Q4 2021 Endeavor Group Holdings Inc Earnings Call
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If you would like to withdraw your question again press Star one thank you.
James Marsh head of Investor Relations you May begin your conference.
Good afternoon, and welcome to <unk> fourth quarter and full year 2021 earnings call.
A short while ago, we issued a press release, which you can view on our Investor Relations website Investor Dot endeavor co Dot com recording this call will also be available via that site for at least 30 days.
Youll hear from Endeavour's, CEO , Mario Emmanuel and CFO , Jason Loveland before we open for questions.
The purpose of the call is to provide you with information regarding our fourth quarter and full year 2021 performance. In addition to our initial outlook for 2022.
I do want to remind everyone that the information discussed will include forward looking statements, Andrew or projections that involve risks uncertainties and assumptions as described in the risk factors section of our filings with the SEC, including our 10-Q s and 10-K.
If these risks or uncertainties materialize or any assumptions prove incorrect our results may differ materially from those expressed or implied in such forward looking statements and projections.
Forward looking statements speak only as of the date. They are made and we undertake no obligation to update them publicly in light of new information or future events, except as legally required.
Our commentary today will also include non-GAAP financial measures, which we believe provide an additional tool for investors to use in evaluating ongoing operating results and trends.
These measures should not be considered in isolation from or as a substitute for financial information prepared in accordance with GAAP.
Reconciliations between GAAP and non-GAAP metrics for our reported results can be found in our press release issued today as well as on our IR site with that I'll hand, it over to Ari.
Thanks James.
As we come up on our first year anniversary as a public company, we feel great about our overall performance and our continued ability to execute on our long term strategy and deliver sustained growth.
Secular tailwind, we laid out a year ago have never been stronger from.
From premium asset and media rights and sports betting a live events and experience. The demand continues to grow we believe there is no better company than a network to.
Continue capitalizing on this demand and that our results in 2021 illustrates that.
We beat our targets and raised our guidance in both the second and third quarters of last year, and we continue to outperform in the final quarter and full year of 2021, while we still face the lingering impact of the pandemic.
Briefly looking back at the year.
In our own sports property segment.
<unk> posted its best financial year in its 28 year history.
All pay per view event sold out sponsorship hit record revenue high and international rights deal saw significant increases.
Within our representation segment, our talent agency William Morris continued its strong growth.
Returning to pre pandemic 2019 levels across categories, such as TV film books and podcasts.
And our events experienced in REIT segment, our IMT Arena sports betting business saw sales surpassed pre pandemic level and with our expected acquisition of Oakland. Later this year, we'll look to further expand and evolve our sports betting offering for rights holders and sports sports, while creating a new <unk>.
Operating segment for this business.
IMG Arena and open debt have been profitable individual businesses and we expect that together, we will be able to achieve meaningful revenue synergies and continue their profitability.
Within our on location experiential business.
We added the IOC at an Olympic games to our client roster and I have been.
<unk> preparations for our gains in Paris in 2024 to be followed by Milan in 2026, and La in 2028 and.
And finally across our own events roster attendance increased significantly as COVID-19 restrictions are lifted we also witnessed a substantial increase in both sponsorship sales and corporate hospitality tied to those events outpacing pre pandemic levels.
As we look back at this success I wanted to take a couple minutes to remind you of the unique position endeavor occupy at the center of sports and entertainment and how that enables us to capitalize on a wide range of secular trends I also want to share with you My view on what this.
Means for endeavour going forward.
We've diligently built what we believe is a well balanced and deeply interconnected portfolio of clients and owned asset across sports and entertainment.
Two of our longest running businesses, William Morris and IMG provide us with invaluable insights that fuel strategic business decisions across the portfolio.
William Morris gives us insight into trends coming down the Pike in media and entertainment for example.
Based on our agency's position in the marketplace and the evolving content landscape five years ago, we saw an opportunity to create an artist friendly independent studio endeavor content.
We closed our sale of 80% of the scripted portion of that business earlier this year and I believe there's no better indicator of the value being placed on premium content than that deal, which valued endeavor content at nearly a $1 billion on a post money basis.
Meanwhile, <unk> media business.
