WWE recently released a number of stars including people like Kurt Angle and Rusev and the reason given for the move was budget cuts due to coronavirus outbreak.
However, reports have since revealed that the company didn’t really need to release the stars amid the pandemic and they could have paid their salaries with ease.
Both Vince McMahon and WWE CFO Frank Riddick took part in the earning calls for Q1 2020 recently and when asked about the cuts, Riddick said the following:
“Overall, we are concerned about the uncertainty and the impacts of additional government regulations and changes in societal behavior around COVID, and how long it will last. Since we don’t know that, we felt like we needed to be maybe overly cautious, or overly conservative, to try to make sure that we had adequate financial resources to adapt the business however it needed to be adapted.”
The WWE Executive went on to describe their reasoning some more and said that while they don’t see any huge use of cash right now, they also don’t know what the market is going to look like in coming times:
“We don’t see anything right now that would result in a huge use of cash, but we don’t know what the market’s gonna look like, or performance is gonna look like in the next few quarters, because we don’t know what the impact of COVID’s gonna be. As soon as we know that, we’ll have a better idea of how to model it, so we’ve been very cautious.”
The Boss Vince McMahon then joined in and made a comment saying that they are just making sure that they are being conservative and maybe even overly cautious:
“And the old expression of cash is king. We have no debt. We’re not looking to buy some crazy something. We’re just making certain, that we are being conservative, and maybe overly cautious.”
