Live Nation Defends Refund Policy, Cuts Executive Compensation
April 14, 2020

The business of live events has been stopped dead in its tracks in the face of COVID-19 as shelter-in place edicts persist throughout the world. All concerts and festivals are off, and even leagues are shutting down. Unsurprisingly, there are thousands of frustrated fans who have purchased tickets to events that are not happening and cannot receive refunds.

Ticketmaster, a division of parent company Live Nation Entertainment (LYV), is bearing the brunt of the backlash. Recently, they made a tweak to their refund policy to clarify that customers stand to receive a refund only if an event is “cancelled” rather than “postponed.” LYV shares have traded down ~42% YTD.

In a recent filing with the SEC, the company says that 90% of affected events (about 7,000 of them) are in fact postponed, and not cancelled. This is an important distinction because the venues themselves (not Ticketmaster) hold the cash – rendering refunds quite difficult to fulfill. These venues, closed, with no immediate revenue prospects, are not in a hurry to return cash that they are not required to. For the remaining 10%, or 1.6M tickets, refunds have been issued.

Don’t fret – Live Nation President, Joe Berchtold, thinks live concerts can return to normal in…2021.

Expense Reductions


In a bid to shore up the company’s financial health, LYV recently took the following steps:

  • Suspended its leverage covenants
  • Added $120mm of borrowing capacity via its revolver
  • Targeting $500mm of cost savings
  • Executive compensation reductions, including 100% salary cut for CEO, Michael Rapino and 50% for other named executive officers

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