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

Okay. So thanks, everyone, for joining us this afternoon. So really excited to be here, up here with Joe Berchtold, who is the President and CFO of Live Nation. Joe, thanks for joining us.

Thank you.

Joe, maybe to start off, this is the first conference we've had, at least this conference in person, in a while, so we'll start with a COVID question in a little bit. COVID restrictions are lifting globally for the most part. Concerts seem to be one of the top priorities for consumer discretionary spend. Can you walk through what you're currently seeing, where we are in the recovery and what the demand pipeline looks like from the consumer end?

Yes. As you said, I mean, this is one of the highest priorities for people coming out of COVID, I think, because concerts are inherently social. And we've seen that people want to get out, they want to interact, they want to socialize, and concerts are an event. They are more than just going out to dinner or something with their friends. They are a great way to reconnect, to get out and really feel alive. So the demand has been there incredibly strong. I know we'll get into the numbers, but our pipeline of tickets sold, we've sold over 50 million tickets for shows -- concerts this year now, up from 45 or so a few weeks ago. So we're seeing people buy tickets. This is going to be a banner year for everything, from stadiums, to amphitheaters, arenas. Festivals are on fire. People really want that great experience of the festival. So we're seeing that strong demand. We're seeing it globally. Europe is absolutely coming back strong now. We'll really -- we'll ramp up over the second quarter, really get to it this summer with the festival season and the outdoor season there. We're not seeing anything that is anything but fully back. I think one of the pieces that was getting some press, that was always exaggerated on a good day, but -- is are people coming. They buy the tickets, but, oh, they're not coming. No, they are coming. Our -- and if you look at arenas, which is probably, to me, the best indicator because it's the largest indoor experience, we're -- the same percentage of people who buy tickets are showing up today as were showing up in 2019. So whatever little dip we had at various points with COVID, that -- we're past that. So they're coming. And then you've seen numbers from everyone. We make -- when fans are coming, they're spending money, whether it's Disneyland or the movie chains or anywhere else, us, last summer, people are absolutely spending money when they come. So every piece of the demand dynamic has been strong over the past few months.

That's great. And how is the macro environment and the Russia, Ukraine conflict impacted the business, if at all? How is it affecting the path to full reopening in light of your previously stated view that 70%, 80% of your markets have reopened by the summer?

Yes. We don't really do shows in Russia. We haven't for a while. That's been too complicated on a number of fronts. We are very big in the U.K., big in Western Europe. We do some things in Eastern Europe. We tend to do the more Western part of Eastern Europe. So this is not having a direct impact. We're obviously having some transitory issues in terms of some commodity pricing. I think the good news is at least all the futures on the commodity pricing are now showing a downward trend. So that looks like it should be short-lived. I think it's -- we tend to have a big click-driven headline on the news cycle, so things are bimodal. But you talk about energy prices. The statistics I saw is energy is as good as 2.5% of disposable income. So when you have a 5% increase in energy costs, that's a 0.2% or 0.3% impact on discretionary spending. So you just -- again, you keep things in context. Again, we'll get more into pricing and all of that. But as you start to talk about a period that's probably has some level of wage-driven inflation over a period of time, we're talking about 3% to 4% inflation. We're not talking about the 1980s, for those of us who were around in the '80s. And I remember my first mortgage that was less than 10%. That was an exciting day. So we're talking about a wage -- or an inflation level that is more of a lubrication in the system, I think, even at 3% to 4%, than something that's going to cause any major dislocations.

How have you handled the increase in labor costs and general inflation so far? And how much of the cost increases have you been able to pass on to the customer?

