Despite Live Nation’s first-quarter loss of $102.7 million, due in part because of fewer music fans attending concerts in the North American market, the company’s CEO Michael Rapino has assured investors that business will pick up this summer.
“Our first quarter results were in line with our expectations and reflect the season’s slowest period of the year for us,” Rapino said today (May 7) during a conference call with investors. “We have now entered the busiest season for concerts and top-line trends remain healthy.”
Live Nation’s first-quarter loss of $102.7 million compares with a loss of $37.2 million, or 50 cents per share, in the year-ago quarter, which had been bolstered by 42 cents per share of income from the sale of its North American theatrical business, motor sports division and a business related to producing and selling concert DVDs. See the full details of Live Nation’s first-quarter results here.
Live Nation will have a busy summer in 2009, promoting international music festivals and tours for such artists as U2, Coldplay, Nickelback, Madonna and the Jonas Brothers, among many others. The live entertainment company is also developing strategies to stimulate ticket sales for concerts at the amphitheaters it owns or operates in North America.
“We’re executing multiple promotions to provide low-cost tickets to fans in this tough economy,” Rapino said. “This summer we have over three million lawn tickets priced under $30, and have expanded our four-pack to 70% of our shows. We’re also running extensive price promotion with corporate partners such as Citi and 7-11, and working to expand the number of affiliate programs to drive ticket sales to our site.”
The CEO also addressed dynamic ticket pricing for upcoming concerts. “In terms of dynamic pricing, I wouldn’t say we’ve made a ton of headroom yet. I think that’s still the low-hanging fruit that we have to get to,” Rapino said. “We’ll test some this summer, but by next year this will be an ongoing change on how we sell with all of the different options.”
One of those tests will be the summer amphitheater tour by No Doubt, which begins later this month. “We priced the house very smartly, versus a traditional three-scale model,” Rapino said of the tour. “And that’s provided some great learning and increased revenue.”
Rapino also addressed the status of Live Nation’s proposed merger with Ticketmaster Entertainment, which is currently under review by the U.S. Department of Justice on whether the combined entities would be anti competitive.
“We’re in the second review, as we’ve announced, which is just an extensive data collection, period,” he said. “All indications we’re getting from advisers is that fall is a very reasonable close and time period.”
Additional reporting by Associated Press