WWE is closing in on plans to launch its own TV network this year, with company chief Vince McMahon telling analysts on Thursday “I hope next quarter I will be making an announcement” on the channel.
The three-month period was the same timeframe McMahon gave during the company’s first quarter earnings call in May. But as WWE continues to negotiate carriage deals and rollout plans, the company has made considerable investments in the new venture, including $1.7 million over the past three months alone. George Barrios, WWE’s chief financial officer, said it will spend between $5 million and $10 million on programming for the WWE Network.
WWE revealed the numbers during its second quarter results, during which the company saw revenue hold event at around $142 million, the same as last year, while net income dipped to nearly $12 million, from $14 million.
Company attributed expenses related to the potential network and film impairments in the prior year quarter to some of the declines.
Without any new releases, WWE Studios generated $600,000 in the second quarter, down from $4.3 million last year. But film arm has a number of titles unspooling in the coming months, including Halle Berry thriller “The Hive,” with Troika Pictures, “The Marine: Homefront,” a co-production with Twentieth Century Fox Home Entertainment; Colin Farrell thriller “Dead Man Down,” co-financed with IM Global and to be distribbed by FilmDistrict; horror pic “No One Lives,” with Pathe Films; and Toronto Film Festival pickup “The Day.”
PPV buy rates rose 17% for the company during the quarter, with “WrestleMania,” hosted from Miami this year, accounting for nearly 60% of the revenue growth with a 15% increase in buys over last year. Revenue from the three other events in the quarter increased 28% based on a combined 20% increase in buys. But “‘Mania” is the juggernaut, with event generating 1.2 million buys, up from nearly 1.1 million last year. Its next major event, “SummerSlam,” takes place Aug. 19, at Staples Center in Los Angeles. Overall, PPV revenue came in at around $41 million.
Around $6.4 million earned from PPV buys for “WrestleMania” helped increase WWE’s live and TV events biz by 6% to $117 million. Last year’s “‘Mania” generated $5.3 million in additional ticket, merchandise and PPV revenue. Overall, live event revenues came in at $35 million, the same as last year.
TV rights revenue also was flat at $32 million during the period but is expected to grow after WWE added a third hour to “Monday Night Raw” on USA Network. Company also will benefit from the launch of “WWE Main Event” on Ion Television in the fourth quarter. The 1,000th episode of “Raw” attracted 6 million viewers last month.
The consumer products division was down, with $16 million in revenue, compared to nearly $22 million, as homevid sales came in even at $7.8 million. A decline in videogame sales shaved licensing revenue nearly in half to $6.6 million from $12 million during the same year-ago period when two titles were available.
The digital division saw an uptick from its YouTube channel, earning around $4.8 million versus $3.4 million a year ago, primarily from the licensing of short-form content to the online distribber. Company invested $5 million in video-based social media service Tout, according to company statements.