It was another challenging month for the nation’s leading audio content creation and distribution company, as iHeartMedia saw revenue growth during the second quarter of 2024 offset by an increase in operating expenses. This resulted in a wider net loss compared to what was seen by the company led by Bob Pittman and Rich Bressler during the three month period ending June 30, 2023.
Here’s the good news: Revenue for the owner of iHeartRadio, national radio syndication group Premiere Network, and one of the biggest podcast entities in the U.S. saw its consolidated revenue grow by 1% year-over-year in Q2, to $929.09 million from $920.01 million. This easily surpassed the consensus estimate of $915.98 million offered by 5 analysts polled by Yahoo! Finance.
While $920.22 million in impairment charges are on the books for Q2, compared to $960.57 million a year ago, direct operating expenses rose by 7.6% to $382.05 million as “selling, general and administrative expenses” — likely including receipts from Cannes Lions 2024 in France, where iHeartMedia again had a lavish presence — surged by 9.6% to $431.61 million.
Add up the numbers and iHeartMedia’s operating loss widened to $909.67 million from $897.19 million.
The net loss attributable to iHeartMedia came in at $981.66 million, surging from $884.47 million.
Adjusted EBITDA sank by 21.4% to $150.21 million, from $191.18 million.
Then, there are higher restructuring costs, suggesting that reports of iHeartMedia executive leaders meeting with Pacific Investment Management Company (PIMCO) to discuss new lender agreements and its 2026 payments due are indeed ongoing. Restructuring expenses rose to $27.56 million from $10.79 million in Q2.
Losses, adjusted for asset impairment costs and restructuring costs, were $0.23 per share, and the results topped Wall Street expectations. The average estimate of three analysts surveyed by Zacks Investment Research was for a loss of $0.31.
Speaking on the company’s earnings call, CEO Pittman was pleased with sequential improvements for its multiplatform business, inclusive of the company’s 800-plus radio stations, and its podcast performance.
MULTIPLATFORM WEAKNESS
Breaking down the numbers in detail, Broadcast Radio was off by 0.9% year-over-year to $425.49 million, from $429.15 million.
Networks revenue fell by 12.8% to $106.59 million from $122.17 million, indicative of the ongoing weakness in national advertising being felt across all broadcast media in Q2.
Sponsorship and events dollars rose to $39.12 million, from $38.21 million.
Then, there is the Podcast revenue, which increased by 8.1% to $104.52 million, from $96.71 million.
Speaking on the company’s Q2 earnings call held early Thursday, Bressler, the company’s COO and CFO, said political revenues are pacing 20% higher than the last election cycle. But, the record political dollars for iHeartMedia won’t offset a low-single-digit decline in the Multiplatform group anticipated for Q3 2024.
ANALYST QUESTIONS RETURN
Jim Goss at Barrington Research kicked off a Q&A session that in Q1 2024 saw no participants, as iHeartMedia decided to hold its earnings call directly opposite a previously announced Q1 ’24 earnings call from Townsquare Media.
Goss asked about podcast performance, with Bressler discussing strong revenue growth for this division and how the business continues to be “extremely healthy.”
Also asking questions: veteran analyst Jessica Reif Ehrlich.
