World Wrestling Entertainment, Inc. Reports 2006 Transition Period Results.

STAMFORD, Conn. -- World Wrestling Entertainment, Inc. (NYSE:WWE) today announced financial results for its eight month transition period ended December 31, 2006. Revenues totaled $262.9 million as compared to $247.7 million in the comparable prior year period. Operating income was $39.2 million as compared to $44.2 million in the prior year period. Net income was $31.6 million, or $0.44 per share, as compared to $29.8 million, or $0.43 per share, in the prior year period.

"Revenues increased 6%, despite the absence of nearly $14 million in domestic cable TV advertising. Growth was led by our live events, venue merchandise and home video businesses," stated Linda McMahon, Chief Executive Officer.

"We are excited about our two major events in April. WrestleMania[R] 23 airs live on Pay-Per-View on Sunday, April 1 from Ford Field in Detroit. Our third feature film, The Condemned[TM], starring fan favorite Stone Cold Steve Austin is scheduled for domestic release on April 27," continued Mrs. McMahon.

Comparability of Results

Based on our decision to change the financial reporting to a calendar year basis, we are reporting an eight month transition period from May 1, 2006 through December 31, 2006, which is referred to as the 2006 Transition Period. To facilitate comparison, in this press release we have presented operating results from the corresponding eight month prior year period, May 1, 2005 through December 31, 2005. Management feels this comparison is appropriate as operating activities within the two periods were consistent. The current period reflects the absence of all domestic cable advertising revenues under our arrangement with USA Network, which accounted for revenues of approximately $13.7 million in the prior year period. The prior year period also included approximately $3.4 million in positive legal settlements. Our effective tax rate of 31% in the current transition period was significantly lower than the 39% rate in the prior period, primarily due to increased tax-exempt income, increased tax benefits from domestic production activities and the favorable settlement of income tax examinations. We modified our business segment reporting to include four reportable segments in the fourth quarter of Fiscal 2006. Results from the prior year have been adjusted for comparability to the new segment reporting structure.

Results By Business Segment for the Eight Month Transition Period

The following chart reflects net revenues and profit contribution by segment for the eight month periods ended December 31, 2006 and December 31, 2005. (Dollars in millions)

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Live and Televised Entertainment

Revenues from our Live and Televised Entertainment businesses were
$183.0 million for the current period as compared to $181.6 million
in the prior year period.
-- Live Event revenues were $52.3 million as compared to $43.7 million
   in the prior year period, primarily due to an increase in North
   American average attendance.

                -- There were 246 events, including 34 international
                   events and 38 ECW(R) branded events, during the
                   current eight month period. There were 199 events,
                   including 25 international events, produced in the
                   prior year period.

                -- North American average attendance was approximately
                   4,900 in the current period as compared to 4,500 in
                   the prior year period. Excluding the ECW events,
                   our North American average attendance was 5,700 as
                   compared to 4,500 in the prior year. The ECW live
                   events generated approximately $1.1 million with an
                   average ticket price of approximately $25.00 and
                   average attendance of approximately 1,100.

-- Pay-Per-View revenues were $53.4 million as compared to $54.5
   million in the prior year period. There were eleven Pay-Per-View
   events produced in each period.
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                    -- Beginning in Q1 of the 2006 Transition Period,
                       the North American retail price of our
                       Pay-Per-View events was increased by $5.00 to
                       $39.95 in order to bring the price more in line
                       with similar events. This increase in price
                       partially offset the decline in the number of
                       buys reported in the current period.

                    -- International buys comprised approximately 39%
                       of total buys in the current period as compared
                       to 37% of total buys in the prior year period.

-- Venue Merchandise revenues were $12.1 million as compared to $8.4
   million in the eight month period last year, primarily reflecting
   the increase in North American attendance and an increase in per
   capita spending by our fans of approximately $0.70 to $10.90 in the
   current year period.

-- Television Rights Fees revenues were $58.7 million as compared to
   $54.7 million in the prior year. This increase is primarily due to
   the rights fees received from our ECW telecasts in the current
   year.

-- Television Advertising revenues were $4.5 million as compared to
   $19.8 million in the prior year period. This decline was due to our
   television distribution agreement with USA Network, which became
   effective in October 2005. Due to this change, we no longer
   participate in domestic television advertising sales. Advertising
   revenues in the current period include sales of advertising on our
   Canadian television programs.

Consumer Products

Revenues from our Consumer Products businesses were $59.2 million
versus $50.6 million in the prior year period, a 17% increase.

-- Home Video net revenues were $35.5 million as compared to $28.1
   million in the prior year period, reflecting a 55% increase in
   gross DVD units sold. This success was highlighted by the release
   of WrestleMania 22, which sold over 425,000 gross units in the
   transition period, representing the best selling title in our
   history.

-- Licensing revenues were $14.7 million as compared to $14.9 million
   in the prior year period, reflecting decreases in videogame and
   novelty related sales. The decline in videogame revenues primarily
   reflects the timing of new videogame releases. Revenue for the
   current period reflects no new titles as compared to two new
   videogames in the prior year period.

-- Magazine publishing net revenues were $8.5 million as compared to
   $7.3 million in the prior year period. In July 2006 we began
   publishing WWE(R) Magazine, which replaced our two former
   magazines, Raw(R) and SmackDown(R). The increase in revenues
   reflects higher newsstand sales.

Digital Media

Revenues from our Digital Media related businesses were $20.7 million
as compared to $15.5 million in the prior year, a 34% increase.