We represent more than 150 sports rights holders on a global basis, giving.
Giving us a unique and expansive perspective on the evolving sports rights landscape.
That perspective, and form past decisions to acquire both the UFC and PBR after representing them for years.
It also enables us.
To consistently create complements to our lives sports viewing experience whether that our sport 24 in flight streaming channel or IMG Arena sports betting operation.
And these media driven insights further informed our decision to pursue the acquisition of open that.
Beyond the insights generated across our portfolio endeavor also benefit from being distribution agnostic.
And the content landscape continues to shift the one constant is the ever increasing demand for sports and entertainment assets.
Whether there is expansion or consolidation of linear broadcasters cable companies or the.
The need for content remains at an all time high.
We will continue to benefit based on our ability to readily fulfill that demand.
And we have seen that both our global scale and our volume of deals has allowed us to command maximum value on behalf of our owned and represented IP.
The definition of content continues to extend beyond traditional verticals like film and television to include everything from podcast social media posts NSP.
This only presents more opportunity for our clients and our own assets going forward.
No matter what form of content takes.
We'll be there every step of the way as we have for decades.
Relying on the unique makeup of our portfolio, our deep capabilities and the insights we're able to generate based on our global footprint.
That powerful combination enables us to not only withstand the evolution of our industry, but also to thrive in the face of it.
Because we are both platform agnostic and well diversified in terms of our volume of businesses and our global footprint.
Our exposure to segment or regional downturn is limited.
I remain confident in saying that we are ideally positioned to benefit from the secular tailwind I mentioned earlier for the months and years ahead.
As we head into our second year as a public company, we continue to face several external factors outside our control.
But we believe in the strength of our diversified business and the durability of our long term strategy we've laid out.
Looking to the future.
Youll see us continue as first movers, identifying and leveraging trends, making one of a kind connections across endeavor ecosystem of talent brands owned IP and carving out new paths for growth.
With that I'll hand, it over to adjacent to talk more about the fourth quarter and the full year 2021, as well as our outlook for 2022.
Thanks, Terry and good afternoon, everyone.
I'll start by walking you through our financial results for the fourth quarter and full year.
I will also provide you some color around what we're seeing each of our operating segments.
In comparison, <unk> annual or quarterly will be in reference to the COVID-19 impacted prior year of 2020.
For the quarter ended December 31 2021.
We generated $1 5 billion in consolidated revenue up.
$545 million or 57%.
Adjusted EBITDA for the quarter was $229 5 million up $57 million or <unk>, 33%.
For the full year revenue was $5 1 billion up $1 6 billion or 46% and adjusted EBITDA was $883 million up $308 million or 54%.
Now I'll walk you through each of our segments.
Our own sports property segment generated revenue of $277 3 million in the fourth quarter.
$8 3 million or 3%.
While the segment's adjusted EBITDA for the quarter was $125 1 million up $2 million or 2%.
On the year the segment generated $1 1 billion in revenue up $155 6 million or 16% and $537 6 million of adjusted EBITDA up $80 million or 17%.
Segment, adjusted EBITDA margins for the year improved 50 basis points to 48, 5%.
As already mentioned UFC delivered its best financial year in its 28 year history driven.
Driven by an increase in the number of events higher media rates revenue and significant growth in sponsorship the organization pulled out all pay per view events with audiences, while setting several arena.
Birds.
As Disney has shared <unk> continued to be a key driver of ESPN plus subscriptions and internationally. We've closed a series of media rights deals for significant rates fee increases. Meanwhile, your chief Ipass revenue was up 30% year over year.
Throughout the year. We also added a series of new multiyear partners like crypto Dot com interop gains to our sponsor roster.
And we made our first foray into NFC with Canadian collections, that's sold out within hours paving the way for our NFC partnership with that pro apps, which launched in January with great success.
Meanwhile, <unk> fan base continued growing and remain one of the most engaged audiences in all of sports.
The organization social media followers grew 32% over the course of the year, reaching $187 million by the end of 2021.
And nearly 300 million hours of UFC content was viewed on Facebook last year, the most in <unk> history.
