Results

Urban One Inc.

08/13/2025 | Press release | Distributed by Public on 08/13/2025 06:12

Quarterly Report for Quarter Ending June 30, 2025 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
Introduction
Revenue
Within our core radio business, we primarily derive revenue from the sale of advertising time and program sponsorships to local and national advertisers on our radio stations. Advertising revenue is affected primarily by the advertising rates our radio stations are able to charge, as well as the overall demand for radio advertising time in a market. These rates are largely based upon a radio station's audience share in the demographic groups targeted by advertisers, the number of radio stations in the related market, and the supply of, and demand for, radio advertising time. Advertising rates are generally highest during morning and afternoon commuting hours.
In the broadcasting industry, radio stations and television stations often utilize trade or barter agreements to reduce cash expenses by exchanging advertising time for goods or services. In order to maximize cash revenue for our spot inventory, we closely manage the use of trade and barter agreements.
Net revenue consists of gross revenue, net of local and national agency and outside sales representative commissions. Agency and outside sales representative commissions are calculated based on a stated percentage applied to gross billing.
The following table shows the percentage of unaudited condensed consolidated net revenue generated by each reporting segment.
Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Radio Broadcasting segment 40.0% 35.7% 37.7% 35.3%
Reach Media segment 5.8% 16.1% 6.1% 12.3%
Digital segment(1)
11.2% 11.9% 11.1% 11.8%
Cable Television segment(1)
43.7% 36.8% 45.8% 41.1%
All other - corporate/eliminations (0.7)% (0.5) % (0.7) % (0.5) %
(1) Effective January 1, 2025, segment information for the prior periods has been recast in this Quarterly Report on Form 10-Q to include reclassification of a portion of revenues from our CTV offering from the Digital segment to the Cable Television segment.
The following table shows the percentages generated from local and national advertising as a subset of net revenue from our core radio business.
Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
Percentage of core radio business generated from local advertising 65.0% 60.6% 65.5% 62.8%
Percentage of core radio business generated from national advertising, including network advertising 28.4% 31.3% 29.0% 31.0%
National and local advertising also includes advertising revenue generated from our Digital segment and low power television revenue. The balance of net revenue from our Radio Broadcasting segment is generated from ticket sales and revenue related to our sponsored events, management fees and other revenue.
The following table shows the sources of our net revenue for the three months ended June 30, 2025 and 2024:
Three Months Ended June 30,
2025 2024 $ Change % Change
(In thousands)
Net revenue:
Radio advertising $ 38,627 $ 45,421 $ (6,794) (15.0)%
Political advertising 254 2,152 (1,898) (88.2)
Digital advertising(1)
10,241 13,714 (3,473) (25.3)
Cable Television advertising(1)
22,977 23,985 (1,008) (4.2)
Cable Television affiliate fees 17,061 19,315 (2,254) (11.7)
Event revenues & other 2,471 13,157 (10,686) (81.2)
Net revenue $ 91,631 $ 117,744 $ (26,113) (22.2) %
Six Months Ended June 30,
2025 2024 $ Change % Change
(In thousands)
Net revenue:
Radio advertising $ 74,844 $ 86,761 $ (11,917) (13.7) %
Political advertising 404 3,388 (2,984) (88.1)
Digital advertising(1)
20,452 25,881 (5,429) (21.0)
Cable Television advertising(1)
48,402 51,129 (2,727) (5.3)
Cable Television affiliate fees 35,778 40,103 (4,325) (10.8)
Event revenues & other 3,986 14,892 (10,906) (73.2)
Net revenue $ 183,866 $ 222,154 $ (38,288) (17.2) %
(1) Effective January 1, 2025, segment information for the prior periods has been recast in this Quarterly Report on Form 10-Q to include reclassification of a portion of revenues from our CTV offering from the Digital segment to the Cable Television segment.
Reach Media primarily derives its revenue from the sale of advertising in connection with its syndicated radio shows, including the Rickey Smiley Morning Show and the DL Hughley Show. Reach Media also operates www.BlackAmericaWeb.com, an African-American targeted news and entertainment website, in addition to providing various other event-related activities.
Within our Digital segment, Interactive One generates the majority of the Company's digital revenue. Our digital revenue is principally derived from advertising services on non-radio station branded, but Company-owned websites. Advertising services include the sale of banner and sponsorship advertisements. As the Company runs its advertising campaigns, the customer simultaneously receives benefits as impressions are delivered, and revenue is recognized. The amount of revenue recognized each month is based on the number of impressions delivered multiplied by the effective per impression unit price and is equal to the net amount receivable from the customer.
Our Cable Television segment generates the Company's cable television revenue and derives its revenue principally from advertising and affiliate revenue. Advertising revenue is derived from the sale of television airtime to advertisers and is recognized when the advertisements are run. Our Cable Television segment also derives revenue from affiliate fees under the terms of various multi-year affiliation agreements generally based on a per subscriber royalty for the right to distribute the Company's programming under the terms of the distribution contracts.
Expenses
Our significant expenses are: (i) employee salaries and commissions; (ii) programming expenses; (iii) marketing and promotional expenses; (iv) rental of premises for office facilities and studios; (v) rental of transmission tower space; (vi) music license royalty fees; and (vii) content amortization. We strive to control these expenses by centralizing certain functions such as finance, accounting, legal, human resources, and management information systems and, in certain markets, the programming management function. We also use our multiple stations, market presence and purchasing power to negotiate favorable rates with certain vendors and national representative selling agencies. In addition to salaries and commissions, major expenses for our internet business include membership traffic acquisition costs, software product design, post-application software development and maintenance, database and server support costs, the help desk function, data center expenses connected with internet service provider ("ISP") hosting services and other internet content delivery expenses. Major expenses for our Cable Television segment include content acquisition and amortization, sales, and marketing.
We generally incur marketing and promotional expenses to increase and maintain our audiences. However, because Nielsen reports ratings either monthly or quarterly, depending on the particular market, any changed ratings and the effect on advertising revenue tends to lag behind both the reporting of the ratings and the incurrence of advertising and promotional expenditures.
URBAN ONE, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS
The following table summarizes our historical unaudited condensed consolidated results of operations:
Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024
Three Months Ended June 30,
2025 2024 Change
(In thousands)
Net revenue $ 91,631 $ 117,744 $ (26,113) (22.2) %
Operating expenses:
Programming and technical, excluding stock-based compensation 28,647 33,256 (4,609) (13.9)
Selling, general and administrative, excluding stock-based compensation 49,493 60,079 (10,586) (17.6)
Stock-based compensation 574 1,079 (505) (46.8)
Depreciation and amortization 3,523 2,993 530 17.7
Impairment of goodwill and intangible assets 130,078 80,758 49,320 61.1
Total operating expenses 212,315 178,165 34,150 19.2
Operating loss (120,684) (60,421) (60,263) 99.7
Interest and investment income 616 1,777 (1,161) (65.3)
Interest expense (9,704) (12,404) 2,700 (21.8)
Gain on retirement of debt 30,297 7,425 22,872 *NM
Other income, net 124 14 110 *NM
Loss from operations before benefit from income taxes (99,351) (63,609) (35,742) 56.2
Benefit from income taxes 21,382 18,512 2,870 15.5
Net loss from consolidated operations (77,969) (45,097) (32,872) 72.9
Net loss (77,969) (45,097) (32,872) 72.9
Net (loss) income attributable to non-controlling interests (67) 334 (401) *NM
Net loss attributable to common stockholders $ (77,902) $ (45,431) $ (32,471) 71.5 %
*NM - Not meaningful
Net Revenue
Three Months Ended June 30, Change
2025 2024
$ 91,631 $ 117,744 $ (26,113) (22.2) %
During the three months ended June 30, 2025, we recognized approximately $91.6 million in net revenue compared to approximately $117.7 million during the three months ended June 30, 2024. These amounts are net of agency and outside sales representative commissions. We recognized approximately $36.7 million of revenue from our Radio Broadcasting segment during the three months ended June 30, 2025, compared to approximately $42.0 million during the three months ended June 30, 2024, a decrease of approximately $5.3 million.This decrease was primarily driven by weaker overall market demand from the national advertisers and lower event revenues.We recognized approximately $5.3 million of revenue from our Reach Media segment during the three months ended June 30, 2025, compared to approximately $18.9 million for the three months ended June 30, 2024, a decrease of approximately $13.6 million. This decrease was primarily driven by a decrease in overall demand and the timing of Fantastic Voyage cruise sailing, that that took place in May 2024. The 2025 Fantastic Voyage cruise is scheduled to take place in October 2025.We recognized approximately $10.3 million of revenue from our Digital segment during the three months ended June 30, 2025, compared to approximately $14.1 million for the three months ended June 30, 2024, a decrease of approximately $3.8 million. This decrease wasprimarily driven by the decrease in national digital sales and direct revenue streams.We recognized approximately $40.1 million of revenue from our Cable Television segment during the three months ended June 30, 2025, compared to approximately $43.3 million for the three months ended June 30, 2024, a decrease of approximately $3.2 million. This decrease was primarily driven by the churn of subscribers.
