Ticketing and concert promotion giant Live Nation Entertainment saw a 98% drop in revenue in its second quarter compared to the same quarter in 2019, the company said in its earnings report on Wednesday — in a stark portrait of just how badly the coronavirus pandemic has upended live music.
This quarter, which typically comprises the bulk of festival season along with summer tours for major artists, represents what should have been the busiest portion of the year for Live Nation. But it was reduced to a near-complete standstill. Revenue for Live Nation’s concert division for the second quarter was $141.8 million versus about $2.6 billion for the same quarter a year ago — a 95% decrease. Meanwhile, Live Nation posted a negative $86 million revenue for ticketing, due to the refunds it had to issue to would-be concertgoers. Ticketing revenue was a positive $371 million for Q2 last year.
But Live Nation also said that despite the mass rescheduling and cancellations, 86% of fans have elected to keep tickets for their rescheduled shows instead of opting out and asking for a refund. Two-thirds of fans are keeping their tickets for rescheduled festival dates, the company said. It added that it’s already sold 19 million tickets across 4,000 festivals and concerts for 2021.
In an effort to keep some semblance of live concerts alive in the pandemic era, Live Nation has experimented with concepts like drive-in concerts, which brought back some shows at a socially distanced capacity, but those shows simply can’t match the cash returns from a typical show at a theater, stadium or arena. Live Nation did not mention these shows’ sales performance in its earnings.
Virtual concerts, Rapino said, are also a promising platform both as the pandemic continues and as a longer-term component. Livestreaming has boomed amid the pandemic, and several artists are taking to paid concerts online to make up for touring revenue that’s gone away as shows have gotten the axe. “In the second quarter, we had 67 million fans view over 18 thousand concerts and festivals globally. Among our highlights, this past weekend we streamed 150 performances for our Virtual Lollapalooza Festival,” he said.
Based on Live Nation’s release, the company seems shifting its focus to a strong return by 2021 — a contrast in messaging to earlier this year when health information was more scarce and Live Nation president Joe Berchtold said the company didn’t foresee the virus heavily impacting business.
“Over the past three months, our top priority has been strengthening our financial position to ensure that we have the liquidity and flexibility to get through an extended period with no live events,” Rapino said in Wednesday’s earnings report. “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.”
Few companies in the live music sector have been untouched by the pandemic. Both Live Nation and competing concert giant AEG implemented furloughs or layoffs to their staffs, as did several of Hollywood’s major booking agencies including WME and Paradigm. Many independent concert venues fear for their future, with the National Independent Venue Association — formed in April amid the pandemic — finding that more than a thousand indie venues may have to close if they must another six months without extra government assistance.