Good day, everyone. My name is Vicky, and I will be your conference facilitator for today. At this time, I would like to welcome everyone to the Live Nation Entertainment third quarter 2019 conference call. Today's conference is being recorded. Before we begin, Live Nation has asked me to remind you that this afternoon's call will contain certain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ, including statements related to the company's anticipated financial performance, business prospects, new developments, and similar matters. Please refer to Live Nation's SEC filings, including the risk factors and cautionary statements included in the company's most recent filings on Forms 10-K, 10-Q, and 8-K for a description of risks and uncertainties that could impact the actual results. Live Nation will also refer to some non-GAAP measures on this call.
In accordance with the SEC Regulation G, Live Nation has provided a full reconciliation to the most comparable GAAP measures in their earnings release. The release reconciliation and other financial or statistical information to be discussed on this call can be found under the Financial Information section on Live Nation's website at investors.livenationentertainment.com. It's now my pleasure to turn the conference over to Michael Rapino, President and Chief Executive Officer of Live Nation Entertainment.
Good afternoon and welcome to our third quarter of 2019 conference call. Live Nation delivered its highest AOI quarter ever as we continue to scale our business globally and build on favorable supply-demand dynamics for live music. AOI grew 11% in the quarter and 13% year to date, outperforming a record Q3 last year and demonstrating the strength of our business model in today's experience-based economy. In response to recent questions about consumer demand, we are seeing fan spending as strong as ever. In September, our amphitheater and arena shows actually closed stronger than shows in September of last year. Our fan spending on-site also showed ongoing growth. At the center of our flywheel, the demand for live events continues to grow as we have sold 92 million tickets through mid-October, up 6% or 5 million tickets compared to this time last year.
We are on track to nearly 100 million fans attending a show this year. We have translated the fan growth into strong AOI gains on on-site spending, sponsorship, and ticketing. As a result, as we wrap up a successful 2019, we are confident that we will deliver double-digit AOI growth for the year. Looking at our concerts business, year to date, we have had 73 million fans attend over 26,000 concerts, delivering $333 million in AOI, which is up 17% from last year. Our international business has been particularly robust this year, delivering much of the fan growth with a strong year for stadiums and theaters. While in the U.S., our arena and theater activity was also up.
As we have grown our show volume and the breadth of artists we work with, we've also been more effective in pricing tickets closer to the market value, particularly with the Platinum pricing tool. So far this year, we have had over 3,000 arena and amphitheater shows use Platinum tickets, with a 54% increase in the number of Platinum tickets sold per show. Looking at our venue operations, we have furthered our focus on the fan experience, improving our hospitality across the board, from our food and beverage offering to our lawn experience to VIP options. As a result, we have increased our average revenue per fan by $2.50 in our amphitheaters to over $29, while also increasing fan spending at festivals, theaters, and clubs. As we continue building our expertise on on-site execution, we're finding more opportunities to build new venues or take over operations of existing venues.
Since the start of this year, we have added 36 venues to our portfolio, ranging from the Brooklyn Bowls in New York and Las Vegas to the Danforth Music Hall in Toronto and Sportpaleis in Belgium. As a result, we are confident in the success of our concert flywheel for 2019. We will promote more shows, reach more fans, price more effectively, and provide a better fan experience at our venues, which will then drive double-digit AOI growth for the business year. Turning to sponsorship, with the first days of Rock in Rio and a strong growth across our entire sponsorship platform, our high-margin sponsorship business delivered 18% AOI growth for the quarter and 13% year to date.
We are the global leader in music sponsorship, delivering the unique value proposition of nearly 100 million fans on-site for brands looking to make a more direct connection with their customers. As part of this, we continue to innovate new ways for brands to interact with fans on-site at our venues and festivals. With new programs such as the Bud Light branded photo installation at our amphitheaters or the Revlon roller rink at Lollapalooza. As a result, sponsorship revenue has grown 11% year to date at our venues, while festival sponsorship has grown 31% year to date. More broadly, growth is driven by our strategic sponsors, all of whom utilize a range of assets and span multiple years. Revenue from this group, which collectively accounted for 70% of our total sponsorship revenue, has grown 15% year to date.
