WWE(R) Reports Fiscal 2006 First Quarter Results

During the quarter, the Company aired five pay-per-view events ascompared to four events in the prior year quarter. The additionalevent, Backlash(R), contributed approximately $4.3 million inrevenues, or $2.1 million in profit contribution.

Linda McMahon, CEO, stated that she was pleased with the Company'sfinancial results and the upward trends in key performance metrics inthe first quarter. "One of the more significant items in our Live andTelevised businesses for the quarter was the increase in pay-per-viewbuys. Each of the pay-per-view events produced in the quarter eithermet or exceeded the buys from the prior year," she said. "Anothersignificant item was an increase in average attendance at our liveevents as the average attendance at both our North American andInternational live events was better than anticipated and surpassedlast year's average by more than 18%."

Mrs. McMahon continued, "Regarding the Branded Merchandisebusinesses, our licensing programs continue to expand internationallywith significantly better than anticipated sales in the toy andnovelty categories. Our Home Video business also out-performed ourestimates due in part to the success of our WrestleMania(R) 21 title,which sold approximately 202,000 DVD units to date in the U.S. alone,making it one of our all-time best sellers. These results show thatour continued investment in areas such as global expansion and talentdevelopment are beginning to yield positive returns."

Results By Business Segment

Live and Televised Entertainment

Revenues from the Company's Live and Televised businesses were$68.6 million as compared to $65.2 million in the prior year quarter.

-- Pay-Per-View revenues were $21.6 million versus $16.9 million in the prior year quarter. In the first quarter of fiscal 2006, five pay-per-view events were produced as compared to four events in the prior year quarter. The Company will produce 16 pay-per-view events in fiscal 2006, as compared to 14 events in fiscal 2005. The details for the number of buys (in 000's) are as follows:
Event Q1 FY06 Q1 FY05
----- -------- ---------
Backlash(R) 273 -
Judgment Day(R) 236 220
ECW One Night Stand(R) / Bad Blood(R) 268 264
Great American Bash(R) 233 233
Vengeance(R) 320 232
Prior period events 115 173
-------- ---------
Total 1,445 1,122

-- Live Event revenues were $16.5 million as compared to $17.9 million in the first quarter of last year.

-- There were 70 events during the quarter as compared to 89 events during the same period last year, including 7 international events held in fiscal 2006 as compared to 10 international events held in the prior year.

-- The average attendance at the Company's North American live events was approximately 4,600 as compared to approximately 3,800 in the prior year quarter, while the average international attendance was 10,700 as compared to 9,300 in the prior year quarter.

-- International events averaged approximately $809,000 in net revenues and approximately $228,000 in profit contribution during the current quarter. This is compared to domestic event net revenues that averaged approximately $172,000 and approximately $33,000 in profit contribution during this same period.

-- Television Advertising revenues were $10.4 million as compared to $10.6 million in the prior year quarter. As previously announced, under our new agreement with USA Network, which will be effective October 2005, we will no longer participate in domestic advertising sales.

-- Average household ratings for the Company's RAW(R) program were 3.8 as compared to 3.7 in the prior year quarter and SmackDown(R) ratings were 3.1 for both the current and the prior year quarter.

-- Television Rights Fees revenues were $20.0 million as compared to $19.8 million in the prior year quarter.

Branded Merchandise

Revenues from the Company's Branded Merchandise businesses were$25.2 million versus $16.4 million in the prior year quarter.

-- Merchandise revenues were $5.2 million as compared to $3.7 million in the prior year quarter. This increase in revenues is primarily driven by our WWE Shop website with the number of orders more than doubling from the prior year quarter from approximately 15,000 orders to approximately 41,000 orders.

-- Home Video revenues were $8.5 million as compared to $5.7 million in the prior year quarter, with 722,000 units sold as compared to 495,000 units sold in the prior year quarter. The increase was due primarily to the release of WrestleMania 21, which sold approximately 202,000 units in the current quarter as compared to WrestleMania XX, which was released in Q4 of fiscal 2004 and sold 60,000 units in the year ago quarter. Other titles released in the quarter included Greatest Wrestling Stars of the 80's, which sold approximately 95,000 units, and The Road Warriors, which sold approximately 84,000 units.

-- Licensing revenues were $7.5 million as compared to $3.0 million in the prior year quarter. The increase was due in part to increases in the Toy and Novelties categories, particularly in territories outside North America. In addition, licensing revenues for Video Games included sales of the WrestleMania 21 game on the Xbox platform in the current quarter, while no titles were released in the prior year quarter.

