Why WWE talent cuts probably aren’t done yet
The bloodletting at WWE continues, with the list of on-air talents being released since mid-week growing to 28 with the news on Saturday that Kassius Ohno was the latest performer to be let go.
Granted, the biggest names in the group – Rusev, Luke Gallows and Karl Anderson, Zack Ryder – hadn’t been used much on TV of late, making it feel like trimming the fat more than cutting muscle into bone.
But it’s clear WWE is feeling some sting from COVID-19.
The company is reportedly pushing forward with going live with its “Raw,” “Smackdown” and NXT weekly TV shows out of fear that broadcast partners NBCUniversal and Fox might trigger clauses in their deals calling for the bulk of the TV product be done live that could lead to a reduction in rights fees.
On top of that, there is without question the hit from not having the live gate from WrestleMania 36. Last year’s WrestleMania event reportedly drew a live gate in the range of $16 million, which is no small amount of change.
According to its 2019 financials, WWE brought in $125.6 million from live events last year, 13.1 percent of its overall annual revenue, which was reported at $960.4 million.
Extrapolating that out for 2020, assuming the numbers would be consistent year over year, WWE should be out around $26 million since the COVID-19 live-event shutdown last month, and if the shutdown continues into the future, as it almost certainly will, the company will miss out on around $9 million a month in revenues from live events for however long a duration we have.
Again, no small amount of change there.
Wrestling Observer editor Dave Meltzer has reported that the talent cuts will save the company around $700,000 a month, with related budget moves announced this week, including delaying its move to a new headquarters building, saving an additional $3.3 million monthly.
Doing the math, then, there’s still a hit on the bottom line, after this week’s cuts, in the area of $5 million a month, for the duration of COVID-19.
This might portend more talent cuts, and the next round might get into the muscle.
Story by Chris Graham