Live Nation Entertainment, Inc. (LYV) Earnings Call Transcript & Summary

All right. Thank you, everyone, for taking the time to join us today. For those of you who don't know me, my name is Stephen Laszczyk. I'm the lead analyst for the music, sports and live events sector here at Goldman Sachs. We are very excited to welcome back to Communacopia this year, Joe Berchtold, President and CFO of Live Nation. Joe, thanks for joining us today.

Thanks for having me, Stephen. I'm sorry, we couldn't be there in person, but hopefully next year.

Hopefully next year. All right. Great.

So starting off with -- just from last week -- last Monday, Live Nation announced that it plans to take a 51% stake in OCESA, Latin America's largest concert promoter and the owner of Ticketmaster Mexico for $450 million. It's a deal, I know, you guys have been going after for a while now. So I was maybe hoping we could start off. And if you could talk about, maybe first, what attracted you to OCESA? And then, looking ahead, what do you see as some of the biggest opportunities of combining these 2 companies together?

Absolutely. They're an at-scale #3 promoter in the world, beachhead into Mexico, into Latin America, provide additional Latin music, which is red hot, into the US., brings our 1 joint venture we have with Ticketmaster and the integrated back into the fall family, all at an accretive -- highly accretive price with substantial opportunity to then accelerate their growth by bringing all of the scale and capabilities of Live Nation to bear. So throughout it all -- through all the pieces, I think it's a fantastic opportunity. The other component of this is, along with being a scale, they've got a great management team. So this is a very well-run mini Live Nation of Mexico that we're excited about partnering with long-term relationship with them going back. Going forward, we'll continue to see. We'll continue to own 49%. We've worked very well with them historically and think there is an opportunity to add tremendous value going forward with it. And really when you look at the pieces, it's across the board. So first of all, we're now fully motivated to bring our full concerts pipeline to bear to just expand the volume of international apps that are coming into Mexico and expand within Mexico where they're going. We'll apply the same hyperlocal strategy of Mexico we've been implying in the U.S. and Western Europe. So it's not just Mexico City. There are a number of markets that we can go to with a lot of these international acts. And then from there, that's the first step and you can start to be able to build out your full Latin America leg because you now have a handful of shows in Mexico. You're not just doing a fly in and out of Mexico City. Ticketmaster, as I said, we've been in partnership with them. We've owned a piece of it. They've owned a piece of it. But as a result, it hasn't really been fully integrated. And as we've consolidated our Ticketmaster on a global basis last year, this was the last major piece that now we can bring in together. And the opportunities there as we continue to improve Ticketmaster's platform, the conversion, reduced customer acquisition costs, increase the upsells and how we're monetizing the fans through their entire experience in Ticketmaster, the improvement of the tools that we provide for the Ticketmaster clients, all big opportunities to continue to grow that business in Mexico and then again into Latin America. And then our sponsorships are. A lot of our sponsors are global companies and are excited about the opportunity to have continued additional reach in New Mexico. And we'll be bringing that team's skills to bear as well.

It's a great overview. You mentioned OCESA has been a beachhead into South America for Live Nation. Could you maybe expand on that a little bit more? How does OCESA fit into your broader international expansion strategy? Investors expect you to be more accretive or more active on the M&A front in Latin America going forward?

