Shares of World Wrestling Entertainment (WWE) tumbled more than 7% in Friday midday trading after the company reported a quarterly loss and negative second-quarter outlook.
WWE stock sank on news that World Wrestling Entertainment had posted an $8 million loss during the first quarter, compared to a profit of $3 million in the prior-year period. Still, that was less than the quarterly loss of between $12 million and $15 million that the company had previously estimated.
WWE attributed the loss to cost stemming from the launch of its new WWE Network, which garnered nearly 670,000 U.S. subscribers. WWE said it expects to hit 1 million subscribers by the end of the year.
More worrisome to investors, and likely driving WWE stock lower on Friday, the company said it anticipates a second quarter loss of between $15 million and $18 million.
WWE noted that profits from WrestleMania 30 would likely be “more than offset by increased Network costs, a seasonal decrease in Licensing and lower results from Home Entertainment (reflecting difficult comparisons to first quarter adjustments).”
On Thursday, WWE stock closed at $20.33 a share.
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