The shows must go on, even if they’re not bringing in quite as much as they were before. Wizard World Entertainment reported a $1.5 million drop in convention revenue to $3.4 million for the quarter ending March 31 as compared to the same quarter in 2016.
Company executives explained the drop by pointing out that it hosted one less show during the quarter than last year (three rather than four). However, the company’s most recent financial report also indicated that the average revenue per show dropped nearly $100,000 as compared to the first quarter of 2016, despite that fact that it raised admission prices and expanded the scope of its events to attract larger audiences.
Meanwhile, revenues from Wizard World Entertainment’s ConBox subscription box business also continued a precipitous free-fall, as the company continued to turn its focus more exclusively toward improving its live entertainment events and improved online services. First-quarter revenues from ConBox sales totaled slightly more than $74,000—down 80% from what the company achieved in the first quarter of 2016.
With big drops in revenues and costs of revenues that stayed roughly the same, even a $400,000+ reduction in operating expenses wasn’t enough to save the quarter, in which the company generated a $1.28 million operating loss.
Wizard World booked a $517,173 net profit for the quarter due to a non-cash $1.9 million increase in fair value of derivatives the company carries on its balance sheet. That doesn’t help cash flow, though, as the company burned through $879,000 in cash during the quarter.
A late-year financing transaction in 2016 (See “Wizard World Cuts Operating Loss”) was enough to provide Wizard World Entertainment some short-term stability and allow it to continue pursuing its planned 16-convention schedule in 2017—the same number of events as last year, but scaled back from the 25 events the company hosted in 2015.
Despite this, the company said it will continue to analyze and evaluate new markets for possible expansion.