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Live Nation Earnings: Double-Digit Growth and Milder Bottom-Line Losses

Rowdy concert audience in silhouette against yellow stage lights.

Ticketmaster parent Live Nation Entertainment (NYSE: LYV) reported fourth-quarter results last week. The event arranger and ticket distributor delivered double-digit revenue growth in all three of its operating segments during a seasonally slow period. Here's a closer look at Live Nation's results.

Live Nation's fourth-quarter results: The raw numbers

Metric Q4 2018 Q4 2017 Year-Over-Year Change
Revenue $2.60 billion $2.32 billion 12%
Net income (loss) attributable to common stockholders ($17.7 million) ($97.6 million) 82%
GAAP earnings (loss) per diluted share ($0.09) ($0.48) 81%

Data source: Live Nation. GAAP = generally accepted accounting principles.

Rowdy concert audience in silhouette against yellow stage lights.

Image source: Getty Images.

What happened with Live Nation this quarter?

  • The company saw concert revenues rise 12% year over year, to $2.05 billion, while ticketing sales increased 15%, to $438 million. Sponsorship and ad sales brought in $118 million to the top line, a 20% year-over-year boost.
  • Strong ad sales are always a welcome trend since this segment is Live Nation's most profitable operation. Forty-nine percent of the incoming sponsorship and ad revenues were converted into operating profit, far ahead of ticketing's 9% operating margin and a negative contribution from concerts.
  • Live Nation's GAAP results are complicated by the 34% ownership stake held by Liberty Media (NASDAQ: FWONA) . Net income before Liberty Media's direct and options-based portions, which appear on Liberty's income statement using the equity accounting method , rose from $7.77 million to $90.3 million.
  • Adjusted operating income, or AOI, swung from a $23 million loss to a $69 million profit. Live Nation's management relies on this non-GAAP metric as a direct measure of operating results that aren't colored by the company's financial structure or acquisition expenses.

What management had to say

CEO Michael Rapino provided more color on the fourth-quarter's successful sponsorship operations on the earnings call . According to Rapino:

Our top strategic sponsors have been a key driver of this growth with 75 sponsors collectively spending over $350 million to reach our fans, up 11% over 2017. Research from our Power of Live white paper indicates that over 90% of fans believe that brands can enhance the live experience and over 60% of fans believe they are more likely to connect with brands at concerts. This reinforces that our shows offer brands a truly unique opportunity to connect with fans. With over 70% of budgeted sponsorship net revenue for the year already committed, pacing double-digits ahead of last year this time, we are confident we will again deliver double-digit AOI growth for 2019.

Looking ahead

The company generally doesn't offer detailed financial guidance targets, but Mr. Rapino provided the following overview of how he expects 2019 to unfold.

I expect us to further grow our global concert position while enhancing on-site hospitality and capturing more pricing opportunities. In sponsorship, we will continue to drive double-digit growth as more brands look for that direct connection with music fans. And as ticketing continues to transform to a truly digital ecosystem, it will benefit from continued growth in concert ticket sales and further expansion of our global footprint.

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Anders Bylund has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Live Nation Entertainment. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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