So the first, the good news is, is we've been -- we've had more pricing ability than price pressure because we've been able -- ticket pricing, we have a product that is still substantially underpriced relative to its intrinsic value. There's still $1 billion of arbitrage in the secondary that we're continuing to try to price out and move over to the artist. But we're doing that in steps. So we're able and we have continued to increase the price of the tickets to capture that value for the artist and have seen very little pushback in terms of that front, 20% of the house, where you have the real inelastic demand. That actually also gives the artist the flexibility to then price-down the back of the house to make sure it's being priced at a level that everybody can afford. With the on-site spending, again, we're not -- we've been able to continue to increase the spend levels. A lot of that is by working through and continuing to offer more variety, more products. We're seeing a continued shift towards premium products in terms of what people are buying. So people are deciding to spend. But I think even more -- and then from a cost side, again, I'll restate what I said at our investor conference, was if you take an amphitheater show as an example, an amphitheater show, about 6% of our costs are associated with labor. So a 5% increase in labor cost is about a 0.3% increase in your cost structure. So limited. I think the piece that we actually haven't talked about that is potentially even more important is the wage increases are accruing disproportionately to the bottom quartile of the population, right? They're getting, on a relative basis, the greatest increases. They've also been the biggest beneficiary over the past couple of years of the tremendous liquidity that's been pumped into the system by the government. So you've got -- if anything, we have always been -- or now, we've been talking for the past 15 years about the dumbbelling of the economy. And I think what's happened over the past couple of years and what's happening now with the wage inflation is you continue to have a lot accruing to your top or your wealthiest part of the population. That's great for us because we continue to extract from the front of the house. And you're actually seeing a leveling out of the dumbbell because you're getting a lot more of the wealth going to the bottom quartile disproportionately. That's very, very important for us because that gives money to a population that then wants to go out and go to concerts. So we're actually -- I expect to see a bigger benefit from some of that wage inflation that flows through on the demand side for us. And I expect that alone to be much greater than any issues we have in terms of our costs, let alone the pricing ability that we have that I started out with.

Interesting. So -- and maybe just to shift gears a little bit off of that. Where are we in terms of number of events versus 2019? I believe in your earnings call, you said show count pacings for the year were up 30% versus your full review on 2019 at the same time. Just maybe talk about that and your visibility you have.

This is going to be a big year. Numbers haven't changed dramatically. We -- I'm not going to try to update every 2 weeks our show count. But I think our macro point that we were trying to make when we had is we expect our fan base to be up double digits this year. So our show count is probably going to be up double digits as well in terms of our large buildings. We're off to a raging start because a lot of things just got put on-sale earlier. We didn't have the same -- there was no competition for on-sales in 2021 to the historical level you had, so you had more on-sale earlier. So we built up this great head of steam coming into the year. You're not -- we're not going to have 130 million fans at our shows this year, but we're going to deliver some very solid growth. As I said, we've already now sold over 50 million tickets. So we've already sold more than half of -- sitting here in mid-March, sold more than half of the total attendance that we had in 2019. So we're feeling great about it. U.S. fully back. As I said, Europe coming back Q2 in massive outdoor season. I think whether we were lucky or good, we ended up planning disproportionately into Q2, Q3 this year. We didn't plan a big Q1 because we didn't know what the -- in particular, in Europe, what a lot of the border restrictions were going to be, how some of the countries might be coming out at different points than other countries. So sitting here in September, we just -- we were unsure of that, so we figured better to wait and come out more in Q2 with that. We ended up that timing was right, so you'll see a lighter Q1. But don't read anything into that. It will be way more than made up for in Q2, Q3.

Okay. And can you talk maybe a little bit longer-term about how you're thinking about show count growth over the next few years and how that's going to remain a tailwind for the company?

