A once-solid live performance sector is showing signs of wear-and-tear, despite resuscitation efforts by Live Nation (LYV). During the most recent quarter, the company produced widening losses amidst sliding revenues, the wrong type of momentum ahead of the critical third quarter summer season. The company largely blamed merger-related costs involving upcoming partner Ticketmaster, though serious underlying issues were also present.
The losses were sizable, and fell below consensus expectations. The three-month period witnessed a slip of $27.2 million, or 33 cents per share, far broader than a year-ago dip of $652,000, or a penny per share. Revenues dipped 6 percent to $1.06 billion, of which foreign currency shifts contributed a decline of $86.3 million.
The question is whether concertgoers are simply deciding to stay home, and shifting towards cheaper, less-complicated entertainment options. Since the onset of the economic implosion, Live Nation has stressed stability and traffic, yet a massive discounting effort - flying under a 'no-fee' banner - suggests something different. On that note, estimated attendance dipped 2 percent to 13.1 million during the three-month period, while the average revenue per attendee dropped 5 percent to $78.16. Over the first half, attendance slipped a more substantial 5.6 percent to 20.2 million.
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