Profit Contribution (revenues less cost of revenues)

Profit contribution for the quarter was $41.3 million as comparedto $33.1 million in the prior year quarter. Profit contribution marginwas approximately 44% as compared to 41% in the prior year quarter.The profit contribution margin increased in part due to themerchandise and licensing businesses.

Selling, general and administrative expenses

SG&A expenses were $22.2 million as compared to $17.9 million inthe prior year quarter. Included in the prior year quarter was a $2.1million reduction of sales tax expense due to a tax refund.Additionally, the current quarter reflects approximately $1.4 millionin severance pay related to certain restructuring plans implemented bythe Company.

Fiscal 2006 Outlook

Based on the first quarter results, which exceeded our plan, wehave increased our full year forecast as follows: revenues for fiscal2006 of between $360.0 and $375.0 million, EBITDA of between $55.0 and$60.0 million, and income from continuing operations of between $32.0and $35.0 million, or $0.46 to $0.50 per share on a diluted basis.

Note: World Wrestling Entertainment, Inc. will host a conferencecall on Wednesday, September 7, 2005, at 11:00 a.m. ET to discuss theCompany's first quarter earnings results for fiscal year 2006. Allinterested parties can access the conference call by dialing800-895-0231 (conference ID: WWE). Please reserve a line 15 minutesprior to the start time of the conference call. A presentation thatwill be referenced during the call can be found at the Company website at corporate.wwe.com. A replay of the call will be availableapproximately three hours after the conference call concludes, and canbe accessed at corporate.wwe.com.

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

Trademarks: The names of all World Wrestling Entertainmenttelevised and live programming, talent names, images, likenesses,slogans and wrestling moves and all World Wrestling Entertainmentlogos are trademarks, which are the exclusive property of WorldWrestling Entertainment, Inc. All other trademarks are the property oftheir respective owners.

Forward-Looking Statements: This news release containsforward-looking statements pursuant to the safe harbor provisions ofthe Securities Litigation Reform Act of 1995, which are subject tovarious risks and uncertainties. These risks and uncertainties includethe conditions of the markets for live events, broadcast television,cable television, pay-per-view, Internet, entertainment, professionalsports, and licensed merchandise; acceptance of the Company's brands,media and merchandise within those markets; uncertainties relating tolitigation; risks associated with producing live events bothdomestically and internationally; uncertainties associated withinternational markets; risks relating to maintaining and renewing keyagreements, including television distribution agreements; and otherrisks and factors set forth from time to time in Company filings withthe Securities and Exchange Commission. Actual results could differmaterially from those currently expected or anticipated.
World Wrestling Entertainment, Inc.
Consolidated Income Statements
(dollars and shares in thousands, except per share data)
(Unaudited)


Three Months Ended
July July
29, 30,
2005 2004
-----------------


Net revenues $93,812 $81,551

Cost of revenues 52,501 48,416
Selling, general and administrative expenses 22,236 17,875
Depreciation and amortization 2,696 2,920
Stock compensation costs 579 1,111
-------- --------

Operating income 15,800 11,229

Investment income, net 1,872 1,232
Interest expense 152 167
Other (expense) income (73) 217
-------- --------
Income from continuing operations before income taxes 17,447 12,511

Provision for income taxes 6,269 4,754
-------- --------

Income from continuing operations 11,178 7,757
-------- --------

Income (loss) from discontinued operations, net of
taxes 2 (111)
-------- --------

Net income $11,180 $7,646
======== ========

Earnings per share - basic and diluted:
Continuing operations $0.16 $0.11
Discontinued operations - -
-------- --------
Net income $0.16 $0.11
======== ========

Shares used in per share calculations:
Basic 68,899 68,691
Diluted 69,627 69,574


World Wrestling Entertainment, Inc.
Consolidated Balance Sheets
(dollars in thousands)
(Unaudited)

As of As of
July 29, April 30,
2005 2005
-------------------
ASSETS

CURRENT ASSETS:

Cash and cash equivalents $74,480 $56,568
Short-term investments 196,837 201,487
Accounts receivable, net 54,352 61,901
Inventory, net 1,285 1,057
Prepaid expenses and other current assets 10,879 15,191
Assets of discontinued operations 415 544
--------- ---------

Total current assets 338,248 336,748

PROPERTY AND EQUIPMENT - NET 64,703 66,638

FEATURE FILM PRODUCTION ASSETS 30,723 28,771

INTANGIBLE ASSETS - NET 2,101 2,608

OTHER ASSETS 7,276 6,640

--------- ---------
TOTAL ASSETS $443,051 $441,405
========= =========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
Current portion of long-term debt $771 $756
Accounts payable 15,913 15,669
Accrued expenses and other liabilities 21,418 21,151
Deferred income 18,132 20,843
Liabilities of discontinued operations 259 254
--------- ---------
Total current liabilities 56,493 58,673

