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Inside Liberty Media’s Investor Meeting, Where Comedy Bits Mingled With Hard Data

Liberty Media’s annual investor meeting represents an opportunity for Chairman of the Board and legendary investor John Malone to present a ‘State of the Union’ on a portfolio that now includes roughly one-third of Live Nation, 80% satellite radio giant SiriusXM and more e-commerce, communications and entertainment companies. And along with the requisite financial information and optimistic portrayals of its portfolio companies’ futures, this year’s edition, held Nov. 18, also showcased the company’s sense of humor.

Held at the Times Center, a block away from Times Square, in Manhattan, this year’s event drew a few hundred investors and analysts – fewer than usual, according to one attendee, possibly because “a lot of investors moved to Miami.” Outside the theater, attendees received a Liberty Media luggage tag with an Apple AirTag.

These days, some shareholder meetings are as colorful as their onscreen counterparts: Warren Buffet’s Berkshire Hathaway hosts 30,000 shareholders in an 18,000-seat arena with a festival-like experience in an adjacent 194,000 square-foot convention center, while Walmart’s investor meeting at the 20,000-capacity Bud Walton Arena at the University of Arkansas has been compared to a religious revival.

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Liberty Media’s meeting is more like a three-and-a-half-hour set at the Comedy Cellar. CEO Greg Maffei — also the chairman of Liberty-owned Live Nation, SiriusXM and TripAdvisor — is known for his sharp business acumen, but he’s not afraid to show his sense of humor. Last year’s theme was the VH1 series Behind the Music. This year’s videos recorded by Maffei and other execs were “streamed” from the fictional online service “Liberty+”, with a user interface modeled after that of Netflix. (Liberty Media tried to buy Netflix when it was $8 a share in order to combine it with the satellite TV provider, DirecTV, Malone told CNBC host David Faber on video during an hour-long interview on Thursday.)

The company’s brightest star isn’t a media company, however. In the lead-off skit, Maffei played a member of a Formula 1 pit crew in a send-up of Drive to Survive, the massively popular Netflix docu-series that helped raise the racing league’s profile around the world. In three seasons, Drive to Survive reached No. 1 in 27 counties, but nowhere is its success more evident than in Liberty Media’s own backyard: The average viewership for Formula 1 in the U.S. is up 61% in 2021 from 2020. What’s more, about two-thirds of the 400,000 fans at the U.S. Grand Prix, held in Austin from October 22 to 24, were first-time attendees, according to the company’s presentation.

Other parody videos included the Netflix show Squid Game and Carpool Karaoke featuring Malone. “There are usually more videos,” said an attendee, “and they’ve been funnier.” But the skits brought some levity to dry details about Liberty Media’s skill for financial engineering. Optimizing taxes through convoluted ownership structures, deftly managing debt and liquidity, and buying back shares at a discount to their net asset value may be humorless exercises, but they’re important parts of how John Malone has made his fortune.

Brief presentations by top Liberty Media chief execs were stitched between the taped comedy sketches. Formula One CEO Stefano Domenicali and Atlanta Braves CEO Derek Schiller appeared in recorded videos, and Witz, Rutledge and Stephen Kaufer of TripAdvisor were on hand for presentations. Live Nation, fewer than two weeks removed from the tragedy at the Astroworld festival in Houston, was a notable absence from the meeting, but CEO Michael Rapino would have had good news to share: Live Nation’s ramped up concerts in 2021 — festivals performed especially well — and promises a full tour pipeline in 2022 and 2023. Radio broadcaster iHeartMedia was also absent after Liberty Media sold off its 7 million shares — the final 5.9 million on Oct. 5 —  for “an attractive price” of $25.31 per share and after-tax proceeds of $175 million.

Underneath it all, the meeting is a way to sell investors and analysts on the future of Liberty Media’s portfolio companies. SiriusXM highlighted its top-tier talent and radio channels, 145 million cars enabled for satellite radio and 31% ad revenue growth in the third quarter. More importantly to investors, SiriusXM is classic Liberty Media: a cash-generating machine that’s structured to return value to its shareholders. Liberty Media’s ownership stake in SiriusXM’s recently surpassed 80%, meaning it will no longer pay taxes on dividends. (Beyond that threshold, the I.R.S. allows corporate shareholders to exclude dividend income to prevent triple taxation.) What’s more, SiriusXM announced on Oct. 25 it will increase its dividend by 50%.

Funny skits are nice, but cash is better.