According to a May 16 report from Forbes, WWE head honcho Vince McMahon saw his net worth drop by over $340 million in a single day, as WWE stocks plummeted to historic new lows. Shares of WWE stock were down by 43 percent by the morning of May 16, before closing at 11.27. Talk about having a bad day at the office.
WWE shares went as high as $31 earlier this year, but they are now down to their lowest level in a long time. There are two key reasons why shares of WWE stock fell so drastically. First of all, the WWE's new deal with NBCUniversal didn't do much to impress investors. The WWE agreed on a deal with NBCU to keep Monday Night Raw at its usual three-hour Monday night block on the USA Network, and its "SmackDown" Friday night show on Syfy.
From the deal, the WWE is slated to receive $200 million, a $90 million increase over their previous television rights agreement. While that sounds like a substantial amount of money, investors were apparently hoping for more. Investors were looking for at least a 50 percent increase from prior broadcast agreements with NBCU.
The other reason why WWE shares are down is the fact that subscription totals for the new WWE Network are not where they need to be to make the network a success. The WWE needs at least 1.3 million subscribers to make the network work, as far as making up for profits lost by putting pay-per-view events on the WWE Network.
At present time, the WWE has gained just over 670,000 subscribers to the WWE Network. Even if the WWE hits the one-million subscriber mark by the end of 2014, they would still be operating at a loss as far as profits go. Since May 15, McMahon has lost nearly a third of his overall fortune, to the tune of $357 million.
Sure he still has hundreds of millions still in the bank, but its certainly a significant loss for him. WWE stocks went up dramatically during the first quarter of the year, but fell by over 20 percent following Wrestlemania 30. In all likelihood, shares of WWE stock will go up again once WWE Network numbers start picking up.