With over 95% of our expected sponsorship revenue for 2019 now contracted, we are confident that we'll deliver sponsorship AOI growth in the mid-teens for the full year. Ticketmaster generated its highest AOI quarter ever, up 20% from last year and with 6% growth year to date, as every quarter in 2019 is one of the top 10 GTV quarters ever. This growth continues to provide Ticketmaster scale to invest in the evolution from paper tickets to digital, which is being demanded by venues and content that are seeking greater control of their tickets and looking to develop a more direct connection with fans. Our Presence rollout is pacing ahead of schedule, and we expect digital ticketing to be installed at over 700 venues, representing 120 million tickets by the end of this year, and over 60% of the fans at digital-enabled events now entering with their mobile devices.
Digital adoption is even greater in the NFL, with 10 teams have now eliminated paper tickets, and over 90% of fans for those games are using their mobile phones to get in. Digital ticketing has expanded our engagement with fans, giving Ticketmaster a more direct connection, providing for more effective marketing and targeted offers. The Ticketmaster app is now regularly in the top 10 ranking for entertainment in the Apple App Store, driving a 30% increase in app downloads this year. This, combined with continued improvements in our mobile web experience, has led to further growth in mobile transactions, now accounting for 46% of ticket purchases globally, up 15% over last year. Digital ticketing is a strong demonstration of what Ticketmaster can be, providing the best ticketing platform for venues by delivering value well beyond the sale of a ticket.
At the same time, giving fans an ever-improving mobile-led purchasing and management experience. With these pieces coming together and continued growth in our Concerts activity, I expect we will deliver AOI growth to Ticketmaster in the mid-single digits for the full year. As we approach the end of 2019, we are confident that our strong performance will deliver another record year of top-line and AOI growth. All of our businesses, Concerts, Sponsorship, and Ticketing, have delivered growth year-to-date. Based on their key operating metrics, we expect each to deliver record revenue and AOI for the full year. With an early look to next year, our 2020 pipeline is up substantially, with over 1,500 stadium, arena, and amphitheater shows booked already, up double digits from the same time last year.
As we look forward, we continue seeing tremendous opportunity to expand our global concerts and festival business, drive further growth and on-site execution, sponsorship, and ticketing. With that, I will turn the call over to Joe, who will take you through additional details on the quarter and the divisions.
Thanks, Michael. Getting into our business segments. First, Concerts. Over the combined past two quarters, which represent our core concert season, AOI was up 9% and revenue up 2% year-on-year as we grew attendance to 73 million fans at over 26,000 shows, up 3% and 11% respectively. As we discussed on our second quarter call, timing this year somewhat shifted to Q2 versus Q3, and as a result, for the third quarter, attendance was 2 million lower than last year, resulting in slightly lower revenue and AOI. Looking to full season, though, every indicator we have is of a robust growing business. Our September results actually came in above our expectations as our amphitheater and arena shows closed strongly and fan spending remained at high levels.
This overperformance in ticket sales in the last two weeks before the shows resulted in over $5 million of incremental AOI in our amphitheaters relative to how the shows closed last year, demonstrating the continued strength of the Concerts business. As Michael said, much of our fan growth this year has come from our international markets, particularly with their stadium lineup. At the same time, we are seeing growing demand throughout our broad portfolio of venue types. Globally, theater shows are our highest growth venues this year as fans continue to find new up-and-coming artists they are excited about. Festivals remain the ultimate fan experience. With the addition of Rock in Rio, the continued globalization of the Lollapalooza brand, and our over 100 other festivals, we expect attendance to be up double digits through over 10 million fans this year.
Arenas continue to be the top place to see the biggest shows, and we expect to add another million fans this year as fans came to see such top acts as the Backstreet Boys, Ariana Grande, and John Mayer. For the fourth quarter, we see continued fan growth, again, driven by our theater shows, but with AOI growth impacted by the cost structure in a seasonally lower period for concert activity. Looking at the growth this year and an even bigger pipeline of shows for next year, combined with ongoing improvements in our on-site execution, we believe we are well set up for continued growth in concerts. Turning to our Sponsorship and Advertising business, in the third quarter, Sponsorship AOI was up 18% and revenue was up 26%, primarily driven by on-site sponsorship as our brand partners continue to recognize the value of engaging with fans at our events.