Yes. It's great being in a business where you just -- you have kind of tailwind after tailwind. I certainly prefer that, the businesses that are shrinking or declining. I always start with the most macro, the most empirical, the shift of GDP spend from goods to experiences. So people want to spend the money on experiences. So our job is to bring that together. And then you have the globalization trends, all of these social media platforms the artists have embraced that make them truly global brands. It's a business that, again, when I was growing up, it was a major market business, and then it would trickle down into the smaller cities and into other countries. But now, we're truly global. So our job is to figure out how to bring supply to a lot of the latent demand that exists globally. Because everybody knows who Rihanna and Beyonce and Bad Bunny and Harry Styles are, and they're all waiting for these artists to come to them. So our focus on the artist side has been really regrouping during the pandemic to be even more holistic, more global in our working with the artist, so that we can have the conversations with any of these artists about let's talk about the next 3 years, let's talk about the 200 shows. And you start with the U.S. and then go to Europe and then back to the U.S. and then Asia or Latin America and think very holistically with them about how it is they go and they see as many fans as possible, do as many shows as possible. And you're doing 2 things simultaneously, which sound the opposite, but are the same, which is you're going truly global because you can, because of the social media platforms, and that's a big reason behind our OCESA acquisition, is adding Mexico, but then adding more of a gateway into Latin America and creating real Latin American legs to the tour. But then it's also going hyperlocal. Because, again, it wasn't -- you've heard about these artists as much in Oklahoma City or Peoria as you have in L.A. or New York now. So you want to go hyperlocal. And I know, I went to the Garth Brooks concert in San Diego last weekend. It was a 4-hour drive from L.A. to San Diego now. COVID's over. The roads are full. But -- so people generally aren't doing that. So you need to treat San Diego as a different market than L.A., and L.A. is a different market than Vegas. And it's different than San Francisco, and Portland and Seattle are different and they're different from Boise. And so when you start to figure out how many markets are there you could actually take a Harry Styles concert to, in the U.S. alone, it's -- you could do the 200 shows just by doing those major markets. So we will continue to grow the show count, working with more artists, working with them holistically, working through all the major markets and all of the midsized towns that exist. That gives you a massive runway to continue to grow the business. And it's fun because people want to do it. The demand is there and we're just helping make the market and enable the artist to be there, and then we'll benefit through our flywheel with all of the other components.

You mentioned, the way you look at it, you like to start with the empirical and how is the shift in GDP, so I guess, can you discuss the -- in the context of that, can you discuss the industry growth profile as a whole, how fast it's growing annually and what have been the major drivers of that growth?

Yes. The industry has grown historically at high single digits. I think, over the past -- again, I always skip the COVID years from my math. It's been more low double digits over the more recent years, I think, in good part because of this GDP shift from goods to experiences. Those numbers are mid-single digits each, from attendance growth and from pricing growth. We've managed to outgrow the industry in terms of our business by continuing to take share, by taking share, doing all the things that I was just talking about, building the holistic touring relationship with the artist, expanding globally, treating this as a truly global experience that is universal and by continuing to build our secondary and tertiary profit streams, that we can benefit from off of the growth of our core fan platform.

And can you talk about the $25 billion concert TAM that you see potentially growing to $40 billion, and how do you get there?

I mean you get there with what I talked about, which is the mix of both globalization and the hyperlocal. So the U.S. is probably 40-ish percent of that number today and I think probably stays around 40% of it even as you grow to $40 billion because there are just so many opportunities in the local markets. And you see, right now, every genre, from Latin, to pop, to country to dance music, everything is performing well. And I think if we have that continue, because we're delivering for the different audiences, that business continues to grow well. I think you have some real growth in Latin America. It's a very low single-digit part of the business today. I think it gets to be a high single-digit part of the business by the time we get to $40 billion because it -- well, because we're going to bring a lot of shows there. And that will help grow that market. You've got Asia, which is probably 15% to 20% of the market, Japan being the largest player there, obviously Korea growing rapidly with the K-Pop and really, frankly, contributing as much on an export basis as they have in Korea. Australia is a strong market, and the others will incrementally grow. And then Europe is sort of the piece in the middle, probably grows not quite as fast as the U.S., so it will grow as a market, but not as fast, so probably lose a little bit of share.

You talked about some of the particular geographies. But how large of an opportunity is international for you? Who are your biggest competitors? Yes, maybe start there.

