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Welcome to PWInsider.com's live, ongoing coverage of WWE's stockholders conference call discussing their record-breaking first quarter 2015 earning.
Michael Weiss welcomed everyone to the call and noted Vince McMahon and George Barrios were also on the call.
They noted that Wrestlemania fell into the first quarter this year, as opposed to last year, when it fit into the second quarter of 2014.
Vince said they were proud to announce they had hit record breaking revenue for the quarter and touted that Wrestlemania 31 was the highest grossing event in their history. He noted that Total Divas was E!'s number one show in its third season as The Kardashians were on hiatus. He noted the WWE Network broke 1.3 million subscribers and pushed the new content, specifically mentioning all the new series that would be debuting soon.
Vince also noted Smackdown would be moving to the USA Network and they expect that will increase viewership. He also talked about Tough Enough returning and said all the current online videos, some of which he called ridiculous, are the show before the show.
George Barrios began reading a prepared statement, recapping the press release breaking down the company's earnings.
They then went into the Q&A portion of the call.
The first question noted that the first quarter was huge and asked about the background of the revenues raising. Barrios noted the videogame sales performed and Wrestlemania exceeded their expectations while some costs were able to be moved back to the second quarter, which also helped.
They were asked about seasonality in the consumer products business. They recognize money from the holiday season in the first Quarter of the year, so there will be a drop from that in the second quarter.
Barrios noted they continue to add additional platforms for the WWE Network, noting they are looking at Chromecast, AndroidTV and others. They have to look at the long-term viability of each platform before they put the money into development.
They were asked about adding investment to create new content with names like Seth Green and Jerry Springer. They spent $115 million last year across the board on the Network and should be within "10% of that" this year.
They were asked about advertising. They are going to continue to evolve relationships like the one they had with Paramount to promote the new Terminator film.
The next caller asked if WWE wanted to go back to a tiered pricing structure since they have different content every month while Netflix doesn't [Note from Mike: WWE's content doesn't, because it's all in VOD so she's way off base.] Vince said they are a company that can adapt quickly, but they aren't currently pricing their PPVs differently. They could down the line but not now.
They were asked how the social media interactions help their economics. Vince said "it's a land grab out there" and it's important to grab as much as you can. He said that they are a hub that can attract fans of all sort of forms of entertainment and it's important to marry and integrate social media to engage the audience. It's not just about a TV rating but about reaching out to engage the audience and immerse them.
They were asked about the demographics of the fan base. Barrios said they see it's skewing number and that's one of the reasons they push the social media, because that's where millennials are.
They were asked about the new TV rights deals. Barrios said that by 2018, they will be $100 million more than 2014 but they haven't broken down how it's broken down. He said that in the first quarter, they have additional episodes of Total Divas in comparison to other quarters, so that's a difference. They don't get that bump over ever quarter and since the company adapts to new ideas quickly, it's hard to give guidance on how that will ebb and flow.
They were asked about the Quarter 1 rise and how it will change. He noted there are season elements, such as licensing which will be down after the holidays and more expensive TV tapings because of the European tour.
The sources of churn when it comes to the WWE Network: Barrios said that he doesn't know they have learned about the sources of it and they work on different ways to market and advertise. He said that they had trained the audience for a long time to pick and choose events and they have broken that with a lot of subscribers but they are still working on it. It's about content as well as marketing.
They declined to release information on how many subscribers for Wrestlemania 30 were retained for Wrestlemania 31.
They noted there aren't a lot of countries left to launch in the WWE Network, and they are working on deals for those areas. It's hard to predict when that will be but they expect plans to be announced over the next 18 months,
They were asked about overlapping information from Youtube subscribers to WWE live event ticket buyers to Network subscribers, etc. Barrios said they are matching those up and are building algorithms to hopefully map those consumers.
They were asked about the relationship of social media engagement and WWE Network subscribers. Barrios said social media is a way to engage people and reach them where they are spending their time and they are only scratching the surface of that.
They were asked about the potential of a cable distribution deal domestically after the Hulu and Netflix deals with Cablevision. Barrios said it's interesting how much the world has changed since they launched the Network. They are open to discussions and the WWE Network could take "different forms" as it makes sense.
They were asked about working with specific regional providers for places like China. Barrios said their strategy in China has been the same as their strategy around the world =- establish a TV presence and then go into the region. He said it's been a slow process but they are really looking into re-evaluating their approach to see if they can move things forward in a faster way.
They were asked if the company had ways to prevent users from turning their Network subscriptions off in April and then signing up in May for free. Barrios said they have tools to manage that but it's never a perfect process.
That was it for the call.
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