World Wrestling Entertainment will slash 7 percent of its workforce after reporting operating at a loss in the second quarter due to the costs of ramping up its online-subscription service.
WWE reported a net loss of $14.5 million, compared to a net profit of $5.2 million last year. "The staff cuts, and other cost-cutting moves, would help boost operating income before depreciation and amortization by $30 million in 2015," WWE said, adding that the cuts would affect 50-60 staffers across all business units.
The WWE Network launched in February, making WWE the first entertainment company with a cable presence to offer a stand-alone online subscription service. Yesterday, WWE reported 33,000 WWE Network subscribers since April for a total of 700,000 subscribers—still 300,000 short of its year-end goal of 1 million. According to The Wall Street Journal, the company "noted that 1.3 million to 1.4 million subscribers would put it past a break-even point offsetting difficulties in pay-per-view."
To increase interest, WWE will add new payment options (the service was originally available only as a six-month subscription), including a commitment-free $19.99 monthly plan.
"For us the payment options are one way to continue learning, to see how people approach it," George Barrios, WWE's chief strategy and financial officer, told The Wall Street Journal. "The fact that we've gone from 0 to 700,000 paying subscribers, I feel really proud."