Yes. International is a tremendous opportunity. As I just said, it's the majority of the market in the world, and it will be the majority of the growth for us. So there's no doubt about that. Sitting here 6 or 7 years ago, I would have said then, I think the majority of our growth is coming internationally. And I would have been dead wrong because I didn't have -- while we were starting this hyperlocal strategy, and it was a few markets, it was some Nashville, some Austins that we saw as being hot markets not fully appreciated. And as we dug into why, we understood the level of demand and the fact that our approach just wasn't fully capturing all those markets, so I would have been wrong because we've delivered the majority of our growth in the U.S. So I continue to believe the majority of the growth will come from new markets. Very excited about Mexico and Latin America, in particular, right now. So -- sorry, and what was the second half of your question?

Who are your biggest competitors?

Oh, biggest competitors. There are always competitors in life. And I think, for any of us, even if you don't have a real competitor, the people who are the buyers will make you feel like you have competitors and that you're competing against somebody. So I don't spend the time thinking about, well, who's my competitor today. AEG is a competitor on a global basis. CTS has some promotional activity. You've got regional, local people in every market, and it's the agent's job in this -- in our music ecosystem to always make you feel like you've got pressure and competition. That's okay. That doesn't worry me. Our job is to figure out how can we pay the artist more than anybody else. That's been our strategy for a long time. It continues to be our strategy. Our view is that because of the secondary and tertiary profit streams that we've created, we should be able to pay the artist more than anybody else. We're not -- we don't lose on that basis. And we just need to continue to figure out more ways we can make money and continue to pay them more. And that will excite them, motivate them to be out there more and be out there more with us.

You mentioned the OCESA acquisition. You closed that -- the largest promoter in LatAm, I think you closed in December. How big is that Latin America opportunity specifically? Maybe talk a little bit more about that.

Again, so $40 billion TAM. If it's high single digit, it could be somewhere between $3 billion and $4 billion business in the medium term for us. It's a tremendous opportunity. Just to start, it's easy to add Mexico to your North America tours. It's easy to go down, when you're in Texas, to go down, add some stops in Mexico. So we'll do that quickly. It's easy to work with them on their relationships for Latin music, bring those artists into the U.S. Latin is one of the fastest-growing, hottest markets in music right now. And so we're very excited about the ability to bring a lot more of that into the U.S. because of those relationships. And then as we start doing more planning, and over the next couple of years, you can then also begin more fully routing your Latin leg, where you do some combination of some Mexico, some Brazil, some other markets down there. So I think that -- I think it becomes a multiple of what it is today. And we're anchored because we've got Rock in Rio down there. We have other -- we have Lollapaloozas that we're in partnership down in Latin America. We've got some other festivals, I can never remember what we've announced, right? So we've got a nice infrastructure of festivals down there that we're established with. And those will be great vehicles to bring artists down and then set up tours around those festivals when they've already come down there for those events.

Okay. And can you talk about -- a little bit more about pacings for ticket sales? I think through mid-February, there were $45 million, up 45% from 2019. Just talk about the strength there and the visibility that you have going forward into ticket sales.

Yes. So it's over $50 million now. So it's continued to grow rapidly. I think we soon enter what we affectionately call the trough, right? If you look at ticket sales, it's -- you have a big burst upfront of the on-sale, which is committed fans that are willing to plan their lives around that, that BTS show that's coming up in 8 months, and nothing is going to change that, plus brokers. So you've got that big chunk of the on-sale. And then you sit in the trough, and then as you go over the last 2 to 3 weeks towards the concert, you then have the fans that realize it's coming up and have that date open and buy those tickets. So we're still -- I don't remember even the exact percentage, but we're still well ahead. I absolutely believe we're going to end up the year double digits ahead of where we ended up '19. And we're going to have a great year across all the different venue type. Stadiums, in particular, will disproportionately have a huge year this year as a lot of artists have come out with these large events, which have proven very popular. But really, it's going to be all venue types.

Okay. And it seems like event ticket prices increase year after year, whether it's concerts or sports. What kind of pricing power do you see going forward? I believe ticket prices in per caps are both pacing up double digits through February over '19. What are some of the ways that you can give more value to consumers and generate more dollars from a spend perspective?