Well, we've been active on the M&A front. We have Rock in Rio is now part of our family. We have operations in Brazil and Argentina and other markets. So we're active. We've been active through our Lollapalooza, where we do a number of Lollapaloozas through Electric Daisy. So we've been active, and we will absolutely continue to be active. We've talked now for probably 3 or 4 years that we saw Latin America as the most untapped global opportunity for our business. We look at ourselves as fully global in terms of what our addressable market is. We have over 40 markets that we're operating in now. And we've got a great business and that we don't have -- there are no real barriers to us going into new countries. There aren't big regulatory barriers, there aren't big capital barriers. We're able to come in, find a local partner, often acquire them, use the flywheel, all the pieces that I just talked about with OCESA and drive growth. So now with OCESA, the part is, what I talked about, which is we're now going to be able to have a baseload of shows that we can do in Mexico. That opens up, makes it much easier to think about how do you do a full tour in the Latin America? And how do you tie that in also the increasing number of festivals we have. We've got 20 festivals that we're getting with OCESA, so we've got a large number there. And then, as I said, we've got Rock in Rio, the Lollapalooza is in Latin America, the Electric Daisy. So we've got that combination of your festival baseline and then now scale that we can be bringing it into Latin America. And again, we'll continue. So we'll continue to be acquisitive. We'll continue to look at Latin America. And it's all grounded on our belief that we've got the best business model in the industry that we can compete in any place that we can get a foothold. So this is now a big -- more than a fold, it's a beachhead, and we'll continue to establish additional footholds and bring the full flywheel effect to bear as we go into each of those markets. What does the time line look like for a lot of this? Just to start, what is the regulatory process down there look like at this point? When do you expect their deal to close? And then to bring on some of these value-added services and integration aspects down to South America? Is it a 2022 story, 2023, longer. So on a regulatory basis, the regulators have approved the deal previously and then we put it on pause because of COVID. So they'll need to relook at it. Nothing has changed fundamentally. So we don't expect it to be a long process. We expect the deal to close late this year to early next year, but don't foresee any major issues. I think that will coincide well with how it is. We're starting to plan for looking at 2022 in Mexico. They're starting to get back, right? They're a bit behind the U.S. in terms of vaccinated rate. They've got about -- think about 50% was the latest numbers I saw with at least the one vaccine. Their numbers are dramatically improved. Cases have dropped 40% over the past point and a half. So they're at a point where they're starting to gather, not ours, not in the deal, but they have an F1 that is going on next month there. There are festivals, including some of ours being planned for the first quarter. So my expectation is, what we will see with them is in '22 is a ramp-up that starts with the festivals because those have the easiest lead time, if you will, because we're planning on and we'll hold the festivals. The artists can come down for that event. And then the tours will follow that. We've got probably 15 international artists in our pipeline right now for 2022 activity in Mexico. Some will drop out, some will get added. But we've got material activity that is now getting planned for 2022 in Mexico. Most of that is probably going to be the second half just from a timing standpoint, right? On our major tours, those are generally -- these 6, often 9 months lead time, when we're in late September. So that just tells you the things that are getting planned now are more likely to be in the second half than the first half.

Makes sense. And maybe if you could expand on that [Audio Gap] more broadly, especially on a global basis, you returned to hosting live events at scale in the U.S. and U.K. this summer. I think we have stadium tours coming back in more force next year in the US and the U.K. What about the reopening time line for the rest of the world? I think markets on really 3 through 5, 6, 7 for you? When do we expect that activity to come back?

Yes. And just to start with the U.S. and the UK, because I think it's worth noting, that has come back even stronger than we've expected. We said it at our earnings [indiscernible] August through October, so we're 2 months out of the 3, right? Because we really got -- mainly got fully rolling by the beginning of August. And we said we were going to focus on outdoor. So if you look at our amphitheater volume, our stadium volume, our festival volume, each of those -- we're expecting to be higher in 2021 than it was for those 3 months in 2019. So I mean -- so that's a huge statement on -- there is now -- we are -- there is back at scale driven by the U.S. and the U.K. and we've had about a 2% cancellation rate of our ships. We've had a low cancellation rate, I believe, because we waited until the timing was right in each market because we've had the strong protocols with our standard of vaccinated or tested to get in. So everybody that's been doing the research from the city officials in Chicago for Lollapalooza, the U.K. has had a very rigorous system of tracking outbreaks to even most -- more recently in BottleRock and API, right? All consistently said there's no discernible spike in cases with these events that are being held outdoor and with these protocols. So that has come back very strongly. And that's given us a lot of confidence now to be continuing to plan as we move forward. So we're expecting most of these markets to have a very strong '22. We're certainly booking Western Europe, U.K., U.S., Canada to have very strong 2022s. We talked again on the last earnings call about the pipeline being up double-digits. I think the expectation is probably a lot of Asia is going to be more a second half, in part because the USX are focusing first on being out in the U.S. and the European acts are getting out first in Europe. And so before they're traveling, they're working their home markets. They're getting a little more time before they go down to Europe. You've got the -- we said, before they go down to Asia, you have the flip time line there anyway. So you'd expect later in the year to be strong there. But everybody is now planning with the expectation of a big '22.