Operating Expenses
Programming And Technical, Excluding Stock-based Compensation
Three Months Ended June 30, Change
2025 2024
$ 28,647 $ 33,256 $ (4,609) (13.9) %
Programming and technical expenses include expenses associated with on-air talent and the management and maintenance of the systems, tower facilities, and studios used in the creation, distribution, and broadcast of programming content on our radio stations. Programming and technical expenses for the Radio Broadcasting segment also include expenses associated with our programming research activities and music royalties. For our Digital segment, programming and technical expenses include software product design, post-application software development and maintenance, database and server support costs, the help desk function, data center expenses connected with ISP hosting services and other internet content delivery expenses. For our Cable Television segment, programming and technical expenses include expenses associated with technical, programming, production, and content management. Programming and technical expenses were approximately $28.6 million for the three months ended June 30, 2025, compared to $33.3 million for the three months ended June 30, 2024, respectively. For our Cable Television segment, the $2.5 million decrease was primarily due to lower program production cost. The $1.4 million decrease in our Radio Broadcasting segment was primarily due to lower headcount. The $0.5 million decrease in our Reach Media segment was primarily due to the loss of one of our nationally syndicated shows.
Selling, General And Administrative, Excluding Stock-based Compensation
Three Months Ended June 30, Change
2025 2024
$ 49,493 $ 60,079 $ (10,586) (17.6) %
Selling, general and administrative expenses include expenses associated with our sales departments, offices, corporate headquarters and facilities, marketing and promotional expenses, special events and sponsorships, and back-office expenses. Expenses associated with securing ratings data for our radio stations and visitors' data for our websites, personnel, and other corporate overhead functions are also included in selling, general and administrative expenses. In addition, selling, general and administrative expenses for the Radio Broadcasting segment and Digital segment include expenses related to the advertising traffic (scheduling and insertion) functions. Selling, general and administrative expenses also include membership traffic acquisition costs for our Digital segment. Selling, general and administrative expenses were approximately $49.5 million for the three months ended June 30, 2025, compared to approximately $60.1 million for the three months ended June 30, 2024, a decrease of approximately $10.6 million. This decrease was mainly driven by the decreases in our Digital, Cable Television, Radio Broadcasting, and Reach Media segments, offset by an increase from our corporate headquarters. Expenses in our Digital segment decreased approximately $0.7 million compared to the three months ended June 30, 2024, primarily due to decreased bad debt expense.Expenses in our Cable Television segment decreased approximately $2.8 million for the three months ended June 30, 2025, compared to the three months ended June 30, 2024,primarily due to decreases in consumer marketing campaign spending.Expenses in our Radio Broadcasting segmentdecreased approximately $1.1 million for the three months ended June 30, 2025, compared to the three months ended June 30, 2024, primarilydue to decreases in sales commissions, national rep fees, and station event expenses as well as lower headcount. Expenses in our Reach Media segment decreased approximately $8.1 million for the three months ended June 30, 2025, compared to the three months ended June 30, 2024, primarily due to the Fantastic Voyage cruise that took place in May 2024. The 2025 Fantastic Voyage cruise is scheduled to take place in October 2025. Our corporate headquarters' expenses increased approximately $2.1 millionfor the three months ended June 30, 2025, compared to the three months ended June 30, 2024, primarily due to the change in the fair value of the Employment Agreement Award liability (as defined in Note 5 - Fair Value Measurements) offset bylower professional services costs.
Stock-based Compensation
Three Months Ended June 30, Change
2025 2024
$ 574 $ 1,079 $ (505) (46.8) %
Stock-based compensation expense was approximately $0.6 million for the three months ended June 30, 2025, compared to approximately $1.1 million for the three months ended June 30, 2024, a decrease of approximately $0.5 million. The decrease was primarily due to the timing of vesting of stock awards for executive officers.
Depreciation And Amortization
Three Months Ended June 30, Change
2025 2024
$ 3,523 $ 2,993 $ 530 17.7 %
Depreciation and amortization expense was approximately $3.5 million for the three months ended June 30, 2025, compared to approximately $3.0 million for the three months ended June 30, 2024, an increase of approximately $0.5 million.This increase is primarily driven by the TV One Trade Name and radio broadcasting license amortization (as described in Note 8 - Goodwill and Other Intangible Assets) offset by additional depreciation on leasehold improvements during the three months ended June 30, 2024.
Impairment Of Goodwill And Intangible Assets
Three Months Ended June 30, Change
2025 2024
$ 130,078 $ 80,758 $ 49,320 61.1 %
Impairment of goodwill and intangible assets was approximately $130.1 million during the three months ended June 30, 2025, compared to $80.8 millionduring the three months ended June 30, 2024. See Note 8 - Goodwill and Other Intangible Assetsof the Company's unaudited condensed consolidated financial statements for further discussion.
Interest And Investment Income
Three Months Ended June 30, Change
2025 2024
$ 616 $ 1,777 $ (1,161) (65.3) %
Interest and investment income was approximately $0.6 million for the three months ended June 30, 2025, compared to approximately $1.8 million for the three months ended June 30, 2024. The decreasewas driven by lower cash and cash equivalents balances during the three months ended June 30, 2025, than in the corresponding period in 2024.
Interest Expense
Three Months Ended June 30, Change
2025 2024
$ (9,704) $ (12,404) $ 2,700 (21.8) %
Interest expense was approximately $9.7 million for the three months ended June 30, 2025, compared to approximately $12.4 million for the three months ended June 30, 2024, a decrease of approximately $2.7 million. This decrease was due to lower overall debt balances outstanding. See Note 9- Long-Term Debtof the Company's unaudited condensed consolidated financial statements for further discussion.
Gain On Retirement Of Debt
Three Months Ended June 30, Change
2025 2024
$ 30,297 $ 7,425 $ 22,872 *NM
There was an approximately $30.3 million gain on retirement of debt for the three months ended June 30, 2025, compared to $7.4 million for the three months ended June 30, 2024. During the three months ended June 30, 2025, the Company repurchased approximately $64.0 millionof its 2028 Notesat an average price of approximately 51.8%of par, resulting in a net gain on retirement of debt of approximately $30.3 million. During the three monthsJune 30, 2024, the Company repurchased approximately $35.5 millionof its 2028 Notes at an average price of approximately 78.0%of par, resulting in a net gain on retirement of debt of approximately $7.4 million.
Benefit From Income Taxes
Three Months Ended June 30, Change
2025 2024
$ 21,382 $ 18,512 $ 2,870 15.5 %
For the three months ended June 30, 2025, we recorded a benefit from income taxes of approximately $21.4 million resulting in an effective tax rate of 21.5%, which includes $6.4 million of discrete tax expense primarily related to the impact of the change of accounting estimate for radio broadcasting licenses that impacted our valuation allowance. For the three months ended June 30, 2024, we recorded a benefit from income taxes of approximately $18.5 million. This amount is based on the actual effective tax rate of 29.1%. This rate includes $0.1 million of discrete tax benefits primarily related to deferred rate changes.
Net (Loss) Income Attributable To Non-controlling Interests
Three Months Ended June 30, Change
2025 2024
$ (67) $ 334 $ (401) *NM
Net (loss) income attributable to non-controlling interests was approximately $(0.1) million for the three months ended June 30, 2025 compared to approximately $0.3 million for the three months ended June 30, 2024.The decrease in net income attributable to non-controlling interests was primarily due to the change in ownership interest in Reach Media during the first quarter of 2025 and decreased profitability in the business compared to the same period in 2024.
