[Executive Summary & Headline Results](index=1&type=section&id=Executive%20Summary%20%26%20Headline%20Results) This section presents Nexstar's Q2 2025 financial performance, highlighting key operational achievements and strategic initiatives despite a decline in political advertising [CEO Statement & Key Financial Overview](index=1&type=section&id=CEO%20Statement%20%26%20Key%20Financial%20Overview) Nexstar Media Group reported solid second-quarter 2025 financial results, with year-over-year impacts primarily from lower non-election year political advertising, partially offset by strong expense management - Q2 2025 results were impacted by lower non-election year political advertising revenue, partially offset by strong expense management[3](index=3&type=chunk) - The CW ascended to the **8-ranked network overall** in the first half of 2025, reflecting five consecutive quarters of primetime ratings growth and a strategic pivot to sports programming, which now accounts for over **40% of its programming hours**[3](index=3&type=chunk) - NewsNation was ranked the fastest growing network overall year-over-year, shortly after celebrating its one-year anniversary as a 24/7 cable news network[3](index=3&type=chunk) - The company refinanced senior secured term loans and revolving credit facilities, reducing interest rate margin, expanding revolver capacity, and extending maturities[2](index=2&type=chunk) - Nexstar returned **$106 million** to shareholders and repaid **$101 million** of debt during the quarter[2](index=2&type=chunk) Q2 2025 Key Financial Highlights (YoY Change) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | H1 2025 ($M) | H1 2024 ($M) | % Change | | :-------------------------------- | :----------- | :----------- | :--------- | :----------- | :----------- | :--------- | | Net Revenue | $1,229 | $1,269 | (3.2%) | $2,462 | $2,553 | (3.6%) | | Net Income | $91 | $106 | (14.2%) | $188 | $273 | (31.1%) | | Net Income % Margin | 7.4% | 8.4% | (1.0) pp | 7.6% | 10.7% | (3.1) pp | | Adjusted EBITDA | $389 | $414 | (6.0%) | $770 | $866 | (11.1%) | | Adjusted EBITDA % Margin | 31.7% | 32.6% | (0.9) pp | 31.3% | 33.9% | (2.6) pp | | Net Cash Provided by Operating Activities | $247 | $176 | 40.3% | $584 | $452 | 29.2% | | Adjusted Free Cash Flow | $101 | $77 | 31.2% | $449 | $466 | (3.6%) | [Company and Business Highlights](index=2&type=section&id=Company%20and%20Business%20Highlights) This section details Nexstar's strategic achievements, including capital structure enhancements, significant viewership growth for NewsNation and The CW, and industry recognition for journalism [Operational and Strategic Achievements](index=2&type=section&id=Operational%20and%20Strategic%20Achievements) Nexstar strengthened its capital structure through successful refinancings and received shareholder approval for key proposals - Completed refinancings for revolving credit facilities, Term Loan A, and Term Loan B, strengthening the Company's capital structure and financial flexibility by extending maturities, reducing interest rate margin, and expanding revolver capacity[8](index=8&type=chunk) - Shareholders approved all proposals at the 2025 Annual Shareholder Meeting, including electing Board nominees and affirming executive compensation with approximately **95.5% support**[8](index=8&type=chunk) - NewsNation celebrated its one-year anniversary of 24/7 news programming, ranking as the **1 basic cable network for year-over-year growth** with overall viewership growing nearly **50%** and **67%** among adults aged 25-54[8](index=8&type=chunk) - The CW achieved five consecutive quarters of audience growth, becoming the **8 network in total audience** for the first half of 2025[8](index=8&type=chunk) - Continued to build sports programming at The CW, renewing the Pac-12 Conference agreement for college football and announcing a multi-year partnership with the Professional Bowlers Association[8](index=8&type=chunk) - Finalized agreements to move three additional CW affiliations to Nexstar stations in Charlotte, NC, Erie, PA, and Elmira, NY, by September 2025[8](index=8&type=chunk) - Earned **52 Regional Edward R. Murrow Awards** for outstanding journalism and locally produced news programming[8](index=8&type=chunk) [Detailed Financial Performance](index=3&type=section&id=Detailed%20Financial%20Performance) This section provides a comprehensive breakdown of Nexstar's