And you mentioned, your guidance or your statement for up double digits and show counts relative to 2019 levels in 2022. I was curious at this point, is it possible to add more supply into 2022 and 2023? Or are the venues sort of at capacity? Have we reached all of the Saturday nights at this point are filled? Where can supply go from here, I guess, is just the question.

There's a lot of opportunity for supply to continue to grow. It's -- at what pace can it grow and how big could '22 or maybe even '23 become. These are operational constraints. So they're not true supply and demand constraints. If you look at how we've grown the business over the past 10 years just using Live Nation, we went from 40 million fans to 100 million fans. So we were able to grow it. And there is the availability of the buildings. There are a lot of artists. There are a lot of global markets. So I don't think there's either a fundamental supplier demand. But there is going to be in the near term is just the practical operational limits on how many road trip that you have out there, who's trained and able to go out on the road. How many buses, I mean, tour buses do you have? What's the ability to execute? How many festivals can you have given you need the portable toilets? You need defense. You need the staging. So it's going to be some more short-term capacity supply chain-ish oriented limits, which we think obviously by the pipeline that we've discussed, we still think enables double-digit growth. But it's not -- it doesn't -- it's not fully scalable to any level you want because of those operational constraints in '22. Now so what we have '22 at this point, I'd say is, we have most of the major headliners in the pipeline, not all of them have been made public yet, but we have most of the majors. And then, it kind of goes down from there. There's still a lot of booking taking place at the amphitheaters. There's still a lot of more regional activity. So there continues to be booking for '22 for sure. But at the same time, we're talking to other artists who are saying, okay, now, I'm going to start focusing on '23. Even some who are saying and in my extended tour, I want '23 and '24. So we're seeing it now look -- we're now having the conversations over a multi-year run because of those operational issues.

So it seems like you have pretty great visibility into concert supply over the next several years. You've maybe seen these logistical issues over the short term. But I'm more curious, what about demand at this point? What gives you confidence that the market can absorb such a surge in supply over the next couple of years?

Well, first of all, history is the best predictor of the future. So we've done it historically. So we believe we can do it again. Secondly, I mean, most people don't go to concerts. Even at 100 million fans globally for us, it's 70%, 80% of the people in the US don't go to concerts. Of those who go to concerts, 70% or 80% go to 1 or 2 shows a year. So this is not that we're needing people to go from 4 lattes a week to 5 lattes a week, right. There is a lot of capacity. And then, we're -- which as I mentioned earlier and we've talked a lot over the past few years about our hyperlocal focus and the more local we can go, the more we can spread that demand. And that's clearly the case then when you add this sort of scale that we're adding in Latin America, that's a whole new set of markets with a whole new set of demand. So really across all of those directions, add to that you've got a structural shift and span at a very macro level from goods to experiences. So that would speak to the point about predilection, likelihood of attending events only goes off. All the surveys -- all the surveys that we've done have said, people place a high priority on getting out and attending live events even more so now coming out post-COVID. So we're not seeing anything that gives us any pause in terms of the ability to continue to drive going forward. The sort of double-digit we've average double-digit growth over the past 10 years. And we don't see a reason why we can't continue to add double-digit growth in our business.

