World Wrestling (WWE) Q4 Earnings & Revenues Beat, Up Y/Y
Zacks Investment Research | Feb 06, 2019 11:56PM ET
World Wrestling Entertainment, Inc. (NYSE:WWE) delivered second straight quarter of positive earnings surprise, when it reported fourth-quarter 2018 results. Net revenues also came ahead of the Zacks Consensus Estimate after missing the same in the preceding quarter. Notably, both the top and bottom lines improved year over year. Clearly, the company’s effort to focus on increasing original content production, localization and strategic initiatives as well as digitization and international development bode well.
This integrated media and entertainment company delivered adjusted earnings of 44 cents a share that surpassed the Zacks Consensus Estimate of 32 cents and surged considerably from 7 cents reported in the year-ago period.
WWE’s revenues of $272.5 million surged 29% and came above the Zacks Consensus Estimate of $252.9 million. Management pointed that top line benefited from increased monetization of content and favorable impact of the adoption of the new FASB standard for revenue recognition (ASC Topic 606) on licensing revenue. For 2019, management anticipates to attain record revenue of approximately $1 billion.
Total adjusted OBIDA advanced 57% to $64.4 million during the quarter, whereas adjusted OBIDA margin expanded roughly 500 basis points to 24%. Adjusted OBIDA surpassed management’s earlier provided guidance range of $45-$55 million.
Management is strengthening and expanding WWE Network through creation of new content along with implementation of programs which will have higher customer attraction and retention power. Further, the introduction of new features, expansion of distribution platforms and foraying into new regions will aid the drive. The company is increasing the monetization of WWE content worldwide. With revenue expected to increase considerably courtesy of new U.S. distribution agreements, management is aiming to attain adjusted OIBDA of at least $200 million for 2019.
The company anticipates first quarter adjusted OIBDA in the band $9-$14 million. Management hinted that the said range as well as the expected performance through the third quarter, reflects year-over-year declines. The company informed that this is because increased content rights fees are likely to be offset by higher fixed costs. For the fourth quarter of 2019, management projects adjusted OIBDA of at least $100 million.
This Zacks Rank #1 (Strong Buy) stock has surged 143.9% in a year, comfortably outperforming the Zacks Investment Research
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