November 7, 2024

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TNT Sports is going through turbulence as it fights to retain NBA rights that the league granted to Amazon. But for the time being, the company remains a crucial part of parent company Warner Bros. Discovery’s portfolio. We examine WBD’s strong quarterly earnings report and what could happen next.

— David Rumsey [[link removed]] and Colin Salao [[link removed]]

TNT Sports Fuels WBD’s Surge As Max Hits 110.5M Subscribers [[link removed]]

Kirby Lee-Imagn Images

TNT Sports parent company Warner Bros. Discovery saw its stock price rise early Thursday after reporting its best quarter of streaming growth since the launch of Max in May 2023.

The total number of Max subscribers grew by 7.2 million to 110.5 million globally by the end of September. Specific U.S. subscriber numbers were not reported.

As NBC does with Peacock and Disney does with ESPN+, more TNT Sports game broadcasts have been simulcasting on Max in the U.S. Eventually, WBD plans to charge $9.99 per month for the B/R Sports on Max tier, but so far it has made all of its content free: NBA, NHL, MLB, March Madness, and more.

On Thursday’s earnings call, WBD CEO David Zaslav touted a recent partnership that made Max free to Charter’s Spectrum TV customers and a separate bundle that brings Max together with Disney+ and Hulu. He didn’t address Venu Sports, the stalled joint sports streaming venture with Disney and Fox, but did call for more consolidation.

“Consumers put on a TV set and they see 16 apps,” Zaslav said. “And each of those are doing different pricing and you’re seeing it with your phone and Googling where a show is or where a sport is and you’re going from one to another and there’s so many that you have. … It’s not sustainable. And there probably should have been more meaningful consolidation … and you’re starting to see it now.”

Outside the U.S., WBD has some global-media rights for the Olympics, and it said the 2024 Paris Games generated more than 215 million cumulative views across WBD platforms, a 23% increase from the Tokyo Olympics in 2021.

During Q3, WBD still felt the negative impact of selling off its AT&T SportsNet regional sports channels last year. That exit hurt the growth rate of the company’s networks segment by roughly 2%, with revenue there still growing to just more than $5 billion.

In December, TNT Sports will add two College Football Playoff broadcasts, and then in 2025 NASCAR (races, practices, and qualifying) and the French Open to its U.S. portfolio, which will lose the NBA after this season.

After taking a huge initial stock hit following its previous Q2 earnings report [[link removed]] in August, WBD was trending up Thursday, reaching a high point of $9.78 per share midway through the morning, following a closing price of $8.38 on Wednesday.

ESPN Bet at Critical Point As Penn Reports Quarterly Earnings [[link removed]]

Austin American-Statesman

Penn Entertainment met expectations in the third quarter—but the next few months are a critical period for the success of its sports betting partnership with ESPN.

The company reported Q3 2024 revenues of $1.64 billion, about a 1.2% increase from the same period in 2023, and nearly in line with Wall Street’s $1.66 billion projection. The company’s stock was up 5.15% at the closing bell Thursday.

Penn’s interactive segment, driven by ESPN Bet, recorded $244.6 million in revenues, up 24.6% compared to the same period last year, but also nearly doubled its EBITDAR loss in the segment to $90.9 million.

Revenue growth was driven by the sportsbook’s growing user base. Penn reported 3.9 million digital users, an 85% increase in the last year, and a No. 3 ranking among all sportsbooks in weekly active users, behind the two sports betting giants, FanDuel and DraftKings. ESPN Bet also launched in New York in September, the company’s 19th state.

“Prior to the start of football season, we released several product enhancements and ESPN integrations to our ESPN Bet offering. These product improvements helped contribute to a higher parlay mix and sportsbook hold during the third quarter,” Penn CEO Jay Snowden said.

The sportsbook, which launched last November following a 10-year, $2 billion partnership with ESPN [[link removed]], is entering its first full NFL season with the media giant, and its performance during the football season will be indicative of its medium- to long-term growth, according to a report by the Jefferies Group.

“This fall is really the key period to really assess where we are, how we’re doing, where we sit in the market,” ESPN VP for sports product and technology Brian Marshall told Front Office Sports in August.

As of an October update from an Eilers & Krejcik Gaming report, ESPN had only secured 2.5% of the gross gaming revenue share of online sports betting from June to August, sixth among sportsbooks. The sportsbook’s GGR fell to 1.5% in September.

Penn and ESPN Bet are hoping that further integration with the broader ESPN ecosystem of digital products will fuel growth through Year 2. ESPN and ESPN Bet account linking launched Oct. 30, which allows a more streamlined process for sports betting straight from the ESPN app. Penn cited more product enhancements coming in the next two quarters, including branded bets and upgraded options to bet while streaming live games.

POWERED BY ESPN EDGE INNOVATION CONFERENCE

Pushing the Limits of Cutting-Edge Innovation

The fourth annual ESPN Edge Innovation Conference is set for Nov. 14 and will be hosted by Tony Reali, host of Around the Horn.

Highlighting the work coming out of the ESPN Edge Innovation Center and ESPN at large, our event brings together accomplished leaders across sports, technology, and business for impactful conversations focused on strategic ways to champion innovation and push the boundaries of sports storytelling with cutting-edge technology.

Tune in virtually on Nov. 14 from 4 to 6:30 p.m. ET at [[link removed]] and engage with us on social using #ESPNEDGE.

ONE BIG FIG Big Number for the Big Ten

The Columbus Dispatch

9.94 million

The number of viewers for Ohio State’s 20–13 win over Penn State on Big Noon Saturday, topping the Sept. 7 game between Texas and Michigan as Fox Sports’ most-watched college football game of the 2024 season.

The Buckeyes’ win is also the fifth-most-watched college football game of the season [[link removed]] across all conferences, with Georgia’s win over Texas on Oct. 19 leading the way with 13.2 million on SEC on ABC.

AWARD

By popular demand, the Best Employers in Sports [[link removed]] survey deadline has been extended!

This award recognizes organizations that do right by their employees. Take the free employee survey [[link removed]] by Nov. 13 for a chance to recognize your company as one of the best in the business.

STATUS REPORT Two Up, One Down, One Push

Akron Beacon Journal

Deshaun Watson ⬇ Browns GM Andrew Berry wouldn’t confirm [[link removed]] that the injured quarterback would remain with the team in 2025 and beyond when speaking with reporters Wednesday. Berry said that the priority for Watson, who Cleveland still owes more than $200 million, is to rehab his torn Achilles. “Everything else, we’ll deal with at a later moment.”

March Madness expansion ⬆ NCAA president Charlie Baker said the men’s and women’s basketball tournaments could see some “modest” growth [[link removed]] beyond their 68-team formats in the near future. “We’re working on it,” Baker told Hoops HQ.

Air Force and UNLV ⬆ The schools are receiving an additional $6.8 million each [[link removed]] to stay in the Mountain West Conference, according to The Athletic.

Traded NFL players ⬆⬇ Five players were traded from a team that hasn’t had its bye week to a team that already had its bye week—and therefore could go through the whole 18-week regular season without a week off, according to ProFootballTalk [[link removed]].

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