“Townsquare is no longer the radio broadcast company it was when it was founded in 2010.” That reminder from Townsquare Media CEO Bill Wilson was brought even closer to home by the Purchase, New York-based company’s revelation that for the second year in a row, more than half of its revenue came from digital sources.
Wilson and CFO Stuart Rosenstein reported a slight decrease in net revenue, totaling $454.2 million for the year, positioning it as the second-highest revenue in its history, second only to 2022 after a 1.9% year-over-year drop.
Adjusted EBITDA also saw a reduction, coming in at $100.0 million. However, Townsquare’s pivot towards a digital-first approach has begun to bear fruit, with digital segments contributing 51% of new revenue and 55% of its Adjusted Operating Income. The digital segment has shown remarkable growth, with digital net revenue in 2023 being 47% higher than in 2019.
Wilson called it a “reset year” for Townsquare Interactive, which faced its own challenges in 2023. The Subscription Digital Marketing Solutions segment experienced a 14.5% revenue decline in the fourth quarter, which was attributed to elevated churn rates and internal issues. However, improvements are promised, and the company is optimistic about regaining growth momentum.
The digital advertising segment emerged as the fastest-growing part of the company, benefiting from proprietary digital products and solutions, and a focus on markets outside the top 50 U.S. cities.
In response to the company’s performance and future outlook, the Board of Directors has approved a 5.3% quarterly cash dividend increase, reflecting confidence in Townsquare’s financial strategy and cash flow generation capabilities. For the first quarter of 2024, revenue is projected to be between $98.5 million and $100 million, with Adjusted EBITDA estimates ranging from $17.5 million to $18.5 million.
The full-year outlook for the “Digital First Local Media Company” suggests net revenue between $440 million and $460 million and Adjusted EBITDA between $100 million and $110 million.
TSQ’s share price experienced surged following the earnings call, jumping from $10.36 to $11.50 after the earnings call, but by the closing bell had settled into a more modest 2% gain to $10.57.