Moving to PBR revenue increase in the quarter, primarily driven by the full return of events. The PBR World finals held in Vegas and November saw revenue increases of over 160% over the prior year's event.
It also marked the first finals ever aired on broadcast television.
Looking back at the full year PBR signed 10, new National partners.
Brought us Reits are screaming channel <unk> and announced an exciting new team carry format that would create new revenue opportunities for the organization.
Now turning to events experiences and rates.
The segment reported revenue of $516 7 million in the quarter up $96 million or 23%.
And adjusted EBITDA of $54 7 million up $12 4 million or 29%.
On the year segment revenue was $2 billion up $437 8 million or 28% and adjusted EBITDA was $215 6 million up $156 4 million or 264%.
Segment, adjusted EBITDA margins improved to 11% for the year.
These increases were driven by strong growth across the segment, including the return of marquee events like High Park Winter Wonderland, and freeze London as well as the resumption of full sporting events schedules, which benefited our media rights and production businesses.
Brian G Arena sports betting business also renewed over 200 content deals with sports books during the year.
While IMG Academy in CSA, the digital recruiting service, we acquired in June of 2021 were both up double digits and enrollment year over year.
Moving on to our representation segment revenue was $717 9 million, an increase of $443 2 million or 161% while.
While adjusted EBITDA was $118 4 million up $68 8 million or 141%.
On a year representation segment revenue was $2 billion up $1 billion or over 100%.
And adjusted EBITDA was $383 4 million up 171 4 million or 81%.
Segment, adjusted EBITDA margins were 20% for the year.
Growth in the representation segment was primarily attributed to a significant increase in debit content project deliveries agency client commissions and brands resuming spending on marketing and experiential activations, which benefits our 160 over 90 business.
Looking specifically at our <unk> agency business 2021 marks a year in which we have more than 330 WMA series across linear broadcast cable <unk> converted more than 230 books to film and television.
It was more than 200 potash deals and have clients play key roles in some of the most viewed and highest grossing films of all time.
Now before I share our outlook for 2022 I wanted to give you an update on our capital structure.
We ended the year with $5 7 billion in debt cash.
Cash balances were approximately $1 6 billion at year end, resulting in a $4 1 billion and net debt.
Cash excludes proceeds from the sale of the restricted portion of endeavor content, which closed in January we.
We remain on track toward our net leverage goal of sub four times.
And finally I'd like to share our current outlook for 2022.
I will first discuss our guidance on a consolidated basis and then provide some additional detail by segment to help you understand the drivers behind our expected financial performance in 2022.
Let me start with initial guidance ranges for revenue and adjusted EBITDA.
As we've said previously we believe our business is best viewed on a full year basis, given quarterly fluctuations related to the timing of events and business transactions on behalf of our clients as well as the renewal of media rights deals.
We expect consolidated revenue for the year to be between $5 2 billion and five $4 5 billion up 5% at the midpoint of the range.
Adjusting for the sale of the restricted portion of the endeavor content revenue growth would be up 23% at the midpoint of the range.
On adjusted EBITDA, we're expecting a range of $1 7 billion to $1, one 2 billion or 24% growth at the midpoint of the range.
Buying a 21% margin on the year.
Adjusting for the sale of the restricted portion of the endeavor content adjusted EBITDA growth would be up 25% at the midpoint of the range.
Embedded in our 2022 guidance are the following considerations.
The removal of the restricted portion of endeavor content.
<unk> related and future pandemic negative impacts as well as current economic and geopolitical risks, none of which we view as material at this time.
M&A, including a full year impact of and TSA and Diamond Baseball holdings as well as the addition of the Madrid open and open debt, which we expect to close around the start of the second quarter and then the third quarter respectively.
And lastly, the ramping up of our investment in <unk> locations upcoming Olympic business.
Now let me provide you with some color on our guidance by segment.
Starting with our own sports property segment, we expect this segment to be driven by continued momentum at the UFC and accelerating growth at PBR.
While we anticipate hosting the same number of events in 2022 as we did in 2021, we expect more content output take place in the second half of the year.
Within UFC, we're seeing continued growth in revenue driven by contractual growth in both U S and international media rights.