I wanted to pivot a little bit within your concert segment and ask about the artist economics and how that will change coming out of COVID. I think you've proven that you offer artists a lot of value in terms of scale and time to market. And sort at the same time, we've learned that over the last year, there's a fair amount of risk in the live events business. I was curious, do you think anything else structurally changed over the long-term when you negotiate with the artists, perhaps greater risk sharing or a greater focus on profitability within your productions business? A: Well, I put aside the extreme situation of a COVID, right? Let's put that aside. In general, what I would say is, we're in the business of risk. I mean that is our business, right? Our fundamental concert promotion is, we're willing -- we believe we can price the risk. And we're willing to take that risk. Plus, we believe the artist is why people are showing up. It's clearly why people are showing up. And they deserve the vast, vast lion's share, almost all of the money, that gets generated by that show. So I don't think that's going to change. I think our focus has been and will continue to be how do we create secondary and tertiary profit streams off of our scale of concerts? How do we continue to make all of those pieces better and better so we can earn more money for our shareholders? And at the same time, we can continue to pay the artists more. We can pay them more than anybody else. We can keep them excited to go out on tour, to go to more markets, to have more than work with us, and drive our global share by being the preferred partner because the artist knows we're going to pay them well, treat them with respect and be totally transparent with them. And that's not going to change. But let's get in some -- maybe some of these other ways that you can generate revenue off of the fan relationship. I know you have a goal to drive on-site spending per fan and amphitheaters from $29 per fan per show in 2019. The $35 in the coming years. Could you talk about some of the opportunities you have out there to grow per cap spending and how do you plan to get from the $29 to $35?

Yes. And again, I'll just say that as we're continuing to get more data on our amphitheaters this year as well as all of our festivals as they fight off. And we have been continuing to drive double-digit growth. Certainly this year, we've seen very strong per cap activity of people that are there. So again, the fact that we've been able to do it and we think we have a road map gives us confidence we can continue to do it. On-site spending is first and foremost about eliminating friction. How do you reduce or eliminate friction so that people can more easily spend the money they want to spend. And then, it's how do you look at your different target audiences and ask what matters in reducing the friction for those people. So it's everything from parking and how do you get more out of parking. How do you further segment your audience who needs the regular parking versus the VIP versus the valet. How do you make it all easy. How do you make them pay for it. How do you extract that? And then, when they're on-site, how do you -- just anywhere you go, when you think you go to a concert that you see lines and you see hassle, all right. If we can eliminate, the merch is a great example. We've revamped our process approach in our amphitheaters to how we sell merchandise. It used to be the scrum, right? 20 people deep. Half the time, you don't go because you're afraid you're going to miss part of the show. Well, we've redone it. We've done more integrated in with the digital. You can order, you can pick up, its cashless. It's a lot faster. We've driven double-digit sales increases in our merchandise in our amphitheaters by eliminating that friction. And a lot of it is what I'll call the affordable luxuries. The experiences people want to have in affordable luxuries. So the more we've done in having premium alcohol. Premium alcohol has taken a large share for mainstream alcohol. Hard liquor, beer, wine because people like that luxury and they want to flex a little bit when they go out to the show with their friends or dates or whoever. So the more we can make that available in more locations, the more we can sell and the more that we'll continue to get that money, more VIP clubs. All -- it's a whole host of opportunities where again you just -- you work backwards. I'm a person coming in. How do I eliminate friction for each of those categories to spend their money? And again -- we're not reinventing the wheel. We're behind the big arenas that have been built lately in terms of how they've done it. So we've got a long runway just going and stealing their ideas and presenting them to our fans.

I want to turn to the Ticketmaster business. Ticketmaster continues to attract new clients. And you've added 11 million new net fee bearing tickets to the platform over this last year. Could you maybe go in a little bit deeper and maybe explain what's the driving force behind these ticket wins? Why are clients choosing Ticketmaster over others? And then, maybe looking out, where do you see the most opportunity going forward to win new ticketing business?