The following table summarizes our historical unaudited condensed consolidated results of operations:
Six Months Ended June 30, 2025 Compared To Six Months Ended June 30, 2024
Six Months Ended June 30,
2025 2024 Change
(In thousands)
Net revenue $ 183,866 $ 222,154 $ (38,288) (17.2) %
Operating expenses:
Programming and technical, excluding stock-based compensation 59,245 65,915 (6,670) (10.1)
Selling, general and administrative, excluding stock-based compensation 99,598 115,708 (16,110) (13.9)
Stock-based compensation 1,250 2,463 (1,213) (49.2)
Depreciation and amortization 5,838 4,843 995 20.5
Impairment of goodwill and intangible assets 136,521 80,758 55,763 69.0
Total operating expenses 302,452 269,687 32,765 12.1
Operating loss (118,586) (47,533) (71,053) *NM
Interest and investment income 1,582 3,775 (2,193) (58.1)
Interest expense (20,628) (25,402) 4,774 (18.8)
Gain on retirement of debt 41,884 15,299 26,585 *NM
Other income, net 316 900 (584) (64.9)
Loss from operations before benefit from income taxes (95,432) (52,961) (42,471) 80.2
Benefit from income taxes 5,724 16,010 (10,286) (64.2)
Net loss from consolidated operations (89,708) (36,951) (52,757) *NM
Loss from unconsolidated joint venture - (411) 411 (100.0)
Net loss (89,708) (37,362) (52,346) *NM
Net (loss) income attributable to non-controlling interests (64) 576 (640) *NM
Net loss attributable to common stockholders $ (89,644) $ (37,938) $ (51,706) *NM
Net Revenue
Six Months Ended June 30, Change
2025 2024
$ 183,866 $ 222,154 $ (38,288) (17.2) %
During the six months ended June 30, 2025, we recognized approximately $183.9 million in net revenue compared to approximately $222.2 million during the six months ended June 30, 2024. These amounts are net of agency and outside sales representative commissions. We recognized approximately $69.3 million of revenue from our Radio Broadcasting segment during the six months ended June 30, 2025, compared to approximately $78.4 million during the six months ended June 30, 2024, a decrease of approximately $9.0 million. This decrease was primarily driven by weaker overall market demand from the national advertisers, lower event revenues, and lower political revenues. We recognized approximately $11.2 million of revenue from our Reach Media segment during the six months ended June 30, 2025, compared to approximately $27.4 million for the six months ended June 30, 2024, a decrease of approximately $16.2 million. The decrease was primarily driven by the Fantastic Voyage sailing in Q2 2024, versus its October scheduling in 2025, decrease in overall demand, and attrition of advertisers. We recognized approximately $20.5 million of revenue from our Digital segment during the six months ended June 30, 2025, compared to approximately $26.3 million for the six months ended June 30, 2024, a decrease of approximately $5.8 million. The decrease was primarily driven by a decrease in national digital sales and direct revenue streams. We recognized approximately $84.3 million of revenue from our Cable Television segment during the six months ended June 30, 2025, compared to approximately $91.3 million for the six months ended June 30, 2024, a decrease of approximately $7.1 million. The decrease was primarily driven by a decrease in audience viewership affecting advertising sales and the continued churn in subscribers.
Operating Expenses
Programming And Technical, Excluding Stock-based Compensation
Six Months Ended June 30, Change
2025 2024
$ 59,245 $ 65,915 $ (6,670) (10.1) %
Programming and technical expenses include expenses associated with on-air talent and the management and maintenance of the systems, tower facilities, and studios used in the creation, distribution, and broadcast of programming content on our radio stations. Programming and technical expenses for the Radio Broadcasting segment also include expenses associated with our programming research activities and music royalties. For our Digital segment, programming and technical expenses include software product design, post-application software development and maintenance, database and server support costs, the help desk function, data center expenses connected with ISP hosting services and other internet content delivery expenses. For our Cable Television segment, programming and technical expenses include expenses associated with technical, programming, production, and content management. Programming and technical expenses were approximately $59.2 million for the six months ended June 30, 2025, compared to approximately $65.9 million for the six months ended June 30, 2024, a decrease of approximately $6.7 million. Expenses in our Cable Television segment for the six months ended June 30, 2025, decreased approximately $4.2 million compared to the six months ended June 30, 2024. The decrease was primarily driven by productions that occurred in 2024 and did not return in 2025. Expenses in our Reach Media segment for the six months ended June 30, 2025, decreased approximately $0.6 million compared to the six months ended June 30, 2024. The decrease was primarily driven by the cancellation of one of our nationally syndicated shows. Expenses in our Radio Broadcasting segment for the six months ended June 30, 2025, decreased approximately $1.5 million, compared to the six months ended June 30, 2024. This decrease was primarily driven by lower headcount. Expenses in our Digital segment for the six months ended June 30, 2025, decreased approximately $0.6 million compared to the six months ended June 30, 2024 primarily driven by lower headcount and lower contract labor expense.
Selling, General and Administrative, Excluding Stock-based Compensation
Six Months Ended June 30, Change
2025 2024
$ 99,598 $ 115,708 $ (16,110) (13.9) %
Selling, general and administrative expenses include expenses associated with our sales departments, offices, corporate headquarters and facilities, marketing and promotional expenses, special events and sponsorships, and back-office expenses. Expenses associated with securing ratings data for our radio stations and visitors' data for our websites, personnel, and other corporate overhead functions are also included in selling, general and administrative expenses. In addition, selling, general and administrative expenses for the Radio Broadcasting segment and Digital segment include expenses related to the advertising traffic (scheduling and insertion) functions. Selling, general and administrative expenses also include membership traffic acquisition costs for our Digital segment. Selling, general and administrative expenses were approximately $99.6 million for the six months ended June 30, 2025, compared to approximately $115.7 million for the six months ended June 30, 2024, a decrease of approximately $16.1 million. Expenses in our Radio Broadcasting segment decreased approximately $1.9 million for the six months ended June 30, 2025, compared to the six months ended June 30, 2024, primarily due to decreases in sales commission and station event expenses, as well as, lower headcount. Expenses in our Reach Media segment decreased approximately $8.0 millionfor the six months ended June 30, 2025, compared to the six months ended June 30, 2024,primarily due to the timing of the Fantastic Voyage cruise in May 2024 vs. October 2025. Expenses in our Digital segment remained flat the six months ended June 30, 2025 and 2024. Expenses in our Cable Television segment decreased approximately $4.2 millionfor the six months ended June 30, 2025, compared to the six months ended June 30, 2024, primarily due to a decrease in consumer marketing and affiliate expenses. Our corporate headquarters' expenses decreased approximately $1.8 million for the six months ended June 30, 2025, compared to the six months ended June 30, 2024, primarily due to lower professional service costs offset by the change in the fair value of the Employment Agreement Award (as defined in Note 5 - Fair Value Measurements).
Stock-based Compensation
Six Months Ended June 30, Change
2025 2024
$ 1,250 $ 2,463 $ (1,213) (49.2) %
Stock-based compensation expense was approximately $1.3 million for the six months ended June 30, 2025, compared to approximately $2.5 million for the six months ended June 30, 2024, a decrease of approximately $1.2 million. The decrease in stock-based compensation was primarily due to the timing of vesting of stock awards for executive officers.
Depreciation And Amortization
Six Months Ended June 30, Change
2025 2024
$ 5,838 $ 4,843 $ 995 20.5 %
Depreciation and amortization expense was approximately $5.8 million for the six months ended June 30, 2025, compared to approximately $4.8 million for the six months ended June 30, 2024, an increase of approximately $1.0 million driven mainly by the additional TV One Trade Name and radio broadcasting amortization of $2.5 million as described in Note 8 - Goodwill and Other Intangible Assetsof the Company's unaudited condensed consolidated financial statements the six months ended June 30, 2025, offset by lower depreciation expense for property and equipment.
Impairment of Goodwill And Intangible Assets
Six Months Ended June 30, Change
2025 2024
$ 136,521 $ 80,758 $ 55,763 69.0 %
Impairment of goodwill and intangible assets was approximately $136.5 million during the six months ended June 30, 2025,compared to approximately $80.8 millionfor the six months ended June 30, 2024. See Note 8 - Goodwill and Other Intangible Assetsof the Company's unaudited condensed consolidated financial statements for further discussion.
Interest And Investment Income
Six Months Ended June 30, Change
2025 2024
$ 1,582 $ 3,775 $ (2,193) (58.1) %
Interest income was approximately $1.6 million for the six months ended June 30, 2025, compared to approximately $3.8 million for the six months ended June 30, 2024. The decrease was driven by lower cash and cash equivalents balances during the six months ended June 30, 2025, than in the corresponding period in 2024.
Interest Expense
Six Months Ended June 30, Change
2025 2024
$ (20,628) $ (25,402) $ 4,774 (18.8) %
Interest expense was approximately $20.6 million for the six months ended June 30, 2025, compared to approximately $25.4 million for the six months ended June 30, 2024, a decrease of approximately $4.8 million. The decrease was due to lower overall debt balances outstanding during the six months ended June 30, 2025. See Note 9 -Long-Term Debt of our unaudited condensed consolidated financial statements for further information.
