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Endeavor Roars Back With $1.5B Q1

Jerome Bettis loves crossing the goal line. When the Hall of Fame ran back left Notre Dame before graduating to pursue his NFL career, he promised he’d be back one day. Nearly three decades later, Bettis completed his degree at the Mendoza School of Business among students half his age.

Barbara Perenic-Columbus Dispatch

Endeavor bounced back from a Q4 that saw it take a small loss to post net income of $517.7 million in Q1.

The entertainment conglomerate was boosted by the return of capacity crowds at UFC bouts and other events, as well as the 80% sale of its production house, Endeavor Content, which netted the company $464 million.

  • Endeavor banked $1.47 billion in first-quarter revenue, up 37.8% year-over-year.
  • All of its UFC pay-per-view events sold out.
  • the Miami Openwhich Endeavor owns through its agency IMG, was “the most attended of all time,” according to the company.
  • hospitality provider OnLocation got a boost from Super Bowl LVIwhich Endeavor said was the largest event by revenue in On Location’s history.

Endeavor boosted its full-year guidance to $5.2 billion to $5.5 billion, with its predicted adjusted EBITDA raised to $1.1 billion to $1.2 billion.

Endeavor beat analyst expectations on its revenue and earnings-per-share, and its stock was up in after-hours trading.

minor problem

The company is still determining how to resolve a hiccup in its planned expansion into Minor League Baseball. The company bought nine teams through a new entity, Diamond Baseball Holdings, late last year.

However, the MLB Players Association says the arrangement violates its bylaws because Endeavor also employs certified MLB agents through its WME Sports agency. The company could sell WME or Diamond to avoid its agents’ decertification.

Earlier this week, La Liga released a fiscal report for the 2020-21 year that detailed just how much damage the pandemic has caused across the Spanish league.

Total revenue was reported at about $4 billion, almost 25% less than the total revenue for the 2019-20 season. Total net loss more than $940 million.

  • The league cited player transfer fees and matchday revenue as the biggest contributors to the losses — both suffered more than a 50% drop.
  • According to the announcement, one unnamed club’s finances dragged down most of the others.

La Liga pointed out, however, that the losses weren’t as high as a previous report from PwC anticipated, nor were they as dire as those reported by UEFA.

The 2021-22 season is expected to be “the start of the recovery period.” By the 2023-24 season, La Liga expects “normal” revenue to be restored.

Profitable Partnership

The Spanish league cited the somewhat controversial $3.2 billion investment from CVC Capital as a major boon, preventing it from sinking even lower during the pandemic.

CVC reportedly now holds more than 10% of ownership of the league.

The Beachbody Company reported less-than-favorable results in its latest earnings report.

The subscription-based health and fitness company generated $198.9 million in revenue in Q1 2022, at 12% decrease Compared to the same period last year. Beachbody also reported a net loss of $73.5 million during the quarter, up from a loss of $30 million in Q1 2021.

  • The company saw digital revenue reach $81.7 million in Q1, down 14% from Q1 2021.
  • Digital subscriptions reached 2.46 million in Q1, a 10% decrease year-over-year.
  • Its nutrition segment generated $98 million in revenue, down 25% compared to Q1 2021.
  • Shares of the company have nearly 90% tanked over the past year.

Beachbody went public in June 2021 through a three-way merger with connected cycling provider MyxFitness and Forest Road Acquisition — a blank-check company led by three former Disney executives that includes Shaquille O’Neal as an adviser.

The combined entity, The Beachbody Company Group, was valued at $2.9 billion following the transaction.

The merger with Myx Fitness saw The Beachbody Company’s connected fitness segment generate $19.5 million in revenue in Q1 2022, compared to none in 2021. The company delivered approximately 16,000 Myx Fitness bikes during the quarter.

looking ahead

Beachbody expects revenue in Q2 2022 to take another dipranging between $175 million and $185 million, down from the $223 million from the second quarter of 2021.

Forbes unveiled its list of the most valuable esports companies in 2022 amid industry challenges that have forced businesses to diversify.

The top 10 esports companies are worth an average of $353 million, to 46% increase Compared to December 2020.

  • SSTwhich rebranded to TSM FTX after signing a $210 million partnership with the exchange, is valued at $540 millionthe most valuable esports company in 2022.
  • 100Thieves emerged as the second-most valuable esports company with a $460 million valuation, driven by a $60 million Series C funding round in December 2021.
  • Team Liquid, owned by aXiomatic Gaming, is the third-most valuable esports company at $440 million.
  • FaZe Clan rounds out the top four with a $400 million valuation, a 31% increase compared to 2020.

FaZe Clan announced plans in October 2021 to go public through a merger with blank-check company B. Riley Principal 150 Merger Corp., valuing the combined entity at $1 billion. The deal would give FaZe the highest-ever valuation for an esports company, surpassing TSM.

Risky Business

FaZe’s plan to go public has come with risks. Last month, the company submitted an amended filing to the SEC indicating that FaZe posted an adjusted EBITDA loss of $28.7 million in FY2021, compared to a projected loss of $19 million.

It also reported that $24.8 million of the $53 million in revenue generated in 2021 came from brand sponsorships. FaZe saw its net losses increase 28% year-over-year in 2021.

  •, FTX, and Coinbase have inked several deals with leagues and teams over the last year. As more than $200 billion of the cryptocurrency market was sold off on Thursday, the downturn could impact the pace of future deals.
  • Sean Payton’s career options keep expanding. The Carolina Panthers are eyeing the Super Bowl-winning coach as the savior who can lead them back to the NFL playoffs and Super Bowl, sources awning Front Office Sports.
  • On Thursday, the NBA announced a new lineup of hardware manufactured by Tiffany and Co., plus a new look for the Larry O’Brien Trophy.
  • Memphis Grizzlies general manager Zach Kleiman has been named the NBA’s 2021-22 Executive of the Year, becoming the youngest GM to win the award.
  • The Florida Panthers, who dominated the NHL in scoring and won the Presidents’ Trophy, have made a habit of epic come-from-behind victories. Subscribe to Scoreboard for more.

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Thursday’s Answer
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