Consumers are speaking that the value is there, and they're giving the money to the brokers on secondary. So in my mind, it's not -- or at least now with ticket pricing, it's not a debate around the value, the value exists. It's one of the few products that still has a large portion of it that appreciates the moment it's sold rather than depreciates. So the value is there. It's the artist, who is a brand manager, deciding how do I find that right balance in terms of the pricing that I give the fan and they're feeling that I'm not pricing them out of the market and be an elitist, with the reality that the scalpers are so sophisticated they're swooping in and giving them the tickets, and they're the ones making the money. The 16-year-old Olivia Rodrigo fan that wants to get the 10th row seat doesn't have a prayer at 10 a.m. on Saturday morning because the brokers have a room full of people that know the system, know Ticketmaster or whatever other system very well, and they've already bought their tickets and are back in for another go-round, while that 16-year-old, who's bought once on Ticketmaster, is still figuring out the seat map. So that's what they're balancing. And what we have found is we've worked with the artist to understand -- there's a term that we coined called platinum tickets, which somehow have the ability to have more pricing because they're perceived as an exception. And we take a certain number of the best seats and we price them as platinum tickets, which is market-based pricing, and that's what's driven a lot of the price increases. And again, we -- and we work with the artist and say we understand you want -- you don't want all your tickets this way, but let's take some of your best tickets, let's take some of your other best tickets and put them in your fan club. So -- and maybe you make them nontransferable. You can do some things. How do you make sure you really get those to your fans at a price, that -- but they're not going to be reselling them. The other ones get the value. And then by -- depending on what type of show you have, maybe we lower the pricing on the back of the house to make sure that everybody who wants to come and see the concert is going to be able to find an affordable ticket. So every artist is different in terms of what's that mix that makes sense. And they're all going to take steps. They're not going to leap to find that full $1 billion of value. They're all going to take steps as they go along the process and extract more. And that's what's led us to have this consistent pricing growth because we haven't tried to do anything that's going to make the artist uncomfortable in terms of how they manage their brands.

Why don't we shift gears to Live Nation venue for a few minutes. Can you talk about the strategy? You've gone from 167 venues in 2015 to 320 at the end of last year. How are you planning to grow the number of O&O venues? And what areas are you primarily focused on for growth?

Yes. We start with an ocean. We look at the concert, and we say we're not making a lot of money on the concert itself to start. And we know that, we've embraced that. We'll pay the artist more than anybody else. So the way we've developed our secondary and tertiary profit streams in the first place is we said where are there profit pools that are associated with the concert and where do we think we can be natural owners of those profit pools. And venues is an area that we were in by happenstance to some extent because we had our amphitheater portfolio going way back. And 7 or 8 years ago, and we've been talking about, we made the decision on the investment. We're going to focus much more on the on-site hospitality, the experience, try to move away from a state fair-quality experience and drive our average per fan revenue by creating a better experience. And we've taken it from $18 to $30-some, basically doubling that over the period because we've been focused on it. As a result, I think we've gone from not being a very good operator, to arguably being the best operator out there, in terms of our ability on a scaled basis to get fans in and provide them hospitality and get them to spend money. We have room to go, but I think that on a scaled basis, we're as good or better than anybody else. So on some level, it's simple math, which is when you look at a venue and you're going to operate it, which means I get to count the beer money, the parking money, the VIP offering, some of the service fee, I get a lot more of these pools. If your skills have increased, the return side of your equation for your return on invested capital goes way up. So you're creating more shareholder value in the buildings you operate because you're operating them better. Well, that means, probably, that you should be operating more of them because you're creating shareholder value in terms of how you're operating them. So that was our -- that's what's happened over the past 5 or 6 years, and we've done it quietly. And we've, as you said, built up -- basically doubled our portfolio over that period. And then what we do is we don't like to generally talk about things before we're ready to do them. During the pandemic, as we reorganized, we said, all right, now is the time, let's fully separate out the operational side of our business from the talent side of it, let's create our venue nation business, where we're housing the capability to run the venues. And now, let's increase our focus on how do we continue to operate more of them. And again, operating means a lot of things. I want to -- it doesn't mean we're going out and we're not building L.A. Lives, we're not building $1 billion, $2 billion NBA Arenas. We're not going capital-crazy. A lot of it is just operating, you're going in and you're putting in some capital to build the space out. Our amphitheater tends to be -- a lot of them are municipally owned. You get a very long-term sweetheart lease in exchange for putting in the capital to build out the amphitheater. In a few cases, you're doing things like what we're doing in the arena in Austin with Oak View, where we are together building an arena on the UT campus. And we're going to finance it separately on asset-backed financing and have something that we then operate and drive a lot of value by putting more shows in those buildings and by operating them more effectively than I think they otherwise would be. So it's -- we think we're a natural owner of venues in many circumstances because we can operate them better and because we can -- and because we can drive the show volume to them.

