Live Nation Entertainment posted the best first quarter in its history this year, according to financial results released Thursday for the quarter ended March 31, 2022.
“Momentum has picked up for all of our businesses over the course of the first quarter, and as a result, we delivered financial performance that greatly surpassed our previous expectations, with operating income of $27 million and [adjusted operating income] of $209 million,” CEO Michael Rapino said in a statement accompanying the results. “Artists are back on the road and fan demand has never been stronger, a reflection that live events remain a clear priority for consumers as our social lives restart.”
The company’s AOI of $209 million topped the previous record, Q1 of 2019, by $94 million, and was $361 million better than 2021 — when the industry had not yet begun to emerge from the pandemic — with a boost of $269 million in ticketing, $66 million in sponsorship and $26 million in concerts.
Ticket sales were the main driver for the quarter’s success. “Despite some markets [globally] taking longer to re-open, the quarter was our second highest ever for GTV [gross transaction value] excluding refunds, trailing only Q4 2021, with March being our highest month ever for transacted GTV, excluding refunds,” Rapino said, noting that the quarter was 33% over Q1 2019.
The company’s secondary-market ticketing GTV growth was even higher, up 106% relative to Q1 2019. This was accomplished by average resale ticket price being up almost 20% compared with Q1 2019; Ticketmaster gaining additional market share by “effectively leveraging its team and league partnerships” across the NFL, NBA and other sporting events; and the market growing at a double-digit pace, as concerts and other live events continue to open up, despite the ongoing pandemic.
Rapino also said that “All leading indicators point to double-digit growth in fan attendance at our concerts this year, relative to 2019,” even though the first quarter had significantly lower attendance than the same period in 2019. Approximately 11 million fans attended the company’s shows in the first quarter compared to 15 million in Q1 2019 – “This was expected, as we planned for limited concert activity in the early months of the year to allow for markets to open,” he said.
However, he added that more than 70 million tickets have been sold for shows in 2022, up 36% compared to the same time in 2019, and that “attendance rates in the U.S. across all venue types [are] at 2019 levels, and no-shows generally in the mid-single digits.”
He also noted that concertgoers are paying more for tickets than ever, which may be great news for investors but less so for fans.
“The industry continues to embrace market-based pricing, particularly on the best tickets, shifting $500 million to artists for shows this year, resulting from a double-digit increase in ticket pricing, and reducing the price arbitrage in the secondary market,” he wrote, adding “At the same time, in the U.S., the average entry level price to get in and enjoy the show remains under $35, approachable for almost all fans” — although that is hardly the case for top acts.
He also noted a rise in the money fans are spending at shows, with average per fan revenue up 30% relative to Q1 2019.
Finally, he noted that sponsorship activity is back in full force, “delivering financial results that well exceeded Q1 2019.” He said the number of strategic sponsors that generated over $1 million of revenue per year has risen by close to 30% since 2019, with their committed spend up 70% and accounting for 80% of our total sponsorship revenue. about 60% of this growth has come from three categories of particular priority over the past two years – technology, telecom and purchase path integration – which have collectively more than doubled their sponsorship since 2019. “At this point our sponsorship sales are up double digits relative to this point in 2019,” he concluded, “and we have sold 90% of our planned sponsorship for the year, positioning us for continued strong financial performance.”
