On Thursday, WWE held its 2022 fourth Quarter earning call. The company generated $1.3 Billion in revenue for the year 2022 which was an increase of 18% when compared to 2021. It’s the highest revenue in WWE history.
WWE earned $325.3 million in revenue for the fourth quarter which was an increase of 5% in the same quarter of 2021. The net income was $38.8 million, a decrease from $60.9 million in the fourth quarter of 2021.
Here’s the full report that WWE issued for the media.
STAMFORD, Conn., February 2, 2023 – WWE (NYSE: WWE) today announced financial results for its fourth quarter and year ended December 31, 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.”
Frank Riddick, WWE President & Chief Financial Officer, added “For the year, we achieved record revenue and Adjusted OIBDA, which was at the very high end of our upwardly revised guidance range. In 2022, Adjusted OIBDA increased 19% reflecting 18% revenue growth. Our financial performance was primarily driven by the return to a full year of ticketed live events, including the staging of two large-scale international events, as well as the contractual escalation of rights fees for our flagship weekly programming and premium live events. In 2023, we anticipate Adjusted OIBDA of $395 to $410 million, reflecting continued revenue growth and relatively flat operating expenses.”
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 Flow3 was $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.
Full Year 2022 Consolidated Results
Revenue increased 18%, or $196.3 million, to $1.3 billion, primarily due to the increased monetization of content, the return to a full year of ticketed live events and the staging of an additional large-scale international event in 2022.
Operating Income increased 11%, or $27.3 million, to $283.3 million, as the increase in revenue was partially offset by an increase in operating expenses. The increase in operating expenses was primarily driven by higher costs to support the creation of content as well as the impact of certain costs associated with the Special Committee investigation and related matters. (See the “Special Committee Investigation and Related Matters” discussion for further details.) The Company’s operating income margin decreased to 22% from 23%.
Adjusted OIBDA increased 19%, or $60.5 million, to $384.6 million. The Company’s Adjusted OIBDA margin remained flat at 30%.
Net Income increased to $195.6 million, or $2.29 per diluted share, from $177.4 million, or $2.09 per diluted share, primarily reflecting the increase in operating performance. The results for 2022 also reflected a decrease in interest expense partially offset by an increase in income taxes.
Cash flows generated by operating activities were $325.6 million, an increase from $182.9 million, primarily due to the timing of collections associated with the Company’s large-scale international events and WWE Network, as well as improved operating performance.
Free Cash Flow was $125.7 million, a decrease from $143.7 million, as the increase in cash flows generated by operating activities was offset by an increase in capital expenditures. For the twelve months ended December 31, 2022, the Company incurred $170.6 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 twelve months ended December 31, 2022 was $296.3 million.
Cash, cash equivalents and short-term investments were $478.7 million as of December 31, 2022. The Company currently estimates debt capacity under its revolving line of credit of $200 million.
Return of Capital to Shareholders
The Company returned $75.7 million to shareholders in 2022, including $40.0 million in share repurchases and $35.7 million in dividends paid. Under the Company’s existing stock repurchase program, approximately 5.3 million shares have been repurchased to-date at an average price of $54.09 per share. As of December 31, 2022, the Company had $211 million available under its existing $500 million stock repurchase authorization.
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