A return to live events in several global markets increases in sponsorship and licensing.
And a return to normalized business for commercial pay per view as bars and restaurants business rebound.
PBR is expected to experience strong top line and profit growth driven by the launch of the New T series This summer as well as increasing rates fees.
For events experienced in Reits, we expect strong revenue and segment profit growth of ongoing reopening trends continue.
As evidenced by our locations record sales for Super Bowl 56, making it the largest single sales event and on location history.
Segment profit growth will be impacted by an upfront investment at on location as we prepare for service Ioc's exclusive hospitality provider for the Paris, 2024, <unk> 2026, and 2028 games.
We expect to ramp up our investment to the tune of approximately $20 million in 2022 and continued investment in 'twenty three before we expect to recognize revenue and profits beginning in 2024, and Paris and with each subsequent gains.
In the aggregate we are enthusiastic about the return profile of this partnership with the Iot.
Also included in our expectations for this segment our acquisitions of the Madrid Open announced in December 2021, which we expect to close around the start of the second quarter as well as the open bet, which we announced in September of 2021, and anticipate will close in the third quarter subject to regulatory approvals.
Upon close we expect to create a new reporting segment to include open back.
Arena business.
Finally in our representation segment, we expect strong growth in revenue and adjusted EBITDA.
We also anticipate margins will improve materially with the removal of the lower margin endeavor content scripted business. Our debut on the agency business is poised for continued growth, which is expected to accelerate as wide music and theater rebounds to pre pandemic levels.
Meanwhile, our one six over 90 business is also expected to return to pre pandemic levels with several major clients aggressively reentering the events activation space after a long hiatus as well as a healthy new client pipeline as brands look to re engage with consumers in more meaningful ways.
Now before we take questions I, just want to reinforce what he said earlier the.
The secular industry trends, we discussed during our very first earnings call as a public company continued to trend positively.
For premium content and media rights to sports betting and live events and experiences the demand has only grown.
And given where we sit in the center of sports and entertainment combined with a unique portfolio. We've built we believe we are ideally positioned to continue driving growth across all of our segments for the balance of 2022 and well into the future.
With that I will hand, it back to James for Q&A.
At this time I would like to remind everyone in order to ask a question. Please press Star then the number one on your telephone keypad.
Your first question comes from the line of David Karnofsky with J P. Morgan Your line is open hi.
Alright, Thank you for the question.
On UFC.
And there's a large amount of major sports rights coming due in the next few years, including the NBA and major college conferences, just given this renewal cycle I was wondering how you think about the best window to launch negotiations for USC domestic rights and was there any benefit at all to kind of get ahead of this wave of contract expirations.
Okay, I'm, sorry, I'd say the activity in the marketplace continues to demonstrate the value being placed on sports rights.
More competition than there has ever been.
With limited rights as we just saw recently.
<unk> sold incredibly well.
Apple just entered the marketplace for MLB.
Amazon for Thursday night football.
That's good for our sports rights assets.
And our owned assets on that on a broad basis represent as you know a 150 <unk> plus our own sports right.
As it relates to the UFC.
We still have three years.
<unk>.
Until the deal is up we feel great about where we sit our relationship with Disney Slash ESPN is a win win even in their last earnings call.
Stipulated that the growth of.
ESPN plus a 21 million was due in part.
The UFC.
As it is in terms of our negotiating window.
Ultimately based on a mutual agreed upon perspective with the partner.
But again.
We feel great about where we are.
Our customers are the people that watch the UFC by pay per views, we've driven value PSTN. So we're feeling really good about where we sit with the asset and the marketplace and the added people joining the marketplace from Apple Amazon and now with discovery Warner's coming online.
So we're feeling pretty positive.
Okay, and then just on location I'm wondering if you could speak to how demand trended this year and for Super Bowl hospitality relative to 2019 kind of how that informs your view for the business post pandemic and then we saw some reports that the NFL owners voted to increase their position in the business just wondering.
If you can say, how that would impact us financially or operationally.
Well I would just say.
We've talked about the experienced economy continues to grow on location is perfectly situated to take advantage of that situation.
And our pre in our remarks.
It was a hugely successful.
