World Wrestling Entertainment, LLC Profile
World Wrestling Entertainment, Inc. and its subsidiaries (WWE) operates as an integrated media and entertainment company.
The company principally engages in the production and distribution of unique and creative content through various channels, including content rights agreements for its flagship programs, Raw and SmackDown, and the company’s premium over-the-top network (WWE Network), premium live event programming, monetization across social media outlets, live events, licensing of various WWE themed products, and the sale of merchandise at its live events.
The company’s operations are organized around the following principal activities:
Media
The Media segment reflects the production and monetization of long-form and short-form video content across various platforms, including broadcast and pay television and streaming, as well as digital and social media. Across these platforms, revenues principally consist of content rights fees associated with the distribution of the company’s programming content, subscriptions to WWE Network, and advertising and sponsorships.
Live Events
Live Events segment provides ongoing content for the company’s media platforms. Live Event segment revenues consist primarily of ticket sales, as well as revenues from events for which the company receives a fixed fee and the sale of travel packages associated with the company’s global live events. In July 2021, the company resumed its domestic and international live event touring schedules.
Consumer Products
The Consumer Products segment engages in the merchandising of WWE branded products, such as video games, toys and apparel, through licensing arrangements and direct-to-consumer sales. Revenues principally consist of royalties and licensee fees related to WWE branded products and sale of merchandise distributed at the company’s live events and through eCommerce platforms. Beginning July 2022, the company launched an exclusive, multi-year partnership with Fanatics, Inc. (Fanatics) to create a new, enhanced experience for WWE fans globally, and transitioned the company’s digital retail platform to Fanatics.
Media
Network
WWE Network launched in February 2014, becoming the first-ever 24/7 live streaming direct-to-consumer network. In addition to the company’s premium live events, WWE Network content includes second runs of the company’s in-ring television programming, exclusive original programming, groundbreaking documentaries, reality shows and in-ring specials, including Table for 3, Steve Austin’s Broken Skull Sessions and WWE’s The Bump. The company’s strategy of creating compelling original content has contributed to the popularity of WWE Network, which premiered nearly 550 hours of original content during 2022.
In March 2021, the Peacock paid streaming service became the exclusive home to WWE Network in the United States in connection with a multi-year license agreement with Peacock TV LLC (Peacock). Network revenues for the year ended December 31, 2021 included the upfront revenue recognition related to the delivery of certain intellectual property rights under this agreement. During 2022, the company entered into agreements to license WWE Network content in certain international markets, including agreements with MBC in the Middle East, Foxtel in Australia and MultiChoice in Sub-Saharan Africa.
The company’s subscription-based WWE Network continues to be available in certain international markets (excluding embargoed countries, including the United Kingdom, Germany and Japan, among others.
Core Content Rights Fees
Leveraging the company’s expertise in live event television production, it produces seven hours of original weekly domestic television programming, RAW, SmackDown and NXT, the company’s core content. RAW and NXT are licensed domestically to NBCU, while SmackDown is licensed domestically to Fox Network. The company also distributes second runs of RAW and NXT to Hulu, which are available after the original first run airing dates on television, along with a wide selection of other WWE content.
RAW is a three-hour live primetime program airing on Mondays. It ranks among the most watched regularly scheduled programs on primetime cable television. RAW is the longest running weekly episodic program in primetime television history, with over 1,500 original episodes, and anchors USA Network’s programming line-up, consistently helping make it the top-rated cable entertainment network.
SmackDown is a two-hour live primetime program airing on Fridays on Fox Network and ranks among the most watched timeslots in the 18 to 49 demographic on Friday nights. SmackDown is the second longest running weekly episodic program in primetime TV history, second only to RAW.
NXT is a two-hour live primetime program airing on Tuesday nights on USA Network. The weekly program continues to air on WWE Network shortly after its initial run on USA Network.
The company anticipates that during 2023 it will be involved in negotiations to renew or replace its domestic television distribution rights agreements for RAW, SmackDown and NXT with their current licensees or others. These domestic licenses together account for a very significant portion of the company’s Media segment revenues and profitability.
WWE’s TV-PG, family-friendly television programming, including RAW, SmackDown and NXT, can be seen in more than one billion homes and in 25 languages around the world. The company’s international broadcast partners include BT Sport in the United Kingdom; Sony Ten in India, Rogers in Canada and Foxtel in Australia, among many others.