International markets drove the majority of our growth, with the first weekend of Rock in Rio contributing to our performance this quarter. Given the 14% growth in sponsor-committed net revenue for the year, I'm confident we will deliver mid-teens AOI growth in Sponsorship for the full year. Finally, Ticketmaster. For the quarter, Ticketmaster AOI was up 20% and revenue was up 5%. Global GTV was up 4% for the quarter, driven by fee-bearing GTV, which was up 5%. As with our Concerts business, International drove our ticketing growth in the quarter, with its fee-bearing GTV up 19%. Globally, primary GTV was up 6% for the quarter, while secondary GTV was flat. As in the past, Concerts drove most of our primary GTV growth.
In Secondary, we saw growth in sports, particularly the NFL, but lower activity in North America concerts, again, consistent with the concerts timing we've discussed. As another sign of success for the Ticketmaster platform, our open distribution strategy continues selling more tickets for clients off-platform, up over 30%, with 15 million tickets sold year-to-date. To save you the question on margin, yes, we're up a fair bit this quarter, due in part to continued improvements in operational areas such as search marketing, and also because of some insurance recovery for the data breach issue last year. Our overall focus remains on growing the cash profitability of the ticketing business, not being margin-focused, which is how we have consistently grown the business over the past several years and expect to continue being successful going forward.
In summary, we are confident that 2019 will be another year of record revenue and AOI results overall and for each of our businesses. We are also making progress on completing our Ocesa acquisition. In August, we submitted the necessary request for approval to the two key regulatory agencies in Mexico and are working through their process. In September, CIE received shareholder approval for the transaction. Pending the timing of the regulatory process, which is basically how many rounds of questions do they need to ask, we expect to complete the transaction between December and February, and we'll provide updates as we have more information to share. I will now turn the call over to Kathy to go through more on our financial results.
Thanks, Joe, and good afternoon, everyone. Our key financial highlights for the third quarter of 2019 are revenue was down 2% to $3.8 billion. AOI increased 11% to $427 million, and operating income increased 11% to $260 million. Our revenue decline in the quarter was primarily driven by a foreign exchange negative impact, and without this, our revenue in the quarter was flat to last year. This FX impact largely affected Concert, which along with the timing shift in events from Q3 to Q2, drove a 4% decrease in revenue. Sponsorship revenue increased 26% from the addition of the first weekend of Rock in Rio in Brazil and overall growth in our on-site sponsorship program. Ticketing delivered a 5% increase in revenue as strong international activity drove a 4% increase in global GTV.
AOI growth was 11% in the third quarter, driven mainly by Sponsorship, which was up 18%, and Ticketing, which was up 20%, as a result of the higher GTV, along with an insurance recovery related to the third-party data breach incident last year that we had not expected to receive in the quarter. This insurance recovery, along with the strength in amphitheater show performance at the end of the quarter, as Joe noted previously, drove our outperformance relative to the AOI guidance we provided in July. Our operating income increased by 11% for the third quarter over last year, driven by the increase in AOI. For the quarter, accretion of redeemable non-controlling interest was $24 million, and our diluted earnings per share was $0.71. Turning to our balance sheet.
As of September 30th, we had total cash of $1.8 billion, including $747 million in Ticketing client cash and $642 million in net Concert event-related cash, leaving free cash of $406 million. Net cash provided by operating activities for the nine months was $33 million, compared to $256 million last year, primarily due to the timing of when payment obligations were due. Free cash flow adjusted for the nine months was $531 million, in line with last year's $529 million. Our conversion of AOI to free cash flow this year was reduced by the timing of distributions to our non-controlling interest partners and an increase in maintenance CapEx. Our total capital expenditures were $225 million for the first nine months, with $120 million spent on revenue-generating items. We expect total capital expenditures for 2019 to be approximately $325 million, with half going toward revenue-generating CapEx projects.