Super Bowl <unk>.
Actually the single largest event and allocation history.
Then went right into New York fashion week.
<unk>.
And then we're also doing now.
Experienced packages for the UFC, APAC and thats selling incredibly well.
In February we announced the deal with the WWE.
<unk>.
I can't comment on anything as it relates to the NFL, but the relationship with the NFL couldnt be better.
Thank you.
Thanks, Josh.
Questions.
Your next question comes from the line of John Hodulik with UBS. Your line is open.
Great.
Couple of question I think Ferrari again on the USP.
First of all any international be registering jewels for UFC to call out for 'twenty two.
Second ESPN has raised prices for for pay per view of a few times.
Dennis.
And Denver do you guys participate in that price increase and that the economics of that lift from that and then lastly, any comments in terms of exposure to Russia Ukraine.
In that segment. Thanks.
So.
So.
Really good about our growth prospect.
<unk>.
Jason said and I have said in the past every major category is substantially up pay per view meteorite sponsored consumer products on the international side to speak specifically to your question.
We see continued strong growth.
And upside as I've said in the past, 90% of our audiences outside the United States.
10% of our revenues come from international right.
Our our international rights to date are up 94% and an AAV over prior term.
Over the last 14 international deals since Q2 of 2021.
And just to clarify.
Talk about the international deals typically run between three and five years.
So in any given year, there is about anywhere from 20% to 30% of our deals up for renewal.
And in 'twenty, two the key ones coming up our <unk>.
Brazil, U K and Scandinavia.
Really feel good about that.
And your last point was.
Okay.
Pricing.
As it relates as it relates to our exposure in Russia and do on Atlanta.
On a general basis or just on the USD basis.
Both would be great.
What we've said is that we expect less than a 2% impact on adjusted EBITDA on a consolidated basis.
And we've already incorporated that into the guidance that we gave you today and we'll continue to see how things evolve and understand.
What sanctions of additional ones are implemented and if we will address as needed if so.
Great.
Okay.
Thanks, John Josh next question. Please.
Your next question comes from Ben Swinburne with Morgan Stanley . Your line is open.
Thanks, Good afternoon, guys I hope everybody is doing well.
Had a couple of questions on the agency business.
Jason mentioned that business should grow nicely I think accelerate in.
In 'twenty, two and whether you see being sold we're going to see that in the numbers better. So two questions I get a lot from investors I'd love to get your thoughts on Alright, one is.
How is the shift from packaging and backend to cost plus impacting the growth of that business. There is some concern I think that there has been a kind of a pull forward of revenue and profits. During this transition that's going on for the last few years. So I'm wondering if could talk about.
To sort of impact of that on.
WMA the growth outlook and margins and then I'll ask my follow up.
There is no we're not there's no pulse there was no pull forward as it relates to revenue or any of those.
Of that situation.
<unk>.
As it relates to the packaging business.
On the movie and TV side.
As I said for the pandemic.
We're the <unk> players Amazon Apple and Netflix they were license.
License fees more than doubled for <unk> right now excuse me.
Packages were.
Windowing like on the office you saw that the bidding for that went to peacock for over $500 million. So all of our packages are our <unk> position.
There is no pull forward as it relates to any economics in the business is stronger than it's ever been as Jason went through the numbers as how many shows we have on now so it.
It's very good right now so I would just add Ben from a margin perspective without endeavor content. We certainly expect the margin the representation adjacent segment to be up year over year as evidenced by the full year margin of the business increasing.
From 'twenty, one to 'twenty two.
On the packaging side as already said, we haven't seen any pull forward. We've just seen a continued great demand for content.
On all sides of content for us and are really seeing a great rebound on the representation business from 'twenty, one over 'twenty and a lot of our businesses back to 19 levels with the exception of obviously some of the music touring our Broadway businesses, where we're expecting to really come back online in 2022.
That makes sense. Thank you and then the second question is just around the visibility into that business.
Is there any way for us to think about how much of your EBITDA.
At the agency in a given year comes from.
Stuff that happened in the past versus happening period, I would imagine that there is there is some sort of library or sort of prior year.