Advertising and Sponsorships
WWE utilizes a multitude of platforms, including the Internet and social media, to promote the company’s brands, market and distribute its content and digital products, create a community experience among the company’s fans and sell advertising across these various platforms. WWE streams its media content on select social media platforms, such as YouTube and Facebook. With nearly 93 million subscribers on YouTube, WWE consistently ranks among the top viewed channels, with over 12 billion views of WWE content in 2022. The company also receives advertising revenues from YouTube and Facebook based on viewership data of the company’s content. In 2022, WWE had over 1.1 billion social media fan engagements across social media platforms, such as Facebook, Twitter, YouTube, TikTok, Instagram and Tumblr.
The company’s primary website, WWE.com, attracted an average of over four million monthly unique visitors worldwide during 2022. These visitors viewed an average of over 40 million pages and five million video streams per month. WWE short-form video and other content is available through the company’s mobile partnerships. WWE has local language-based websites allowing fans to experience WWE in their native language with a concentration on local events and shows. The company monetizes its digital advertising inventory on WWE.com in global markets via programmatic ad sales and relationships with sales agencies.
In addition, through the company’s product integrations, it offers advertisers a wide range of promotional opportunities, including online and print advertising, on-air announcements and special appearances by the company’s Superstars. These opportunities allow its advertisers and sponsors to engage consumers across a variety of the company’s platforms. In 2022, the company grew several partnerships with blue-chip brands, including Take-Two Interactive, Xfinity Comcast, C4 Energy, Credit One Bank, and Blue Triton/Pure Life. The company also partnered with new advertisers, such as Door Dash, Mike’s Hard Beverage Co., Toyota, Krafton, Hasbro, and Amazon Studios. The company’s sponsors promote their products utilizing its digital media assets, including promotion on WWE.com, as well as promotion through WWE Network and through the company’s live events. Certain sponsorship sales related to WWE Network are shared with NBCU.
Other
The company’s Media segment also generates revenue from the distribution of other WWE content, including, but not limited to, certain live in-ring programming content in international markets, scripted, reality and other programming.
During 2022, the company held two large-scale international events, Elimination Chamber and Crown Jewel, for which it received a fixed fee, as compared to one large-scale international event during 2021 due to the impact of COVID-19.
The company’s WWE Media team also develops and produces scripted and non-scripted television and digital content. In 2022, the company expanded its partnership with A&E with the creation of new documentaries, including WWE Rivals, while also adding additional episodes to the acclaimed Biography: WWE Legends and WWE’s Most Wanted Treasures series. This programming continues to drive viewership gains on Sunday nights for the A&E network. The company also created new content in its partnership with Peacock to deliver the series WWE Evil, which chronicles the minds of the most diabolical antagonists in WWE history.
The company’s reality-based television series is Miz and Mrs. This docuseries, which premiered in July 2018 on USA Network, chronicles the lives of WWE Superstars The Miz and Maryse. The third season of this series premiered in June 2022.
Live Events
The company’s broad and talented roster of Superstars allows it to perform in numerous domestic markets and take advantage of the strong international demand for the company’s events. Live events and the associated programming produced at its live events are the company’s principal creative content and production activities. The company’s creative team develops compelling and complex characters and weaves them into dynamic storylines that combine physical and emotional elements. Storylines are usually played out in the ring and unfold on the company’s weekly television shows, culminating in the company’s premium live events, which air on WWE Network.
North American Ticket Sales
In 2022, the company produced 218 live events (excluding NXT) throughout North America, entertaining over 1.3 million fans. The company held many of its premium live events at major stadiums and arenas across the country. In addition to providing content for the company’s television and other programming, these events provide it with a real-time assessment of the popularity of the company’s storylines and characters.
International Ticket Sales
In 2022, the company produced 13 live events (excluding NXT) internationally, reaching nearly 106,000 fans. These events were held primarily in the United Kingdom during the company’s international tour in September 2022, including the company’s premium live event, Clash at the Castle. The company also held events in Germany, Switzerland, Mexico and France during 2022.
