Q4 2024 Live Nation Entertainment Inc Earnings Call
Speaker Change: If it was up to me, I wouldn't give it nobody's no sympathy I'd take away the pain, I'd give you everything Where do I be, where do I be?
Speaker Change: He got in our door, so Maybe you would stop, strike, close And I'll get you everything, girl I'm coming with it on my soul Raleigh town, wrist, watch it I'm on the way home This world, concrete, that was raw Raleigh, she only doin' what she know Weakest
Speaker Change: Get it poppin' on the low, better days comin' for sure If it was up to me, I wouldn't give it nobody's sympathy I'll take away the pain, I'll give you everything I just want the money
Speaker Change: I can't lie, I trust you, I love you I won't waste your time, I'll turn it off Just so I can turn you on I'ma make you stay in love I'm not even trippin', I won't shut you out I might even settle down for you I'ma show you I'm a pro I'ma take my time and turn it off Just so I can turn you on, baby When it gets good, poppin' on the low Bad days comin' for sure Why are you comin' for me?
Everything I have is 맛있어요 if this world were mine
Speaker Change: 16 carriages, driving away while I watch them ride with my dreams away to the summer sunset on a holy night on a long black road all the tears I fight 16 carriages, driving away while I watch them ride with my dreams away
Speaker Change: This is a commiseration on a holy night On a long black road, on a field outside Fifteen, the innocent ones gone astray Had to leave my home at an early age I saw mama prayin', I saw daddy grind All my tender problems had to leave behind
John: Good afternoon. My name is John, and I will be your conference operator today. At this time, I would like to welcome everyone to Live Nation's fourth quarter and full year 2024 earnings call.
Ms. Young: I would now like to turn the call over to Ms. Young.
Thank you, Ms. Yong. You may begin your conference.
Speaker Change: Good afternoon and welcome to the Live Nation full year and fourth quarter 2024 earnings conference call. Joining us today is our president and CEO Michael Rapinoe and our president and CFO Jill Berchtold.
Speaker Change: We would like to remind you that this afternoon's call will contain certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ, including statements related to the company's anticipated financial performance, business prospects, and new developments in similar matters.
Speaker Change: Please refer to Live Nation's SEC filings, including the risk factors and cautionary statements included in the company's most recent filings on Forms 10-K, 10-Q, and 8-K for a description of risks and uncertainties that could impact the actual results.
Speaker Change: Live Nation will also refer to some non-GAAP measures on this call. In accordance with the SEC Regulation G, Live Nation has provided definitions of these measures and a full reconciliation to the most comparable GAAP measures in our earnings release.
Speaker Change: The release reconciliation can be found under the financial information section on Live Nation's website. With that, we will now take your questions. Operator?
Speaker Change: Thank you. We will now be conducting a question and answer session.
Speaker Change: If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the queue. You may press star 2 to remove yourself from the queue.
Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.
Speaker Change: We ask that you please limit yourself to one question and one follow-up. Thank you. One moment, please, while we poll for questions.
Speaker Change: And the first question comes from the line of Steven Lasacek with Goldman Sachs. Please proceed with your question.
Speaker Change: Hey guys, thanks for taking the questions. Maybe to start it off from Michael, on consumer demand, you guys have put a lot of stadium supply on the market over the last few months. I'm curious if you maybe could talk a little bit more about the demand trends you're seeing play out across the slate so far this year. Is there anything that you're seeing that makes you any more constructive or perhaps any more cautious on the demand front since we last caught up in November before a lot of the supply went on sale?
Speaker Change: When we look at one stat, the first week on sales, we're selling through over 75 percent.
Speaker Change: and that's much higher than the last year. So we're seeing consumers buying up those stadium dates faster than ever, up year over year or any comparable base.
Speaker Change: So, no slowdown at all. Lots of inventory, but equally great demand selling most of these stadiums out or close to being sold out by the time we get to the show dates.
Speaker Change: Yeah, thanks Steven. I think that this year is going to be more like a 23 year as we look at how we're growing the business with all this stadium volume leading the way. I'd expect to see
Speaker Change: Some good revenue growth. I think Ticketmaster, first and foremost, will be a big beneficiary. I talked a lot about last year on the other side.
Speaker Change: that it took 10 amp shows to deliver the kind of revenue for Ticketmaster's one stadium show. Now we have all those stadium shows. So I think you'll really see.
