TKO Makes First Big Move After WWE-UFC Merger

The newly formed TKO Group Holdings confirmed initial projections by making its first big move following the landmark, $21.4 billion UFC-WWE merger. But Wall Street immediately made it clear that it’s still not happy.

Just nine days after WWE president Nick Khan said the company was “pretty deep” in its rights negotiation process for Raw and SmackDown and predicted a sizable rights increase, NBC completed a new five-year, $1.4 billion pact for the U.S. rights to SmackDown. 

The deal, which is focused on broadcasting the shows on its USA Network, is roughly 40% higher on an annual basis than Fox’s existing deal for those rights. The agreement even includes plans to produce four primetime specials annually that will air on NBC beginning in the 2024-25 season, giving WWE a major broadcast network showcase.

The network particularly lauded WWE, “which has helped cement USA Network’s consistent position as the top-rated cable entertainment network in live viewership.”

But even that business success was no match for the lofty expectations of TKO investors wanting an even-bigger rights fee bump and Thursday’s overall down market. Company shares closed down 15% on the New York Stock Exchange at $85.97 per share.

Also influencing the TKO stock selloff is a separate, one-time cash dividend of $3.86 per share for TKO. Those who sold shares of TKO on Thursday will still get that dividend, but not after.