Saudi Show “Crown Jewel” Remains on WWE’s Event Calendar

Crown Jewel

Despite reports to the contrary, “Crown Jewel” remains on WWE’s calendar of events indicating the November 2nd show in Riyadh, will go off as planned. Political and diplomatic tensions between the U.S. and Saudi Arabia, have driven several high-profile companies to cut business ties with the Kingdom and have brought on calls for WWE to cancel the high-profile show. Sports Illustrated reported that several of the company’s stars are uncomfortable with the idea of performing in Saudi Arabia, citing the country’s “poor record with human rights” as the reason for their apprehension; WWE female stars are still banned from performing in the Kingdom. WWE has not made a formal announcement on the status of the show, but is said to be monitoring the situation. 

Howie Long-Short: If WWE does pull the plug on show, it’ll be a big upset; Dave Meltzer (Wrestling Observer Newsletter) had insisted it would take “State Department” intervention or “Trump himself” for WWE to walk away from this event. Why? “Crown Jewel” isn’t your average house show, it’s the 2nd PPV quality show in a 10-year pact with the Kingdom, worth $450 million, and the decision to cancel the event could torpedo the lucrative deal.

Should the WWE end their relationship with the Saudi’s, they’ll join Endeavor and Virgin as companies that ended profitable deals in the name of morality. Richard Branson has put a halt to the Saudi’s $1 billion investment in Virgin’s space tourism venture, while Endeavor is reportedly terminating a $400 million investment agreement that would have given the Saudi’s a 5-10% stake in the company. Of course, both of those entities are privately held; WWE has shareholders to answer to.

Q2 ’18 was another landmark quarter for the WWE. The company posted record quarterly revenue (+31% to $281.6 million) and reported it had nearly doubled operating income (to $21.2 million) from the prior year quarter; the +31% revenue increase represents the company’s greatest YoY sales increase in 2 years.

In addition to strong financials, WWE reported significant growth in digital engagement; video views rose +58% YoY (to 14.4 billion) and the number of hours consumed watching WWE content across digital/social grew a staggering +71% YoY (to 509 million hours). The company also just crossed the 30 million subscriber threshold on YouTube, a figure that represents a larger following on the platform than that of the NBA, NFL, MLS, MLB, NHL, PGA TOUR and NASCAR combined. While YouTube subscribers don’t directly correlate into dollars, WWE Network subscriptions do; and the company reported paid subs rose +10% (to 1.8 million) during the quarter ending June 30th. The company will report Q3 financials on 10.25.

WWE shares are up +168% YTD, they’ll open at $84.29 on Wednesday 10.17.18.

Fan Marino: The controversy surrounding whether “Crown Jewel” should take place seems to be greater than the demand for the actual event within Saudi Arabia. Originally scheduled to be held in a 70,000-seat venue, tempered local interest has driven the event’s relocation to 25,000-seat King Saud University Stadium.

While certainly no cause for panic (they just signed lucrative long-term broadcast deals for RAW and SmackDown Live), it should be noted that the Monday Night Raw posted its 2nd lowest rating ever against Monday Night Football on 10.1; when just 2.08 million viewers tuned in for the show’s final hour (despite an appearance from Shawn Michaels). The Chiefs/Broncos game posted the highest MNF rating in over a year that evening.

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Author: John Wall Street

At the intersection of sports & finance.

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