second-quarter financial results, analyzing changes in net revenue, distribution, advertising, net income, EBITDA, and cash flows [Net Revenue](index=3&type=section&id=Net%20Revenue) Second quarter net revenue declined by **3.2%** year-over-year to **$1.23 billion**, primarily driven by a reduction in political advertising revenue Net Revenue (Q2 YoY) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :--------- | :----------- | :----------- | :--------- | | Net Revenue | $1,229 | $1,269 | (3.2%) | - The decline was primarily due to reduced political advertising revenue[12](index=12&type=chunk) [Distribution Revenue](index=3&type=section&id=Distribution%20Revenue) Distribution revenue for the second quarter saw a marginal decrease of **0.1%** year-over-year to **$733 million** Distribution Revenue (Q2 YoY) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :----------------- | :----------- | :----------- | :--------- | | Distribution Revenue | $733 | $734 | (0.1%) | - Primarily reflects modest subscriber renewals in 2024 vs 2023 and MVPD subscriber attrition[12](index=12&type=chunk) - Partially offset by increased rates, contractual commitments, growth in vMVPD subscribers, and the addition of CW affiliations[12](index=12&type=chunk) [Advertising Revenue](index=3&type=section&id=Advertising%20Revenue) Second quarter advertising revenue decreased by **9.0%** year-over-year to **$475 million**, primarily attributable to a **$36 million** decrease in political advertising Advertising Revenue (Q2 YoY) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :----------------- | :----------- | :----------- | :--------- | | Advertising Revenue | $475 | $522 | (9.0%) | - Political advertising decreased by **$36 million** to **$9 million**[12](index=12&type=chunk) - Non-political advertising revenue decreased by **$11 million (2.5%)** due to television advertising market softness[12](index=12&type=chunk) [Net Income](index=3&type=section&id=Net%20Income) Net income for the second quarter decreased by **14.2%** year-over-year to **$91 million**, with the Net Income margin declining from **8.4% to 7.4%** Net Income (Q2 YoY) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :--------- | :----------- | :----------- | :--------- | | Net Income | $91 | $106 | (14.2%) | | Net Income Margin | 7.4% | 8.4% | (1.0) pp | - Primarily reflects lower revenue, increased one-time corporate expenses from debt refinancing, and reduced income from equity investments related to TV Food Network LLC[12](index=12&type=chunk) - Offset, in part, by lower amortization of broadcast rights at The CW, lower interest expense, income tax, and operating expenses[12](index=12&type=chunk) [Adjusted EBITDA](index=3&type=section&id=Adjusted%20EBITDA) Second quarter Adjusted EBITDA decreased by **6.0%** year-over-year to **$389 million**, with the margin at **31.7%** compared to **32.6%** in the prior year Adjusted EBITDA (Q2 YoY) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :-------------- | :----------- | :----------- | :--------- | | Adjusted EBITDA | $389 | $414 | (6.0%) | | Adjusted EBITDA Margin | 31.7% | 32.6% | (0.9) pp | - Primarily reflects lower revenue and reduced income from equity method investments, mainly from TV Food Network LLC[12](index=12&type=chunk) - Offset, in part, by lower amortization of broadcast rights at The CW and lower operating expenses from restructuring initiatives[12](index=12&type=chunk) [Net Cash Provided by Operating Activities](index=3&type=section&id=Net%20Cash%20Provided%20by%20Operating%20Activities) Net Cash Provided by Operating Activities for the second quarter increased significantly by **40.3%** year-over-year to **$247 million** Net Cash Provided by Operating Activities (Q2 YoY) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :-------------------------------- | :----------- | :----------- | :--------- | | Net Cash Provided by Operating Activities | $247 | $176 | 40.3% | - Increase primarily due to changes in operating assets and liabilities reflecting the timing of receipts and payments[12](index=12&type=chunk) - Offset, in part, by a reduction in net income excluding other non-cash items[12](index=12&type=chunk) [Adjusted Free Cash Flow](index=3&type=section&id=Adjusted%20Free%20Cash%20Flow) Second quarter Adjusted Free Cash Flow increased by **31.2%** year-over-year to **$101 million**, driven by lower interest expense, capital