Friday, August 16, 2024

"Nexstar Ad Sales Fall 36% in Q4 as CW Loss Narrows to $52 Million"/ "The CW Losses Decline By $50M In Q1, But Parent Nexstar Flags Concern About A National TV Ad Sector That Is 'Not In A Positive Place'"

Feb. 28, 2024 "Nexstar Ad Sales Fall 36% in Q4 as CW Loss Narrows to $52 Million": Today I found this article by Jennifer Mass on Variety:

Nexstar reported its fourth-quarter 2023 earnings Wednesday, revealing its TV ad sales were down 36% from Oct. 1- Dec. 31.

In the same period, Nexstar’s losses at the CW narrowed to $52 million from $60 million in Q3

That marks a 45% improvement in the network’s losses (down from $94 million) since Q4 of 2022, 

when the CW was formally acquired by Nexstar from Paramount Global and Warner Bros. Discovery.

Nexstar’s core ad sales were $449 million in Q4, a decrease of 5.9% from the comparable year-ago quarter. Political ad sales fell 88.7% to $30 million from $266 million in 2022, when midterm elections spiked that categories revenue.

Total TV ad sales were $479 million, down 36% year-over-year from $743 million.

Distribution revenue grew 14.3% ($704 million vs. $616 million), 

digital dropped 5.4% ($106 million vs. $112 million) 

and “other” revenue dipped 6.3% ($15 million vs. $16 million).

Free cash flow stood at $295 million. Net income was $100 million, down 43.8% year over year from $178 million in fourth-quarter 2022.

Wall Street forecast earnings per share (EPS) of $4.20 on $1.31 billion in revenue, according to analyst consensus data provided by LSEG, formerly Refinitiv. Nexstar reported diluted EPS of $3.32 on $1.3 billion in revenue. That revenue figure is down from $1.5 billion in Q4 2022.

“The power of the broadcast model and its ability to reach the largest audience of any medium with important news, sports and entertainment content is as strong as ever, reflected by the record audience delivery for NFL and Super Bowl, Grammys and other live sports and event programming,” Nexstar CEO Perry Sook said in a letter to shareholders. 

“Validating the enduring strength, reach and appeal of broadcast, during the fourth quarter we successfully completed all of our remaining distribution negotiations without interruption, as our distribution partners, their customers and our audience value the highest-rated broadcast and fastest-growing cable news network programming we provide. 

The completion of these and other recent distribution agreements provide solid visibility for our distribution revenues in 2024 and beyond.  As we move into 2024, an election year, we look forward to once again demonstrating the value of broadcast television to candidates and campaigns looking to communicate to the electorate through political advertising on television.”

During an earnings call Wednesday morning, Nexstar president Michael Baird spoke out about the proposed Fox-Disney-Warner Bros. Discovery streaming sports joint venture and how it would affect the TV stations group company, stating there was “significant misinterpretation” and “market overreaction” to the initial news of the product.

“We believe the three JV partners understand the value of the linear ecosystem, as pay TV revenues remain vital to each of them,” Baird said. “They’ve demonstrated this in their respective approaches to DTC, largely avoiding the strategies of some of their peers that have undermined the value of their own core linear networks.”

But Biard cautioned there are still “more questions than answers about the proposed product,” which is already the subject of one lawsuit, with the most notable being “assurance it will actually launch.” 

“We know launching a new streaming startup will be challenging, including potential regulatory hurdles, lawsuits and other complicating factors surrounding the JV,” Baird said.

Also on that earnings call, Sook responded to an analyst question regarding whether Nexstar was interested in buying another broadcast network, like Disney’s ABC, should it go up for sale: “We would not have an allergic reaction to having that discussion but it would have to be the same kind of opportunity acquisition that we have made in the 27-year history of the company.”

Nexstar stock closed Tuesday at $162.40 per share. The regular U.S. stock markets will reopen at 9:30 a.m. ET.

https://variety.com/2024/tv/news/nexstar-cw-earnings-ad-sales-1235924635/



May 9, 2024 "The CW Losses Decline By $50M In Q1, But Parent Nexstar Flags Concern About A National TV Ad Sector That Is 'Not In A Positive Place'": Today I found this article by Dade Hayes on Deadline:


The CW‘s losses fell by $50 million in the first quarter and parent Nexstar Media Group still expects the network to turn a profit by next year, but CFO Lee Ann Gliha offered investors some reason for caution.

“We’re no longer going to externally disclose the CW numbers separately,” the exec said during the Nexstar first-quarter earnings call when asked about the network’s revenue trends. 

Since Nexstar took its 75% stake in 2022, she continued, “the quarter-over-quarter comparison is good. I would say just anecdotally it’s still driven by the national advertising market, 

which is not in a positive place even despite the green shoots.”

Excluding political spending, advertising declined 7% in the quarter ended March 31 compared with the same period in 2023, the company said. 

The negative effect of the high-interest-rate environment, among other challenges, took the blame for the dip. Total revenue inched up 2% to $1.28 billion, roughly in line with Wall Street forecasts, while earnings per share came in well ahead of expectations, at $5.16 compared with $2.97 in the year-ago quarter.

The $50 million reduction in losses at The CW represents about half of the projected $100 million in loss reduction for all of 2024, execs said, with the slowdown in the latter half of the year chalked up to various cyclical factors.

Asked about programming trends, Gliha noted that The CW has been in an active mode, especially in live sports. 

The network is not staging an upfront presentation alongside most broadcast peers, but a number of its executives will be in New York next week as the 2024-25 schedule is announced.

“We’ve tried to put on some programming that is not just focused on the 18-to-34 demographic but more focused on the broader demographic of The CW and that has benefited it,” Gliha said. 

In the first two quarters of the 2023-24 broadcast year, the network recorded sequential audience growth in prime time, though 2023 was impaired by the dual strikes. 

“We feel good about it and we think it will continue to do well for the rest of the year because some of the sports programming that we’ve announced but haven’t yet gotten on the air will be on the air later this year.”

CEO Perry Sook fielded another national TV question on the call, on the topic of NewsNation.

The network was rebranded and completely revamped from its well-penetrated predecessor, WGN America, after Nexstar acquired Tribune Media in 2019. 

The network will fully transition to 24/7 news programming on June 1,

Sook said, and has been “profitable since Day 1” because the company is shifting from a pricey diet of syndicated programming spending to a leaner all-news model.

Awareness of NewsNation, in Nexstar’s monthly viewer surveys, has risen to 35% from 11% when the rebrand first took effect, Sook said. 

“Reception is not the problem,” he observed. “Awareness is the opportunity.”

https://deadline.com/2024/05/the-cw-nexstar-network-revenue-broadcast-tv-1235909965/

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