Last weekend’s Lollapalooza festival in Chicago was indicative of music fans’ pent-up demand for concerts. Along with Rolling Loud Miami and Latitude Festival in Suffolk, England, Live Nation hosted about 750,000 concertgoers in the past few weekends. With ticket sales and attendance “pacing faster than expected,” the company’s positive adjusted operating income was “well ahead of where we thought we would [have] for this quarter,” said CEO Michael Rapino during Tuesday’s earnings call. That enthusiasm has led the average fan to spend more on the experience -- more food and beverage, more VIP packages and more upsets. “The pocketbooks are open,” said president Joe Berchtold.
Ticketing was the biggest factor to Live Nation’s second quarter recovery by contributing $99.4 million of adjusted operating income to offset the concert division’s $84 million AOI loss. Helped by a high number of concerts going on sale, June was Ticketmaster North America’s fourth-best month ever and the U.S. concerts division set a record for most shows put on sale -- 50% higher than the previous record set in March 2019. With the 2022 concert pipeline up double digits from 2019, event-related deferred revenue -- from advance ticket sales -- was up $650 million to $2.1 billion.
“We’re content with our ’22 lineup right now,” said Rapino. Billie Eilish, John Mayer and Alanis Morissette are among the artists with Live Nation dates set for 2022. “We’re talking mostly about what to add now into ’23 and ’24... We’ve got three, four years here of strong demand [that] we’re going to smooth out over time so everyone can get the right market and the right Friday nights and the right dates.”
Here are the elements details of Live Nation's Q2 2021 earnings report:
Financial metrics - year over year (Q2 2021 vs. Q2 2020)
- Revenue: $575.9 million, up 677.2% from $74.1 million
- Adjusted operating income: $9.7 million, up from a $431.9 million loss
- Net loss: $210.5 million, down 66% from $610.6 million
Financial metrics - sequential (Q2 2021 vs. Q1 2021)
- Revenue: up 98.2% from $290.6 million
- Adjusted operating income: up from a $151.7 million loss
- Net loss: down 34.8% from $322.7 million
Division metrics - year over year (Q2 2021 vs. Q2 2020)
- Concerts revenue: $287 million, up 102.4% from $141.8 million
- Ticketing revenue: $244 million, up from a $87 million loss
- Advertising and sponsorships revenue: $44.6 million, up 142.4% from $18.4 million
Division metrics - sequential (Q2 2021 vs. Q1 2021)
- Concerts revenue: up 19.9% from $239.4 million
- Ticketing revenue: up 762.2% from $28.3 million
- Advertising and sponsorships revenue: up 97.3% from $22.6 million
Additional financial information
- Liquidity on June 30, 2021, was $2.1 billion -- unchanged since Q1 2021 -- a combination of $971 million in available debt capacity and $1.1 billion in free cash.
- Event-related deferred revenue was $2.1 billion as of June 30, 2021, compared to $0.9 billion as of June 30, 2020. Long-term deferred revenue was $381 million for events that have been rescheduled more than one year out as of June 30, 2021.
- The company expects adjusted operating income to be positive in the second half of 2021.
- Enterprise value on August 3, 2021: $21.1 billion, down 4.9% from $22.2 billion on March 31, 2021.
- 12-month price change: up 167.8%, from $46.67 to $78.33.
- Of the 15 analyst ratings for Live Nation tracked by Refinitv, 9 recommend buys, 5 are hold and 1 is sell. The 12 analyst price targets tracked have an average of $93.50.
Major Events of Q2 and Q3 (to date) 2021
- Debuted a one-week, “Return to Live” promotion with $20 tickets to almost 1,000 concerts in 2021.
- Ticketmaster extended its deal with ASM Global.
- Acquired Mellen Events, a Western Australia touring company.
- Announced partnership with French ticketing retailer Carrefour Spectacles for online sales and over 600 ticket offices.