expenditures, cash taxes, and operating expenses Adjusted Free Cash Flow (Q2 YoY) | Metric | Q2 2025 ($M) | Q2 2024 ($M) | % Change | | :-------------------- | :----------- | :----------- | :--------- | | Adjusted Free Cash Flow | $101 | $77 | 31.2% | - Increase primarily due to lower interest expense (from reduced SOFR and debt reduction), lower capital expenditures, lower cash taxes, and lower operating expenses[12](index=12&type=chunk) - Offset, in part, by lower advertising revenues[12](index=12&type=chunk) [Capital Allocation](index=4&type=section&id=Capital%20Allocation) This section outlines Nexstar's capital allocation strategy for Q2 2025, detailing debt repayment, dividend distributions, and share repurchases [Q2 2025 Capital Allocation Summary](index=4&type=section&id=Q2%202025%20Capital%20Allocation%20Summary) In the second quarter of 2025, Nexstar utilized cash on hand and operating cash flow to repay **$101 million** of debt, distribute **$56 million** in dividends, and repurchase **$50 million** worth of common stock - Used cash on hand and cash flow from operations to repay **$101 million** of debt in Q2 2025[13](index=13&type=chunk) - Paid **$56 million** in dividends and repurchased **311,998 shares** for **$50 million**, totaling **$106 million** in shareholder returns in Q2 2025[13](index=13&type=chunk) Capital Allocation (Q2 & H1 YoY) | Cash Used For | Q2 2025 ($M) | Q2 2024 ($M) | H1 2025 ($M) | H1 2024 ($M) | | :-------------------- | :----------- | :----------- | :----------- | :----------- | | Debt repayment | $101 | $31 | $132 | $61 | | Acquisitions | - | - | $22 | - | | Stockholder return | $106 | $190 | $238 | $358 | | Common stock dividends | $56 | $55 | $113 | $112 | | Stock repurchases | $50 | $135 | $125 | $246 | | Shares Outstanding (End of period, in thousands) | 30,315 | 32,486 | 30,315 | 32,486 | | % Change in shares outstanding | (0.1%) | (1.7%) | (1.0%) | (3.3%) | [Debt, Cash and Leverage](index=5&type=section&id=Debt%2C%20Cash%20and%20Leverage) This section provides an overview of Nexstar's consolidated debt, cash balances, and leverage ratios as of June 30, 2025, including updated calculation methodologies [Debt and Leverage Ratios](index=5&type=section&id=Debt%20and%20Leverage%20Ratios) As of June 30, 2025, Nexstar's consolidated debt stood at **$6.4 billion**, with a first lien net leverage ratio of **1.81x** and a total net leverage ratio of **3.19x** - Consolidated debt of Nexstar and Mission Broadcasting, Inc. was **$6.4 billion** as of June 30, 2025, including senior secured debt of **$3.7 billion**[18](index=18&type=chunk) - The Company updated its leverage ratio calculation to reflect the average of the last two years of EBITDA[18](index=18&type=chunk) - As of June 30, 2025, the first lien net leverage ratio was **1.81x** (compared to a covenant of **4.25x**) and the total net leverage ratio was **3.19x**[18](index=18&type=chunk) Cash Balances and Debt Obligations | ($ in millions) | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Unrestricted Cash | $234 | $144 | | Revolving Credit Facilities | $206 | $62 | | First Lien Term Loans | 3,465 | 3,750 | | 5.625% Senior Unsecured Notes due 2027 | 1,716 | 1,716 | | 4.75% Senior Unsecured Notes due 2028 | 996 | 995 | | Total Debt | $6,383 | $6,523 | [Non-GAAP Financial Measures & Reconciliations](index=7&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section defines Nexstar's key non-GAAP financial measures and provides detailed reconciliations for Adjusted EBITDA, Free Cash Flow, and Adjusted Free Cash Flow [Definitions of Non-GAAP Measures](index=7&type=section&id=Definitions%20of%20Non-GAAP%20Measures) This section provides the definitions for key non-GAAP financial measures used by Nexstar, explaining their calculation methodologies and purpose as indicators of operating performance and liquidity - Adjusted EBITDA is considered an indicator of the assets' operating performance, calculated by adjusting net income for various non-cash and one-time items[21](index=21&type=chunk) - Free Cash Flow is calculated as net cash provided by operating activities less capital expenditures[22](index=22&type=chunk) - Adjusted Free Cash Flow is considered a liquidity measure, providing useful information about cash generated for ongoing operations, debt payments, dividends, share repurchases, and acquisitions, by adjusting Free Cash Flow for specific