In the early weeks of the global Covid-19 crisis, some concerts were optimistically postponed until the autumn. Now Live Nation has offered its verdict on when we’ll be back gigging properly. “Our expectation is that live events will return at scale in the summer of 2021, with ticket sales ramping up in the quarters leading up to these shows,” it announced, as it published its latest financial results.
(In the company’s earnings call, CEO Michael Rapino offered more colour on that summer return: “We would be looking right now at the business as a strong amphitheater festival outdoor business in Europe and into America, and then most of your touring indoor stuff will start to ramp up in the fall into winter.”)
Those financial results show the scale of the Covid-19 impact for the live music industry’s biggest company. In the second quarter of 2020, its revenues from concerts were just $141.8m compared to $2.64bn in the same quarter a year ago. Live Nation’s revenues from ticketing were negative: -$87m compared to $370.8m a year ago, while its sponsorship and advertising revenues also plummeted from $151.5m to $18.4m.
Overall, that amounted to a 98% drop in Live Nation’s total revenues: from $3.16bn a year ago to just $74.1m in Q2 2020. An operating profit of $171.6m a year ago became a $588.1m loss last quarter. None of which is a surprise, given the global pandemic’s far-reaching impact.
As you’d expect, Live Nation is looking forward, and making its case for a future bounceback. “Concerts are worth the wait,” is one of the key lines in its financial announcement, alongside stats showing that 86% of fans are holding onto tickets for rescheduled shows rather than getting refunds; that the company has sold 19m tickets to more than 4,000 concerts and festivals scheduled for 2021; and results from its surveys suggesting that nearly 90% of fans globally are ‘confident in their return to live music’.
Let’s hope so. There were also some interesting datapoints on Live Nation’s work on livestreams during the pandemic. “In the second quarter we had 67 million fans see over 18,000 concerts and festivals globally,” Rapino told analysts in the earnings call. “Given the tremendous popularity of these shows, we are seeing the potential for live streaming to become an additional long-term component of our concert business, allowing fans in other cities or those who can’t attend to enjoy the concert as well.”
That’s a theme that’s already emerged elsewhere: the sense that one lasting effect of Covid-19 will be continued exploration of livestreams (and specifically paid livestreams) even when concerts are back at scale. But Rapino expressed confidence about that return. “2021, 2022, we can debate what quarter exactly ramps but we believe 2021 into 2022 will be record years with artists on the road who are pent-up,” he told analysts.
“We are very gifted in this industry and that we have incredible supply chain, a lot of ongoing creative geniuses who make their living connecting with fans on the road. So that will continue, and we know now from all of the craziness we have seen across America, the fans are going to gather. We just got to make sure we can do it safely.”
The latter being a key point: in reference to a recent Chainsmokers concert that sparked controversy over its seeming lack of social distancing, Rapino promised “we won’t be doing DJ sets in The Hamptons anytime soon”.