Speaker Change: that benefiting on the Ticketmaster side. I think that we continue to have a sponsorship business that's performing extremely well. We note here 75% sold, up double digits, so you expect that to continue to...
Speaker Change: So, I think it will ultimately come down to the pace of revenue growth versus the pace of AOI growth, which we don't know yet because we haven't gotten into the AMP season.
for the latter part of your question.
Speaker Change: Peters and clubs over the course of the year all of that will just help determine the exact balance of Revenue growth versus AOI growth there But we expect to see all of all the businesses performing well this year and as Michael said in aggregate Continuing to deliver double-digit AOI growth for the business
Speaker Change: And the next question comes from the line of Brandon Ross with LightShed Partners. Please proceed with your question.
Hi guys, thanks for taking the questions.
Speaker Change: Something that stood out in the release to me was that Ticketmaster transacted ticket volume you said was up only 3% and then the event-related deferred at 11%. I thought that would have been much higher given the pipeline and frankly the answer that you gave to Stephen's last question. Can you guys explain the disconnect for me?
Speaker Change: Sure, let me take the two different pieces because I think they're slightly different in terms of what's going on. So, Think and Master Transacted volume, as you noted, is up 3% while our...
Speaker Change: Concert tickets are up 10%. So if you look at the numbers, our concert tickets are up around 6 million. The TM transacted tickets, which is everything at the high end of all of our tickets.
Speaker Change: 2 at the lower end family shows and other lower price things up 3% but off of a roughly double almost double the base
Speaker Change: So, what you have is, at this point of the year, strong growth in the Live Nation concerts that Ticketmaster has been selling. You have a bit less activity in some of the other, whether they're promoters or some of the other activity in the Ticketmaster buildings.
Speaker Change: But we're still very early in the Ticketmaster scheme. It's about 100 million tickets. We ended up the year, last year, at about 330 million tickets. We expect to see growth off of that.
Speaker Change: So we're at a pretty early point for the Ticketmaster volume, as opposed to somewhat further along on the Live Nation side. So I think it's...
Speaker Change: It's a bit early to read too much into that number. Then in terms of the deferred, I think the on-sale timing this year was slightly different than.
Speaker Change: what we saw last year, this year, because we had such a strong stadium lineup.
Speaker Change: That really owned the fourth quarter in terms of the majority of the on sales.
Speaker Change: So, that drove growth, but we didn't have as early of on-sales on the arenas and the amphitheaters as we had last year. Last year, because we didn't have the stadium volume, at the end of 2023, we saw some earlier on-sales on the arena and amphitheater side.
Speaker Change: So, that's in effect why you got the double-digit level of deferred growth at that point.
Speaker Change: Great and then Michael you talked a lot about the strong demand for stadium shows
Speaker Change: and answering Stephen's question. But just optically, I look at some of these shows and I see a lot of high price tickets still on sale for high profile shows. Do you think ticket pricing is getting ahead of itself or is there some other explanation for that? And how should we expect Apple's ticket prices to grow this year? So stadium versus stadium.
Speaker Change: Yeah, I think you're seeing, you know, the artists in general, every cycle is a little more educated on what's the best way to price my ticket, how do I keep it accessible to my fans, but make sure scalpers don't run away with it.
with the Front of the House.
Speaker Change: So, we love seeing these stadiums sitting somewhere around 95% sold out right now. The instant we sold out at 10 a.m. means we transferred a lot of wealth to the scalpers. If you see any of those tickets, any tickets you're talking about are going to be the high-end tickets.
Speaker Change: sitting on the market. Those will flush out between now and show date.
So, we thank these artists on their stadium pricing.
who are priced at almost perfection, where strong, strong demand.
Speaker Change: So, would it be silly to partially think about it as you're taken away from secondary ticketers or ticket platforms and that's moving more to primary now?
Speaker Change: Thank you.
Speaker Change: First just wanted to say thoughts go out to you guys and everyone in the L. A office after everything that's happened this year.
Speaker Change: Pretty tough up everyone hanging in as well as can be expected.
Speaker Change: But Michael one one high level question for you as we frame the opportunity you've laid out for sustained double digit AOI growth over the next few years.
Speaker Change: Love to hear your thoughts on whether you expect the drivers of that performance to evolve over that timeframe.
