World Wrestling Entertainment (WWE) has announced record earnings for the full year 2022.
“2022 was another strong year for WWE. We generated record financial results and our business continued to perform well due to the strength of our content and brand, which drove audience engagement and monetization across multiple platforms,” said Nick Khan, WWE Chief Executive Officer.
“In 2023, we’re focused on continuing to execute on our key operational initiatives, such as the domestic licensing of our flagship programs, Raw and SmackDown, as well as the international licensing of our content in key markets. At the same time, we’re focused on the review of strategic alternatives that we announced earlier this year, with the goal of maximizing value for all shareholders.”
Fourth Quarter 2022 Highlights
- Revenue was $325.3 million, an increase of 5%; Operating income was $62.7 million, a decrease of 22%; and Adjusted OIBDA was $90.2 million, a decrease of 4%
- Returned $8.9 million of capital to shareholders through dividend payments
- Crown Jewel was the most viewed international event in WWE’s history. Domestic unique viewership on Peacock increased 70% over the prior year event
- Each WWE domestic premium live event (Extreme Rules and Survivor Series) was the most viewed event in its history with year-over-year increases of 36% and 46%, respectively, in domestic unique viewership
- WWE announced a multi-year extension of its partnership with MultiChoice to expand the distribution of the Company’s content in Sub-Saharan Africa
- In January 2023, WWE held Royal Rumble at the Alamodome in San Antonio, TX. The event was the most viewed Royal Rumble in WWE’s history, with a 52% year-over-year increase in domestic unique viewership, and generated the highest gate in the event’s history
Full Year 2022 Highlights
- Revenue increased 18% to $1.3 billion, the highest in the Company’s history
- Operating income increased 11% to a record $283.3 million
- Adjusted OIBDA increased 19% to a record $384.6 million
- Returned $75.7 million of capital to shareholders, including share repurchases and dividends paid
Fourth-Quarter Consolidated Results
Revenue increased 5% to $325.3 million, primarily due to an increase in network revenues related to the timing of premium live events as well as higher monetization of third-party original programming. These increases were partially offset by a decline in consumer products licensing and eCommerce revenue. Results also included the staging of a large-scale international event in both the current and prior year periods.
Operating Income decreased 22%, or $17.9 million, to $62.7 million, as the increase in revenue was offset by an increase in operating expenses. The increase in operating expenses was primarily driven by higher costs to support the creation of content. To a lesser extent, costs associated with the Special Committee investigation and related matters as well as higher stock compensation expense also contributed to the increase in operating expenses. (See the “Special Committee Investigation and Related Matters” discussion for further details.) The Company’s operating income margin decreased to 19% from 26%.
Adjusted OIBDA decreased 4% to $90.2 million. The Company’s Adjusted OIBDA margin decreased to 28% from 30%.
Net Income was $38.8 million, or $0.45 per diluted share, a decrease from $60.9 million, or $0.73 per diluted share, primarily reflecting the decrease in operating performance.
Cash flows generated by operating activities were $120.3 million, an increase from $46.6 million, as lower net income was more than offset by the favorable timing of collections associated with the Company’s large-scale international events.
Free Cash Flow3was $43.0 million, an increase from $31.8 million, as the increase in cash flow generated by operating activities was partially offset by an increase in capital expenditures. For the three months ended December 31, 2022, the Company incurred $71.7 million of capital expenditures related to its new headquarter facility. Excluding the capital expenditures related to the new headquarter facility, Free Cash Flow for the three months ended December 31, 2022 was $114.7 million.
Return of Capital to Shareholders
The Company returned $8.9 million of capital to shareholders in dividends in the fourth quarter of 2022. There were no share repurchases under the Company’s existing stock repurchase program.