Ticketmaster Entertainment is infamous for its ticketing charges. Now it's suffering from a $1.1 billion charge — a goodwill write-down on the decline in its stock. The stock is trading around $4, less than a quarter of its price when it spun off from Barry Diller's IAC/InterActiveCorp in August. Revenue grew nine percent in the quarter, largely on acquisitions. Earnings per share, excluding the charge, dropped 81 percent to 16 cents per share.
Ticketmaster offers insight into the consumer economy — and no surprise, people are spending less. The total number of tickets sold in the quarter dropped 9 percent. And tickets cost less — the total value of tickets sold dropped 14 percent to $2.13 billion. The company says huge bands continue to attract fans, but family entertainment and smaller bands aren't holding up as well.
This is the company's first earnings report since Ticketmaster merged with Front Line Management and Irving Azoff took the CEO spot. Azoff is emphasizing the positive, pointing to the fact that the company increased free cash flow to $49 million, from negative $15 million last year.
The real question looming over Ticketmaster is whether federal regulators will give it approval to merge with Live Nation. Azoff says he's excited that this combined model is the future of the entertainment industry. No surprise, analysts had plenty of questions about the merger on the earnings call. Azoff says everything is moving along, and until then, it's business as usual, with Ticketmaster and LiveNation competing against each other.
The company says it's working with the Department of Justice and other regulatory authorities and though they can't discuss details or the likelihood of the merger happening at this point, they hope to close in the second half of this year.
Meanwhile Ticketmaster is trying to manage complaints about its strategy of sending concertgoers to sites also owned by the company, that resell tickets at higher prices.
Now it's making nice with Bruce Springsteen fans who complained about how the company diverted them to a Ticketmaster subsidiary that jacked up prices. Later this month the company will hold a random drawing for 1,861 people for two tickets to the May 21 or 23 Bruce Springsteen concerts in New Jersey. If you don't win a ticket, you'll get a $100 Ticketmaster gift certificate and the opportunity to buy two tickets to another Springsteen concert in New Jersey.
Another Ticketmaster snafu: Phish tickets were put on sale last night, March 18, instead of March 26, when they were supposed to go on sale. The band announced a four-night stand at the Red Rocks Amphitheater in Colorado, one of the smallest venues they've played in over a decade. Needless to say, Phish fans were excited, and word of the technological error spread fast. Now Ticketmaster has cancelled all of the orders and fans are livid.
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