Yes. The number is now almost 14 million. So in the few months since we last talked about this, it's continued to grow and really perform well this year. I do believe and we've talked now for a few years about our focus on digital ticketing and the importance of continuing to invest in the ticketing technology which has a host of ramifications. We can talk about further and have talked about. I think that matters more today than a year ago. I think if you're a venue and you see what we have done in terms of -- okay, it's touchless, it's easy to manage my ticket, easy to transfer, easy to resell, I can add on other things to it. It's part of the overall experience that matters in today's world that I think that it further differentiates us. I don't think anybody else has been spending on anything near the scale in terms of just the products that we have. And that's borne a fruit this year. I think it'll continue to bear fruit as we continue to invest in the globalization of our ticketing platform as we've talked about, and we've got great penetration in the major buildings and major markets in the US with digital tickets. We've figured out how to get it working in a lot of the rest of the world where we needed to get it working. But it's got a ways to go to get it at real operational scale as opposed to figure out how to get it working because we need to be touchless right now. And as we do that, all of the pieces continue to fall in place. We'll get more better data that is important for our venues, sports, artists, so they know who's in the building and who are their fans, how can they do more with them, how can they reduce friction and extract more from them in their own ways and build those relationships. And it continues to have better tools for the venues and their -- and the content to price and manage all of their tickets and then all the things it does on the marketplace which are, again, generally just helping sell more tickets which is what ultimately matters to content.

Understood. And you mentioned some of the ramifications of digital ticketing and to the penetration curve as it ramps up here. I was curious in what [indiscernible] some of these more financial implications to show up in your P&L. Is it a 2022 story? Do you need a proof of concept? Does it mean [indiscernible] financial impact from the company?

Yes. To be clear, it's an enabler. It's not a standalone product, right? It's an enabler to our concert team to more effectively price and market their product. So you're not going to see it as a line item in our P&L. You're just going to see that we continue to sell more tickets and we continue to price them more effectively to the market to extract more and be able to pay the artist more and spin the flywheel where we've been more effective and we see per caps continue to grow. Because we're more effective and I can offer you the right set of low-friction products at the amphitheater that's different than somebody else. So you'll see it all flow in that manner. You'll see it flow through sponsorship because they'll become an increasing part of a lot of our major sponsorship deals that they want that direction, that connection with the fan at a new level. So you're not going to see it. It's going to be a ramp up. The ramp up is going to start next year for sure particularly as it relates to how it is we're using the data ourselves to market and have direct relationship with the fans. And then it'll build from there.

Got it. One of the other key growth areas for Ticketmaster has been on the secondary side of the market. Could you talk about your strategy to grow your secondary business both here in the US and abroad? And then maybe to expand on that a little, how does your strategy in secondary compare to some of your competitors out in the marketplace?

We never really wanted to -- I don't think we've ever talked about where we needed to go grow our secondary business because we want to have a big secondary. Secondary is an inefficiency in the system that exists because artists in particular still for social reasons want to price their product below its market value. So we created the integrated marketplace and we're the first by far to do that because we wanted fans to be able to have all of their choices in one location. And as long as the artist wants to make that decision, we support them. But then we want to make sure that we have people able to come to Ticketmaster and have a high quality safe experience. Now the evolution of secondary is very different in different markets. So in a lot of Europe, certainly in the UK, there is a lot of regulatory backlash against the notion of brokers making high profits. And you're starting to see more regulatory action. Our focus there has been more on a face value, fan to fan exchange because that's the direction the regulators and the public are pushing it. Different in the US which is more of a free market mindset and saying, no, we want people to be able to pay whatever they want and then brokers will be able to charge whatever they want. So it's different, different approaches. Our focus will continue to be we'd like the price of the ticket right at the first time. And we've seen large success in doing that with artists, particularly on the front of the house. You'll see more and more platinum tickets which is really a market-based pricing vehicle that we use for some of the best tickets. And we'll continue to work with the artists to figure out how do we best work -- walk that line. The balance between they need to make sure that their fans are comfortable, that ticket price is approachable. With our view and shared by a lot of artists that most of that money should go to the artist as opposed to be an inefficiency in the marketplace. But then, once that's said, then we'll use the scale of Ticketmaster. We'll use the marketing that we have to drive what we think is a reasonable share in secondary and stay very relevant game. Most of the other players, if you want to simplify, are in a search customer acquisition game. StubHub has done a fair bit to build some brand name. But I think that most of the people would still go to Google and put it in search and so people are buying search to have it be a more search-driven business. But some of the -- those players are now beginning to be public. There's more transparency and we're very comfortable with the scale of our business and its strategic positioning probably even more importantly, and whether it grows or shrinks because we're pricing it better at the on sale is not frankly the concern.

