World Wrestling Entertainment Earnings: Profit Down but Still Beats Estimates

Although World Wrestling Entertainment Inc.’s (NYSE:WWE) net income fell in the third quarter from a year earlier, profit exceeded analysts’ expectations. World Wrestling Entertainment is engaged in the development, production and marketing of television and pay-per-view event programming and live events, and the licensing and sale of consumer products featuring its World Wrestling Entertainment brands.

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World Wrestling Entertainment Inc. Earnings Cheat Sheet

Results: Net income for World Wrestling Entertainment Inc. fell to $3.5 million (5 cents per share) vs. $10.6 million (14 cents per share) a year earlier. This is a decline of 66.7% from the year-earlier quarter.

Revenue: Fell 4% to $104.2 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: World Wrestling Entertainment Inc. reported adjusted net income of 7 cents per share. By that measure, the company beat the mean estimate of 4 cents per share. It fell short of the average revenue estimate of $113.7 million.

Quoting Management: “In the third quarter, we continued to make important progress on our key strategic initiatives, expanding our content and distribution and enhancing our brand strength,” stated Vince McMahon, Chairman and Chief Executive Officer. “The production and licensing of new programs, including a third hour of Raw, the WWE Main Event and WWE Saturday Morning Slam, as well as the development of online distribution on Hulu Plus exemplify our achievement of these goals. The performance of our new programs, which have attracted an average audience 14% to 50% higher than the viewership of the programs they replaced, demonstrate our ability to build consumer interest, which forms the foundation of our proposed WWE Network.”

Key Stats:

The company has now topped analyst estimates for the last three quarters. It beat the mark by 3 cents in the second quarter and by 12 cents in the first quarter.

Revenue has dropped in the past two quarters. In the second quarter, revenue declined 0.6% to $141.6 million from the year-earlier quarter.

Looking Forward: Expectations for the company’s next-quarter performance are higher than they were ninety days ago. Over the past three months, the average estimate for the fourth quarter has risen to 2 cents per share from one cent. The average estimate for the fiscal year is 39 cents per share, a rise from 38 cents ninety days ago.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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