Production, that's flowing through the earnings every year I don't know if library is the right phrase but is there any way to think about how much of your cat year EBITDA in that business comes from our library versus stuff that's going on in period. Just so we can think about the visibility you have into that business.
Yes look I mean, like we've said historically in the agency business, we've been a double digit grow every year up until the pandemic.
And those revenues give us a lot of visibility and predictability into into our agency business. So.
They are part of the revenue and part of the revenue mix that obviously helps us helps us get to the EBITDA for the business in total but.
We haven't outlined as sort of a number for that but it is a it's a good part of our revenue that helps us get more predictability and comfort on that business from a budgeting and pro forma basis on a year to year basis.
Got it thank.
Thank you.
Okay next question Josh.
Hi.
Next question.
Yes.
Your next question comes from the line of morale with RBC capital markets. Your line is open.
Great. Thank you for taking the questions.
I wanted to ask about the Olympics deal and then one on M&A first on the on location Olympics partnerships I was hoping if you could better understand help us better understand the financial impacts over the next few years, Jason I know you mentioned that there will be about $20 million of investments in this year with continued investments in 2023 before profitability.
In 2024, with Paris, I guess I was hoping for.
More details on your expectations for 2023 and 'twenty four.
It seems like your earnings will be understated. The next two years. So it would be helpful for us offset better appreciate these dynamics.
Can you talk a bit more about your M&A appetite and the deal pipeline going forward now that the endeavor content deal is behind you and we're getting closer to closing on open but that can change in your priorities going forward as you balance M&A.
Versus your reiterated outlook for getting leverage to below four times and sorry, just lastly, any specific areas or verticals of focus with M&A given your unique position in the ecosystem. Thanks.
Yes, So let me start with.
The IOC question first so yes.
I expect it to have ramp up costs, we had some in 'twenty one into 'twenty two we.
Outlined roughly $20 million and then probably 'twenty three I would say, it's a little bit step up a little bit from there we haven't quantified exactly all of those cost yet, but it will be slight increase over 2002.
From a from a working capital perspective, we also expect to be on sale.
In Q4 for our first.
Prepare so from a working capital perspective, we certainly expect to have cash coming into the business from pre sales starting at the end of the year.
But from a revenue recognition perspective, we can't recognize any revenue associated with the games until the games actually take place. So we will be recognizing all the revenue prepared for 2024.
Even though we will have pre sales in 'twenty, two and 'twenty three in a similar situation in 25.
With some probably pre cost for 2006 until we can recognize revenue in 2007.
Some costs going into the 28 revenue as well.
As it relates to M&A.
As I said to you.
<unk>.
We look at all of our verticals.
<unk> NR.
In our almost more properties now.
Setting.
And we continue to pushing on those as we did with open bet for arena as we did with NPSA printer our Academy business.
You will continue to see us kind of moving in those directions.
As you saw in the events business now with Madrid.
So from our perspective.
Those are the things that we look at and we get.
Indications from our global footprint of what rates are available.
And also we do it from a representation business both at.
And IMT and WMA and we will continue to do that on a go forward basis to strengthen our position in the marketplace and grow.
I'm not going to give you any insights into the companies. We're looking at but we have been a very curious company and I think we've executed well on our M&A strategy from growing the business.
That's perfect. Thank you Bob.
Okay.
Your next question comes from the line of Stephen <unk> with Goldman Sachs. Your line is open.
Great. Thank you for Ari you mentioned it briefly but could you speak some more about some of the emerging forms of media like social podcasts in some of the wet three opportunities I think you called out.
If you could expand on that that'd be great is there something you think is incremental and can move the needle over the next few years.
Well I mean, if you just look at the expansion.
From the early days, who knew on the cable side, there would be food category now podcast.
Again, we're platform agnostic in that space.
That business has grown significantly.
All of the players entering the marketplace, we've done a significant amount of deals in the podcast space and we've done a significant now the new category.
Either marketing or <unk>.
FTE, both for our own sports properties.
Like the UFC and dafna labs or with.
Just clients doing NLP. So those are categories that are growing in addition to social just in a general basis as we look to our social players on the forms of Tic Tac and Instagram moving them to the traditional business. So those are the areas that when we defined content those are the additional cost.
