In this week’s edition of Five on Friday, WWE reports strong third quarter results, despite COVID-related event cancellations, and Under Armour plans to sell MyFitnessPal for $130 million less than it paid for it. Also, Google One launches a VPN subscription service for private browsing, the pandemic boosts TV news but hits newspapers hard, and LinkedIn shares top subscription jobs for those looking to make a move.
WWE Reports Strong Q3 2020 Despite COVID-Related Losses
Despite a challenging economic environment, WWE reported strong results for its third quarter 2020, a significant improvement over previous quarterly financials. Highlights for the quarter include the following:
- Total revenue was $221.6 million, a 19% increase year-over-year. While impressive, this was offset by the loss of ticket and merchandise sales from cancellation, postponement and relocation of live events due to the coronavirus pandemic.
- WWE Network, WWE’s streaming video subscription service, had average paid subscribers of 1.6 million, representing an increase of 6% year-over-year. This was the first quarterly increase WWE Network has seen since Q1 2019.
- Digital video views were 9.2 billion, a 3% increase year-over-year, and hours watched were 345 million across social and digital platforms, also a 3% increase year-over-year.
- The company’s biggest increase for the quarter was in ecommerce revenue of $9.1 million, a 60% increase. This increase helped offset losses of venue merchandise sales because there were 74 fewer events during Q3 as a result of the pandemic.
- Live event revenue was $0.7 million, a 97% decrease, due to the lack of live events and ticket sales.
An operational highlight for WWE during the quarter was the creation of WWE ThunderDome, which opened at the Amway Center in Orlando, Florida. WWE ThunderDome is an interactive virtual experience for WWE fans. It attempts to recreate the atmosphere of arena-based live events, which have been canceled since mid-March.
“Our third quarter financial performance was strong and reflected our ongoing creativity in a challenging environment,” said Vince McMahon, WWE Chairman & CEO, in an October 29 news release. “We continue to adapt our business, as demonstrated by the creation of WWE ThunderDome, focusing on increasing audience interaction and engagement to support the value of our content globally.”
The company noted in its quarterly report that COVID-related closures have continued to negatively impact their business. In addition, some employees are returning from furloughs, which will continue into 2021.
Subscription Show 2020 On-Demand
“Management is currently developing its 2021 annual operating and strategic plans, and it remains challenging to quantify the potential impact of COVID-19 on its business, and the financial impact to the Company may be material. Accordingly, management previously withdrew its full year 2020 guidance and based on sustained economic uncertainties is not reinstating guidance at this time,” WWE said.
Under Armour to Sell MyFitnessPal for $345 Million
Last week, Under Armour announced it is selling MyFitnessPal to global investment firm Francisco Partners for $345 million, including potential earn-out payments. Under Armour acquired MyFitnessPal, a nutrition and exercise tracking app, in 2015 for $475 million. The deal is expected to close in the fourth quarter, assuming it meets standard closing conditions and gets regulatory approval.
“As part of our ongoing transformation, we are committed to actively managing our business to ensure that our strategies and assets are prioritized to connect even more deeply with our target consumer – the Focused Performer,” said Patrik Frisk, Under Armour President and CEO, in an October 30 announcement.
“This announcement reduces the complexity of our consumer’s brand journey by empowering sharper alignment with our long-term digital strategy as we work towards a singular, cohesive UA ecosystem. Additionally, it affords us investment flexibility to drive greater return and value to our shareholders over the long-run,” Frisk added.
MyFitnessPal uses the freemium model, offering limited nutrition tracking with its free tier and a host of additional features (guided fitness and nutrition plans; food analysis and insights; custom dashboard; etc.) in its premium tier. The premium tier is available for $49.99 when paid annually or $9.99 a month when paid monthly. According to MyFitnessPal, premium members are 65% more likely to reach their weight loss goals.
Christine Wang, principal at Francisco Partners, also commented on the deal.
“MyFitnessPal supports over 200 million users in their ongoing health and fitness journeys and we are excited to partner with the business for its next stage as a standalone company to continue a strong history of recurring revenue growth, organic user acquisition and a unique consumer proposition,” said Wang.
Under Armour will continue to operation MapMyRun and MapMyRide, but it will discontinue its Endomondo platform at the end of the year.
Google One Introduces a VPN Subscription for Extra Online Security
No tricks, just treats. Last Thursday, Google One announced the launch of a new virtual private network (VPN) designed to give subscribers an extra layer of online security for Android phones. The new VPN is only available with the company’s 2 TB plan, not with its 100 GB or 200 GB plans. The Google One 2TB plan is available for $9.99 a month or $99.99 a year. With the VPN, subscribers can:
- Stream, download and browse using an encrypted, private connection
- Protect their information from hackers on unsecured networks, like public Wi-Fi
- Hide their IP addresses and prevent third parties from using it to track their locations
For those concerned about privacy from Google, Google said it will never use the VPN to track, log or sell subscribers’ browsing information. Also, with the VPN’s advanced security, others will not be able to tie online activity to a subscriber’s identity.
