iHeartMedia, the largest U.S. radio and podcast distribution company, said on Monday (Aug. 10) that revenue for its second quarter came in ahead of guidance, growing by 4.7% to $977 million, as political primary ads and those for the November midterm elections continue to ramp up.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 2.9% to $152 million, down from $156 million in the same period last year.
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iHeart’s executives said they expect robust spending in the second half of the year from political and other advertisers who are not able to secure TV spots as political placements fill the airwaves. Those ad dollars are anticipated to deliver adjusted EBITDA growth for the multiplatform division.
“The early indications are it is performing at the level [of a presidential election year],” Pittman said on a call discussing iHeart’s quarterly results.
However, executives added that no single advertiser contributes greater than 2% of iHeart’s overall ad revenue and no industry segment contributes more than a 5% share. That diversity of advertisers will help insulate it from impacts from macroeconomic and geopolitical uncertainty, executives said.
Cash provided by operating activities generated $65 million, while free cash flow — what’s left over after operational spending and capital expenses are covered — was $46 million, compared to a loss of $13 million last year.
The company reaffirmed its full-year EBITDA guidance of $800 million and free cash flow of $200 million, adding that it expects to grow this, in part, with a 50% increase in total programmatic revenue to approximately $200 million.
In the second quarter, the company let go of staff at radio stations, in management and in sales positions, according to media reports. The company has not disclosed the total number of jobs eliminated.
Revenue from iHeart’s multiplatform group, which includes its more than 860 broadcast radio stations with shows like The Breakfast Club with Charlamagne Tha God, slipped 2% to $536 million. Adjusted EBITDA margin contracted to 10.9%.
Elsewhere, revenue from the digital audio group was up 12% to $364 million. iHeart’s fast-growing podcast division reported revenue of $164 million, up 21% from a year ago, while digital revenue excluding podcasts rose 7% to $202 million. Segment adjusted EBITDA rose 14% from a year ago to $123 million, with an adjusted EBITDA margin of 33.8%.
The company’s share price was down 3.89% in after-hours trading to $3.71.