Consumer Products
Consumer Product Licensing
The company has established a worldwide licensing program using its marks and logos, copyrighted works and characters on a large variety of products, including video games, toys, apparel, trading cards and other collectibles. The company has relationships with more than 100 licensees worldwide that provide products for sale at major retailers. To maintain the distinctive style and quality of its intellectual property and brand, the company retains creative approval over the design, packaging, advertising and promotional materials associated with these products. Additionally, the company continually seeks new opportunities to partner with best-in-class organizations to develop new products for its fans and further expand its licensing business.
Video games and toys are among the largest components of the company’s licensing program. The company has a comprehensive, multi-year licensing agreement with Mattel, Inc., its master toy licensee, covering all global territories, and a multi-year licensing agreement with Take-Two Interactive Software, Inc. (Take-Two) to produce and sell its branded console video games. WWE branded video games include WWE 2K, WWE Battlegrounds, and WWE SuperCard. The video game industry continues to migrate the availability of video games toward downloadable content through an Internet connected device. Accordingly, the company’s video games can be downloaded via the Internet and contain subsequent downloadable content that can be purchased to add additional characters and game modes to enhance game play.
The company has several exclusive multi-year agreements for trading cards and other collectibles, including the Panini Group and Blockchain Creative Labs. These relationships provide opportunities for WWE to develop new products with its fans and expand its licensing business.
Music is an integral part of the WWE entertainment experience. The company composes and records music, including Superstar entrance themes, in its recording studio. In addition to its own composed music, the company licenses music performed by popular artists.
eCommerce
In July 2022, the company launched an exclusive, multi-year partnership with Fanatics to create a new, enhanced retail experience for WWE fans globally, and transitioned its digital retail platform to Fanatics. As a result of this partnership, Fanatics became the exclusive provider of certain product categories for e-commerce. Prior to this transition, WWEShop was its direct-to-consumer e-commerce storefront and the company also distributed its merchandise on other domestic and international e-commerce platforms, including Amazon, which continues for certain product categories. Under the direct-to-consumer model, the company processed nearly 300,000 orders through July 2022.
Venue Merchandise
The company’s direct-to-consumer venue merchandise business consists of the design, sourcing, marketing and distribution of numerous WWE-branded products, such as t-shirts, belts, caps and other novelty items, all of which feature its Superstars and/or logos.
Customers
The company’s customers include content distributors of its media content through their networks and platforms, fans who purchase tickets to its live events or purchase its merchandise at venues or online through its eCommerce partner, subscribers to WWE Network, advertisers, sponsors, and consumer product licensees. The company has several important partners, including NBCU and its affiliates who, among other things, carry the domestic television distribution of Raw and NXT, and carry exclusive streaming rights of WWE Network content domestically. The company also partners with Fox Network who carries the domestic television distribution of SmackDown, and the General Entertainment Authority of the Kingdom of Saudi Arabia who, among other things, hosts its large-scale premium live events in the Middle East. The company anticipates that during 2023 it will be involved in negotiations to renew or replace its domestic television distribution rights agreements for RAW, SmackDown and NXT with their current licensees or others.
Creative Development and Production
The company’s creative team develops compelling and complex characters and weaves them into dynamic storylines that combine physical and emotional elements. Storylines are usually played out in the ring and unfold on its weekly television shows, culminating in its premium live events. The company voluntarily designates the suitability of each of its television shows using standard industry ratings, and all its in-ring television programming carries a PG rating, which is critical to maintaining the company’s reputation for family friendly entertainment.
The company’s success is due primarily to the continuing popularity of its Superstars. The company has nearly 250 Superstars under exclusive contracts, ranging from multi-year guaranteed contracts with established Superstars to developmental contracts with its Superstars in training. The company’s Superstars are highly trained and motivated independent contractors, whose compensation is tied to the revenue that they help generate. The company owns the rights to substantially all its characters and exclusively licenses the rights the company does not own through agreements with its Superstars.
Regulation
Certain Federal Communications Commission (FCC) regulations are imposed directly on the company and/or indirectly through its distributors. One of the company’s weekly television programs, SmackDown, is distributed via broadcast television on the Fox Network, and as a result the company is responsible, directly or indirectly, for compliance with certain additional FCC regulations and statutory requirements.
History
World Wrestling Entertainment, Inc. was founded in 1980. The company was incorporated in 1987.
