WWE sees quarterly returns increase, announces Vince McMahon documentary

STAMFORD — WWE reported Thursday rising quarterly returns that were boosted by higher rights fees for its flagship TV programs “Raw” and “SmackDown,” while announcing new initiatives including the sale to Netflix of a documentary about CEO and Chairman Vince McMahon.

In the third quarter, Stamfordbased WWE’s revenues rose 19 percent year over year to about $222 million.

Profits surged to about $48 million, compared with $6 million in the same period last year. The burgeoning bottom line reflected “stronger operating performance” and also benefited from after-tax “unrealized gains” of about $5 million related to the value of its investment in fantasy sports and sport-betting firm DraftKings, according to company officials.

“Our third quarter financial performance was strong and reflected our ongoing creativity in a challenging environment,” McMahon said in a statement. “We continue to adapt our business, as demonstrated by the creation of (event-viewing platform) WWE ThunderDome, focusing on increasing audience interaction and engagement to support the value of our content globally.”

While the company is reaping greater rights revenues from Raw and SmackDown, the shows saw respective ratings declines of 29 percent and 2 percent in the past quarter. The programs faced “unprecedented competition” from leagues such as Major League Baseball, the NBA, and the NFL and events such as the Kentucky Derby and Indy 500, according to executives.

“When you look at, in total, everyone who looks at WWE through the course of the year … we have far more fans now than we have ever had,” McMahon said in a conference call Thursday with investment analysts. “You can’t just hang your hat on ‘ok, ratings are down.’ Without question, we have to have a mothership, and we do in terms of Raw and SmackDown.”

In October, “our ratings have held consistent across the board,” said new President Nick Khan.

McMahon said he was encouraged by the recent launch of ThunderDome, which virtually connects fans to the Amway Center in Orlando, Fla., where Raw and SmackDown are now being held behind closed doors. ThunderDome features live video on LED boards, pyrotechnics, lasers, graphics and drone cameras.

The CEO also said that better writing, talent and “execution” would help to boost ratings.

Among other platforms, the subscription-based WWE Network’s average number of paid subscribers increased 6 percent, to 1.6 million. Digital video views increased 3 percent to 9.2 billion.

Upcoming programs include the multipart documentary about the life of McMahon, which Khan said was one of the highest-budgeted documentaries in Netflix’s history.

Bill Simmons, who collaborated with WWE on an HBO documentary about the late WWE legend Andre the Giant, will executive produce the project. Chris Smith, the director of the Netflix documentary about the ill-fated Fyre Festival, will direct.

WWE officials did not disclose on the conference call when the documentary would be available to watch on Netflix.

While the company continues to churn out a voluminous amount of content, it has not outlined when it might allow fans to again attend its events in person.

In response to the spread of COVID-19, WWE temporarily stopped holding its shows in arenas and moved them to a closeddoors setup at its training facility in Orlando, before relocating them to the Amway Center.

The pandemic has sparked other major changes. In April, WWE announced deferred spending on its planned headquarters move within Stamford, employee furloughs and released more than a dozen of its Superstar performers.

“Roughly 25 percent of our employee base was furloughed,” said new Chief Financial Officer Kristina Salen. “We estimate that nearly all of them will be back by the end of the year.”

McMahon said that the company had been galvanized by recent hires, including Khan and Salen, who started in their positions in August.

“I’ve never felt as confident as I currently do in terms of our new management. It’s really extraordinary what this has done for the entire business,” McMahon said. “There’s a new spirit, a new vibrance… This is a fun and exciting place to be.”

The third-quarter results were released after the stock markets closed for the day. WWE shares closed Thursday at $37.33, up about 2 percent from their Wednesday finish. The total trails a 52-week high of about $68.