As of September 30th, our total deferred revenue related to future events was $952 million, an increase of 26% over the $759 million at this point last year. In October, we issued $950 million of 4.75% senior notes due 2027 and amended our senior secured credit facility, including a new $950 million Term Loan B. In addition, we have an undrawn $500 million revolver and a $400 million delayed draw Term Loan A. The proceeds from these transactions were used to redeem our $250 million of 5.375% senior notes due 2022 and to repay the outstanding balance of our existing term loans. After these repayments and other fees and expenses, we will have $527 million of incremental cash on the balance sheet.
This will allow us to meet the cash portion of our purchase price for the Ocesa acquisition, along with funding other acquisition opportunities. After this refinancing, our weighted average cost of debt remains at 4.2%, and we estimate that our interest expense will initially increase by approximately $10 million in the fourth quarter as a result of this refinancing. For the remainder of 2019, we expect negative FX impacts of approximately 2% for revenue and 7% for AOI in the fourth quarter based on current rates. This FX headwind to AOI is largely driven by higher sponsorship activity in Brazil, Australia, and New Zealand, which are all projected to be off 7% in the fourth quarter, and the euro and British pound, which are projected to be off 4%-5%. Revenue has less of an impact as that mix is more heavily weighted to the U.S.
We have factored this FX impact into our full year guidance that both Michael and Joe discussed, which takes into consideration our reported year-to-date results and our expectations for the fourth quarter. Consistent with where we projected it last quarter, we currently expect that free cash flow adjusted for the full year as a percentage of our 2019 AOI will be in the mid-50s. Our accretion of redeemable non-controlling interest for the fourth quarter is projected to be approximately $26 million. As a reminder, as you look forward to 2020, our Rock in Rio festival, which spanned Q3 and Q4 this year, is a biannual festival and will therefore not take place next year. Thank you for joining us today. Operator, we will now open the call for questions.
Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star one to ask a question, we'll pause for just a moment to allow everyone an opportunity to signal for questions. We'll go first to David Karnovsky with JPMorgan.
Hi. Thanks for taking the questions. You highlighted getting questions around consumer demand. I assume maybe some of this pertains to macro and possibly recession risk. The last time there was a downturn, Live Nation was a pretty different company than it is today. I'd be interested to know how you see Live positioned should we enter a softer economic period at some point.
Hey, David, this is Joe. I'll start that. Again, as we gave with some of our numbers, we have seen whatever periodic retail slowness in September or anything else that the market has looked at, we have not seen that impact us at all. In fact, September this year, as I gave the numbers, was stronger than September of last year. We're feeling very good how it's holding up in general. As you said, we think we're a very different company than we were 10 years ago. We think our understanding of the consumer, our level of sophistication associated with pricing, understanding different consumer segments, our ability to execute on site, are all substantially higher.
We feel like our capabilities have certainly continued to develop and that the structural tailwinds we have in shifts in spend from goods to experience, the globalization of our business, all trends that lead to a lot of demand support under any economic scenario.
Also, it's Michael, just to tie in. We're seeing also what is on sale for next year. Festivals and shows that are already on sale for next summer are showing strong demand. No weakness at all in terms of the consumer buying the tickets, as well as Joe said, and the people coming to shows in September spending at the show. We haven't seen any pushback at all. Business as usual from a sales perspective.
Okay. It's very helpful. You highlighted an additional 36 venues year to date. I'm interested to know if you anticipate accelerating the strategy. Is there a specific type of venue that you're more focused on? Finally, I'd be interested to get your view on Groot Hospitality and how that adds to the portfolio.
All right. I'll take a shot. You're coming across a little muffled there, so I think I got the gist of it. We've always been in the on-site business, and our most profitable businesses are our festivals, where we get to count multiple revenue streams, and our amphitheaters, 50 of them that we have in America. Those would be our highest margin concert venues or concert business. We've always been expanding and looking at leasing and managing concert venues. We've had a portfolio of theaters and clubs, House of Blues, Fillmores, well over 100 of them now around the world. We've been managing those for the last 15 years. Continually looking at any concert venue from 500 seats up to amphitheaters. If they're pure play concert venues where our content can leverage our relationship into multiple revenue streams by managing or leasing or building that music venue.