items[23](index=23&type=chunk) [Adjusted EBITDA Reconciliation](index=11&type=section&id=Adjusted%20EBITDA%20Reconciliation) This section presents the reconciliation of Net Income to Adjusted EBITDA for the three and six months ended June 30, 2025, and 2024, detailing the adjustments made to arrive at this non-GAAP measure Reconciliation of Adjusted EBITDA | ($ in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $91 | $106 | $188 | $273 | | Add (Less): | | | | | | Transaction, other one-time and restructuring expenses | 10 | - | 10 | 1 | | Stock-based compensation expense | 21 | 20 | 39 | 38 | | Depreciation and amortization expense | 197 | 208 | 402 | 398 | | (Amortization) of broadcast rights expense | (79) | (87) | (168) | (156) | | Amortization of basis difference of equity method investments | 17 | 17 | 35 | 35 | | Interest expense, net | 97 | 113 | 194 | 227 | | Pension and other postretirement plans (credit), net | (8) | (7) | (16) | (14) | | Income tax expense | 39 | 43 | 80 | 105 | | Gain on disposal of an investment | - | - | - | (40) | | Other | 4 | 1 | 6 | (1) | | **Adjusted EBITDA** | **$389** | **$414** | **$770** | **$866** | [Free Cash Flow and Adjusted Free Cash Flow Reconciliation](index=12&type=section&id=Free%20Cash%20Flow%20and%20Adjusted%20Free%20Cash%20Flow%20Reconciliation) This section provides the reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Adjusted Free Cash Flow for the three and six months ended June 30, 2025, and 2024 Reconciliation of Free Cash Flow and Adjusted Free Cash Flow | ($ in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $247 | $176 | $584 | $452 | | Add (Less): | | | | | | Capital expenditures | (29) | (37) | (64) | (81) | | **Free Cash Flow** | **$218** | **$139** | **$520** | **$371** | | Add (Less): | | | | | | Transaction, other one-time and restructuring expenses | 10 | - | 10 | 1 | | Changes in operating assets and liabilities | (21) | 75 | (18) | 150 | | Changes in income tax payable | (92) | (130) | (38) | (59) | | Taxes paid on sale of assets | - | 11 | - | 11 | | Pension and other postretirement plans (credit), net | (8) | (7) | (16) | (14) | | Payments for capitalized software obligations | (7) | (10) | (10) | (11) | | Proceeds from disposal of assets and insurance recoveries | 1 | 1 | 1 | 2 | | Cash contribution from noncontrolling interests | - | - | - | 19 | | Other | - | (2) | - | (4) | | **Adjusted Free Cash Flow** | **$101** | **$77** | **$449** | **$466** | [Consolidated Financial Statements](index=9&type=section&id=Consolidated%20Financial%20Statements) This section presents Nexstar's condensed consolidated statements of operations and cash flows for the specified periods, offering a statutory view of financial performance [Condensed Consolidated Statements of Operations](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section provides the condensed consolidated statements of operations for the three and six months ended June 30, 2025, and 2024, detailing net revenue, operating expenses, income from operations, net income, and earnings per share Condensed Consolidated Statements of Operations | (in millions, except for share and per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net revenue | $1,229 | $1,269 | $2,462 | $2,553 | | Operating expenses: | | | | | | Direct operating | 557 | 552 | 1,108 | 1,100 | | Selling, general and administrative | 198 | 216 | 404 | 432 | | Corporate | 64 | 54 | 116 | 108 | | Depreciation and amortization | 197 | 208 | 402 | 398 | | Other | - | (1) | - | (1) | | Total operating expenses | 1,016 | 1,029 | 2,030 | 2,037 | | Income from operations | 213 | 240 | 432 | 516 | | Income from equity method investments, net | 11 | 16 | 19 | 35 | | Interest expense, net | (97) | (113) | (194) | (227) | | Pension and other postretirement plans credit, net | 8 | 7 | 16 | 14 | | Gain on disposal of an investment | - | - | - | 40 | | Other expenses, net | (5) | (1) | (5) | - | | Income before income taxes | 130 | 149 | 268 | 378 | | Income tax expense | (39) | (43) | (80) | (105) | | Net income | 91 | 106 | 188 | 273 | | Net loss attributable to noncontrolling interests | 6 | 12 | 17 | 20 | | Net income attributable to Nexstar Media Group, Inc. | $97 | $118 | $205 | $293 | | Net income per share available to common stockholders: | | | | | | Basic | $3.09 | $3.59 | $6.50 | $8.85 | | Diluted | $3.06 | $3.54 | $6.43 | $8.71 | | Weighted