Michael Rapino: ‘Live music is bigger than ever’

Live Nation boss Michael Rapino believes the touring business is in line for “incredible growth” in the coming years after the company reported another record quarter.

The promoter’s Q2 2023 financial results saw revenue rise 27% to US$5.6 billion (€5.1bn) year-on-year, operating income increase 21% to $386 Million and AOI up 23% to $590m. The firm’s share price opened at $98.93 this morning, just shy of its 52-week high of $99.66.

More than 117 million tickets have been sold for Live Nation shows so far this year, up 20% on the same period 12 months ago. Record Ticketmaster sales are also expected, with 151 million reported fee-bearing tickets sold year-to-date, up 22% Y-O-Y.

“Live music is bigger than ever, with global demand driving the industry to record levels,” says Rapino, LN’s president and CEO. “There’s a more diverse pipeline of artists breaking from all corners of the world, and at the same time tours are going to more markets – particularly in Latin America and Asia. This was our strongest second quarter ever, with 2023 on pace to be a record year, and early indicators for 2024 giving us confidence in continued growth.”

Attendance growth was powered by international markets. Stadium crowds were up 28% to 8m fans, led by Europe and Asia Pacific. Arenas were up 19% to 10.7m fans, largely from Canada, Asia Pacific and Latin America, and festivals were up 14% to 4.5m fans, driven by demand across all its markets. Overall, international markets were up 46%, while North American attendances have grown by 8% for the year to-date.

“Everyone thought ’22 was the record year, and we were headed into an air pocket, and we’ve blown the doors off in ’23”

Live Nation says it is on course to invest over $12bn in staging artists’ shows in 2023, a 30% increase on 2022.

“I think everyone thought ’22 was the record year, and we were headed into an air pocket, and we’ve blown the doors off in ’23,” Rapino told investors on the company’s Q2 earnings call. “We believe for the next multiple years that this industry, in general, is going to have a growth surge on a global basis.

“We don’t think this is just any Covid catch-up. We think that this is going to be the time where live on a global basis is going to have an incredible growth run for years to come.”

Rapino, who previously praised the emergence of younger headliners such as Bad Bunny, Karol G, Rosalia, Blackpink, BTS and Billie Eilish, said “the artist has been unlocked globally”, with the groundwork laid by the company in non-traditional markets now bearing fruit.

“Consumers, thanks to social media and others are driving global consumption with no gatekeepers,” he said. “We have 100 offices in over 40 countries. We have been on this march for a long time. And we think there’s still lots of opportunity… in Latin America, Pacific Rim, Eastern Europe.

“We kind of predicted the artists would continue to go global – more global artists and international markets would want to be just like New York – and Boston would want to be hosting U2 and Beyoncé’s of the world, so we had an opportunity to build out those markets. So pedal down, we see lots of great growth opportunity for years to come on that front.”

“The artists are the ones who are set the price of their tickets. It’s our job to provide the information to them to help them understand the market value”

Rapino and LN president and CFO Joe Berchtold were also asked about the adoption of “platinum” market-based dynamic pricing.

“The artists are the ones who are set the price of their tickets,” said Berchtold. “It’s our job to provide the information to them to help them understand the market value of their tickets, so they can figure out the balance that’s right for them and their fanbase in terms of pricing the tickets.

“It’s almost becoming standard that they’re understanding they should price the front of their house to capture most of the value. Otherwise, it’s the scalper who’s going to take it. And then they want to make sure the back of the house is priced so that every fan can afford to buy a ticket can get in.”

Berchtold said dynamic pricing had become “ubiquitous” in North America post-pandemic, and was becoming “much more heavily adopted” overseas.

“I think we still have a long ways to go in international markets towards full adoption,” he continued. “And if you look at the pricing with platinum, there’s still a substantial gap relative to average secondary pricing, which would imply that artists are continuing or attempting to give a lot of the value to fans and we’ll see how that evolves over time.”

The biggest advantage to dynamic pricing and platinum price over the last few years was really, just how do you help the whole house gets sold?

Rapino said the real “magic” of platinum tickets was to help artists fully sell out shows.

“We have never jumped on an earnings call and told you we couldn’t sell the first 10 rows out,” he said. “Our job is always to sell the last 10 rows out in the upper nosebleeds. So what platinum has enabled the industry to do is, as the artist has increased show cost and needs to get a certain gross for that night, we should figure out how to maximise some of the front of the house closer to market, but that’s also let us bring the price down in the back end of the house. So the net gross can be more overall, but it’s giving fans a better sell-through rate on the back end of the house.

“We used to be locked into kind of three ticket prices that didn’t have that opportunity. So the biggest advantage to dynamic pricing and platinum price over the last few years was really, just how do you help the whole house gets sold? How do you reduce the prices in the back end of the house that are always the harder ones to sell, so you truly get a full house on the proper gross for the artist? All of us benefit when more people walk through those doors.”

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