Speaker Change: It's really just down to executing against a similar playbook is what supported the growth that you delivered here in 'twenty four.
Speaker Change: And then one for Joe on the outlook for.
Speaker Change: 900000, Capex in 'twenty five another big increase similar to what we saw in 'twenty four.
Speaker Change: What what would you say investors should take away from the decision to ramp that so healthily in terms of ROI ROI, you're seeing from that spend so far in.
Speaker Change: Any help with framing the timing from kind of investment outflow.
Speaker Change: The returns showing up on the P&L will be helpful. Thanks.
Speaker Change: I'll go back to your first question, if I can remember it but.
Speaker Change: Yes.
Speaker Change: We've been we love consistency over here, so if you've been following our stock and you've been to our Investor days. The last few years, we don't.
Speaker Change: We havent deviated really from what we think our thesis of why the industry is a great industry on a global basis, we think lives.
Speaker Change: It has a real global unlock and will be a.
Speaker Change: Hi, a high single double digit kind of industry.
Speaker Change: For the next decade as we were.
Speaker Change: We saw our KOL place show in India, sellout largest single concert.
Speaker Change: And history 125000 people.
Speaker Change: Those date sellout instantly so we've been talking a lot about the globalization of the consumer.
Speaker Change: Supply demand.
Speaker Change: The globalization untapped markets.
Speaker Change: To grow still so our model is the same were 100 100 offices in about 40 countries keep growing those offices growing our market share in those underdeveloped markets.
Speaker Change: We will continue to follow that global trend of more consumers wanted to go to shows from Pittsburgh to the Philippines. So we think the industry is growing we tend to grow better than the industry be able to capture the revenue from our <unk>.
Speaker Change: From our consumers walking in the door.
Speaker Change: And Cameron I think in some regards your second question is the same as your first question, which is if our if our thesis is is we're going to grow to 200 million fans as the next step in the different levers we have in venue side is a key piece of it and certainly our capital deployment is going to mirror.
Speaker Change: For the delivery of that OE growth. So I think we should take from the fact that we're increasing.
Speaker Change: Increasing our capital spend as we're continuing to see a lot of opportunities that have very attractive returns globally.
Speaker Change: Again heavily focused internationally on the at the arena level.
Speaker Change: Globally focused on these large theatres both types of venues that can deliver.
Speaker Change: Deliver attractive returns, but also move some reasonable volume of fans.
Speaker Change: Expand our shows growth market.
Speaker Change: So that's the biggest takeaway I would take from that in terms of the timing of these projects are all different in terms of how long they take from shovel in the dirt through through growing it out what we're trying to do and we gave you. Some pieces here is understanding of winter what venues opening how many millions of fans.
Speaker Change: Give you some guide for how we're seeing the impact roll in.
Bob: Got it helpful. Thank you Bob.
Speaker Change: And the next question comes from the line of David Karnofsky with J P. Morgan. Please proceed with your question.
David Karnofsky: Hi, Thank you.
David Karnofsky: So I'm just wondering music labels and DSP has recently come to agreements that may allow for Super premium tiers.
Wondering if you've thought of potentially about the rules like music within some of these offerings, maybe it was something like <unk>.
David Karnofsky: Access is there inventory that can be made available and could this be a potential sponsor opportunity.
David Karnofsky: Yeah. Thanks, David.
David Karnofsky: Yes, we can.
David Karnofsky: Currently.
David Karnofsky: Our job is to use that inventory that we have.
David Karnofsky: Acquired from the artist and maximize it to sponsorship currently and we have a lot of pre sale programs in place with you've seen them all horizons.
David Karnofsky: And citibank's et cetera. So our job is always to look at that show work with the artist and figure out is there is there are ways to maximize that inventory.
David Karnofsky: The <unk> business the business as well as consumers.
David Karnofsky: As far as the latest rounds of Spotify, and Apple and Amazon.
David Karnofsky: They've approached us all we've talked to them all.
David Karnofsky: About ideas.
David Karnofsky: If they if they wanted to inventory.
David Karnofsky: Cost of that and we would entertain and look at that option. If it made sense for us in comparison to other options we have for that.
Speaker Change: Please tell what you say.
David Karnofsky: It's a very valuable.
David Karnofsky: Asset the artist himself tend to do their own deals we do deals for the artist.
