WWE Trims Full-Year Outlook on Higher Spending, Top-Line Weakness - 13th September 2013

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WWE Wrestling

World Wrestling Entertainment Inc. (WWE), the entertainment firm known for producing professional wrestling matches, tempered its 2013 earnings outlook, citing lowered revenue expectations and higher investment spending costs.

The news sent shares down 2.6% to $9.90 in after-hours trading.

In the first two quarters of the year, WWE reported higher revenue but lower operating income, as the top line has been bolstered by increased production and licensing of television content as well as increased ticket revenue, though costs have risen for staffing and other expenses.

Looking ahead, WWE now sees full-year operating income before depreciation and amortization of $40 million to $50 million. Previously, WWE had projected that metric would fall "at the lower end" of the range of $56.9 million to $69.5 million.

Second-half revenue is now expected to be 5% less than prior expectations, WWE said.

But WWE struck a bullish tone about the future. Chief Financial Officer George Barrios said the rising value of the entertainment company's content should bolster future earnings as WWE aims to renegotiate its four largest television distribution pacts and potentially launch its own network.

World Wrestling Entertainment Inc. (WWE), the entertainment firm known for producing professional wrestling matches, tempered its 2013 earnings outlook, citing lowered revenue expectations and higher investment spending costs.

The news sent shares down 2.6% to $9.90 in after-hours trading.

In the first two quarters of the year, WWE reported higher revenue but lower operating income, as the top line has been bolstered by increased production and licensing of television content as well as increased ticket revenue, though costs have risen for staffing and other expenses.

Looking ahead, WWE now sees full-year operating income before depreciation and amortization of $40 million to $50 million. Previously, WWE had projected that metric would fall "at the lower end" of the range of $56.9 million to $69.5 million.

Second-half revenue is now expected to be 5% less than prior expectations, WWE said.

But WWE struck a bullish tone about the future. Chief Financial Officer George Barrios said the rising value of the entertainment company's content should bolster future earnings as WWE aims to renegotiate its four largest television distribution pacts and potentially launch its own network.