Gain On Retirement Of Debt
Six Months Ended June 30, Change
2025 2024
$ 41,884 $ 15,299 $ 26,585 *NM
There was approximately an $41.9 million gain on retirement of debt for the six months ended June 30, 2025, compared to approximately $15.3 millionfor the six months ended June 30, 2024. During the six months ended June 30, 2025, the Company repurchased approximately $92.2 million of its 2028 Notes at an average price of approximately 53.7%of par, resulting in a net gain on retirement of debt of approximately $41.9 million. During the six months ended June 30, 2024, the Company repurchased approximately $110.5 million of its 2028 Notesat an average price of approximately 85.0% of par, resulting in a net gain on retirement of debt of approximately $15.3 million.
Other income, net
Six Months Ended June 30, Change
2025 2024
$ 316 $ 900 $ (584) (64.9) %
Other income, net, was approximately $0.3 million for the six months ended June 30, 2025, compared to approximately $0.9 million for the six months ended June 30, 2024. During the six months ended June 30, 2024,the Company recognized income related to the sale of its equity interest in Broadcast Music, Inc.
Benefit from income taxes
Six Months Ended June 30, Change
2025 2024
$ 5,724 $ 16,010 $ (10,286) (64.2) %
For the six months ended June 30, 2025, we recorded a benefit from income taxes of approximately $5.7 million. This amount is based on the actual effective tax rate of 6.0%. This rate includes approximately $14.6 million of discrete tax expense related to valuation allowance for net operating losses, and approximately $6.6 million of discrete tax expense related to the impact of the change of accounting estimate for radio broadcasting licenses. For the six months ended June 30, 2024, we recorded a benefit from income taxes of approximately $16.0 million. This amount is based on the actual effective tax rate of 30.0%. This rate includes $0.1 million of discrete tax benefits primarily related to deferred rate changes.
Loss From Unconsolidated Joint Venture
Six Months Ended June 30, Change
2025 2024
$ - $ (411) $ 411 (100.0) %
For the six months ended June 30, 2024, we recognized approximately $0.4 million loss from the termination of an unconsolidated joint venture related to the Company's investment on RVAEH.
Net (Loss) Income Attributable To Non-controlling Interests
Six Months Ended June 30, Change
2025 2024
$ (64) $ 576 $ (640) *NM
Net (loss) income attributable to non-controlling interests was approximately $(0.1) million for the six months ended June 30, 2025, compared to approximately $0.6 million for the six months ended June 30, 2024. The decrease in net income attributable to non-controlling interests was primarily due to the increase of our change in ownership interest in Reach Media during the six months ended June 30, 2025, compared to the six months ended June 30, 2024
Non-GAAP Financial Measures
The presentation of non-GAAP financial measures is not intended to be considered in isolation from, as a substitute for, or superior to the financial information prepared and presented in accordance with accounting principles generally accepted in the United States ("GAAP"). We use non-GAAP financial measures including broadcast and digital operating income and Adjusted EBITDA as additional means to evaluate our business and operating results through period-to-period comparisons. Reconciliations of our non-GAAP financial measures to the most directly comparable GAAP financial measures are included below for review. Reliance should not be placed on any single financial measure to evaluate our business.
Measurement Of Performance
We monitor and evaluate the growth and operational performance of our business using net loss and the following key metrics:
(a)Net revenue: The performance of an individual radio station or group of radio stations in a particular market is customarily measured by its ability to generate net revenue. Net revenue consists of gross revenue, net of local and national agency and outside sales representative commissions consistent with industry practice. Net revenue is recognized in the period in which advertisements are broadcast. Net revenue also includes advertising aired in exchange for goods and services, which is recorded at fair value, revenue from sponsored events and other revenue. Net revenue is recognized for our online business as impressions are delivered. Net revenue is recognized for our Cable Television segment as advertisements are run or impressions delivered, and during the term of the affiliation agreements at levels appropriate for the most recent subscriber counts reported by the affiliate, net of launch support.
(b)Broadcast and digital operating income: The broadcasting industry commonly refers to "station operating income" which consists of net loss before depreciation and amortization, income taxes, interest expense, interest and investment income, non-controlling interests in income of subsidiaries, other income, net, loss from unconsolidated joint venture, corporate selling, general and administrative expenses, stock-based compensation, impairment of goodwill and intangible assets, and (gain) loss on retirement of debt. However, given the diverse nature of our business, station operating income is not truly reflective of our multi-media operation and, therefore, we use the term "broadcast and digital operating income." Broadcast and digital operating income is not a measure of financial performance under GAAP. Nevertheless, broadcast and digital operating income is a significant measure used by our management to evaluate the operating performance of our core operating segments. Broadcast and digital operating income provides helpful information about our results of operations, apart from expenses associated with our fixed assets and goodwill and intangible assets, income taxes, investments, impairment charges, debt financings and retirements, corporate overhead, and stock-based compensation. Our measure of broadcast and digital operating income is similar to industry use of station operating income; however, it reflects our more diverse business and therefore is not completely analogous to "station operating income" or other similarly titled measures as used by other companies. Broadcast and digital operating income does not represent operating income or loss, or cash flow from operating activities, as those terms are defined under GAAP, and should not be considered as an alternative to those measurements as an indicator of our performance.
Broadcast and digital operating income decreased to approximately $25.7 million for the three months ended June 30, 2025, compared to approximately $34.2 million for the three months ended June 30, 2024, a decrease of approximately $8.5 million or 25.0%. This decrease was primarily due to lower broadcast and digital operating income at all segments but our Cable Television segment. Our Digital segment generated approximately $0.1 million of broadcast and digital operating loss during the three months ended June 30, 2025, compared to approximately broadcast and digital operating income of $2.9 million during the three months ended June 30, 2024, primarily due to lower revenues offset by lower expenses. Reach Media generated approximately $0.9 million of broadcast and digital operating loss during the three months ended June 30, 2025, compared to approximately $4.3 million of broadcast and digital operating income during the three months ended June 30, 2024, primarily due to lower revenues offset by lower expenses. Our Radio Broadcasting segment generated approximately $6.9 million of broadcast and digital operating income during the three months ended June 30, 2025, compared to approximately $10.8 million during the three months ended June 30, 2024, primarily due to lower revenues offset by lower expenses. Finally, Cable Television generated approximately $19.8 million of broadcast and digital operating income during the three months ended June 30, 2025, compared to approximately $16.0 million during the three months ended June 30, 2024. The increase in the Cable Television segment's broadcast and digital operating income was primarily due to lower expenses offset by lower net revenue.
Broadcast and digital operating income decreased to approximately $48.7 million for the six months ended June 30, 2025, compared to approximately $66.2 million for the six months ended June 30, 2024, a decrease of approximately $17.5 million or 26.5%. The decrease was primarily due to lower broadcast and digital operating income at all segments but our Cable Television segment. Our Digital segment generated approximately $0.1 million of broadcast and digital operating loss during the six months ended June 30, 2025, compared to approximately $5.9 million of broadcast and digital operating income during the six months ended June 30, 2024, primarily due to lower revenues offset by lower expenses. Reach Media generated approximately $0.7 million of broadcast and digital operating loss during the six months ended June 30, 2025, compared to approximately $6.9 million of broadcast and digital operating income during the six months ended June 30, 2024, primarily due to lower revenues offset by lower expenses. Cable television generated approximately $39.8 million of broadcast and digital operating income during the six months ended June 30, 2025, compared to approximately $35.5 million during the six months ended June 30, 2024. The increase in the Cable Television segment's broadcast and digital operating income was primarily due to lower expenses offset by lower net revenue. Finally, our Radio Broadcasting segment generated approximately $9.7 million of broadcast and digital operating income during the six months ended June 30, 2025, compared to approximately $17.4 million during the six months ended June 30, 2024, primarily due to lower revenues offset by lower expenses.