-- WWE.com revenues were $7.3 million as compared to $5.9 million in
   the prior year period, reflecting additional revenues from
   web-based advertising and wireless content.

-- WWEShop revenues were $13.0 million as compared to $8.7 million in
   the prior year period, primarily due to a 54% increase in the
   number of orders processed during the current period. The average
   amount spent by our customers per order was approximately $53.00,
   which was consistent with the prior year period.

WWE Films[TM]

During the eight month 2006 transition period we released two feature films, See No Evil[TM] and The Marine[TM], to theaters in widespread distribution. See No Evil was released domestically in theaters in May 2006 and on DVD in November 2006. The Marine was released domestically in theaters in October 2006 and on DVD in January 2007, subsequent to year end. During the current transition period we incurred approximately $16.9 million in capitalized production costs for our third feature film, The Condemned[TM], which is scheduled for release in April 2007. WWE does not participate in any revenues associated with these film projects until the print and advertising costs incurred by our distributors have been recouped and the results have been reported to us. Accordingly, no revenues have been recorded in the 2006 transition period.

Profit Contribution (Net revenues less cost of revenues)

Profit contribution for the 2006 transition period was $105.8 million as compared to $108.3 million in the prior year period. Total profit contribution margin was approximately 40% for the current period as compared to 44% for the prior year. The decline in the profit contribution is due in part to the absence of domestic television advertising revenues in our Live and Televised Entertainment segment and the increases in revenues from businesses with lower profit margins than advertising, such as live events and venue merchandise.

Selling, general and administrative expenses

SG&A expenses were $61.0 million for the current period as compared to $56.9 million in the prior year period. The prior year period included approximately $3.4 million in positive legal settlements.

EBITDA

EBITDA was approximately $44.8 million in the current period as compared to $51.5 million in the prior year period.

Summary Income Statements

The following chart reflects a summary income statement for the eight month periods ended December 31, 2006 and December 31, 2005:

(Dollars in millions, except per share data)

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Cash Flows

Net cash provided by operating activities was $22.3 million for the eight months ended December 31, 2006 as compared to $67.1 million in the prior year period. In the 2006 transition period we spent approximately $17.5 million on the production of feature films as compared to $5.3 million in the prior year period.

Change in Fiscal Year

As previously disclosed, the Company switched to a calendar year basis beginning with calendar year 2007.

The financial statements included in the attached supplemental schedules show the results of the eight month 2006 transition period and the twelve months ended April 30, 2006, consistent with the presentation required in Form 10-K.

Business Outlook

The Company is committed to complete a comprehensive strategic review with the objective of identifying sustainable, multi-year growth rates. We expect to communicate our financial objectives within the near term. As such, our management has decided not to provide specific guidance on near-term results. In lieu of providing such financial guidance, we are expanding the depth of our business metrics, and will make these available to investors on a monthly basis on our corporate website - corporate.wwe.com. As a specific point of reference, the Company has targeted 2007 EBITDA growth of approximately 12% over the prior calendar year for the payout of management bonuses.

Note: World Wrestling Entertainment, Inc. will host a conference call on February 13, 2007 at 11:00 a.m. ET to discuss the Company's earnings results for the 2006 transition period. All interested parties can access the conference call by dialing 800-862-9098 (conference ID: WWE). Please reserve a line 15 minutes prior to the start time of the conference call. A presentation that will be referenced during the call can be found at the Company web site at corporate.wwe.com. A replay of the call will be available approximately three hours after the conference call concludes, and can be accessed at corporate.wwe.com.

World Wrestling Entertainment, Inc. (NYSE: WWE) is an integrated media and entertainment company headquartered in Stamford, Conn. Additional information on the Company can be found at wwe.com and corporate.wwe.com.

Trademarks: All World Wrestling Entertainment, Inc. programming, talent names, images, likenesses, slogans, wrestling moves, and logos are the exclusive property of World Wrestling Entertainment, Inc. and its subsidiaries. All other trademarks, logos and copyrights are the property of their respective owners.

Forward-Looking Statements: This news release contains forward-looking statements pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995, which are subject to various risks and uncertainties. These risks and uncertainties include the conditions of the markets for live events, broadcast television, cable television, pay-per-view, Internet, feature films, entertainment, professional sports, and licensed merchandise; acceptance of the Company's brands, media and merchandise within those markets; uncertainties relating to litigation; risks associated with producing live events both domestically and internationally; uncertainties associated with international markets; risks relating to maintaining and renewing key agreements, including television distribution agreements; and other risks and factors set forth from time to time in Company filings with the Securities and Exchange Commission. Actual results could differ materially from those currently expected or anticipated.

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Non-GAAP Measure:

EBITDA is defined as net income from continuing operations before interest and other income, income taxes, depreciation and amortization. Although it is not a recognized measure of performance under U.S. GAAP, EBITDA is presented because it is a widely accepted financial indicator of a company's performance. The Company uses EBITDA to measure its own performance and to set goals for operating managers. EBITDA should not be considered as an alternative to net income, cash flows from operations or any other indicator of World Wrestling Entertainment Inc.'s performance or liquidity, determined in accordance with U.S. GAAP.

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Non-GAAP Measure:

We define Free Cash Flow as net cash provided by continuing operations less cash used for capital expenditures. Although it is not a recognized measure of liquidity under U.S. GAAP, Free Cash Flow provides useful information regarding the amount of cash our continuing business is generating after capital expenditures, available for reinvesting in the business and for payment of dividends.