Endeavor Q1 revenue boosted by demand for events
WME parent company Endeavor has reported significant growth in the first quarter of 2022, driven by the resumption of concert touring and demand for live events.
Endeavor, which also owns sports agency IMG and the Ultimate Fighting Championship (UFC), among other properties, generated revenue of US$1.474 billion for the first fiscal quarter of 2022.
Net revenue came to $517.7m, while EBITDA (earnings before interest, taxes, depreciation and amortisation) totalled $314.4m.
The agency’s representation business (comprising WME, sports agency IMG and Endeavor Content) generated revenue of $357.3m for the quarter, up $108.4m or 44% compared to the first quarter of 2021.
The segment’s adjusted EBITDA was $101.7m for the quarter, up $40.2m or 65%, year on year.
According to the company, the growth was primarily driven by increased brand spending, as well as higher commissions resulting from continued strong demand for Endeavor’s talent, and the recovery of live entertainment, primarily music and comedy touring.
WME artists include Drake, Justin Timberlake, Adele, Bruno Mars, Pearl Jam, Kendrick Lamar, the Killers, Bjork, Frank Ocean, Foo Fighters, St Vincent, Shakira and more.
“Our growth in the first quarter was driven by our ability to respond to the high demand for premium content and live events”
Elsewhere, the Events, Experiences & Rights segment revenue was $825.8m for the quarter, up $286.2m or 53% compared to the first quarter of 2021.
Increases were primarily driven by the return of more full-capacity live events in the quarter compared to the first quarter of 2021, including Super Bowl LVI, the Miami Open, the NCAA Final Four and Frieze LA, as well as $38m in revenue from the acquisition of NCSA, which closed in Q2 2021.
The segment’s adjusted EBITDA was $132.5m for the quarter, up $93.4m or 239%, year on year.
Owned Sports Properties segment revenue was $296.7m for the quarter, up $13.2m or 5% compared to the first quarter of 2021 – primarily driven by greater sponsorship, licensing, commercial PPV and event-related revenue for UFC among other factors. The segment’s adjusted EBITDA was $148.7m for the quarter, up $3.2m or 2% year on year.
“Our growth in the first quarter was driven by our ability to respond to the high demand for premium content and live events,” said Ariel Emanuel, CEO, Endeavor. “We feel great about where we sit relative to the secular tailwinds across all of our businesses, and we’ve raised our guidance for the fourth quarter in a row to reflect our positive outlook for the balance of the year.”
For 2022, Endeavor is projecting revenue between $5.235bn and $5.475bn, as well as adjusted EBITDA between $1.1bn and $1.15bn.
Last year, the company generated $5.1bn in revenue but posted a net loss of $467.5m.
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Blavatnik, IMG’s Shustorovich drawn into Trump Russia probe
Two prominent entertainment business figures have been drawn into the ongoing investigation into alleged Russian interference in last year’s US presidential election.
Sir Len Blavatnik, whose Access Industries holding company owns Warner Music Group, and Alexander Shustorovich, the chief executive of performing arts agency IMG Artists, are reportedly under scrutiny from investigators led by special counsel Robert Mueller, who is overseeing a probe into the Trump presidential campaign’s alleged links with the Russian government.
According to the Dallas Morning News, political contributions by Sir Len – a Ukrainian-born American/British businessman who had previously donated to both parties – took a “hard right turn” in 2015–16, when he gave more than US$6m to Republican party political action committees (PACs).
Of that $6m, the paper says, the majority, $3.5m went to a PAC associated with Kentucky Republican senator and Senate majority leader Mitch McConnell, with smaller amounts donated to PACs backing senator Marco Rubio ($1.5m), Wisconsin governor Scott Walker ($1.1m) and Trump’s Inaugural Committee ($1m).
Len Blavatnik and Alexander Shustorovich are reportedly under scrutiny from investigators led by special counsel Robert Mueller
Shustorovich, a Russian-American business magnate with business interests in TV, radio and other media, similarly gave $1m to the Inaugural Committee, which was accepted by the Trump team – despite the rejection of a previous attempt to donate to the Republicans, in 2000, because of concerns over his ties to the Russian government.
Two other men, Andrew Intrater and Kukes – neither of which have any history of political donations – are also reportedly of interest to investigators. Both have been employees of Sir Len: Intrater is chief executive of Columbus Nova, a division of Renova, an investment company co-founded by Blavatnik and his business partner Viktor Vekselberg in 1990, while Kukes worked for Blavatnik and Vekselberg’s TNK from 1998 to 2003.
In addition to owning Warner Music, Access Industries is an investor in Spotify, Deezer and Songkick, the latter of which Warner partially acquired in July. Blavatnik was knighted in 2017 for his philanthropy.
Democratic representative Adam Schiff told ABC News he believes the contributions to be legal, as all donors are US citizens, “unless the contributions were directed by a foreigner”. He added, however, that they “could still be of interest to investigators examining allegations of Russian influence on the 2016 campaign. Obviously, if there were those that had associations with the Kremlin that were contributing, that would be of keen concern.”
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