(c)Adjusted EBITDA: Adjusted EBITDA consists of net loss plus (1) depreciation and amortization, income taxes, interest expense, net income attributable to non-controlling interests, impairment of goodwill and intangible assets,stock-based compensation, (gain) loss on retirement of debt, corporate development costs, severance-related costs, investment income, loss from unconsolidated joint venture, loss from ceased non-core business initiatives less (2) other income, net and interest and investment income. Net loss before interest income, interest expense, income taxes, depreciation and amortization is commonly referred to in our business as "EBITDA." Adjusted EBITDA and EBITDA are not measures of financial performance under GAAP. We believe Adjusted EBITDA is often a useful measure of a company's operating performance and is a significant measure used by our management to evaluate the operating performance of our business. Accordingly, based on the previous description of Adjusted EBITDA, we believe that it provides useful information about the operating performance of our business, apart from the expenses associated with our fixed assets and goodwill and intangible assets, or capital structure. Adjusted EBITDA is frequently used as one of the measures for comparing businesses in the broadcasting industry, although our measure of Adjusted EBITDA may not be comparable to similarly titled measures of other companies, including, but not limited to the fact that our definition includes the results of all four of our operating segments (Radio Broadcasting, Reach Media, Digital, and Cable Television). Business activities unrelated to these four segments are included in "Corporate/Eliminations/ Other" line item in the reconciliation to the pre-tax income. Adjusted EBITDA and EBITDA do not purport to represent operating income or cash flow from operating activities, as those terms are defined under GAAP, and should not be considered as alternatives to those measurements as an indicator of our performance.
Summary Of Performance
The tables below provide a summary of our performance based on the metrics described above:
Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
(In thousands) (In thousands)
Net revenue $ 91,631 $ 117,744 $ 183,866 $ 222,154
Broadcast and digital operating income 25,664 34,196 48,680 66,210
Adjusted EBITDA(a)
13,960 28,922 26,817 51,179
Net loss to common stockholders (77,902) (45,431) (89,644) (37,938)
(a)In 2024, we made an immaterial change to the definition of Adjusted EBITDA by adding back the loss from ceased non-core operations. All historical periods were recast to reflect this immaterial change.
The reconciliation of net loss attributable to common stockholders to broadcast and digital operating income is as follows:
Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
(In thousands) (In thousands)
Net loss to common stockholders $ (77,902) $ (45,431) $ (89,644) $ (37,938)
Add back/(deduct) certain non-broadcast and digital operating income items included in net loss:
Interest and investment income (616) (1,777) (1,582) (3,775)
Interest expense 9,704 12,404 20,628 25,402
Benefit from income taxes (21,382) (18,512) (5,724) (16,010)
Corporate selling, general and administrative, excluding stock-based compensation 12,173 9,787 23,657 25,679
Stock-based compensation 574 1,079 1,250 2,463
Gain on retirement of debt (30,297) (7,425) (41,884) (15,299)
Other income, net (124) (14) (316) (900)
Loss from unconsolidated joint venture - - - 411
Depreciation and amortization 3,523 2,993 5,838 4,843
Net (loss) income attributable to non-controlling interests (67) 334 (64) 576
Impairment of goodwill and intangible assets 130,078 80,758 136,521 80,758
Broadcast and digital operating income $ 25,664 $ 34,196 $ 48,680 $ 66,210
The reconciliation of net loss attributable to common stockholders to Adjusted EBITDA is as follows:
Three Months Ended June 30, Six Months Ended June 30,
2025 2024 2025 2024
(In thousands) (In thousands)
Net loss to common stockholders $ (77,902) $ (45,431) $ (89,644) $ (37,938)
Add back/(deduct) certain non-broadcast and digital operating income items included in net loss:
Interest and investment income (616) (1,777) (1,582) (3,775)
Interest expense 9,704 12,404 20,628 25,402
Benefit from income taxes (21,382) (18,512) (5,724) (16,010)
Depreciation and amortization 3,523 2,993 5,838 4,843
EBITDA $ (86,673) $ (50,323) $ (70,484) $ (27,478)
Stock-based compensation 574 1,079 1,250 2,463
Gain on retirement of debt (30,297) (7,425) (41,884) (15,299)
Other income, net (124) (14) (316) (900)
Loss from unconsolidated joint venture - - - 411
Net (loss) income attributable to non-controlling interests (67) 334 (64) 576
Corporate costs(a)
362 3,488 1,109 8,847
Severance-related costs - 516 219 580
Impairment of goodwill and intangible assets 130,078 80,758 136,521 80,758
Loss from ceased non-core business initiatives(b)
107 509 466 1,221
Adjusted EBITDA $ 13,960 $ 28,922 $ 26,817 $ 51,179
(a)Corporate costs include professional fees related to the material weakness remediation efforts.
(b)In 2024, we made an immaterial change to the definition of Adjusted EBITDA by adding back the loss from ceased non-core operations. All historical periods were recast to reflect this immaterial change.
LIQUIDITY AND CAPITAL RESOURCES
Our primary source of liquidity is cash provided by operations and, to the extent necessary, borrowings available under our asset-backed credit facility. Our cash, cash equivalents and restricted cash balance was approximately $86.2 million as of June 30, 2025. As of June 30, 2025, there were no borrowings outstanding on the Current ABL Facility (as defined below) which has $50.0 million in overall capacity.
The Company regularly considers the impact of macroeconomic conditions on our business. Uncertainty in the macroeconomic environment with newly implemented tariffs, continued increases in inflation and interest rates, along with banking volatility, may have an adverse effect on our revenues.
From time to time, the Company may repurchase its outstanding debt and/or equity securities in open market purchases. Under open authorizations, repurchases of our outstanding debt and/or equity securities may be made from time to time in the open market or in privately negotiated transactions in accordance with applicable laws and regulations. Repurchased debt and equity securities are retired when repurchased. The timing and extent of any repurchases will depend upon prevailing market conditions, the trading price of the Company's outstanding debt and/or equity securities and other factors, and subject to restrictions under applicable law.
On September 27, 2022, the Compensation Committee authorized the repurchase of up to approximately $0.5 million (the "Employee Stock Repurchase Authorization") worth of shares in the aggregate from employees who want to sell in connection with the Company's most recent employee stock grant. During the six months ended June 30, 2025 and 2024, the Company did not repurchase any shares of Class A stock in connection with the Employee Stock Repurchase Authorization. During the six months ended June 30, 2025, the Company repurchased 98,976 shares of Class D stock under the Employee Stock Repurchase Authorization at an average price of $0.98 for a total amount of approximately $0.1 million. During the six months ended June 30, 2024, the Company repurchased 25,285 shares of Class D stock under the authorization at an average price of $3.76 for a total amount of approximately $0.1 million. The Company has approximately $0.1 million remaining under the Employee Stock Repurchase Authorization.
In addition, the Company has limited but ongoing authority to purchase shares of Class D common stock (in one or more transactions at any time there remain outstanding grants) under the 2019 Equity and Performance Incentive Plan. This limited authority is used to satisfy any employee or other recipient tax obligations in connection with the exercise of an option or a share grant under the 2019 Equity and Performance Incentive Plan, to the extent that the Company has capacity under its financing agreements (i.e., its current credit facilities and indentures) (each a "Stock Vest Tax Repurchase").
On June 10, 2024, the Company's Board of Directors approved a share repurchase authorization to repurchase up to $20.0 million of the Company's outstanding Class A and/or Class D Common Stock (collectively, the "2024 Stock Repurchase Program") on a cash basis.
During the six months ended June 30, 2025, the Company repurchased 675,293 shares of Class A Common Stock under the 2024 Stock Repurchase Program of approximately $1.0 million at an average price of $1.53 per share. During the six months ended June 30, 2024, the Company repurchased 449,277 shares of Class A Common Stock in the amount of approximately $0.9 million at an average price of $2.06 per share.
During the six months ended June 30, 2025, the Company repurchased 405,195 shares of Class D Common Stock in the amount of approximately $0.3 million at an average price of $0.70 per share. During the six months ended June 30, 2024, the Company repurchased 87,659 shares of Class D Common Stock in the amount of approximately $0.1 million at an average price of $1.59 per share.
After giving effect to the above transactions across both our Class A and our Class D Common Stock, the 2024 Stock Repurchase Program has approximately $12.2 million remaining under the authorization. See Note 14- Subsequent Eventsof our unaudited condensed consolidated financial statements for additional purchases subsequent to June 30, 2025.
During the six months ended June 30, 2025, the Company executed Stock Vest Tax Repurchases of 394,439 shares of Class D Common Stock in the amount of approximately $0.3 millionat a price of $0.78 per share. During the six months ended June 30, 2024, the Company executed Stock Vest Tax Repurchases of 396,391shares of Class D Common Stock in the amount of approximately $1.3 million at an average price of $3.35 per share.
On January 25, 2021, the Company closed on an offering (the "2028 Notes") of $825.0 million in aggregate principal amount of the 2028 Notes in a private offering exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"). The 2028 Notes are general senior secured obligations of the Company and are guaranteed on a senior secured basis by certain of the Company's direct and indirect restricted subsidiaries. The 2028 Notes mature on February 1, 2028, and interest on the Notes accrues and is payable semi-annually in arrears on February 1 and August 1 of each year, commencing on August 1, 2021 at the rate of 7.375% per annum.