Understand. Moving over to your advertising and sponsorship business for a moment. On your second quarter call, you stated that contracted sponsorship was trending up double-digits from 2022 from where you were at this point in 2019 for 2020. Could you talk a little bit about what's driving the strength in sponsorship and what are you hearing from your partners as they try to position their brands coming out of the pandemic?

Well, brands want to reconnect with fans just as much as artists do and as much as the fans want to reconnect with artists and everybody else. So there is pent-up demand on the sponsorship side for sure that they want to get out there and re-engage as people are getting back to live experiences. I've heard that consistently from a lot of our major sponsors. And they're trying to figure out new and innovative ways to do it. And I think what we're going to see is a lot more on how do we think about what are the -- some of the creative ways that we can apply technology differently better in the process, whether it's in the ticket purchase process, whether it ties in with the digital ticket, whether it's the use of augmented reality when you're at a festival. There's a whole host of sponsors that are asking the question, how do we do this a bit differently? How can we use our brand to create value for the fan? This isn't about putting a banner out up. This is about doing something that creates real value either for our customer base who are attending the show or all fans so that they start to see the value that we can provide. And I think that's increasingly where it's going. And that's why we're seeing to add such great value because we have 100 million people. We have real scale now and 100 million people. And they say, well, we want to start to cut it. Who are the Hilton? Who are the Hilton? Important clients. So when you go to the amphitheater and it's a digital ticket and I can cross reference, you're a Hilton Diamond member. You get free entry of the VIP lounge or you're a Hilton Platinum, you get a free lunch. Right? They can start delivering real value to the fans. And all of that is in a totally new way that wasn't previously possible. And that's going to be a key driver to how it is for continuing to grow that sponsorship business at a double-digit pace.

You mentioned Hilton as one of your key brand partners. This past quarter, you also announced that you added some other key brand partners to the sponsorship platform including Allegiant Air, Adobe and I believe Clorox as well. What other verticals are needing large opportunities for Live Nation on the sponsorship side and what's your plan to tap into that white space?

Probably the biggest one is technology. And it's what I talked about before which is technology play -- we've had some technology partners Cisco, Salesforce, a handful of others. But I think that we're now seeing some technology players that are thinking more about how can we do things that help improve and change the concert experience. How can -- and so, it's our creativity plus their creativity against their product road map to think about what are those opportunities and how do you [indiscernible] such incredible assets. You've got so many of the largest festivals in the world. The Lollapaloozas, the Austin City Limits, the Bonnaroos, you've got incredible portfolio that's even bigger than when you go [indiscernible]. We're talking to all of our sponsors about that. But I think the big category that there continues to be a lot of growth for on that is in the technology side.

Okay. We have about 7 or 8 minutes here. I wanted to move over to leverage and capital allocation. Live Nation had $4.2 billion of net debt at the end of the second quarter or about 4.5 turns of net leverage. That's using you're 2019 AOI just for comparison purposes. Historically, you've operated the business a little bit that other 3 turns of leverage. With that as a backdrop, I'm curious how you're thinking about the capital structure today and the balance between deleveraging the balance sheet going forward and investing further in the business.

Yes. I think I look at it slightly differently. So if I take your consensus on our numbers for 2022 and I look at that relative to 2012, which is -- again, let's use history and how we've grown the business and how we performed [ in history ], it would say that we're about to turn higher on our debt in '22 than we were in '12. But it's ignoring the fact that our weighted average cost of debt has dropped by -- from a bit over $5 billion to a bit over $4 billion now. So if you look at what's our interest coverage, our interest coverage is actually up over a turn. So we're in a position as a business that even though in theory the debt is higher on the first metric, on a practical metric of how much of our cash do we need to be servicing the debt, it's down dramatically. Higher on the first metric on a practical metric of how much of our cash do we need to be servicing the debt, it's down dramatically. And maybe, you could argue it's somewhere in the middle, but the broader point is that, we're not in a situation where we feel constrained in our capital. We are a growth business. We will continue to be a growth business. If you look at us this year, we are -- in this second half, or in particular, we're continuing -- even putting OCESA aside, we're continuing to focus on doing some M&A work. We're continuing to focus on deploying revenue-generating topic. And we're continuing to make artist advances, which is effectively buying future shares. So all 3 of those are major investments that we're making this year to drive the future growth of the business. That's been our strategy, that'll continue to be our strategy. We'll continue to opportunistically be looking at our capital structure. There's nothing there that we feel constrains us from making [indiscernible] any opportunity out there.