On a global basis, we continue to look at them as great returns, and they're the places that our flywheel comes to life the most leverageable in terms of content, sponsorship, and ticketing.
Okay. Just anything on Groot? I'm not sure if it came through on the question.
Oh, Groot. Yeah. Part of what we've been talking about in the last few years on our hospitality food and beverage business is we are a very large food and beverage business on our own. If you just spun our food and beverage business off, we would be a world-leading hospitality food and beverage in terms of our revenue and footprint. One big part of our revenue hospitality strategy is to continue to make sure we understand the high-end consumer and the hospitality around VIP and servicing that customer well. Our core DNA knows how to put a lot of people through buildings in an efficient manner and service them.
We want to get more skill sets that understand how to take care of the VIP high-end customer, how best to set up the VIP, what does that VIP flow look like, how best to monetize the customers that want a better and higher experience or a unique experience. Dave is an expert in the business in Miami. He's been very successful at what he does. He's tested it at the Miami Dolphins stadium with his platform there. We look at him and other skill sets like that we bring those in-house.
Open our platform to them. They will help us design, build, and expand our VIP hospitality business in our current portfolio.
Okay, thank you.
We'll go next to Benjamin Swinburne with Morgan Stanley.
Thank you. Good afternoon. Just first on digital ticketing, you talked about Presence being ahead of schedule. Can you talk a little about what's driving that? Is that demand driven or your ability to deploy that technology faster? Clearly it's resonating with consumers. You can see it in the app download data. Can you help us think about the financial benefits to the company over the longer term as that scales to become a majority or past majority of your ticketing business?
Sure. This is Joe. I'll give it a start. First of all, in terms of the pace and why it's deploying faster, it's two things. One is, I think we've been successful because of how effective it's been both with the NFL as well as our own buildings. We're just seeing tremendous demand by other venues that are saying, "We don't want to get left behind. We want to shift to digital so we can be getting that consumer data, understanding better control of the ticket as well." Our processes for deploying the systems, actually going to the venue, changing the access control systems. I think we've gotten that working well very quickly. I think that has led us over the course of this year to move our target for installations from 500 to 600 now to 700 installations.
In terms of the long-term impact, clearly just for Ticketmaster, it's a fundamentally different value proposition that it provides to its venues now. It's no longer just selling a ticket, but it is providing an important data service. That's an important piece of just what Ticketmaster is. We've talked through, there are a multitude of uses that the data will provide. It'll support Ticketmaster and our concert business in terms of the effectiveness of their marketing, their ability to provide much more targeted information to fans based on what we think they're interested in. It'll be very important to our venue strategy in terms of being able to make offers to people based on what their past behavior is. It'll be important for sponsors, for them to directly tie in sponsor segments, customer segments, and targets with who our 100 million people are on site.
The ability to do all of those things over the next several years, I think, will be tremendously important throughout the entire company.
Got it. That's helpful. Just maybe one follow-up. The show pipeline for next year, as you highlighted, is up double digits. I know it's too early to talk about 2020 in a lot of detail, but does that suggest that events will be up double digits next year? You also have a fairly sizable acquisition, which should close as well. I don't know if I'm over-extrapolating, but just thought I'd ask.
Sure. A couple things. First of all, we haven't built in Ocesa in our numbers yet because of the uncertainty over ± a few months in terms of the timing. Anything that we also gave you in terms of the on sale would not have included them, because we're not yet exchanging that data with them. I think what you can take from it being up double digits at this point is two things. One is, it looks very strong for next year, both in terms of the volume and then, as Michael said, the early demand for what we do have put on sale is also very strong. Two is, you're continuing the trend of seeing some shift into the fourth quarter in terms of timing of some of the on sales.
I don't think we're ready to declare the exact amount that we're going to be up, but we're feeling very good as we're starting to turn the focus to 2020 shows.