The 2028 Notes Offering and the guarantees are secured, subject to permitted liens and except for certain excluded assets (i) on a first priority basis by substantially all of the Company's and the guarantors' current and future property and assets (other than accounts receivable, cash, deposit accounts, other bank accounts, securities accounts, inventory and related assets that secure our asset-backed revolving credit facility on a first priority basis (the "ABL Priority Collateral"), including the capital stock of each guarantor (collectively, the "Notes Priority Collateral") and (ii) on a second priority basis by the ABL Priority Collateral.
During the first quarter of 2025, the Board of Directors authorized and approved a further note repurchase program for up to $75.0 million of the currently outstanding 2028 Notes (the "March 2025 Authorization") on a cash basis.
During the three months ended June 30, 2025 the Company repurchased approximately $64.0 millionof its 2028 Notes at an average price of approximately 51.8% of par, resulting in a net gain on retirement of debt of approximately $30.3 million. During the six months ended June 30, 2025, the Company repurchased approximately $92.2 million of its 2028 Notes at an average price of approximately 53.7%of par, resulting in a net gain on retirement of debt of approximately $41.9 million. There is approximately $48.2 millionremaining under the March 2025 authorization.
During the three monthsJune 30, 2024, the Company repurchased approximately $35.5 millionof its 2028 Notes at an average price of approximately 78.0%of par, resulting in a net gain on retirement of debt of approximately $7.4 million. During the six months ended June 30, 2024, the Company repurchased approximately $110.5 million of its 2028 Notes at an average price of approximately 85.0%of par, resulting in a net gain on retirement of debt of approximately $15.3 million. As of June 30, 2025, the total outstanding aggregate principal amount of the senior secured notes due 2028 is approximately $492.3 million.
On February 19, 2021, the Company closed on an asset backed credit facility (the "Current ABL Facility"). The Current ABL Facility is governed by a credit agreement by and among the Company, the other borrowers party thereto, the lenders party thereto from time to time and Bank of America, N.A., as administrative agent. The Current ABL Facility provides for up to $50.0 million revolving loan borrowings in order to provide for the working capital needs and general corporate requirements of the Company. The Current ABL Facility also provides for a letter of credit facility up to $5.0 million as a part of the overall $50.0 million in capacity. As of June 30, 2025, there was no balance outstanding on the Current ABL Facility.
At the Company's election, the interest rate on borrowings under the Current ABL Facility are based on either (i) the then applicable margin relative to Base Rate Loans (as defined in the Current ABL Facility) or (ii) until the Waiver and Amendment (as defined below) took effect, the then applicable margin relative to LIBOR Loans (as defined in the Current ABL Facility) corresponding to the average availability of the Company for the most recently completed fiscal quarter.
On April 30, 2023, the Company entered into a waiver and amendment (the "Waiver and Amendment") to the Current ABL Facility. The Waiver and Amendment waived certain events of default under the Current ABL Facility related to the Company's failure to timely deliver certain Annual Financial Deliverables for the fiscal year ended December 31, 2022. Additionally, under the Waiver and Amendment, the Current ABL Facility was amended to provide that from and after the date thereof, any request for a new LIBOR Loan (as defined in the Current ABL Facility), for a continuation of an existing LIBOR Loan (as defined in the Current ABL Facility) or for a conversion of a Loan to a LIBOR Loan (as defined in the Current ABL Facility) shall be deemed to be a request for a loan bearing interest at Term SOFR (as defined in the Amended Current ABL Facility) (the "SOFR Interest Rate Change").
As the Company was undrawn under the Current ABL Facility as of the date of the Waiver and Amendment, the SOFR Interest Rate Change would only bear upon future borrowings by the Company such that they bear an interest rate relating to the secured overnight financing rate. These provisions of the Waiver and Amendment are intended to transition loans under the Current ABL Facility to the new secured overnight financing rate as the benchmark rate.
Advances under the Current ABL Facility are limited to (a) eighty-five percent (85%) of the amount of Eligible Accounts (as defined in the Current ABL Facility), less the amount, if any, of the Dilution Reserve (as defined in the Current ABL Facility), minus (b) the sum of (i) the Bank Product Reserve (as defined in the Current ABL Facility), plus (ii) the AP and Deferred Revenue Reserve (as defined in the Current ABL Facility), plus (iii) without duplication, the aggregate amount of all other reserves, if any, established by the Administrative Agent.
All obligations under the Current ABL Facility are secured by a first priority lien on all (i) deposit accounts (related to accounts receivable), (ii) accounts receivable, and (iii) all other property which constitutes ABL Priority Collateral (as defined in the Current ABL Facility). The obligations are also guaranteed by all material restricted subsidiaries of the Company.
The Current ABL Facility matures on the earlier to occur of: (a) the date that is five years from the effective date of the Current ABL Facility, and (b) 91 days prior to the maturity of the Company's 2028 Notes. The Current ABL Facility is subject to the terms of the Revolver Intercreditor Agreement (as defined in the Current ABL Facility) by and among the Administrative Agent and Wilmington Trust, National Association.
The following table provides a summary of our statements of cash flows for the six months ended June 30, 2025, and 2024, respectively:
Six Months Ended June 30,
2025 2024
(In thousands)
Net cash flows provided by operating activities $ 8,290 $ 3,685
Net cash flows used in investing activities (4,215) (319)
Net cash flows used in financing activities (55,432) (104,564)
Net cash flows provided by operating activities were approximately $8.3 million and $3.7 million for the six months ended June 30, 2025, and 2024, respectively. Net cash flow from operating activities for the six months ended June 30, 2025 increased from the prior year primarily due to increased collection of accounts receivable, lower payments for content, offset by the decrease in reserve for audience deficiency.
Cash flows from operations, cash and cash equivalents, and other sources of liquidity are expected to be available and sufficient to meet foreseeable cash requirements.
Net cash flows used in investing activities were approximately $4.2 million and $0.3 million for the six months ended June 30, 2025, and 2024, respectively. Net cash flows used in investing activities primarily increased from the prior year due to the cash receipts on disposition of station for approximately $3.5 million.
Net cash flows used in financing activities were approximately $55.4 million and $104.6 million for the six months ended June 30, 2025, and 2024, respectively. During the six months ended June 30, 2025, and 2024, we paid approximately $49.5 million and $93.9 million, respectively, to repurchase approximately $92.2 million and $110.5 million of our 2028 Notes. We repurchased approximately $1.7 million of our Class A and D Common Stock during the six months ended June 30, 2025. We repurchased approximately $2.5 million of our Class A and D Common Stock during the six months ended June 30, 2024. In addition, certain non-controlling interest shareholders of Reach Media exercised their annual Put Righton February 14, 2025 for $3.2 million, which resulted in an increase of the Company's interest in Reach Media to 94.6% and decreasing the interest of the non-controlling interest shareholders from 10.0% to 5.4%. Finally, Reach Media paid approximately $0.9 million and $1.8 million in dividends to non-controlling interest shareholders during the six months ended June 30, 2025, and 2024, respectively.
Credit Rating Agencies
On a continuing basis, Standard and Poor's, Moody's Investor Services, and other rating agencies may evaluate our indebtedness in order to assign a credit rating. Our corporate credit ratings by Standard & Poor's Rating Services and Moody's Investors Service are speculative-grade and have been downgraded and upgraded at various times during the last several years. Any reductions in our credit ratings could increase our borrowing costs, reduce the availability of financing to us or increase our cost of doing business or otherwise negatively impact our business operations.
CRITICAL ACCOUNTING POLICIES
Our significant accounting policies are described in Note 2 - Summary of Significant Accounting Policiesof the consolidated financial statements in our 2024 Form 10-K. There have been no significant changes in our critical accounting policies from those presented in our Form 10-K other than the change in useful lives of radio broadcasting licenses, which are described in Note 2 - Summary of Significant Accounting Policies.
CRITICAL ACCOUNTING ESTIMATES
Our critical accounting estimates are described in our Form 10-K for the year ended December 31, 2024, under the heading Part II - Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. There have been no significant changes in our critical accounting estimates from those presented in our Form 10-K, other than the change in useful lives of the TV One Trade Name and radio broadcasting licenses (see further discussion below).
Radio Broadcasting Licenses
As of May 31, 2025, projected gross market revenues and operating profit margin declined creating a triggering event indicating that the fair value of the Company's radio broadcasting licenses were more likely than not to be less than its carrying value.