How are you financing the purchase and construction of the venues?

So in that instance, again, it's a -- this is a non -- the PropCo is a nonconsolidated entity that is an off-balance sheet, asset-backed financing. And the OpCo, which has the contract with PropCo, is we will consolidate and we'll have all that AOI that we're counting. Again, in most -- I always go back to -- this is not -- this isn't -- we're not going from not doing any of this, to doing a lot of it and having some big massive change. You just talked about the fact we increased from 150-something to 300, and nobody even noticed. So obviously, this is not something that is a mind-altering event in terms of our balance sheet. What we're doing is -- it generates a lot of AOI. And what we're doing is in the normal course of our business. We're getting more focused on it. We're going to hire more people that can help run it and can help execute it and can help grow it. I don't see it as being a massive change to the business.

Yes. Let me talk about Ticketmaster. What are the opportunities ahead for the business? You added 17 million primary tickets from new clients last year, most of them international. How did you manage such a large increase? And where do you think that goes from here?

It's a tremendous success story. Very few companies like Ticketmaster have been able to successfully reinvent themselves as I think they have over the past decade, moving from a pretty opaque business model, to a real technology business with a technology marketplace that serves fans and what's effectively an ERP system for the revenue side of venues and have done so successfully over the past decade. Our international is an area that we had a lot of growth last year in terms of signing new clients. I think because, in good part, we globalized our Ticketmaster organization. So it, like many global -- so-called global businesses, was actually a multi-region business. Your biggest region by far is usually the U.S., so that gets the resources, management, time and attention. And so you build your biggest-best products in your North American market, and your -- some of your other global markets don't get the same attention. So during the pandemic, we said -- we stopped, let's step back and figure out how do you optimize this business. Will you optimize it, if you were going to start it today, a truly global platform. So how do we take what we have in North America to truly globalize it. Let's start by taking an Australian who's worked in London for the past decade and is now going to move to the -- or has moved to the U.S., right? Let's get a global person because as much as we try, most of us that have worked our lives in the U.S. aren't great at thinking globally. And how do we globalize that product, we can deliver cheaper because we're now operating off of one platform. But probably, more importantly, is we truly leapfrogged the competition in terms of the capabilities that we have with that platform because we've taken the North America platform and extended it globally. So that's a huge story, to be able to walk in internationally. We have digital ticketing. We have a platform that is very effective at selling ads and serving sponsors. We have one that has great marketing tools, great pricing tools, if you're a venue, and that's resonated. And I expect that to continue to be a very strong growth opportunity for us as we continue to expand internationally and in a lot of cases, will follow the concert side where it goes internationally.

Okay. Why don't we shift to sponsorship. So in sponsorship, you grew from $334 million in 2015, to $590 million in 2019. How much do you see sponsorship revenue growing over time? What are the conversations with sponsors and advertisers been like recently? And do you have any major renewals coming up, maybe to within that?