Great. Thank you.
We'll go next to David Joyce with Evercore ISI.
Thank you. A couple questions. First, on the deferred revenue now being up 26%, what would that look like excluding the one week of Rock in Rio that falls in this quarter? Could you discuss other comparable timing events that would be impacting the concert performance for the fourth quarter? Secondly, on CapEx, if you could talk about some of the components of the revenue-generating CapEx. What have you been doing on the real estate side there? Thank you.
On the deferred revenue, yeah, Rock in Rio would be in there. Remember, Rock in Rio, as most festivals are, is largely sponsorship driven, and we haven't given any specific breakdowns that the second weekend would be in Q4. What we said on the other comments are that Q4 is largely going to be theater and club driven. That would be part of it. Then you'll also be seeing some of the impacts of the on sales for next year in there as well. Far as CapEx, rev gen is going to be highly around, we said we added 36 venues. There's part of that's going to be running through that continued enhancement along the Ticketmaster technology as well.
Great. Thank you.
It's probably hospitality, right? Michael talked to hospitality. We talked a lot about the growth in per caps. We give you specific numbers at the end, but also at our festivals, at our theaters and clubs. All of that is clearly a priority on our rev gen CapEx.
Right. Okay, thank you.
We'll go next to Brandon Ross with LightShed.
Hello?
Go ahead, Brandon
Okay. Sorry, we're having some phone troubles here. We're a startup. On sponsorship, you lowered your guide for the year to mid-teens from mid to high. I guess you said the consumer is in great shape, but just wanted to make sure you're finding the same with advertisers and sponsors. Is there anything to read into there vis-a-vis the demand for Rock in Rio? On ticketing, I think your Q4 ticketing guide implies flat AOI year to year. How do we reconcile that with your increased show pipeline for next year and this continued trend to a shift in timing to Q4 on sales from Q1?
On the first question, there is absolutely no shift in our overall outlook on sponsorship. The only change is our previous guidance was constant currency, but we saw a lot of modeling issues with people trying to understand constant versus reported. We shift this guidance to reported currency, and we gave you very explicitly in Kathy, the fact that you're off 7% in Brazil, Australia, New Zealand, and 4% to 5% in Great Britain and in Europe. It's just that math that's having an effect to change where the numbers are. No change in terms of if we would have given you constant currency versus reported.
The demand is.
The demand is absolutely no change, no deterioration. In terms of second, without getting too exact, there's still some timing to be worked out in terms of exact on sales for ticketing. Ticketing, again, you're going to have some of the same issues in terms of some of the FX impacts. Overall, again, we're seeing robust show pipeline and robust consumer demand when we do put the shows on sale. It's just a matter of when exactly they're all going to get put on sale. We have a lot of shows that we have confirmed with the artists that they'll be touring. We have contracts with them. We're scheduling them. We have not declared whether those actual tours are going on sale in Q4 or Q1.
We're comping up a large Q4 last year on ticketing. Just keep that in mind in your whole comparison.
Got it. Thanks for the questions.
I'm going to go next to Conor Miguel with Jefferies.
Hi, good afternoon, everyone. Thanks for taking my questions.
Sure.
The first question is just around, you mentioned the strength of the consumer and you're not seeing any slowdown there. Can you maybe just frame up how much headroom you have on your ability to price the shows as we look forward? The second question is around the digital ticketing. Are there any gating factors to you increasing the venue rollout above 700 as we think about maybe 1,000, 1,200 and as we move forward? Are there any gating factors to that?
First, on the consumer strength, the pricing headroom, most recent numbers we've given is we think there's still probably about $1 billion of price arbitrage if we look at the secondary market as a guide for market value of ticket prices relative to how we price tickets. We absolutely believe that one of the factors during any economic slowdown is that provides a buffer, and that arbitrage gets eaten away before some of the fundamental demand hits our tickets. That absolutely is a piece that gives us some greater comfort as we think about different economic cycles. In terms of digital ticketing, the rollout, I think by the end of this year, we'll have 80% of the major buildings. One gating factor is just you're not going to have your NBA, NHL teams shift mid-season.
