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Live Nation upbeat on post-COVID revival as it publishes third quarter financials
By Chris Cooke | Published on Friday 5 November 2021
The live sector at large may still be someway off normality, but Live Nation yesterday declared that “live music roared back over the past quarter” as it published its latest quarterly financial report. All that roaring, it added, drove “all our business segments to positive operating income and adjusted operating income for the first time in two years, with a company-wide operating income and adjusted operating income of $137 million and $306 million respectively”.
The return of shows and festivals over the summer months – especially in the US and UK – helped ensure that Live Nation, the biggest live music company in the world, is now in full-on recovery mode. With many fans eager to return to live entertainment after all the COVID lockdowns, the live giant says that many of its festivals sold out in record time this year, despite ticket prices having risen in many cases. And once inside venues or on site, fans have been spending more on food, drink and other services.
Capitalising on that demand required the live sector to meet COVID safety requirements, of course. And, Live Nation brags in its financial report, it rose to that challenge rather well. “We delivered these results within an operating environment that required us to ramp up quickly, institute new health and safety protocols, and staff our front line in a tight labour market”, CEO Michael Rapino writes in his note to investors.
“On the health and safety front, we set the industry standard by requiring proof of vaccine or testing for our shows, with no change in fan purchasing behaviour. More importantly, our protocols proved effective in mitigating major COVID disruptions to our business in the US and the UK and allowed us to work in conjunction with local health officials to mitigate transmission risks from our events”.
Of course, comparing Live Nation’s revenues in quarter three 2021 to quarter three 2020 doesn’t really tell us much, except that last year was really really bad. However, the live firm says, aspects of the business are starting to perform well compared to 2019 figures.
“As fans came back, so too did our brand partners who continue to seek to connect to the live music fans”, Rapino goes on. “As a result, our sponsorship and advertising business delivered over $100 million in operating income and adjusted operating income in the quarter, the first time at this level since third quarter of 2019. The return of sponsorship and advertising has been largely driven by our historical major partners, along with the addition of new brands including Truly Hard Seltzer, as well as Coinbase and Solana in the fin-tech space”.
And looking ahead into 2022, Rapino adds: “We are encouraged by all our leading indicators across each business. Through October, our confirmed show count across amphitheaters, arenas and stadiums is up double-digits relative to the same time in 2019 for 2020 shows, and through mid-October, we have already sold 22 million tickets for our shows in 2022. Demand has been stronger than ever for many of these on-sales with one million tickets sold for each Coldplay and Red Hot Chili Peppers tours, and several other tours already selling over 500 thousand tickets”.
He concludes: “As we get close to turning the page on 2021, I remain more convinced than ever on the power and potential of live entertainment, and the strength of our position. No industry was more impacted by the pandemic over the last two years, and no industry has so proven its durability of demand in the face of such disruption. I fully expect we will continue to have bumps in the road in the coming months, and it will take some time for international artists to be touring on a truly global basis, but the fundamental strength of live entertainment and Live Nation has proven out, and I expect we will only continue to grow from here”.