To determine the fair value of the broadcasting licenses, the Company utilized the income approach which values a license by calculating the value of a hypothetical startup company that initially has no assets except the asset to be valued (the broadcasting license). The Company performed a discounted cash flow analysis for broadcasting licenses across relevant radio markets. The key assumptions used in the discounted cash flow analysis for broadcasting licenses include market revenue and projected revenue growth by market, mature market share, operating profit margin, and discount rate.
Based on this analysis, the Company recognized an impairment loss of approximately $121.3 million associated with twelve radio markets within the Radio Broadcasting segment, included in impairment of goodwill and intangible assets, on the unaudited condensed consolidated statement of operations during the three months ended June 30, 2025. During the six months ended June 30, 2025 the Company recognized impairment loss of approximately $127.8 million within the Radio Broadcasting segment, included in impairment of goodwill and intangible assets, on the unaudited condensed consolidated statement of operations.
Below are the key assumptions used in the income approach model for estimating the fair value of the broadcasting licenses for the thirteen radio markets in the most recent interim impairment assessment performed as of May 31, 2025.
Unit of Accounting (a)
Carrying Value (in millions) Excess % FV over CV Discount Rate Revenue
Growth Rate 		Mature
Market Share 		Operating Profit Margin
1 $52.0 Impaired 9.5% (1.5)% - 0.1% 2.5% - 15.0% 5.0% - 30.0%
2 3.1 408.1% 9.5% (2.1)% - (0.4)% 3.2% - 19.0% 5.0% - 30.0%
4 8.2 Impaired 9.5% (1.3)% - 0.3% 4.3% - 26.0% 0.8% - 17.0%
5 7.5 Impaired 9.5% (2.3)% - (0.5)% 1.2% - 7.0% 2.5% - 15.0%
6 6.9 Impaired 9.5% (3.2)% - (0.5)% 2.5% - 15.0% 3.3% - 20.0%
7 7.1 Impaired 9.5% (2.2)% - (0.5)% 2.0% - 12.0% 2.5% - 15.0%
8 13.0 Impaired 9.5% (1.6)% - 0.0% 0.8% - 5.0% 2.5% - 15.0%
10 93.0 Impaired 9.5% (1.8)% - (0.1)% 3.7% - 22.0% 5.0% - 30.0%
11 12 Impaired 9.5% (1.9)% - (0.4)% 5.5% - 33.0% 2.8% - 17.0%
12 9.8 Impaired 9.5% (2.1)% - (0.4)% 1.0% - 6.0% 2.5% - 15.0%
13 12.1 Impaired 9.5% (1.7)% - (0.2)% 2.8% - 17.0% 1.7% - 20.0%
14 1.6 Impaired 9.5% (2.0)% - (0.5)% 2.2% - 13.0% 2.5% - 15.0%
16 25.0 Impaired 9.5% (1.9)% - (0.2)% 2.3% - 14.0% 2.7% - 20.0%
(a)The units of accounting are not disclosed on a specific market basis in order to not make publicly available information that could be competitively harmful to the Company. Units of accounting, not presented in this table, were previously disposed by the Company.
To the extent that there is a potential recession (local to any of the markets in which we operate or nationally) that further disrupts the economic environment impacting the financial performance, market share, or changes in interest rates, these events could negatively affect the key assumptions and result in significantly lower fair value of the broadcasting licenses.
The following table presents sensitivity analyses for radio broadcasting licenses within the Radio Broadcasting segment showing the impact on our most recent quantitative impairment assessment resulting from: (i) a 100 basis point decrease in operating profit margins; (ii) a 100 basis point increase in the discount rate; and (iii) both a 5.0% and 10.0% reduction in the fair values of broadcasting licenses.
Hypothetical Increase in the
Recorded Impairment Charge
For the Six Months Ended
June 30, 2025
Broadcasting
Licenses
(in millions)
Impairment Charge Recorded:
Radio Broadcasting Licenses $ 127.8
Hypothetical Change for Radio Broadcasting Licenses:
A 100-basis point decrease in operating profit margin in the projection period 11.8
A 100-basis point increase in the applicable discount rate 9.8
A 5.0% reduction in the fair value of broadcasting licenses 6.3
A 10.0% reduction in the fair value of broadcasting licenses 12.7
Due to industry and macro-economic conditions along with ongoing declines in national and local radio listenership, and forecasted cash flows for the Radio Broadcasting segment, the Company reassessed the useful life for the broadcasting licenses. As a result of the reassessment, the Company concluded the useful life should change from indefinite-lived to finite-lived intangible assets effective June 1, 2025. The Company has adopted an accelerated amortization method and will amortize the assets with a carrying value of $129.9 million over a range of 9 to 18-year period This was considered a change in estimate, was accounted for prospectively, and resulted in amortization expense of $1.3 million included in depreciation and amortization, on the unaudited condensed consolidated statement of operations for the three and six months ended June 30, 2025, respectively.
See Note 8 - Goodwill and Other Intangible Assetsof our unaudited condensed consolidated financial statements for further discussion.
TV One Trade Name
Due to industry and macro-economic conditions along with ongoing subscriber churn, and forecasted cash flows for TV One, the Company reassessed the useful life for the trade name TV One (the "TV One Trade Name"). As a result of the reassessment, the Company concluded the useful life should change from indefinite-lived to a finite-lived intangible asset effective January 1, 2025. The Company has adopted an accelerated amortization method and will amortize this asset with a carrying value of $26.6 million over a 20-year period. This was considered a change in estimate, was accounted for prospectively, and resulted in amortization expense of $0.6 million and $1.3 million included in depreciation and amortization, on the unaudited condensed consolidated statement of operations for the three and six months ended June 30, 2025, respectively.
See Note 8 - Goodwill and Other Intangible Assetsof our unaudited condensed consolidated financial statements for further discussion.
Goodwill
As of May 31, 2025, an overall decline in revenue and operating profit margin created a triggering event indicating the fair value of the Company's Radio Broadcasting, Reach Media and Digital reportable units were more likely than not to be less than its carrying value. Therefore, the Company performed interim quantitative assessments at ten of the reporting units containing goodwill. During the three months ended June 30, 2025, the Company recorded impairment losses of approximately $4.9 million and $3.9 million to reduce the carrying value of our Digital and Radio Broadcasting reporting unit goodwill balances, respectively.
Radio Market Reporting Units
The Company noted a continued decline in revenues in the Radio Market reporting units, indicating that it was more likely than not that the reporting units were impaired. Therefore, the Company performed a quantitative impairment assessment on the Radio Market reporting units to determine whether it was impaired as of May 31, 2025. Based on these analyses, the Company recognized an impairment loss of approximately $3.9 million associated with the Radio Broadcasting reporting units, included in impairment of goodwill and intangible assets, on the unaudited condensed consolidated statement of operations during the three months ended June 30, 2025.
Below are the key assumptions used in the income approach model for estimating the fair value of the Radio Market reporting units in the most recent interim impairment assessment performed as of May 31, 2025.
Goodwill (Radio Market Reporting Units) May 31,
2025
Discount rate
9.5%
Revenue growth rate range
(34.5)% - 53.1%
Terminal growth rate
(25.0)% - (8.0)%
Mature market share range
9.5%
Operating profit margin range
(4.9)% - 43.1%
To the extent that there is a potential recession that further disrupts the economic environment impacting the financial performance or changes in interest rates, these events could negatively affect the key assumptions and result in significantly lower fair value of the Company's reporting units.
The following table presents sensitivity analyses for goodwill of reporting units within the Radio Broadcasting segment showing the impact on our most recent quantitative impairment assessment resulting from: (i) a 100 basis point decrease in industry or reporting units terminal growth rates; (ii) a 100 basis point decrease in operating profit margins; (iii) a 100 basis point increase in the discount rate; and (iv) both a 5.0% and 10.0% reduction in the fair values of the reporting units.
Hypothetical Increase in the
Recorded Impairment Charge
For the Six Months Ended
June 30, 2025
Goodwill
(in millions)
Impairment Charge Recorded:
Radio Market Reporting Units $ 3.9
Hypothetical Change for Radio Market Reporting Units:
A 100-basis point decrease in radio industry terminal growth rates $ 1.0
A 100-basis point decrease in operating profit margin in the projection period 1.0
A 100-basis point increase in the applicable discount rate 1.5
A 5.0% reduction in the fair value of the Radio Markets 3.3
A 10.0% reduction in the fair value of the Radio Markets 6.7
iOne Reporting Unit
The Company noted a continued decline in revenues in the iOne reporting unit, indicating that it was more likely than not that the iOne reporting unit was impaired. Therefore, the Company performed a quantitative impairment assessment for iOne reporting unit to determine whether it was impaired as of May 31, 2025. Based on these analyses, the Company recognized an impairment loss of approximately $4.9 million associated with the iOne reporting unit, included in impairment of goodwill and intangible assets, on the unaudited condensed consolidated statement of operations during the three months ended June 30, 2025.
