Events promoter and Ticketmaster parent company Live Nation predictably took a battering in its latest round of quarterly earnings amid the ongoing Covid-19 pandemic, but the company pointed to several hopeful signs of rapid recovery.
Fueled heavily by widespread cancellation and postponement of sporting events and concerts around the globe, Live Nation reported a 21 per cent decline in revenue in its fiscal first quarter to $1.37bn and an operating loss of $172.7m, a more than seven-fold increase compared to the same period a year ago.
Live Nation said it had 7,067 concert events worldwide during the quarter, nearly all of them prior to the acceleration of the public health crisis in mid-March, and a 14 per cent reduction from the first quarter in 2019. And with public gathering restrictions still widely in place, that number will continue to fall for the foreseeable future.
“In mid-March, we came to a halt. We have held no concerts in almost two months,” said Live Nation president and chief executive Michael Rapino. “Despite these challenging times, we continue to have full confidence in the long-term supply and demand of the live concert industry, Live Nation’s leadership position, and our business model’s ability to successfully delivery growth and shareholder value.”
To that end, Live Nation said more than 90 per cent of its concert ticket purchasers have held on to their tickets in expectation of rescheduled dates for when it is safe to resume shows. That percentage has existed after the company has offered refunds for thousands of events. And Live Nation’s own fan polling pointed to strong consumer desires to return to live events across numerous content types.
“Almost all fans are holding on to their tickets, and we believe 2021 can return to show volume and fan attendance at levels consistent with what we’ve seen in recent years,” Rapino said. “I think it’s probably the most compelling data one could look at that says the consumer is going to come back strong. It’s a big part of their old social DNA to get out gather and communal experiences with their friends and family.”
Live Nation’s Ticketmaster, a ticketing partner of the National Football League, is playing a key role in ticket sales for that property as it released its 2020 schedule. But as many individual NFL teams have tempered their own sales activity, the company’s sports business will continue to unfold differently this year.
And with game resumption plans entirely unknown for both two other Ticketmaster partners, National Basketball Association and National Hockey League, both for the current season and their 2020-21 campaigns, that presents even more uncertainty for Live Nation.
“We need to understand what’s going to happen in the fall time in their arenas, and what availability is and when is the season going to start. Traditionally, the NFL, and the NBA, NHL announce their season, and then we kind of know the next Q4, Q1, Q2 availabilities. As soon as they get their exact schedules up, then we’ll be able to slot all the dates in,” said Rapino, who like many chief executives around the industry is forgoing his salary during the pandemic.
Live Nation also said it has $1.7bn in untapped liquidity to help it endure the current absence of normal business activity. But pressure will remain on the company as its stock is down 48 per cent since mid-February. As a result, it still targeting $600m in cost reductions this year.