The slow start of the WWE’s (NYSE: WWE) online streaming service and lukewarm reception to the organization’s new television deal has had a significant impact on Chairman Vince McMahon’s bank account. The 68-year-old reportedly dropped from the ranks of the world’s billionaires after losing $350 million in a single day.
The WWE’s stock plummeted more than 40 percent last week, from around $20 on May 15 to under $11 on May 16, Forbes reports. On Tuesday morning, WWE shares held at under $11. The company’s issues had a significant impact on McMahon’s personal net worth, which now stands at $750 million after his $350 million loss.
“The company’s valuation could take a heavy beating this morning, as the new domestic TV deal with NBCUniversal likely disappointed investors,” McMahon wrote in a report, explaining the plunging price target for the company’s stock, according to Forbes.
The new television deal, while lucrative, fell short of expectations, the Los Angeles Times reports. NBC Universal will reportedly pay around $150 million a year for the rights to air “Raw,” “Smackdown” and E! Network’s “Total Divas” series, which represents a $60 million increase from the previous deal. However, analysts had expected the new deal to at least double the value of the old one.
Furthermore, the WWE’s online streaming service, which launched in February, has yet to turn a profit. As Forbes notes, company shares rose 89 percent in the first three months of 2014, causing McMahon’s net worth to reach $1.6 billion. However, shares dropped considerably when WWE officials revealed that the service had just 667,000 subscribers, well short of the projected 1.5 million “break even” mark.
WWE believes that the online streaming service will lose between $45 million and $52 million in 2014, the Los Angeles Times notes. But the company projects that the service will reach 1 million subscribers by the end of the year.
Despite his losses, McMahon remains optimistic about the WWE’s future. “The rising value of our content coupled with the global expansion of WWE Network will provide the foundation for long-term growth that continues to transform our business over the coming years,” he said in a statement.