible token) during WrestleMania weekend, many of which sold out within seconds and said that they will be doing more NFT’s in the future. Khan noted that they have made a key deal in the gambling space with Draft Kings, while they have also sold a multi-episode WWE anime series to Crunchyroll. Khan put over the Young Rock series and Biography and Most Wanted Treasures series, all of which feature WWE footage and WWE stars and said that the Biography episode on Stone Cold Steve Austin was a ratings success.

Stephanie McMahon said that this year’s WrestleMania pay-per-view was historic for many reasons and said that it felt amazing to stand on the stage, look out, see and hear the cheers of the audience and that there wasn’t a dry eye as everyone celebrated the power of belonging and that going from last year to this year was a full circle moment of hope, noting that they changed their signature intro to “Then. Now. Forever. Together”. Stephanie said that they had record breaking numbers and that they launched their Peacock partnership in just 52 days, while WrestleMania 37 was the most-viewed live event in Peacock’s young history and their media coverage for the event increased by 25%, while creatively, everything kicked off with the WrestleMania episode of SmackDown on FOX. Stephanie put over the celebrity involvement at WrestleMania 37 and noted that the company had a record new and returning record 14 blue chip partners for this year’s pay-per-view. Stephanie said that video views for WrestleMania week hit 1.1 billion, while 33 million hours of content were consumed, of which WWE-related content saw 115 million engagements. Stephanie said that WrestleMania 37 was the most socially engaged event each day of the weekend, while they had record merchandise sales per capita at the stadium. Stephanie said that they had specialized vaccination messaging for the market in Florida and worked with community outreach programs locally in the Tampa area. Stephanie noted that television viewership remained stable as they transitioned to the ThunderDome, noting a 9% increase for SmackDown, while RAW remained stable and noted that Bad Bunny’s appearances brought a 37% increase in the Latin viewership for his segments alone. Stephanie said that the company are ready to work with brands to help cultivate and create unique ways to promote them such as the recent segments across television and online, including the new Old Spice campaign. WWE’s Chief Financial Officer Kristina Salen stepped in and said that she was amazed by the WWE team during WrestleMania week and then proceeded to recap the financial numbers that were released. Salen said that the company do not expect to regularly stage live, ticketed events until the second half of 2021. Things were then turned over to the Q&A session.

The first question asked about sponsorships and what sort of inventory is tied to the Peacock side of things and what opportunities the company sees in the coming years. Stephanie McMahon said that there is potential upside in mirroring what sports leagues do and capitalizing on the talents, who are influencers themselves, plus the fact that they own 100% of their intellectual property. Nick Khan said that they would be selling the inventory with Peacock and that launching the product was the focus and that now that everyone is happy with that launch, they can get themselves in order.

The next caller asked what sort of lift they expected for the ratings as they start to get back towards the traditional live event format. Nick Khan said that they look at ratings the same way they think buyers would look at it, noting that it is a robust number of linear, streaming, digital, etc and there is a challenge in linear content for everything as how often does someone watch something on a streaming device or their phone, noting that it is easy nowadays. Khan noted that the company launched the WWE Network in 2014 because they saw where things were going, they get it and that is also why they did the Peacock deal. Khan said that they want live fans back and performers in front of them as it is the best way to know what is working and what is not working and that when they do, it will benefit all forms of their business.

The next caller asked about the differences between viewership for WrestleMania 36 and WrestleMania 37. Khan revealed that Peacock requested that they would not share the numbers, but said that when you don’t hear from partners after the show, that is a problem, however in Peacock’s case, they were in contact with them all weekend about how happy they were with everything and said that they wnated to expand the fan base and that is why they did that deal with Peacock.

The next caller asked about NXT viewership and how All Elite Wrestling is doing well on Wednesday nights and if the company cares about that. Nick Khan said that they are focused on getting eyeballs on their own content, noting that the last time around, they were asked about the NHL’s potential impact on their business. Khan said that going forward, they don’t believe that NBC and NHL will be in business and that moving NXT to Tuesday nights had nothing to do with the NHL. Khan said that they are pleased with the increase in the NXT ratings and that they are focused on themselves and nothing, nor no one else.

The next caller asked about who the potential players may be looking at certain live events, such as Amazon Prime. Khan said that they know that Apple have been looking at live event, so it is something that could happen, but has not happened yet. Khan said that there are behemoth digital companies looking to get into the space and they believe that there will be significant competitors for premium content rights as live matters and that is what the WWE does.

The next caller asked if the company has sold everything that they can monetize right now. Khan said that in the United States, they are locked in for WWE RAW and WWE SmackDown content through October 2025, however that is for existing content and not new content, nor is it for international rights, noting that they are looking at international and other potential platforms, while most of their Peacock licensing fees will be reflective starting in the Q2 call.

The next caller asked about a possible return to touring, questioning whether they would hold a residency while phasing-in touring, or if they will go full steam ahead. Kristina Salen said that they have not yet decided on this Summer, but their hope is that in the second half of the year that they would go full-touring, noting that their current guidance includes them going full touring towards the end of the year and that they are looking forward to getting back out on the road again.

The next caller asked whether the success of e-commerce has been a result of the lack of live event merchandise sales. Kristina Salen said that they have really taken advantage of the trends to try and bring people to WWEShop permanently and that this quarter alone, they released three new title belts. Nick Khan said that the brick and mortar business has changed, either forever, or for some time to come, but that they remain bullish on the return of live events and fans buying merchandise there when they get the green light to resume touring. Salen said that they will be in the NFT business on a long-term business, as these are essentially the baseball cards of the digital world.

The next caller asked about whether the plans to develop local talent and WWE Performance Centers has been halted due to the Coronavirus pandemic. Khan said that the plans have not changed, but that they were delayed by COVID-19 indeed, however they did a show for their partners SONY in India titled Superstar Spectacular that drew 5 times their usual rating in India, noting that they were thrilled to do that in Florida as it is very difficult to do international events and build facilities right now, however those plans will resume when they are out of COVID-19, which they believe is heading in that direction. Salen noted that the brand is so strong that they can be global without the need to travel and said that they have partners that they can look to help them invest and promote themselves in those markets, as well as to help guide them to unique opportunities.

The next caller asked if the new Peacock partnership covers new deals that have not been struck. Stephanie McMahon said that any partnerships that are seen on Peacock, then the WWE and Peacock are working on those and said that when you are working with teams that have sold for the Olympics, as well as the Super Bowl, it provides the company with opportunities that they have never had previously.

The next caller asked about the level of investment being made by the company going forward. Kristina Salen said that when they think about new opportunities, it is about them harvesting or optimizing what is already there and not building something new, noting that they will be spending money on a new Headquarters that they have delayed for almost two years now, but that they are really excited about the future, noting that there has been no change in the timing of what they expected, in regards to Peacock, except that some of it was hit in the first quarter. Salen said that they are very pleased with the results of NXT’s new deal with the USA Network, while they were hesitant about NFT’s at the start of the pandemic, but now they know that market, stating that as always, there is room to learn and that they are confident that they can deliver what their audience is looking for.