average number of common shares outstanding: | | | | | | Basic (in thousands) | 30,221 | 32,816 | 30,375 | 33,133 | | Diluted (in thousands) | 30,514 | 33,287 | 30,719 | 33,656 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the condensed consolidated statements of cash flows for the six months ended June 30, 2025, and 2024, detailing cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows | ($ in millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | | Cash flows from operating activities: | | | | Net income | $188 | $273 | | Adjustments to reconcile net income to net cash provided by operating activities: | | | | Depreciation and amortization | 402 | 398 | | Stock-based compensation expense | 39 | 38 | | Amortization of debt financing costs, debt discounts and premium | 5 | 5 | | Loss on extinguishment of debt | 5 | - | | Gain on disposal of an investment | - | (40) | | Deferred income taxes | (24) | (14) | | Payments for broadcast rights | (161) | (166) | | Income from equity method investments, net | (19) | (35) | | Distribution from equity method investments – return on capital | 125 | 139 | | Changes in operating assets and liabilities, net of acquisitions and dispositions: | | | | Accounts receivable | 6 | 48 | | Prepaid and other current assets | (6) | (12) | | Other noncurrent assets | 5 | (11) | | Accounts payable | 60 | (94) | | Accrued expenses and other current liabilities | 20 | (1) | | Income tax payable | (38) | (59) | | Other noncurrent liabilities | (29) | (21) | | Other | 6 | 4 | | Net cash provided by operating activities | 584 | 452 | | Cash flows from investing activities: | | | | Purchases of property and equipment | (64) | (81) | | Payments for acquisitions | (22) | - | | Proceeds from disposal of an investment | - | 40 | | Other investing activities, net | (3) | 2 | | Net cash used in investing activities | (89) | (39) | | Cash flows from financing activities: | | | | Proceeds from debt issuance, net of debt discounts | 3,393 | 55 | | Repayments of long-term debt | (3,543) | (116) | | Purchase of treasury stock | (125) | (246) | | Common stock dividends paid | (113) | (112) | | Payments for capitalized software obligations | (10) | (11) | | Contribution from noncontrolling interests | - | 19 | | Payment for excise tax on stock repurchases | (5) | - | | Other financing activities, net | (2) | (3) | | Net cash used in financing activities | (405) | (414) | | Net increase (decrease) in cash and cash equivalents | 90 | (1) | | Cash and cash equivalents at beginning of period | 144 | 147 | | Cash and cash equivalents at end of period | $234 | $146 | [Other Information](index=5&type=section&id=Other%20Information) This section provides details on Nexstar's Q2 2025 conference call, forward-looking statement disclaimers, and investor and media contact information [Second Quarter Conference Call](index=5&type=section&id=Second%20Quarter%20Conference%20Call) Details for Nexstar's second quarter 2025 earnings conference call, including dial-in numbers, conference ID, and webcast access for investors and interested parties - Nexstar hosted a conference call on August 7, 2025, at 10:00 a.m. ET to discuss financial results[17](index=17&type=chunk) - Dial-in number: **+1 877-407-9208** or **+1 201-493-6784**, conference ID **13753994**[17](index=17&type=chunk) - A live webcast and replay are available through nexstar.tv under 'Events and Presentations' / 'Investor Relations'[17](index=17&type=chunk) [Forward-Looking Statements](index=6&type=section&id=Forward-Looking%20Statements) This section serves as a standard disclaimer, indicating that the communication contains forward-looking statements based on current expectations, which are subject to various risks and uncertainties - The communication includes forward-looking statements based on current expectations and projections about future events[19](index=19&type=chunk) - These statements involve risks and uncertainties, and are subject to change based on various important factors, including economic conditions, debt servicing, acquisitions, advertising pricing, regulatory actions, competition, programming costs, and technological developments[19](index=19&type=chunk) - Nexstar undertakes no obligation to update or revise any forward-looking statements[19](index=19&type=chunk) [Investor and Media Contacts](index=8&type=section&id=Investor%20and%20Media%20Contacts) This section provides contact information for investor relations and media inquiries, listing key personnel and their respective contact details - Investor Contacts: Lee Ann Gliha (EVP and Chief Financial Officer) and JCIR (Joe Jaffoni, Jennifer Neuman)[27](index=27&type=chunk) - Media Contact: Gary Weitman (EVP and Chief Communications Officer)[27](index=27&type=chunk)

