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Live Nation set records for concert revenue and ticket sales in the third quarter of 2022 as the touring industry continued its recovery from the COVID-19 pandemic. Third-quarter revenues were $6.2 billion, 66.8% greater than the same period in 2019, while adjusted operating income increased 45% to $621 million, the company announced Thursday (Nov. 3).
“Fans around the world continue prioritizing their spend on live events, particularly concerts,” said president and CEO Michael Rapino in a statement. “Despite varying economic headwinds including inflation, we have not seen any pullback in demand, as on-sales, on-site spending, advertising and all other operating metrics continue showing strong year-on-year growth.”
The concerts division tallied its highest-ever quarterly attendance with 44 million fans at 11,000 events that generated $5 billion of revenue and $281 million of adjusted operating income (AOI), up 67% and 44%, respectively, from the same period in 2019. Demand was strong across all types of venues and markets. Stadium attendance tripled to almost 9 million as many top artists, including Bad Bunny (the highest grossing Latin tour in Boxscore history), Red Hot Chili Peppers and The Weeknd, took advantage of strong fan demand by performing the larger venues.
Ticketmaster also had a record-breaking quarter by delivering its highest fee-bearing gross transacted value of $7.3 Billion, a 62% increase from the same period in 2019. Ticketing revenue was $343 million, up 96.7% year-over-year and 36.8% greater than the same period in 2019. Ticketing’s AOI of $163.2 million was 5% lower year-over-year but 28.2% above the third quarter of 2019.
Ticketmaster has made headlines because some artists — namely Bruce Springsteen and Blink-182 — opted for dynamic pricing that charged more for the best seats. The practice may frustrate some fans, but Live Nation expects to transfer over $550 million to artists through higher primary ticket prices — value that might otherwise have been captured on the secondary ticketing market.
Sponsorship and advertising revenue was up 59.4% to $343 million on the strength of Live Nation’s festivals and Ticketmaster platform integration. The high-margin segment’s AOI of $226.2 million was 103.4% better year-over-year and 69.8% higher than the same period in 2019. Confirmed sponsorship revenue for 2023 is up 30% over the same period a year ago.
Through September, ancillary fan spending at U.S. amphitheaters was up 30%. “The consistent theme is that fans are eager to enhance their experience, as we continue elevating our hospitality operations and provide more premium options,” said Rapino.
Looking ahead, the busy touring season will continue into 2023 and consumer demand appears to be holding strong despite widespread fears of an upcoming recession and tightening budgets due to persistent inflation. “Ticket sales for shows in 2023 are pacing even stronger than they were heading into 2022, up double-digits year-over-year, excluding sales from rescheduled shows,” said Rapino. Through the third quarter, Ticketmaster sold over 115 million, up 37% from the same period in 2019.
Live Nation’s share price rose 4.6% to $79.90 in after-hours trading on Thursday following the earnings release.
Financial metrics
Total revenue: $6.2 billion, up 63.TK% from 2019
Adjusted operating income: $621 million, up 45% from 2019
Concert revenue: $5.29 billion, up 66.8% from 2019
Ticketing revenue: $531.6 million, up 36.8% from 2019
Sponsorship and advertising: $343 million, up 59.4% from 2019
Fan metrics
North America concerts; 8,261, up 14% from 2019
International concerts: 2,958, up 57.4% from 2019
North American fans: 29.1 million, up 27.7% from 2019
International fans: 15.2 million, up 71.9% from 2019
Fee-bearing tickets: 73.4 million, up 32.7% from 2019
Calls to break up Live Nation Entertainment are getting louder.
The American Economic Liberties Project, a nonprofit advocating for more aggressive antitrust enforcement, urged the Department of Justice on Wednesday to unwind the merger between Ticketmaster and Live Nation for allegedly price gouging customers in addition to strong-arming artists and venues into accepting unfavorable conditions. In a letter to the DOJ obtained by The Hollywood Reporter, the group claims that the live-events behemoth continues to violate the conditions of a 2010 settlement greenlighting the deal.
“Ticketmaster’s market power over live events is ripping off sports and music fans and undermining the vibrancy and independence of the music industry,” said Sarah Miller, executive director of the American Economic Liberties Project. “With new leadership at the DOJ committed to enforcing the antitrust laws, our new campaign helps connect the voices of fans, artists and others in the music business who are sick and tired of being at the mercy of Ticketmaster’s monopoly with enforcers who have the power to unwind it.”
Ticketmaster and Live Nation merged in 2009, two years after the live-events organizer announced plans to build its own ticketing service. Prior to the deal, Live Nation was Ticketmaster’s largest customer.
The merger was met with pushback. Bruce Springsteen, upset at Ticketmaster for steering concertgoers toward its own secondary ticketing platform, wrote in a 2009 letter to his fans that “the one thing that would make the current ticket situation even worse for the fan than it is now would be Ticketmaster and Live Nation coming up with a single system, thereby returning us to a near monopoly situation in music ticketing.” (Springsteen’s current tour lists dates with Ticketmaster listings.)
At the time, David Balto, an antitrust attorney at the Center for American Progress Action Fund, testified to the Senate that the combined company “will cut off the air supply for any future rival to challenge its monopoly in the ticket distribution market,” and use its newfound reach to “diminish competition in independent concert promotion.”
Antitrust regulators approved the deal with certain conditions. They required Ticketmaster to sell its ticketing service subsidiary, Paciolan, to Comcast and to license its ticketing software to Live Nation’s rival, AEG. The new company was also not allowed to bundle or retaliate against venues for working with other ticketing services.
The American Economic Liberties Project argues that Live Nation is violating the consent decree. It points to conditioning the availability of the company’s performers to independent venues using Ticketmaster’s services.
“Live Nation essentially uses its concert promotion services to bully venues away from using the few competitors that Ticketmaster still has,” states an analysis from the group. “If a venue opts not to use those services, Live Nation retaliates by effectively boycotting the venue. Because Live Nation controls so much of the market for concert promotion, being able to book performers who contract with Live Nation can make or break a venue’s ability to survive.”
In 2019, the DOJ found that Live Nation had been violating the terms of the settlement by forcing venues to accept Ticketmaster’s ticketing services as a condition for hosting Live Nation performers and retaliating against those that refused. The agency, in turn, threatened to assess monetary penalties for additional violations and installed a monitor tasked with investigating further breaches of the consent decree, which was extended until 2025.
The organization also claims that Ticketmaster wouldn’t be able to charge hidden and excessive fees if it weren’t an illegal monopoly and that it facilitates price gouging by encouraging scalping. The company runs a secondary ticket market called Ticketmaster Resale, where they charge a second, more lucrative fee in addition to the fee assessed on its primary ticket market. By allowing scalpers to buy up the majority of tickets, Ticketmaster can essentially assess a second fee on consumers who missed out on the initial sale of concert tickets.
“Ticketmaster has an incentive to minimize the genuine sales by concertgoers on the primary market, by either restricting sales or allowing scalpers to buy, and then profiting from the price gouging in the secondary market, where consumers pay far more,” the analysis states. (The American Economic Liberties Project’s petition is here.)
This article was originally published on THR.com.