Below are the key assumptions used in the income approach model for estimating the fair value of the iOne reporting unit in the most recent interim impairment assessment performed as of May 31, 2025.
Goodwill (iOne Reporting Unit) May 31,
2025
Discount rate
9.5%
Revenue growth rate range
(34.5)% - 53.1%
Operating profit margin range
(4.9)% - 43.1%
The following table presents sensitivity analysis for the iOne reporting unit showing the impact of the most recent quantitative impairment assessment results from a 100 basis point increase or decrease in the terminal growth rate, operating profit margin, discount rate, 5.0% and 10.0% reduction in fair value of the iOne reporting unit which the Company has determined to be a significant assumption impacting the impairment:
Hypothetical Increase in the
Recorded Impairment Charge
For the Six Months Ended
June 30, 2025
Goodwill
(in millions)
Impairment Charge Recorded:
iOne Reporting Unit $ 4.9
Hypothetical Change for the iOne Reporting Unit:
A 100-basis point decrease in digital industry terminal growth rates $ 0.4
A 100-basis point decrease in the applicable operating profit margin 1.7
A 100-basis point increase in the applicable discount rate 0.6
A 5.0% reduction in the fair value of iOne 0.7
A 10.0% reduction in the fair value of iOne 1.5
Fair Value Measurements
The Company estimated the fair value of the Employment Agreement Award as of June 30, 2025and December 31, 2024, at approximately $11.7 million and $10.4 million, respectively, and, accordingly, adjusted the liability to that amount. The fair value estimate incorporated a number of assumptions and estimates, including but not limited to revenue growth rates, future operating profit margins, discount rate, peer companies, average recurring EBITDA multiples and weighting of the income and market approach. As the Company will measure changes in the fair value of this award at each reporting period as warranted by certain circumstances, different estimates or assumptions may result in a change to the fair value of the award amount previously recorded.
RECENT ACCOUNTING PRONOUNCEMENTS
See Note 2 - Summary of Significant Accounting Policies of our unaudited condensed consolidated financial statements for a summary of recent accounting pronouncements.
CAPITAL AND COMMERCIAL COMMITMENTS
Radio Broadcasting Licenses
Each of the Company's radio stations operates pursuant to one or more licenses issued by the Federal Communications Commission that have a maximum term of eight years prior to renewal. The Company's radio broadcasting licenses expire at various times beginning in October 2027, through August 2030. Although the Company may apply to renew its radio broadcasting licenses, third parties may challenge the Company's renewal applications. The Company is not aware of any facts or circumstances that would prevent the Company from having its current licenses renewed. A station may continue to operate beyond the expiration date of its license if a timely filed license renewal application was filed and is pending.
Indebtedness
As of June 30, 2025, we had approximately $492.3 millionof our 2028 Notes outstanding within our corporate structure. See Note 9 - Long-Term Debtof our unaudited condensed consolidated financial statements. The Company had no other indebtedness.
Royalty Agreements
Musical works rights holders, songwriters and music publishers, have been traditionally represented by performing rights organizations, such as the American Society of Composers Authors and Publishers ("ASCAP"), Broadcast Music, Inc. ("BMI") and SESAC, Inc. ("SESAC"). The market for rights relating to musical works is changing rapidly. Songwriters and music publishers have withdrawn from the traditional performing rights organizations, particularly ASCAP and BMI, and new entities, such as Global Music Rights Inc. ("GMR"), have been formed to represent rights holders. These organizations negotiate fees with copyright users, collect royalties and distribute them to the rights holders. These licenses periodically come up for renewal and, as a result, certain of our performing rights organizations ("PRO") licenses are currently the subject of renewal negotiations. The outcome of these renewal negotiations could impact, and potentially increase, our music license fees. In addition, there is no guarantee that additional PRO's will not emerge, which could impact, and in some circumstances increase, our royalty rates and negotiation costs.
The Radio Music Licensing Committee ("RMLC"), of which we are a represented participant, has negotiated and entered into, on behalf of participating members, an Interim License Agreement with ASCAP effective January 1, 2022 and to remain in effect until the date on which the parties reach agreement as to, or there is court determination of, new interim or final fees, terms, and conditions of a new license for the five year period commencing on January 1, 2022 and concluding on December 31, 2026. On February 7, 2022, the RMLC and GMR reached a settlement and achieved certain conditions which effectuate a four-year license to which the Company is a party for the period April 1, 2022, to March 31, 2026. The license includes an optional three-year extended term that the Company may effectuate prior to the end of the initial term.
On November 1, 2024, RMLC announced that it had won a ruling in its rate determination proceedings with SESAC with respect to fees paid by RMLC-represented stations. The determination sets the rates for the period January 1, 2023, through December 31, 2026, and is retroactive in its application. RMLC-Represented Stations that have paid SESAC interim license fees at higher previous rates may receive a true-up adjustment in order to bring rates into conformity with the now-final rates. This ruling did not have a material impact on the Company's operations. The RMLC is currently negotiating with BMI.
Lease Obligations
We have non-cancelable operating leases for office space, studio space, broadcast towers and transmitter facilities that expire over the next forty-eight years. See Note 13 - Commitments and Contingencies of the Company's unaudited condensed consolidated financial statements for further discussion.
Operating Contracts And Agreements
We have other operating contracts and agreements including employment contracts, on-air talent contracts, severance obligations, retention bonuses, consulting agreements, equipment rental agreements, programming-related agreements, and other general operating agreements that expire over the next four years.
Reach Media Non-controlling Interest
Beginning on January 1, 2018, the non-controlling interest shareholders of Reach Media have had an annual right to require Reach Media to purchase all or a portion of their shares at the then current fair market value for such shares (the "Put Right"). This annual right is exercisable for a 30-day period beginning January 1 of each year. The purchase price for such shares may be paid in cash and/or registered Class D common stock of the Company, at the discretion of the Company. The non-controlling interest shareholders of Reach Media exercised 50.0% of their Put Right on January 29, 2024 for $7.6 million. On February 14, 2025, certain non-controlling interest shareholders of Reach Media exercised their annual Put Right for approximately $3.2 million, increasing the Company's interest in Reach Media to approximately 94.6% and decreasing the interest of the non-controlling interest shareholders from approximately 10.0% to approximately 5.4%.
Management, at this time, cannot reasonably determine the period when and if the non-controlling interest shareholders will exercise the remaining portion of the Put Right.
Contractual Obligations Schedule
The following table represents our scheduled contractual obligations as of June 30, 2025:
Payments Due by Period
Contractual Obligations Remainder of
2025 		2026 2027 2028 2029 2030 and Beyond Total
2028 Notes(a)
$ 18,155 $ 36,310 $ 36,310 $ 510,491 $ - $ - $ 601,266
Other operating contracts/agreements(b)
34,110 20,912 8,598 3,983 2,602 54 70,259
Operating lease obligations 3,927 8,993 7,278 6,998 6,987 26,182 60,365
Total $ 56,192 $ 66,215 $ 52,186 $ 521,472 $ 9,589 $ 26,236 $ 731,890
(a)Includes interest obligations based on interest rates on senior secured notes outstanding as of June 30, 2025.
(b)Includes employment contracts (including the Employment Agreement Award), severance obligations, on-air talent contracts, consulting agreements, equipment rental agreements, programming related agreements, launch liability payments, asset-backed credit facility (if applicable) and other general operating agreements. Also includes contracts that our Cable Television segment has entered into to acquire entertainment programming rights and programs from distributors and producers. These contracts relate to their content assets as well as prepaid programming related agreements.
Of the total amount of other operating contracts and agreements included in the table above, approximately $41.6 millionhas not been recorded on the balance sheet as of June 30, 2025, as it does not meet recognition criteria. Approximately $6.4 millionrelates to certain commitments for content agreements for our Cable Television segment, approximately $18.0 millionrelates to employment agreements, and the remainder relates to other agreements.
Off-Balance Sheet Arrangements
The Current ABL Facility provides for up to $50.0 million revolving loan borrowings in order to provide for the working capital needs and general corporate requirements of the Company. The Current ABL Facility also provides for a letter of credit facility up to $5.0 million as a part of the overall $50.0 million in capacity. As of June 30, 2025 and December 31, 2024, there was no balance outstanding on the Current ABL Facility.
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