It’s a story you’ve heard before, but it bears repeating: Townsquare Media, the “local first” company with subscription digital marketing solutions and a vibrant digital advertising division has released first quarter 2025 earnings results that show Digital comprising 57% of quarterly revenue.
That tale is one that company executives including CEO Bill Wilson focused on as he convened what is now the traditional 8am Eastern earnings call for analysts and investors. But, there’s another tale that bears explanation — the interest-fueled flip to a net loss in Q1 2025.
Ahead of that call, Wilson shared his perspective on how pleased he and the executive leadership team at Townsquare are with the first quarter results.
“Sometimes it takes a challenging macroeconomic environment to serve the purpose of highlighting how truly differentiated Townsquare is from others in local media,” he said. “We have transformed and evolved; we began as a traditional broadcast company and we are now a Digital First Local Media.”
Again, that’s something Wilson has been drilling to institutional investors, lenders and everyday shareholders for several years since assuming the CEO role from Dhruv Prasad. Yet the Q1 results are eye-opening.
Digital Advertising rose by 7.6% from Q1 2024 to $36.75 million, from $34.16 million. Concurrently, Subscription Digital Marketing Services jumped ahead by 4.2% to $19.02 million, from $18.25 million.
This helped offset the weakest link in the Townsquare Media revenue chain — its broadcast radio stations. Broadcast Advertising slumped by 9.1% year-over-year in Q1 to $41.32 million, from $45.46 million. Ex-political, broadcast advertising improved from its Q4 performance yet was still down 8% as Townsquare guided on its March earnings call, thus coming in line with expectations.
Total it up, and net revenue slipped to $98.68 million, from $99.63 million. This was anticipated, and Townsquare came within the revenue estimate window of between $98.5 million and $99.39 million based on two analysts’ forecasts.
The good news? Expenses were reduced by 1.6% across the board, to $91.54 million, helping operating income grow by 7.4% to $7.13 million, from $6.64 million.
This means Townsquare’s first quarter results met or exceeded its previously issued guidance as it is reaffirming its 2025 full year guidance for both net revenue and adjusted EBITDA.
Speaking of Adjusted EBITDA, there are two important line-item expenses to gauge when looking at the numbers for Townsquare Media in Q1. Adjusted EBITDA rose to $18.14 million, from $17.52 million. On an ex-political basis, it grew to $17.66 million, from $16.62 million.
Then comes a $17.96 million interest payment, rising from $17.64 million last year. Additionally, capital expenditure costs rose to $4.48 million, from $4.43 million.
These expense line-items explain why Townsquare swung to an adjusted net loss of $871 million (-$0.05) per share, compared to adjusted net income of $480 million ($0.03) in Q1 2024. And, it signifies an earnings beat: One analyst chimed in with an earnings per share prediction of -$0.07.
With Townsquare Media’s Board of Directors approving a quarterly cash dividend of $0.20 per share, payable on August 1 to shareholders of record as of the close of business on July 18, the company also offered guidance for the second quarter. Net revenue is expected to be between $114 million and $116 million, and Adjusted EBITDA is expected to be between $25 million and $26 million.
The Townsquare Media Q1 2025 earnings call, held at 8am Eastern on May 8, saw Michael Kupinski of Noble Capital Markets and Patrick Sholl of Barrington Research further discuss the company’s results. “May and June are picking up quite nicely” for Townsquare as trade deals such as one with the United Kingdom revealed on Thursday are resolving a period of economic uncertainty, Wilson shared with Sholl. May and June look better for digital and broadcast advertising, Wilson added.
Sholl on March 18 stuck with his “Buy” rating on Townsquare stock, and adjusted the target price downward from $17 to $15. That’s still a bold target price, with “TSQ” in pre-market trading on Thursday at $7.24, up 5.85% from the May 7 closing price.