People, just think about TV movies, we look at the full scope of the media landscape and are agnostic again to reemphasize on distributions. So.
Those areas are growing substantially they have.
Halo effects across the platform on an architecture basis. So that's the way we look at it.
Great. Thanks for that and then on sports betting we've seen competitive uptick in the industry over the last few months, especially on the back of New York Legalizing online betting I was curious if you can maybe talk a little bit more about what that means for the opportunity you see in the sports business.
Sure.
Well I mean.
This relates to kind of sports betting in general.
There is.
It's global.
Going across the United States.
And that's positive for sports padding ecosystem, as a whole and increase more opportunity for AMG and once we close.
<unk>.
When you look at what we have when you.
Combined open bet with IMG Arena, we have the full menu.
Menu for sports teams and leagues on a global basis, whether it be player wallets content data feeds live streams. So from our perspective lowering it will become a one stop shop again different from our competitors both business and are very profitable.
<unk>.
As Jason mentioned, we believe significant revenue synergies.
And growth potential across the globe with those two businesses as we become a one stop shop different from any of the competitors on a full scale basis.
Great Thanks for that.
Thanks, Steve next question please.
Your next question comes from the line of Rich Greenfield with light shed partners. Your line is open.
Hi, Thanks for taking the question I'm going to start out on their representation business, and then Brandon I'm going to tag team and ask a question on USA.
When David Zaslav from discoveries soon to be Warner Bros. Discovery, We wanted last earnings call. He basically made a comment to that.
It's not about having the most content, it's about having sort of just not liking the cable network world, but having a show or two that people really love.
I know you're doing a lot with Apple and Amazon and Netflix who are obviously gunning for a tremendous amount of content.
I guess I'd love your view or do you think that the discoveries.
The peacocks.
Even the Paramount places do they all come to the realization that they need far far more content than they are currently creating in their digital plans and just how do you think that plays out because I think that's a big question in terms of how much bigger the spend get both on TV and movies over the next several years and then Brendan will follow.
So I mean <unk>.
You just look at some reports the spend is going to be upwards of $140 billion across all the platforms.
<unk>.
And.
David and I joke about kind of how much money. He is he's going to have to spend with me.
To compete.
Thank you he.
He did this because he was in the middle and not at.
At the end to compete when he was just discovery.
Don't believe any of them are not.
Spending money on content and now spends anywhere from I think $20 billion plus.
And from our perspective, whether it be Amazon Apple Netflix discovery, Warner's Peacock Paramount Roku.
Disney Hulu the competition could be if one of them dropped out or goes down a little it doesn't really affect that as I said, we're platform agnostic and as we once talked to you and I about the movie business.
During the pandemic there was only three buyers you now have as I said to you there would be a robust theatrical business.
Whether that be uncharted Spider man Batman that business is now coming on with the pandemic kind of.
And the restrictions moving off so there's even more competition.
Im not really nervous if he decides that he doesn't want to spent everybody else is spending.
And again.
There's 708 players in the marketplace.
Great and then this is Brandon Ross UFC fiber comp and benefits have become a real hot.
Topic of conversation lately I know.
Thats been the elevated bi.
J Paul was just wondering if you could give your perspective on why the overall split have ended up where they are and what your outlook is there whether we should expect.
Yes relative share that fibers are getting all that revenue pool to go up in time or stay kind of where it is.
On our last earnings call I think this was a question also on that exactly this question, but similar.
We've increased fighter plane.
Want to make sure I'm right about 400%, 600% since 2005.
And we're investing in the business with performance Institute.
Good recovery.
So we have done and now participation in and depth in our labs in Ftes.
In the kit. So we think we've done very very well and as the.
Revenue for the business increases its only has only benefited that business and we've grown in the sport has grown and fighter pay has grown too as I said.
How much it's gone up since 2009.
I think the pushback thats out there though.
Our overall revenue base at UFC has grown much more than 600% I believe.
And.
What what the overall relative share should be.
Well I'm not commenting on that I think we've done very well as it relates to the pay for the fighters.
Thank you next question.
Josh can we have the next question please.
