Live Nation Entertainment shattered records in the first quarter of 2022, and is on track for a pandemic-busting year with more than 70 million tickets already sold for shows during the year, the company announced as it released its Q1 earnings statements May 5.
The company says the momentum driving all of its businesses over Q1 has “delivered financial performance that greatly surpassed our previous expectations,” CEO & President Michael Rapino said in a statement, pointing to operating income of $27 million and adjusted operating income (AOI) of $209 million on the quarter. That’s a drastic swing from the pandemic-hobbled year of 2021, during which the company posted a loss of $303.2 million in operating income.
Live Nation President & Chief Financial Officer Joe Berchtold added, “This was our highest Q1 AOI ever, exceeding Q1 of 2019 by $94 million, which had been our previous record first quarter.” Live Nation posted $1.803 billion in total revenue on the quarter, of which $480.4 million derived from ticket sales.
“Artists are back on the road and fan demand has never been stronger, a reflection that live events remain a clear priority for consumers as our social lives restart,” he said.
Demand, as directly reflected by ticket sales, continue to drive that momentum.
“Ticket buying serves as a leading indicator to our overall business,” Rapino added. “Ticketmaster’s strong first quarter performance drove the company’s overall profitability, and shows how well our concert and sponsorship businesses are positioned to deliver record results this year.”
Rapino noted that Q1 was Live Nations second-highest ever for ticketing gross transaction value, excluding refunds, trailing only 2021’s fourth quarter, noting that March was LN’s highest month ever.
“In primary ticketing, we are now benefiting from the 17 million net new fee bearing tickets we gained in 2021, which helped drive transacted GTV for the quarter up 33% relative to Q1 2019,” Rapino said. “ This quarter, we also added 7 million net new additional tickets through new contracts with venues as well as content creators, setting us up for ongoing growth this year and into 2023.”
Berchtold said ticketing “was again the star of the quarter,” delivering $206 million in AOI, making it the second-best quarter ever for Ticketing, and more than doubling the Q1-2019 AOI results of $100 million, noting pandemic impacts in 2020 and 2021.
In the primary ticketing market, Berchtold acknowledge that some of that pace was driven by higher ticket prices.
“A continued shift toward more market based pricing helped grow GTV levels, with average primary ticket prices up double digits for the first quarter relative to Q1 2019,” he said in remarks upon the release of the earnings report.
An upward shift in secondary tickets took place as well, Berchtold added. “In resale our average price increased 18%, while our overall resale GTV doubled compared to the first quarter of 2019 — indicating that demand for the top seats across all live events continues to outpace efforts by sports teams, artists and others to capture more of the full value from their events.”
Not only did fan demand accelerate, but so did the signing of new Ticketmaster contracts – helping fuel the increase in tickets sold, “reinforcing that Ticketmaster is the enterprise platform of choice for teams, artists and other content creators, and continues to be the most effective fan marketplace,” Rapino said.
Sponsorships are quickly returning after drying up during the pandemic, well exceeding the last “normal” year of 2019. “We are seeing growth along a number of dimensions – expansion of existing relationships, new categories expanding our breadth of partners and new ad units being created both on-site and online,” Rapino said.
“The number of strategic sponsors that generated over $1 million of revenue per year has risen by close to 30% since 2019, with their committed spend up 70% and accounting for 80% of our total sponsorship revenue. About 60% of this growth has come from three categories of particular priority over the past two years – technology, telecom and purchase path integration – which have collectively more than doubled their sponsorship since 2019.”
Rapino credits much of that sponsorship growth to its efforts in elevating the fan experience.
“We have had great success with this in recent years and so far this year through our partnership with Verizon, we started powering our venues with cutting edge 5G connectivity and launched an initiative with Snap to give artists Augmented Reality capabilities at shows and festivals,” he said.
Rapino says leading indicators point to double-digit growth in concert attendance in 2022, relative to the last comparable year in 2019. In Q1 2022, approximately 11 million fans attended shows compared with the same period in 2019.
“This was expected as we planned for limited concert activity in the early months of the year to allow for markets to open,” Rapino explained.
But with more than 70 million tickets already sold for 2022 shows, volume is up 36% compared to this point in 2019 and committed show count is up 44% through late April compared to 2019. No-shows, which was a concern in 2021, are generally in the mid-single digits in 2022.
“The industry continues to embrace market-based pricing, particularly on the best tickets, shifting $500 million to artists for shows this year, resulting from a double-digit increase in ticket pricing, and reducing the price arbitrage in the secondary market,” Rapino said. “At the same time, in the U.S., the average entry level price to get in and enjoy the show remains under $35, approachable for almost all fans.”
Per person spending is healthy as well, with average per fan revenue up 30% relative to Q1 2019. And the same figure holds up for spending at four recent festivals at served more than 300,000 fans, according to the report.
“Looking ahead to the summer and the rest of the year, we remain optimistic that we are just getting going as all leading indicators reinforce record activity levels and financial results,” Rapino says, looking forward to the remainder of 2022.
“Concert fans are showing no signs of slowing down – they are paying more for the best tickets, attending the shows, and spending more onsite as they create lifetime memories,” Rapino said.
“I continue to expect this to be the start of our run. The global addressable market for concerts, ticketing and sponsorship all provide a long runway for continued growth. We have over 60 tours already under discussion for 2023 – our earliest indicator of next year, and great positioning for ongoing growth.”