The VPN by Google One will be available in the United States in the coming weeks and is accessible through the Google One app for Android. It will eventually expand to other countries and to iOS, Windows and Mac platforms.
Pandemic hits newspapers hard in the second quarter
The coronavirus has taken its toll on the American economy in ways we never could have predicted. According to the Pew Research Center, the second quarter of 2020 erased five years of growth. In particular, the newspapers industry was hit the hardest, requiring some publications to close, and others to lay off or furlough staff or make other major changes to their operations.
In a research study of six publicly traded newspaper companies, who collectively own more than 300 daily publications, advertising revenue dropped 42% compared to Q2 2019. Circulation revenue declined by 8%. Local TV took a similar hit to ad revenue, but cable and network TV held their own. Here are some findings from the report:
Circulation revenue took a bit hit (8% overall), but at all but two of the news organizations looked at (The New York Times and Tribune Publishing), circulation revenue was lower than most years since the recession in 2007.
Pew Research Center points out that some news organizations were able to turn to other revenue streams like commercial printing services, affiliate fees and marketing, but other streams like events also decreased. In fact, “other revenue” dropped by double digits at most companies. The New York Times is among the companies that has seen an increase in circulation revenue since the recession, due to strategic efforts to diverse revenue streams through affiliate revenue, paywall and pricing experiments, standalone apps like NYT Cooking and Crossword and partnerships with universities and other organizations.
Since the pandemic continues to surge in much of the country, we can expect similar results in the third and fourth quarters. This is not what the newspaper industry needed. If Congress offers some type of bailout, as we discussed in last week’s Five on Friday, it might help, but it may be too late for some of these new organizations to rebound in the near future.
LinkedIn: Top Subscription Jobs
Subscription Onboarding Director
PrincePerelson and Associates
Salt Lake County, UT
As Onboarding Director, the ideal candidate will need to study and understand the subscription business, best practices for onboarding new customers, and become an expert on all the things that we offer. You will be responsible for helping onboard newly acquired customers through various channels of distribution. You will also work directly with various internal and external stakeholders, including senior management, department managers, development, and marketing teams to ensure successful campaigns. The ideal candidate will successfully strategize, carry out, and deliver on a comprehensive strategy to ensure that all new customers have a great onboarding experience. Read more.
Director of Social Media
El Segundo, CA
TechStyle Fashion Group is currently looking for a Director of Social Media Fabletics. How Do You Fit In? As the Director of Social Media at Fabletics, you will be responsible for defining and executing an innovative social media strategy in addition to developing campaigns that deliver measurable business results. This position collaborates with key internal stakeholders across PR, Creative, Product, Marketing and Merchandising to create the social content strategy. The ideal candidate will have a strong background in strategic planning within the social and digital space and experience developing and implementing highly successful social media campaigns. This position will report to the Vice President of Marketing at Fabletics. Read more.
Strategy and Operations Lead, Subscriptions
Los Angeles, CA
YouTube Marketing’s mission is to know our users, and to connect them to the magic of our products and creators. We make YouTube successful by shaping people’s perceptions of YouTube and inspiring them to engage with us. We’re also responsible for all of YouTube’s marketing activities to consumers, creators, and key opinion influencers. As the Strategy and Operations Lead for the Subscriptions Marketing team at YouTube, you will promote strategy and business execution for critical growth areas at YouTube and Google more broadly. You will work closely with YouTube Marketing leaders to shape the team vision, and be a thought leader that helps shape priorities and work across YouTube Marketing Strategy and Operations and Google Marketing. Read more.
Marketing Manager – Subscription
New York NY
HarperCollins Children’s Books is seeking a creative, organized, and dynamic Marketing Manager (Subscription) to oversee the strategy and day-to-day marketing needs for HarperCollins Children’s I Can Read! subscription box and developing subscription box programs. Duties include directing content creative, social media marketing strategy, and ongoing digital and advertising campaigns to promote the program. This will include creative copywriting, advertising and social media strategy development, and routing and organizing all materials for approvals. This role will report to Senior Director, Marketing for HarperCollins Children’s. We are looking for an incredibly detail-oriented, creative, proactive, and strategic professional who is a self-starter with a background in subscription box service marketing who can multi-task, set priorities, and manage a multitude of complex projects with several internal and outside parties on tight timelines. Read more.
Director, Premium Support
The GitHub Director of Premium Support is responsible for ensuring the success of our most strategic customers by effectively leading a team of Technical Support Account Managers (TSAM) and organization-wide support projects and processes that enable us to deliver the highest level of service to our customers. This role involves managing case assignment, escalations, career development, and project management processes that will result in 100% customer retention, increased Premium revenue and overall increase in Customer adoption of GitHub subscribed Products and services. The candidate is expected to be independent, self-motivated, proactive, results-oriented and able to define and provide a high level of customer satisfaction through the delivery of proactive world-class technical support services. Read more.