Live Nation sees double-digit revenue growth in first quarter

After promoting 21 of the Top 25 global tours this year— including Beyoncé, Coldplay, Guns N’ Roses, Rihanna and Drake – Live Nation Entertainment’s first quarter revenues of the year showed a double digit revenue growth in its concerts and ticketing businesses.

The global giant’s revenue rose 7.8% to US$1.21 billion ($1.61 billion) exchanging exchange rate fluctuations, or up 10% to $1.23 billion ($1.64 billion) at constant currency. The results were more than the $1.18 billion ($1.57 billion) expected by analysts.

Concert revenue grew 12% to $695.4 million ($930.4 million), and a $50.4 million ($67.4 million) operating loss, while ticketing was up 10% to $412.5 million ($551.9 million) and $35.4 million ($47.3 million) in operating profit In the first quarter, primary concert ticket sales jumped to 41.2 million from 37.9 million, not including season seat packages and sales through venue box offices.

The high margin sponsorship and advertising division grossed $58.8 million ($78.6 million), a 13% jump, and $26.2 million ($28.3 million) in operating profit. The Artist Nation management division’s income fell by 3% to $75.4 million ($100.8 million), while its operating loss worsened 10% to $17.7 million ($23.6 million).

Live Nation’s losses in the quarter were $44.5 million ($59.5 million), which was narrower than expected, after its $58.3 million red post ($77.9 million) last year.

The promoter believes that a strong concert schedule will see a record 2016, exceeding last year’s total revenue of $7.2 billion ($9.6 billion). Already ticket sales are 10% ahead of last year to 35 million. It also says all its divisions are continuing to build global market share.

Michael Rapino, its President, Chief Executive Officer and Director said, “We have built the industry’s most scalable and unparalleled live platform, connecting over 500 million fans to that magical two-hour event each year. Concerts continue to be the flywheel for our high-margin On-Site Retail, Advertising, and Ticketing segments, and this year will be another step forward in the company delivering strong long-term growth.”

He stated that Ticketmaster lead in the festival sector, with 78 festivals drawing 7 million. He expects a growth in festivals internationally, “in both large and niche size, with many markets still under-serviced.”

Rapino also predicted, “Along with attendance growth, we also expect to continue growing on high-margin on-site revenue this year as we continue to rollout new tech-powered product offerings at both amphitheatres and festivals. Such items as ordering from your seats at the amphitheatre from your app, to expanded cashless ordering at our festivals. And at the same time, we are expanding our global footprint, most recently adding South Africa as the 37th country we promote in.”

Ticketmaster’s first quarter increased GTV by 18% at constant currency. This was lead by a 43% rise in its secondary ticketing business, with this quarter the eighth consecutive quarter to show a 20% increase.

“Primary ticketing GTV grew by 16% for the quarter at constant currency. The month of February was the largest ever at Ticketmaster, selling over 17 million tickets globally, and during the quarter we had five of the top 20 days in the history of Ticketmaster.

“Over the past year, we have reinforced our position as the top global ticketing partner for venues and content, adding over 150 new clients to our strong venue base of 12,000. On the product side, one of our main areas of focus continues to be delivering a great mobile experience for fans buying at Ticketmaster. At this point, our websites are largely mobile response ready, and we have continued to upgrade our iOS and Android apps. As a result, we have increased our mobile ticketing sales by 30% year-on-year, now accounting for over 25% of all ticket sales.”

Earlier this week, Live Nation and the Hulu streaming service announced they were teaming up to create a platform for a Virtual Reality concert series. The platform will be on Hulu’s app, allowing customers to hang out backstage with the stars and watch the show from "the best seat in the house."

They say the move will transform the way concerts are experienced and will offer a "specially curated virtual reality" series with some of the biggest names in music. For Live Nation, the move will increase ad dollars and taking the concert experience online will strengthen ticket sales in the future.