A second-quarter earnings name with Live Nation execs Wednesday was stuffed with hope, promise and even swagger… for 2021-22. Not surprisingly, although, the present numbers had been grim, with income predictably down by a staggering 98% from year-to-year within the firm’s quarterly earnings report.
Income was $74 million for the quarter, down from $3.2 billion in the identical timeframe in 2019.
Live Nation’s web loss for the second quarter was reported at $568 million, in comparison with web revenue of $172 million within the quarter final 12 months.
Nonetheless, the corporate reported in its name Wednesday afternoon, it believes it has “adequate liquidity to take care of important operations till exhibits return,” which Live Nation anticipates will occur in an enormous means in summer time 2021.
“We gained’t be doing DJ units within the Hamptons any time quickly,” CEO-president Michael Rapino quipped, referred to a latest profit present by the Chainsmokers in New York that drew unfavourable consideration from politicians and well being officers. “We’re gonna play lengthy and play secure.”
Among the many stats cited, Live Nation says that 86% of followers have chosen to carry onto their tickets for rescheduled exhibits as a substitute of asking for refunds, “indicating a robust need to attend live shows sooner or later.” The variety of followers throwing their tickets for festivals into the next 12 months relatively than choosing a refund is decrease, at about two-thirds. However Live Nation pointed to sturdy gross sales for festivals in Europe which have already gone on sale for subsequent summer time, saying 19 million tickets have been offered for 2021 exhibits.
Within the name, Rapino expressed religion in vaccines and therapy to make the world secure for exhibits a 12 months from now.
As for earnings, Rapino mentioned, “We didn’t need deferred income to have any false narrative to it. We’re main the business,” he mentioned, in providing refunds to followers who need them for postponed exhibits, suggesting that some rivals are decided to carry on to that ticket cash at any price to its picture.
“I consider ’21, ’22 will probably be file years,” Rapino mentioned. “No matter what quarter precisely we scale at, the enterprise will probably be stronger than ever.”
Live Nation reps on the decision mentioned the corporate is “speaking a couple of spring return to enterprise outside in 40 international locations” and that the enterprise might see a return to concertgoing in “some markets earlier than the spring,” however that the dedication could be completely different for various territories. The U.S., they indicated, would take the longest in ramping again up, however the 50 amphitheaters that Live Nation manages would supply a bonus.
Within the preliminary report, the corporate mentioned, “Practically 90% of followers globally are planning on attending live shows once more,” though not everybody will see greater than 10% of the inhabitants swearing off live shows altogether as encouragement for the way forward for the business.
The corporate mentioned it has focused price cuts of greater than $800 million this 12 months and lowered money utilization by $1.four billion.
Requested about latest reviews that Live Nation was asking brokers and artists for rather more favorable phrases on festivals subsequent 12 months — which resulted in appreciable backlash — Rapino mentioned that was an unlucky leak of what was solely meant to be a place to begin in negotiations.
“We needed to ensure going into ’21 that for those who had been a headline artist that was going to play a sure competition this 12 months and nonetheless needed to subsequent 12 months… (that) we each shared a number of the danger,” by way of asking for “a refund discount and a few insurance coverage.” Regardless of what he known as “drama within the press,” Rapino mentioned the corporate solely “needed to ensure we weren’t paying the identical value in ’21 if we had a 30% discount” in followers keen to purchase tickets. However he added that he doesn’t foresee any such drop in fan curiosity or willingness at this level.
“The press received ahold of a sort of work in progress, which is simply too unhealthy,” he mentioned. “Negotiating offers with brokers and managers, that’s the enterprise mannequin… completely different phrases for various artists and completely different instances. The method is all the time fluid. … The brokers and the artists have all been very cooperative that for those who had a present this 12 months and needed to reschedule subsequent 12 months, some compromise within the phrases must be made.”
As for when followers may anticipate to see gross sales for exhibits within the U.S. start once more, Live Nation president Joe Berchtold mentioned, “We do anticipate the on-sales to be a couple of towards the top of the 12 months and the majority of them as we get into the primary quarter of subsequent 12 months.”