If they didn't shift before the start of this season, they won't shift between now and the end of the year. It would be when they take a break again during their next cycle. Then it's just a matter of getting to a lot of the smaller buildings.
It's Michael. Just on pricing, just to give some narrative. The press likes to talk sometimes about the ticket pricing of the high shows. Overall, concerts are at a very affordable price point. If you look at the average ticket price in the $60, average fans go to two or three shows a year. It's still a very affordable lifetime memory versus a trip or a vacation. In a recession, we see that the consumer may pull back on high ticket items. He may not go on a vacation.
He may pull back on a new car, but to take his kids to Taylor Swift or his wife to a show or his friends, it's still a very affordable option that we know because they're lifetime moments and Kodak moments in your life, they still make sure they go to that local show at the arena or stadium or amphitheater because it's still incredibly affordable, even if they're in a slight pullback on discretion spend. Now, I say that, it also means why we believe the ticket is completely still underpriced. Why there's $8 billion-$10 billion in the secondary market on an ongoing basis.
We still think that the front of the house is wildly underpriced and year-over-year, we'll make progress with the artists to keep pricing it better, and taking some of that high-end opportunity into his pocket, as well as lowering the price on the back end to get better full capacity. Overall, we think the show is still a very affordable option in life.
Cheaper than a good dinner in the big picture, with great pricing opportunity, given we still think it is a very low-priced option if you compare it to an NBA game, a night at the theater, a front row seat at an NFL game, et cetera. We think the concert is underpriced, lots of room for pricing, still affordable to everybody, no matter where their economic situation lies. We think the secondary is the proof that we have upside.
Thanks very much.
Again, press star one to ask a question. I will go next to Jason Bazinet with Citi.
Yeah. Just had a question on CapEx. I know you guys have always talked about 2% CapEx to revs. It seems like with the second move up in CapEx, we're verging sort of 3. Do you see enough sort of good revenue opportunities that we should be thinking sort of 3% of revs as sort of a more reasonable number in the interim, next few years as opposed to 2? Or is 2019 sort of an aberration? Thanks.
Part of that, just to restate, those 2% were back before rev rec changes, so it made a little bit of an increase in it. I think, around 2.5% is probably the right rule, and some years may cross a little bit above that. Yes, there are a lot of what we think are good investment opportunities in our venues, in hospitality, in our technology, that we think they're the right way to continue to invest in the business.
Perfect. Thank you.
We'll go next to Doug Arthur with Huber.
Yeah. Hi, it's Doug Arthur. Joe, I'm wondering if you could delve into the mix in the concert business a little bit more in the third quarter. Obviously, you had cited some timing issues going into the quarter. Your number of events in North America was up 15%. It looks like attendance per event was down close to 20. That's a pretty unusual mix, for the third quarter. Does that reflect a lack of stadium shows basically, or is there something else going on?
No, you have it exactly right. It's a mix shift. If you look at, just to start, if you look at Q2 and Q3 together, because we told you we were going to have more weight to Q2 this year, those two quarters together is the core concert segment. The concerts business is up about 4% on a constant currency. First of all, you lose a few points on the revenue side just because of the currency fluctuation. Really what's going on, as we've told you over the past nine months, is we have fewer stadium shows. We have about 30 fewer stadium shows this year than last year. We've had tremendous growth in our theater shows, in particular, both in North America and internationally. Those stadium shows that we don't have are the highest volume shows and also the highest average ticket price.
Your theater shows are going to be a much lower average attendance and also a lower ticket price. All you're seeing is some mix shift going on. There still is, across all of the venue types, very strong sell-through demand. We talked about Platinum tickets. We talked about all of the components. The performance is very strong across the board. As we look at next year, we see a big uptick again in our stadium volume, which is what you get the first read on in the business. We're feeling very good. There's absolutely nothing you should read into this other than timing.
Great. Thank you.
At this time, I would like to hand the call back over to our speakers for any additional or closing remarks.
Thank you, everybody.
Well, that does conclude today's conference. We thank you for your participation.