Yes. The -- again, I always start with past behavior is the best predictor of future behavior, unless you see a shock to the system. So that's been a business that's grown in the teens pretty consistently for a sustained period. Growing in the teens because, again, you've got the underlying growth rate of the fans, you've got an increase in your venue portfolio, which is an important part for the sponsors in terms of them connecting with the fans. And you've got a very attractive platform. The more scale you have with the platform, the more attractive it is to sponsors. When we hit 100 million fans, 500 million tickets, those are scale levels that really matter to sponsors. So all those pieces have been helpful in terms of getting to the growth, going forward the growth. Our on-site platform is hugely differentiated. What are the opportunities -- how many opportunities are there for brands at scale globally to reach and connect with their customers and do so in a way that adds value. I mean -- and to be clear, when you're a sponsor and you're having a conversation now about how do I reach your fans, it's not to deliver a banner ad at an amphitheater or send you a text that says some generic information. It's how do you deliver value, what can you do in the system. If you're a Hilton, it's a great opportunity. When you show up at the amphitheater, if you're a Hilton Diamond member, you get the text that says use the VIP club on us. If you're a Blue member, you get a free lunch, right? So you can think about your pyramid of your customer base and how it is you retain, how it is you build those relationships. And we've got a great differentiated platform for doing that. And then Ticketmaster remains one of the largest still e-commerce platforms, the opportunities that it has for continuing to more effectively monetize that whole checkout experience, how to do better targeted advertising throughout the process, how to more effectively upsell, whether that upsell is on behalf of sponsors or on behalf of our concert business. How do you deliver value at checkout. Obviously, the fintech space, the crypto space is crazy. We get paid a lot of money for who gets to be where at our checkout, what are we taking, who are we advantaging. And those, as you can imagine, the bidding wars on those are only going through the roof right now, to speak nothing of the presales, right? One of the great values we have is the credit card presales historically. Well, now, it's not just the credit card companies, it's the mobile companies. And it's not just credit card, it's crypto, it's fintech. It's everybody is looking for how can I get access to tickets that are great currency, a great benefit that I can deliver to my customer base. So every aspect of that sponsorship opportunity is only larger now than it ever was before. To answer your question, every year, we have -- I think we'll end this year with probably 100 different sponsors that are spending over $1 million a year. So I don't know, 20 of them were up every -- this year, right? Every year, a number of them are coming up. But we're finding more demand. On almost every category, when we have a renewal, we're seeing more people, not just the incumbents, who are saying, "Hey, we would like the opportunity to bid and to shift this over to us." So we're seeing a lot more increased competition for a category as opposed to brands that are saying they've changed their priorities.

Yes. A lot of leverage driving that growth. Sounds like a lot of ability to really manage that.

Yes.

Interesting. And maybe just to wrap up, with the remaining 1.5 minutes we have here, you're targeting double-digit AOI growth at least through 2025. Can you talk about some of the operating efficiencies you've realized at Live Nation, over the course of the pandemic, particularly Ticketmaster and with one global team? And what are your plans going forward to continue on that front?

Yes. Again, if you'll indulge me, I mean, again, I'll just start macro, right? So growing TAM; growing revenue; continue to gather operating efficiencies; the $200 million of costs that we have talked about, taking it; each of our businesses, I think, still continuing to have structural tailwinds that we've talked about; starting with the concerts flywheel; continuing on with the spending, including the spending that's being driven by some of the wage inflation; the attractiveness of the sponsorship business; the globalization of the ticketing business and the benefit that accrues. We look and we see, we see this as a richer opportunity set than we've ever had. We think we've got an organization and management team that we've continued to renew, bringing in new talent that's better positioned to capture the opportunities than ever before. We have a track record of effective conversion of our revenue to AOI and of our AOI to free cash. And we'll continue to do that. We'll continue to invest that free cash in further growth because we see a very long runway of this opportunity continuing. We don't see this as a short-term play. We don't see end in the medium term, as I look out over the next 5 years. So that will continue to be our focus. And we expect we'll continue to grow every part of the business along the way.

Great. Well, that sounds like a good way -- a good place to stop there. So thanks, Joe. I really appreciate it.

All right. All right. Thanks, Bryan.

Thanks, everyone.