Shares of World Wrestling Entertainment (WWE 1.42%), a producer of live wrestling events and programming, are jumping 14% higher Friday afternoon after the company released a strong fiscal first quarter.
WWE has taken some criticism for continuing to hold live events during the COVID-19 coronavirus outbreak, but without competition from other events and live sports, its business surged during the first quarter. Revenues jumped a staggering 60% to $291 million compared to the prior year, topping analysts' estimates of $272 million. Net income checked in at $0.31 per share, well above the prior year's loss of $0.11 per share and ahead of analysts' estimates of $0.26 per share. WWE Network average paid subscribers were in line with guidance at 1.46 million, digital video views jumped 25% to 9.6 billion, and hours consumed increased 15% to 344 million across its digital and social media platforms.
Said WWE chairman and CEO Vince McMahon in a press release:
Our first quarter financial performance was strong and largely unimpacted by the COVID-19 outbreak. Now we are in the midst of unprecedented times, which require us to be especially nimble, creative and efficient in order to ensure the long-term value of WWE. We are taking precautions to protect the health and safety of our performers and staff as we produce content in new ways, engage fans with a much-needed diversion and operate effectively in this evolving environment.
Investors are focused on how the company is adapting to the impact of COVID-19. WWE has focused on cost reductions such as reducing executive and board member compensation and decreasing operating expenses by furloughing a portion of its workforce, talent, and third-party staffing/consulting. Also, thanks to deferring spending on its new headquarters, the company has improved its cash flow by $140 million, and it has roughly $500 million of cash and debt capacity to help weather the COVID-19 storm.