Netflix has invested $5 billion USD to secure the rights of the WWE starting in 2025 for 10 years. WWE Raw will be exclusively streamed on Netflix. Outside the US, Netflix will also exclusively telecast all WWE shows and specials, including SmackDown, as well as pay-per-view live events such as WrestleMania and Royal Rumble.
In Canada, Rogers Sportsnet is the main home for WWE programming including WWE network. The WWE network outside of the US is also shutting down with all programming shifting to Netflix.
After the first five years have passed, Netflix has an option to opt out of the deal early, or can extend it by another decade.
The announcement finalizes the fates of all three of WWE’s weekly series in the U.S.—SmackDown is heading to the USA Network in October 2024, and NXT will make its CW debut the same month—and comes on the heels of rumors from earlier this January that both Amazon and Warner Bros. USA currently airs Raw in the U.S. and the contract expires in September. Currently there is no word on what will happen to Raw for October through to December 31.
TKO shares spiked more than 15% following the news and a separate announcement that actor and former wrestling superstar Dwayne Johnson would join its board of directors. Netflix shares rose about 1%, ahead of the company’s fourth-quarter earnings report after the bell Tuesday.
Dwayne “The Rock” Johnson will be receiving a substantial compensation package as part of his appointment to the TKO Group Holdings Board of Directors. This compensation includes $30 million worth of TKO stock, which is in part payment for his role in promoting the WWE brand.
SEC filing related to Johnson’s appointment reads as followed:
On January 22, 2024 (the “Effective Date”), TKO and World Wrestling Entertainment, LLC (“WWE”), a wholly owned subsidiary of TKO, entered into an IP Assignment Agreement with certain affiliates of Mr. Johnson, pursuant to which WWE assigned to Mr. Johnson (via one of his affiliates) “The Rock” trademark and certain related trademarks, service marks, ring names, taglines and other intellectual property assets (the “Assigned IP”).
On the Effective Date, WWE also entered into an Independent Services Contractor and Merchandising Agreement with Mr. Johnson and certain of his affiliates (the “Services Agreement”), pursuant to which Mr. Johnson agreed to provide to WWE certain promotional and other services. Under the terms of the Services Agreement, Mr. Johnson further agreed to license the Assigned IP and Mr. Johnson’s name, likeness and certain other intellectual property rights to WWE for use in connection with certain categories of licensed products related to professional wrestling for up to 10 years, subject to certain earlier termination rights.
As consideration for Mr. Johnson’s services pursuant to the Services Agreement, and in respect of the intellectual property grants and licenses made by Mr. Johnson and his affiliates in connection therewith, Mr. Johnson is entitled to receive an award of restricted stock units in respect of TKO’s Class A common stock, par value $0.00001 per share (“Class A common stock”), in an amount equal to $30,000,007 based on a 30-day average of the daily volume-weighted average sales price per share of the Company’s common stock on the New York Stock Exchange, as such daily volume-weighted average sales price per share is reported by Bloomberg L.P. (the “Equity Award”). Subject to certain forfeiture and acceleration events, the Equity Award will vest as follows: 25% on the Effective Date; 25% upon completion of certain services described in the Services Agreement; 25% on December 31, 2024; and the remaining 25% in equal monthly installments from January 31, 2025 through December 31, 2025.
Prior to the Effective Date, Mr. Johnson received annual royalties from WWE in connection with his appearances in WWE-produced content, merchandise, and other services performed for WWE. For the year ended December 31, 2023, Mr. Johnson received royalties in an aggregate amount of approximately $491,000. Following the Effective Date, Mr. Johnson will continue to receive such annual royalties from WWE and will be entitled to receive royalties in connection with the sale of licensed products that utilize the Assigned IP and his name, likeness and other intellectual property rights in accordance with the Services Agreement.
Other than the Amended Governance Agreement and WWE’s and Endeavor’s director designation rights therein, there are no arrangements or understandings between either Mr. Johnson or Mr. Keywell and any other person pursuant to which such person was appointed as a director to the TKO Board.
TKO Group Holdings is the parent company of WWE and UFC.
