Live Nation Releases 2014 Earnings: Losses Deepen as Revenue Ticks Up

Michael Rapino
Paul A. Hebert/Invision/AP

Michael Rapino, President and CEO of Live Nation Entertainment, photographed on April 16, 2014 in Los Angeles. 

Acquisitions and steady demand for live music pushed up Live Nation's revenue, but the promotion and ticketing giant saw its bottom line fall in 2014. Live Nation's net loss to shareholders more than doubled to $186.5 million from $82 million in 2013, as revenue grew 6 percent to $6.87 billion.

In what CEO Michael Rapino called an "exceptional" year for stadium concerts in the U.S., Live Nation had a record 76 stadium shows in North America, including tours by One Direction, Jay Z & Beyonce and Rihanna & Eminem. It was the most stadium shows in the U.S. since 1994, according to Billboard Boxscore statistics

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Operating income fell to $7.2 million from $139.7 million mainly due to a goodwill impairment of $135 million -- $117 million in the concerts division and $18 million in Artist Nation.

The view is considerably brighter when viewed through the lens of "adjusted operating income," a measure that Live Nation prefers because it removes extraordinary expenses, certain gains and losses and expenses not related to the company's ongoing operations. AOI increased 10 percent to $554.9 million from $505.2 million. Similarly, free cash flow grew to $327.0 million from $300.2 million.

Concerts revenue grew 5 percent to $4.73 billion. The segment was a drag on operating income, however, posting an operating loss of $70.9 million compared to a loss of $31 million in 2013. While the number of events was basically flat at 22,810, the number of estimated fans across all events fell nearly 1.1 million to 58.6 million.

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COO Joe Berchtold called the 76 stadium shows in North America "the strongest driver of fan growth." North American attendance grew 5.6 percent to 40 million, while the number of concerts increased a milder 2.4 percent. Bob Roux, co-president of North American concerts for Live Nation, told Billboard in December Live Nation had sold more than 3 million tickets for its stadium shows. 

Attendance at Live Nation's international shows declined 14.1 percent to 18.5 million from 21.5 million. Berchtold said the decline was "not a consumer demand issue" but rather "tour cycles and geographic mix" helped push show count down nearly 6 percent. The attendance per international event rose less than 1 percent.

Festival attendance was up 9 percent to almost 5 million fans. Live Nation's latest big acquisition is not represented in the earnings released Thursday. The company completed its acquisition of festival promoter C3 Presents in December. 

Ticketing revenue rose 11 percent to $1.56 billion while its operating income jumped 25 percent to $126.9 million. Resale was especially strong as secondary gross transaction volume increased 55 percent. The gross transaction volume of primary tickets rose 7 percent.

The Sponsorships and Advertising division also added greatly to Live Nation's bottom line. Revenue climbed 5 percent to $300.3 million and operating income rose 8 percent to $207.7 million.