Your next question comes from the line of Meghan Durkin with Credit Suisse. Your line is open.
Hi, guys.
Alright, so as sports betting platforms like draft kings, bringing their technology in house, where they still need to open that and maybe what do you see as the opportunity for the revenue synergies over time, I think you outlined $100 million of rent revenue synergies over the next several years.
And then I want.
Wanted to follow up on the minor league deals with.
And touched on today I don't think I heard you talk about them in the guidance are they included in the guidance and then what's the timing of that and maybe outline sort of the strategy with the stadiums, how youre going to be using the platform to to sort of supercharge that.
Assets.
As it relates to draft Kim Drapkin bought <unk>.
<unk>.
<unk>.
And the business that we're in it's a global business. So our platform whether it be in Greece, whether it be in the middle East.
Our Latin America, there's a huge market for.
Our one stop shop, I think Jason mentioned.
Of revenue synergies.
So.
With fan dual and.
It also can be an Ala carte service. So it doesn't have to be one service. It's all of the services. So if certain people just want the data and the fee. They can take that if they want to play our award of the content.
They can do that so we.
We feel very good about where we sit on a global basis with regard to that offering across the globe.
So.
As far as it relates to Diamond Batesville holdings those numbers are in the guidance. We gave you today, we closed six deals at the end of last year, an additional four teams.
At the beginning of this year and the plan there is to do similar to what we've done with the other sports leagues, we own which is now use our best practices to drive sponsorship revenue ticket revenue and really.
Synergize those business.
Synergize those business isn't really professionalize them in one organization.
Okay. Thanks.
Thanks, Mike next question please.
At this time I would like to remind everyone. If you'd like to ask a question. Please press Star then the number one on your telephone keypad. Your next question comes from the line of David Joyce with Barclays. Your line is open.
Thank you first a clarification please.
The guidance for this year does that include open bit from your expected.
Acquisition date.
And I appreciate that you've provided the growth excluding.
Endeavor content.
How can you help us think through what your true organic growth is for all of the underlying businesses, if you weren't going to exclude.
Location and CSA.
Sort of thing.
So.
Our guidance we have included our expected.
Open better expected timeline, which is Q3 of this year forward.
Inorganic basis look.
We're getting growth across all our businesses across the entire platform in all segments.
And <unk>.
M&A is a big part of what we do in quarter over quarter over quarter of our business, but what I would say is we feel very good about the overall growth we get an organic is a very big part of that overall growth, we're getting across the company.
If I could just drill down a bit more on the consumer demand for the <unk>.
Vince and looking at how things are trending versus the pre pandemic levels.
What are you seeing in the near term in terms of.
The supply of these events anecdotally there have been.
Some sets of tickets going straight to discount platforms. Just wondering if there is maybe some near term supply issues or concerns given gas prices and consumer discretionary spending given that theres also the balancing of the staycation versus.
Patient kind of consumer discretionary expense just was wondering what kind of got youre seeing and there is no problem.
You saw in the live nation earnings they are seeing very high demand for events as you look from us as it relates to winter Wonderland sold out.
Freeze in La <unk> sold out our pay per view events as we've mentioned so that's super bowls fold.
Best it's ever sold so we are seeing high demand as it relates to.
Our event.
And from our perspective.
<unk> people want to get out and want to.
Have experiences.
We're feeling.
We're seeing very high demand.
For those.
Thanks, David.
Thank you.
He got a final question.
And there are no further questions at this time I will turn the call back to Ari Emanuel for closing remarks.
Thank you very much so I appreciate your time everybody.
Loud of what our team accomplished.
This past year and considering the external headwinds.
We built a diversified business that is platform agnostic that I've mentioned.
And Maureen every major secular trend category.
We had content spend experienced economy, where sports betting.
We're growing at double digits, and we believe we're significantly outpacing industry averages.
We have great momentum and given our position and the results to date, we are guiding to revenue and EBITDA, both up over 20% with expected margin expansion. So I just want to remind everybody of that and with that we look forward to updating you on our progress going forward. Thanks, everybody.
This concludes today's conference call. Thank you for joining you may now disconnect.
Okay.
Yes.
[music].
Yeah.