David Karnofsky: Ultimately artist has control of it.
David Karnofsky: Artist job is to maximize the revenue from it.
David Karnofsky: They are not giving that away to anyone for free.
David Karnofsky: So whether we partner with them and found sponsors or we paid for it.
David Karnofsky: It's valuable and wouldn't surprise me of course the labels.
David Karnofsky: Distributors trying to add a $5 premium to a monthly subscription.
David Karnofsky: And they don't have enough of their own inventory in terms of music or free songs. It's always the easy go to let's get them presale access the hard part about presale was just scaling it everybody wants the offtake presale.
David Karnofsky: And that's hard to scale. So we've been working with all three of them.
David Karnofsky: I'm trying to find a model that may work for us and them and Super they're talking to others also.
David Karnofsky: And then.
David Karnofsky: Maybe just separate the Doj Doj antitrust nominee recently indicated.
David Karnofsky: Some openness to settlements were effective remedies can be put into place just wondering kind of what room, you see to advance discussions with the agency or relative to the prior administration and then I don't know if just separate to this are there any updates you can give on just the trial in terms of timing or kind of notable dates to be aware.
David Karnofsky: Yes.
David Karnofsky: Yes. This is Joe the trial process continues to move a pace as it has targeting early next year for trial date. So question is is over the course of this year can you.
David Karnofsky: Is there a path towards a resolution with the Doj that that doesn't it doesn't lead to the trial. We've said no asset administration. There was really no interest in any discussion.
On settlement. So we're hoping that this doj returns to a more traditional approach and as open because they don't own it in the same way. So those discussions, but we haven't had any discussions yet the person that you would discuss it with us.
Not been approved yet not been appointed so until that happens there's nothing we can do.
David Karnofsky: And we will see how that plays out in the coming months, but.
David Karnofsky: Nothing nothing really substantively now.
David Karnofsky: Okay.
Speaker Change: And the next question comes from the line of Peter Zaffino with Wolfe Research. Please proceed with your question.
Speaker Change: Hi, everybody a question on the new nation capital.
Speaker Change: I'm wondering if the 2025 budget, which thank you detailed as being $2 million to $300 million greater than 2024.
Speaker Change: Any change in the mix of U S versus international and then a parallel question on the large arena sort of the 15% to 20000 seat segment I'm wondering if those opportunities are coming any faster or slower than you imagined and whether your appetite to invest in that particular segment has shifted at all thank you.
Joe: Although this is Joe.
Speaker Change: First I was just going to jump on the second.
Speaker Change: The large opportunities on an international basis are coming consistently.
Speaker Change: Ongoing so continue to see that ramp up we tend to be the first second phone call. If you are a developer thinking about building or have land and want to use that land or have venue. If you want to sell so we see that pipeline growing and our appetite still remains very large.
Speaker Change: To expand on that platform.
Speaker Change: And just on that on that same thread Michael just answered. The first question to which is I think that in general you will see a trend towards more of the capital being deployed internationally because of the attractiveness and volume of those of those arena opportunities.
Speaker Change: Thank you.
Speaker Change: And the next question comes from the line of Peter Henderson with Bank of America. Please proceed with your question.
Peter Henderson: Yes, hi, everyone.
Peter Henderson: So just wondering I mean theres been some concerns over the softness of U S consumer, particularly on the low end recently it doesn't sound like you guys are experiencing any of that but coming back to sort of brandon's question as well are you seeing any.
Peter Henderson: Trade down from more affluent cohorts and what are you seeing sort of from the more value conscious consumer.
Peter Henderson: And just related to that I'm wondering recently announced that they will not be a long past program in 'twenty five and Im wondering if you give any color on sort of the size of that and.
Peter Henderson: Why the decision was made and that program in <unk>.
Peter Henderson: What are the programs youre considering.
Peter Henderson: Yes, I mean overall the demand we're seeing for the concert and I assume.
Peter Henderson: The NFL has got the similar slimmer asked so we're seeing no pullback, it's still on a global basis.
Peter Henderson: Strong demand we're seeing it.
Peter Henderson: A small to big so yes. The answer is we're always going to have incredible demand, but if you look at my club business, we're going to do 30000 club shows lost in a year. Our club business is up 17% year over year. So that's kind of the simplest way to say.
Peter Henderson: Bottom end.
