By James Caldwell, PWTorch assistant editor

WWE Revenue & Profit/Loss Break Down - Q3-2014

One theme is that most divisions were not as profitable as the previous year quarter. The divisions that increased profits were Licensing and WWE Shop.

Media Division

- TV Rights Revenue: $42.2 million, down 6.0 percent from $44.8 million in the prior-year quarter.

WWE said the decrease was due to the timing of "Total Divas" (five more episodes in Q3-2013) and one fewer episode of Raw in the U.S. due to the calendar.

TV Profit was $20.7 million, down 3.0 percent from $21.3 million in Q3-2013.

- WWE Network: $22.4 million in revenue (versus zero revenue in Q3-2013). Profit was $2.3 million.

- PPV: Revenue was $3.7 million, down 76 percent from $15.5 million in Q3-2013.

- Home Entertainment: $3.6 million in revenue, down 31 percent from $5.2 million in the previous year quarter.

Profit was $1.3 million, down 32 percent from $1.9 million in a business segment with thin margins.

WWE explained: "The decline in unit shipments reflected reduced shipments of WWE's catalog titles, which are typically characterized by lower prices and profit margins than new releases.

"The average effective price declined 19 percent to $9.22 as retail pricing pressure on both new releases and catalog titles more than offset the impact of product mix."

- Digital Media: $5.0 million in revenue, down 31 percent from $7.2 million. Profit was $2.3 million, down 26 percent from $3.1 million.

WWE attributed the decline to "lower advertising across various platforms as well as lower monetization of the Company's pay-per-view webcasts via WWE.com as these events became available on WWE Network."

Live Events

- Live Events: $21.8 million in revenue, down 13 percent from $25.1 million in Q3-2013. Profit was $3.9 million, down 30 percent from $5.6 million.

WWE attributed the performance to a less-than-desirable mix of domestic events (middling house shows) and fewer lucrative international events.

This is captured by WWE running 11 more North American events, but generating $0.2 less in domestic revenue. Notably, average attendance declined 7.0 percent to 5,100 fans per event and the average ticket price declined 5.0 percent to $44.60.

Consumer Products Division

- Licensing Revenue: $10.0 million, up 75 percent from $5.7 million. Profit was $5.9 million, up 79 percent from $3.3 million.

This segment boosted the overall quarter in comparison to Q3-2013. WWE attributed to stark change to a "higher effective royalty rate for the Company's franchise video game" from 2K Sports.

- Venue Merchandise: $4.2 million, up 5.0 percent from $4.0 million. Profit was about even at $1.6 million versus $1.7 million.

Despite the less-than-stellar Live Events performance, WWE said that because they had so many more domestic events in the quarter, their merchandise sales still increased $0.2 million.

- WWEShop: $4.3 million in revenue, up 48 percent from $2.9 million. Also, profit was $0.7 million, up from $0.5 million.

For the second consecutive quarter, WWE attributed the increase to "mobile shop optimization and a new distribution model utilizing Amazon U.K."

WWE Studios

- WWE Studios division: $1.9 million in revenue, even with $1.8 million in the prior year quarter. Also, the segment generated $1.7 million last quarter (Q2-2014). It sets a reasonable expectation of about two-million-dollars in revenue per quarter.

However, Studios still reported a loss of $0.4 million in the quarter.

Corporate

- WWE reported "Corporate & Other" Revenue of $1.1 million, the same as Q3-2013. However, costs increased $7.6 million to $36.4 million from the prior year quarter.

WWE disclosed: "As defined, these expenses include corporate G&A expenses as well as sales, marketing, and talent development costs, which cannot be allocated to specific segments.

"The increase in Corporate and Other expense during the quarter included $2.1 million in severance and related restructuring charges. Excluding the impact of restructuring, the $5.5 million increase in expenses supported the expansion of the Company's international infrastructure, talent development, and brand marketing."

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