Summary of Key Points from the Conference Call Industry Overview - The conference focused on the media and sports industry, featuring 13 companies and discussions on regulatory changes, consolidation, and digital media trends [1][2] - Media consolidation remains a significant topic, with notable deals such as Amazon's acquisition of MGM for $8.5 billion and the Discovery and WarnerMedia merger [3] - The shift from traditional media to digital media continues, with American consumers spending approximately eight hours daily on digital platforms, which is double the time spent on traditional media [4] Company Focus: EW Scripps - EW Scripps is a diversified media enterprise with a strong presence in local television, operating 61 TV stations and reaching over 36% of U.S. TV households [9][10] - The company has undergone significant transformation, focusing on expanding its local TV footprint from 27 stations to over 60 in the past decade [14] - Scripps aims to enhance connections between audiences and brands, as well as between advertisers and audiences, to drive financial benefits for shareholders [15] Financial Performance and Capital Allocation - Scripps' primary capital allocation priority is debt reduction, with leverage decreasing from 6x in Q2 of the previous year to 4.9x in the most recent quarter [17][18] - The company has directed 99% of discretionary cash flow towards debt paydown since the ION acquisition in 2021 [18] - Recent refinancing efforts have limited the increase in average debt costs to less than one percentage point despite a challenging rate environment [19] Regulatory Environment and Consolidation - There is optimism regarding deregulation in the broadcast industry, which could facilitate consolidation and benefit local broadcasters [22] - Scripps supports changes to antiquated ownership rules, emphasizing the need for regulations to adapt to the current competitive landscape, including competition from big tech [23][24] - The company sees opportunities for asset swaps and selective sales to improve operational performance rather than being a major buyer in the M&A market [31] Advertising Trends - Local advertising comprises 70% of Scripps' core advertising revenue, with national businesses accounting for 30% [59] - The advertising environment is challenging, with local businesses showing resilience while sectors like automotive are struggling [60][61] - Political advertising is expected to grow, with Scripps positioned to capture a significant share of spending in upcoming elections [79] Sports Programming Strategy - Scripps has developed a national sports strategy leveraging its reach through ION, focusing on underrepresented leagues like the WNBA and NWSL [51][54] - The company has seen significant audience growth, with the Florida Panthers' ratings up 149% compared to the previous RSN model [56] - Scripps anticipates a shift in MLB rights negotiations, likely following a model that combines linear and streaming platforms [57] Connected TV and Future Opportunities - Scripps has reported a 42% increase in connected TV revenue, now exceeding $100 million, indicating a strong growth area [87] - The company is optimistic about the potential of ATSC 3.0 technology to transform local broadcasting, with plans for significant developments in the coming years [94][96] Conclusion - Scripps is focused on improving operational performance, reducing debt, and navigating regulatory changes to enhance its competitive position in the media landscape [44][45] - The company is well-positioned to capitalize on growth opportunities in sports programming and connected TV while adapting to the evolving advertising environment [78][87]