LONG-TERM DEBT 7,000 7,198

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
Class A common stock 211 210
Class B common stock 479 479
Additional paid-in capital 256,066 254,716
Accumulated other comprehensive loss (1,083) (908)
Retained earnings 123,885 121,037
--------- ---------
Total stockholders' equity 379,558 375,534
--------- ---------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $443,051 $441,405
========= =========


World Wrestling Entertainment, Inc.
Consolidated Statements of Cash Flows
(dollars in thousands)
(Unaudited)

Three Months Ended
July 29, July 30,
2005 2004
-----------------
OPERATING ACTIVITIES:
Net income $11,180 $7,646
Adjustments to reconcile net income to net cash
provided by operating activities:
(Income) loss from discontinued operations, net
of taxes (2) 111
Revaluation of warrants (639) (212)
Depreciation and amortization 2,696 2,920
Realized loss on sales of investments - 338
Amortization of investment income (263) (32)
Stock compensation costs 579 1,111
Provision for doubtful accounts 370 225
Provision for inventory obsolescence 307 46
Provision for deferred income taxes 308 581
Changes in assets and liabilities:
Accounts receivable 7,179 11,188
Inventory (534) (11)
Prepaid expenses and other assets 200 1,302
Feature film production assets (1,952) (386)
Accounts payable 243 (2,544)
Accrued expenses and other liabilities 4,537 (12,300)
Deferred income (2,588) 1,078
-------- --------
Net cash provided by continuing
operations 21,621 11,061
Net cash provided by (used in)
discontinued operations 136 (794)
-------- --------
Net cash provided by operating
activities 21,757 10,267
-------- --------

INVESTING ACTIVITIES:
Additions to property and equipment (255) (916)
Purchases of short-term investments (1,325) (1,257)
Proceeds from sales or maturities of short-term
investments 5,470 20,000
-------- --------
Net cash provided by continuing operations 3,890 17,827
Net cash used in discontinued operations - -
-------- --------
Net cash provided by investing activities 3,890 17,827
-------- --------

FINANCING ACTIVITIES:
Repayments of long-term debt (184) (171)
Dividends paid (8,267) (4,112)
Issuance of stock, net 187 171
Proceeds from exercise of stock options 529 37
-------- --------
Net cash used in continuing activities (7,735) (4,075)
Net cash used in discontinued operations - -
-------- --------
Net cash used in financing activities (7,735) (4,075)
-------- --------

NET INCREASE IN CASH AND EQUIVALENTS 17,912 24,019
CASH AND EQUIVALENTS, BEGINNING OF PERIOD 56,568 48,467
-------- --------
CASH AND EQUIVALENTS, END OF PERIOD $74,480 $72,486
======== ========


World Wrestling Entertainment, Inc.
Supplemental Information - EBITDA
(dollars in thousands)
(Unaudited)


Three Months Ended
July July
29, 30,
2005 2004
-----------------

Net income reported on U.S. GAAP basis $11,180 $7,646

(Income) loss from discontinued operations, net (2) 111
Provision for income taxes 6,269 4,754
Interest and other, net (1,647) (1,282)
Depreciation and amortization 2,696 2,920

-------- --------
EBITDA $18,496 $14,149
======== ========

Non-GAAP Measure:

EBITDA is defined as earnings from continuing operations beforeinterest, income taxes, depreciation and amortization. Although it isnot a recognized measure of performance under U.S. GAAP, EBITDA ispresented because it is a widely accepted financial indicator of acompany's cash flow. The Company uses EBITDA to measure its ownperformance and to set goals for operating managers. EBITDA should notbe considered as an alternative to income from continuing operations,net income, cash flows from operations or any other indicator of WorldWrestling Entertainment Inc.'s performance or liquidity, determined inaccordance with U.S. GAAP.
World Wrestling Entertainment, Inc.
Supplemental Information- Free Cash Flow
(dollars in thousands)
(Unaudited)


Three Months Ended
July July
29, 30,
2005 2004
------------------

Net cash provided by continuing operations $21,621 $11,061

Less cash used in capital expenditures:
Purchase of property and equipment (255) (916)

-------- --------
Free Cash Flow $21,366 $10,145
======== ========

Non-GAAP Measure:

We define Free Cash Flow as net cash provided by continuingoperations less cash used for capital expenditures. Although it is nota recognized measure of performance under U.S. GAAP, Free Cash Flowprovides useful information regarding the amount of cash ourcontinuing business is generating after capital expenditures,available for reinvesting in the business and for payment ofdividends.