WWE may not like the word “fake” when it comes to their product, but it certainly is embracing the concept of “virtual.” Or, more specifically, the virtual nature of NFTs, like the Undertaker-themed NFTs sold during WrestleMania weekend. And more offerings are coming, based on some of the discussion on the company’s quarterly investor call, held Thursday afternoon.
“At the start of the pandemic, we were neophytes (about NFTs),” said Nick Khan, the company President. “Now I’d put our level of knowledge as high. We’re confident on what we can deliver, and what our audiences are looking for.”
Calling the virtual collectibles, “the baseball cards of the digital world,” he noted that the Undertaker offerings were completely sold out (including one single version that sold for over $100,000). As WWE “own(s) all (our) intellectual properties, and the overwhelming majority of character rights,” Khan noted that they have a huge offering of digital moments that are ripe for the NFT treatment. “That business is something we are looking to be in for the long term.”
Another thing they are looking to be in is arenas in front of live fans, and they confirmed their hopes to resume live touring starting in the second half of 2021, pending any major issues stemming from the ever-evolving COVID situation.
“It was an amazing feeling to be in front of a live crowd at WrestleMania,” said Stephanie McMahon, the Chief Brand Officer. “(When we were on the stage), we all celebrated something much bigger than ourselves: the power of belonging.”
Chief Financial Officer Kristina Salen noted that their intent is to be on a full touring schedule, as opposed to keeping a residency in the Thunderdome and presenting TV shows with a mix of live and virtual audiences.
“The fans are our fourth wall,” said Khan. “They tell us in the moment how we are doing. We think that (resuming live events) is going to have a direct impact on all parts of our business in an overwhelmingly-positive way.”
Other Highlights from the Investors Call
During the quarter, revenue was $263.5MM (USD). This was a decrease from the same period last year, as this year saw no live events during the quarter; the decrease was offset by the realization of money earned from the Peacock deal. Net income for the quarter was $43.8MM.
The company earned $6.2MM in the quarter from merchandise sales, a significant increase of 24% from the same period last year. This increase can be partially credited to new offerings on the online WWE Shop, new lines of character-specific championship belts, video game royalties including for mobile apps, and action figures. It was noted that WWE action figures are the number one figure line sold in Wal-Mart stores.
Compared to the same three-month period last year, ratings for RAW have fallen an average of 17%, a bigger decline than for the USA network overall and for the top 25 cable networks. Smackdown fared a bit better, losing only 12% of viewers on average, compared to 44% for the entire FOX lineup and 19% for the big 4 broadcast network programming.
These figures, it was pointed out, only consider linear TV ratings. In terms of other channels, WWE’s media consumption hours in the past quarter were some of their highest in the past three years: 9.4 Billion global views on third-party and WWE platforms like Facebook, YouTube, Twitter, and Instagram) and 367 hours of content viewed.
In terms of social media, the company hit a new high with an average number of 1.159MM social media followers. The official YouTube channel is the fourth most-watched channel in the world.
The use of celebrities certainly helped draw eyeballs and attention to the company. During his appearances on WWE programming, Logan Paul had over 100MM impressions on social media. And ratings among the Spanish market increased over 30% any time Bad Bunny appeared on WWE TV.
In response to a question on AEW and whether that played a part in the move of NXT to Tuesday nights, Khan said that it didn’t.
“We looked at the efficiencies (that could be realized in holding) Sunday night Pay-Per-Views, then Monday night RAW and then (NXT) on Tuesday – that’s what really drove the decision. We’re pleased with the increase in NXT’s ratings (since the move). We’re not focused on anyone else. All we’re focused on is tracking of eyeballs on our content.
