WWE Network Revenue Up 60%, With 1.2 Million Internet Video Subs at End of 2015

WWE Network
Courtesy of WWE

Wrestling entertainment company has said over-the-top network could hit 4 million subs in five years

WWE pinned 1.22 million paid subscribers for its over-the-top WWE Network as of the end of 2015, up 72% from the year-earlier period, as revenue for the segment rose 60%.

And the wrestling king said viewing on the $10-per-month OTT network now outranks that of every traditional cable TV network: Over the course of 2015, WWE Network subs watched an estimated average of 188 hours of content per household. In addition, the brand generated more than 8 billion YouTube views.

“These metrics demonstrate the unique power of our brands and our potential to capitalize on a multiplatform-content strategy to drive long-term growth,” CFO and chief strategy officer George Barrios said in announcing the results.

Still, WWE Network’s sub count was down sequentially from 1.31 million in the third quarter of 2015. Engagement for the OTT network in Q3 was driven by live event specials including “Beast in the East” and “NXT Takeover: Brooklyn,” the company said.

Moreover, investors have been expecting a faster ramp-up for WWE Network, which launched in February 2014. Barrios has previously said the service could hit as many as 4 million subscribers worldwide within the next five years. WWE shares opened 4.4% higher Thursday before investors pushed the stock down as much as 8% in morning trading, amid a broader market decline.

WWE Network revenue for the fourth quarter of 2015 increased to $37.2 million from $23.3 million in the prior-year quarter.

Overall, the company slightly topped Wall Street expectations for the fourth quarter. WWE reported revenue of $166.2 million (up 18%) and a net loss of $1.2 million, or 2 cents per share, versus a net loss of $1.6 million in the year-earlier quarter. Excluding charges, adjusted net income was $3.4 million versus a net loss of $0.6 million in Q4 2014. The most recent quarter included a $7.1 million write-off for the value of costs related to a media center expansion project that WWE said it has abandoned.

For the first quarter of 2016, the company projects average paid WWE Network subscribers of 1.28 million, which would be up 38% year-over-year. WWE noted that its flagship WrestleMania event will occur on April 3 this year, falling in Q2, whereas last year’s event occurred in the first quarter.

WWE projected Q1 adjusted operating income of $15 million to $19 million, versus $21 million in the year-ago quarter, primarily because of the timing of WrestleMania which grossed approximately $15 million last year.

Internationally, WWE Network had 277,000 subscribers as of the end of 2015. It launched across the Indian subcontinent in November 2015, and last month WWE Network debuted in Germany, Austria, Switzerland and Japan. The company plans to launch in other territories, including China, Thailand and the Philippines.

In Q4, WWE Network premiered more than 85 hours of original content and increased its on-demand library to more than 4,300 hours. Among the content that debuted during the quarter were the original series “Breaking Ground” and two live specials, “Live from Madison Square Garden” and “NXT Takeover: London” from Wembley Arena in the U.K.

The company expects to add more than 300 hours of original content to WWE Network’s featured programming in 2016, including more than 1,000 hours of archival content.

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  1. Kalvin says:

    Their subscriber count WENT DOWN?!? That is not good. Looks like the WWE is going down. I thought this was supposed to be at like 2million USA subscribers with another 1million international subscribers by now. When all those investor lawsuits came out I sold my WWE. Now I understand why all of the insiders keep selling their vested shares as soon as they can. I would not want to be on their board right now….dead meat

  2. After WM the sub count will be at 1.45 to 1.66 mil. Still positive comparisons year over. Street is impatient and as subs declined year over from the 3rd to 4th Q, this was what happened in 2014. It’s the nature of the beast as it was 30+ years of PPV’s. Trend year over still very positive.

  3. Chris says:

    Variety…your headline is misleading, the WWE Network has failed in every way in which it was intended and designed. Management repeated for two years that by 2016 the WWE Network would have 2-3million “paying annual average subscribers.” There are no new markets to tap or exploit, the management team under Vince needs to go to save the company.
    And that is why the stock is currently trading lower than when it went public a decade ago.
    Time to toss this Hairhat CFO Barrios

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