One Championship made $47m but lost $99m in 2019

One Championship, which bills itself as Asia’s leading mixed martial arts (MMA) entity, saw widening net losses for 2019, the company revealed in its financial statement.

At S$131 million, the loss is more than double of what Tech in Asia had projected in an earlier piece, based on our understanding of the company’s financials.

One Championship only had a 2% gross margin, with its marketing expenses exceeding its revenue. Its administrative and other expenses nearly matched its revenue figure.

The good news is that the company disclosed a significant uptick in broadcasting revenue. It sees this stream as its biggest source of income moving forward, Tech in Asia understands.

One Championship is “investing heavily upfront” in its platform, brand, and ecosystem, CEO Chatri Sityodtong said in an emailed statement to DealStreetAsia, which first reported the company’s financials.

While the company has allocated a huge budget to marketing, it’s not clear whether that has translated to strong brand recognition in Asia, according to Google Trends, which logs people’s queries on the search engine.

By that measure, One Championship appears to lag behind UFC, the world’s leading MMA organization, by a wide margin in key Asian markets except Myanmar.

However, One’s group president Teh Hua Fung says it’s beating competitors in Asia on viewership numbers (it tracks broadcast, digital, and social media views), which it considers as the most important metric.

“One Championship is largely on free-to-air TV in our core markets versus cable TV for our competitors. Cable TV has a minority share of the market relative to free to air TV,” he tells Tech in Asia.

The deepening losses in 2019 may explain why the company laid off a reported 20% of employees in June 2020, while at the same time raising another US$70 million.

2020 would end up being a challenging one for One Championship, which had to suspend its events as the pandemic spread throughout Asia. Victor Cui, who heads the firm’s international business, had resigned in July 2020, the financial report noted.

According to data from Tubular, One Championship seemed to have cut marketing expenses for social media last year. It ranked third in cross-platform views among sports properties in 2019, but fell out of the top ten the following year.