And you mentioned the opportunities. Could you maybe speak a little bit more holistically about how you view the opportunities to invest back in your business? And maybe some return profiles or strategic capabilities for across the different assets that you could acquire, capabilities that you could acquire?

So the important point is, these investments are being made to drive attractive AOI cash-generating results, right? So we're not off spending a ton of money on things that aren't. So part of how we have succeeded in the past decade and how we expect to continue to succeed is by making investments that have strong returns. But then, you naturally de-lever as opposed to feel the need to de-lever, because you're not going to be able to grow and go beyond. In general, what we've done is -- or assesses the great case where the numbers are probably the most transparent is on the promotion side We tend to like to go in, acquire the number one promoter in the market who might have a building or 2, in this case 13 who might have a festival, in this case, 20. If you're going to look at the numbers, it's a highly accretive acquisition and then we turn on all the pieces of the flywheel from there and drive the profitability up. And we've given some examples over time. What we did in Germany and what we did in terms of our investment in Insomniac, we've given some of those very transparently over time in the level to which we have had extremely high returns on those acquisitions, because of what our flywheel can deliver. On the CapEx side, it tends to be more a mix of -- that's where Ticketmaster gets most of its money. We don't tend to do a lot of M&A in ticketing. We tend to invest in the product for all the reasons that I talked about. And now with the 14 million-ish new tickets already, I mean, you're seeing how that's bearing fruit on what the real returns on that sort of investment are or we're investing in our buildings. And the investment in our buildings is going up. And it's going up for a very simple reason. As we've gotten better and better at driving the monetization of the fan experience in a building, the R on your ROIC has grown. So if your invested capital requirements stay the same and your return has increased, that creates a huge set of new opportunities for you to go out and make investments that create shareholder value that you weren't able to previously make. So when you see us ramp that up, it's not for any dramatic reason other than that because we're able to. Because those opportunities exist. So we've reorganized now. We have our venue management company separated out from our talent touring organization because we want to focus on continuing to grow that operation, which we think will pay huge dividends for our shareholders.

And then, last question for me here. It seems like there is ample opportunities for Live Nation to execute against your foreseeable future. I was wondering if you could just narrow us in on maybe the top 2 or 3 priorities that investors should be really focused on and really judge your company by -- over the next year here as we come out of the pandemic and kind of return to what will be a new run rate, operating environment for your company?

Yes. Look, because we have a broad set of businesses, from concerts to ticketing, to sponsorship, they each have their own set of opportunities and priorities. So it's a little hard to force it down to 2 or 3 and I don't want to pick all of our thunder from, when we do our Liberty Investor Day. But it's getting back up to scale operationally for some of the supply chain reasons I talked about earlier. I'm incredibly proud of the teams that have done this. It hasn't been me operationally this summer. Again, point, I mean, just stop and think about that. August or September, more fans at its stadiums, festivals than 2019. We all topped 2019. It was a great year, right? So our teams in the midst of all of the various complexities have been able to pull that off. So now they need to pull that off in even more markets for the full year next year. That's the priority. I have every confidence in them. It's going to take their focus and we'll get that done. And then, it's just all pieces of the flywheel that we continue to talk about. It's continuing to grow our global market share in both concerts and ticketing. It is continuing to price the ticket right. It's drive the on-site per caps, extend the venue portfolio, get digital ticketing deployed as we really consolidate the full global Ticketmaster technology platform and take advantage of all the pieces that we can from that. Well, then having our sponsorship team work with more and more sponsors to play more and more fans together in ways where we can share in that value.

It's a great place to end. Thank you for your insights and for taking the time to join us today.

All right. Thank you, Stephen.

Have a nice day.

Thank you.