Peter Henderson: On a Tuesday in Indianapolis.
Peter Henderson: Business is doing better.
Peter Henderson: <unk> come into the club to see the young bands. So we're seeing our festivals, which are on sale already there. They are selling at record levels. So im seeing no pullback in any festivals from EDM to our country Festival.
Peter Henderson: As we always say someone will write about.
Peter Henderson: One that gets canceled or a dog here and there, but generally overall macro our festival business globally is stronger than ever.
Peter Henderson: Our club and theater business is stronger than ever and obviously our stadium business is on fire, so whether it's geographical whether it's.
Venue type or whether it's festival, we're still seeing strong strong consumer.
Peter Henderson: But across the board in terms of buying tickets for the 25 season.
Peter Henderson: As far as the law in past, so very small program and.
Peter Henderson: And we've put some new leadership in charge of the venues this year expanded Jordan <unk> role.
And put some some some.
Peter Henderson: Some new thinking around how do we sell.
Speaker Change: The summer at the theater.
I think our belief was we were discounting too much too early with some of the programs. We had so was too.
Speaker Change: Pull back and relaunch, which we always do our annual concert week is kind of a big if you want to call that our Amazon Prime day.
Speaker Change: Answer we can.
Speaker Change: Later in the summer earlier in the spring beginning.
Speaker Change: Beginning of the summer that's kind of our big Big deal, where we sell all of our volume that matters. So we're going to just consolidate around that bigger idea.
And we're going to eliminate some of the smaller programs that we're selling.
Speaker Change: Small small volume of tickets overall.
Thanks.
And the next question comes from the line of Jason Bazinet with Citibank. Please proceed with your question.
Speaker Change: I'm, a big fan of the Capex, you're spending so don't take this the wrong way. It's just a clarifying question when I look historically, the new nation.
One I don't know less than 10% of the venues. Most released your operated or whatever is this capex really moving more overtly than the outright ownership with these arrangements is that what we're talking about or is it spending capex.
Speaker Change: And then having the right to lease it at a lower rate or operate it.
Speaker Change: Okay.
Chunk of it is absolutely owning it every.
Every situation.
Speaker Change: We're following your advice and trying to own more.
Speaker Change:
Speaker Change: Upstream so if we're in a situation where we can own it dirt on up we do sometimes we can't own the dirt along the building scan on the building will do as much of the capital build out and minimize our lease so.
Speaker Change: You don't always have exactly what you want but we are absolutely pushing it further further upstream if you will.
Speaker Change: That's great. Thank you.
Speaker Change: And the final question comes from the line of gun morale with Evercore ISI. Please proceed with your question.
Speaker Change: Great. Thanks for taking the question. Another one on venue nation, you provided a lot of great color at the Investor day on the midterm outlook I know the impacts to the model gets a bit tricky because as Joe mentioned timelines vary greatly depending on how the shovel to dart to grow the venue out process looks like but it is an area where.
We get a lot of questions on so I was hoping you could help us think about what the.
Speaker Change: Impacts of venue nation, maybe was in 2024 and a little bit more specifics around how you see that evolving in 2025, just given the growing venue base there. Thank you.
Speaker Change: Yes.
Speaker Change: Haven't really tried to break it out for you guys as a segment.
Speaker Change: First of all part of it or a good chunk of it obviously comes from the sponsorship side, we've talked about two thirds of sponsorship is venue.
Speaker Change: When you're driven so you've got a component over there you then you've got the operating component, which is heavily driven by your by your beer and buyer parking and so on so we haven't really tried to fully model it and break it out that way for you. Unfortunately, we tried to use where we presented liberty is the overall guidepost.
Speaker Change: Silver over a midterm basis as you said to then try to back in and say how are these pieces potentially going to rollout how do they maintain the sort of growth profile over the next several years and am I comfortable there you'd be able to do it right.
Speaker Change: We're not really in a place that we're going to break out and give you the standalone venue nation business model.
Speaker Change: Worth a shot thanks Joe.
Speaker Change: Okay.
Speaker Change: Yeah.
Speaker Change: And I'd like to pass the floor back over to Michael Rapino for any closing remarks.
Thank you everybody look forward to talking about Q1 in May.
Speaker Change: Ladies and gentlemen that does conclude today's teleconference. We thank you for your participation you may disconnect your lines at this time.
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