Core Viewpoint - Nexstar Media Group, Inc. (NASDAQ: NXST) is initiated with a Strong Buy rating and a price target of $239, highlighting its position as the largest local television broadcaster and media platform in the US [1] Company Overview - Nexstar Media Group is recognized for delivering local programming and advertising, establishing itself as a key player in the local media landscape [1] Research Methodology - Moretus Research employs a structured framework to identify companies with durable business models and mispriced cash flow potential, focusing on U.S. public markets [1] - The research emphasizes rigorous fundamental analysis combined with a judgment-driven process, avoiding noise and overly complex forecasting [1] - Valuation methods are based on sector-relevant multiples tailored to each company's business model, emphasizing comparability and relevance [1] Investment Focus - The research coverage targets underappreciated companies undergoing structural changes or temporary dislocations, where disciplined analysis can lead to asymmetric returns [1] - Moretus Research aims to elevate the standard for independent investment research by providing actionable insights and a strong filter for relevant information in equity analysis [1]

Nexstar Media Group (NXST) FY Conference Summary Industry Overview - **Industry**: Broadcast Media - **Company**: Nexstar Media Group Key Points and Arguments 1. **Local Station Business Focus**: Nexstar emphasizes the importance of local stations as the foundation of their business, providing relevant content and entertainment to local communities, which fosters strong relationships with advertisers and audiences [4][5] 2. **Regulatory Environment**: The current political landscape is seen as favorable for deregulation, with one party controlling both houses of Congress, which may lead to the removal of outdated regulations that hinder competition with tech giants [6][7] 3. **Future of the Industry**: There is uncertainty about the future of traditional networks, but Nexstar anticipates a consolidation of local groups that could expand their footprint across the U.S. [8][9] 4. **Legal Challenges**: Potential legal challenges are anticipated regarding the removal of ownership caps and duopoly rules, but Nexstar believes the DOJ will be cooperative in merger reviews [10][11] 5. **M&A Strategy**: Nexstar has a strong track record in M&A, with 40 deals completed from 2011 to 2019, and aims to continue creating shareholder value through strategic acquisitions, particularly in larger markets [13][14][19] 6. **Synergy Opportunities**: The company sees opportunities for synergy capture through retransmission optimization and cost efficiencies, especially in owning multiple stations in a market [16][17][19] 7. **Advertising Revenue Composition**: 63% of Nexstar's revenue comes from distribution, which is more insulated from economic changes, while 37% comes from advertising, with a significant portion being local advertising [54][55] 8. **Political Advertising Outlook**: Nexstar expects strong political advertising revenue in 2026, driven by their presence in battleground states and increased spending in upcoming elections [58][60] 9. **News Nation Growth**: The network is focused on increasing awareness and credibility, leveraging local journalists to provide unique perspectives on news stories [49][50][52] 10. **Sports Programming Strategy**: Nexstar is expanding its sports programming, with 40% of CW's schedule now dedicated to live sports, and is exploring opportunities to acquire more sports rights [38][44][45] Additional Important Content - **Impact of Streaming Services**: The introduction of new streaming services is seen as a potential challenge, but Nexstar believes that broadcast components will remain essential for sports leagues [32][35][36] - **ATSC 3.0 Development**: Nexstar is involved in discussions about developing a backup GPS system using spectrum, which could lead to significant revenue contributions in the future [63][64][66] - **Market Dynamics**: The company acknowledges competition from tech companies like Amazon in local advertising markets, emphasizing the need for regulatory changes to level the playing field [12][26] This summary captures the essential insights from the Nexstar Media Group FY Conference, highlighting the company's strategic focus, regulatory environment, and market opportunities.

Core Viewpoint - DLT Entertainment has expanded the distribution of its 80's Sitcom Flashback FAST Channel through new deals with The CW and TCLtv+, enhancing its reach and accessibility to audiences [1][2][4]. Company Overview - DLT Entertainment is an award-winning international production and distribution company, founded in 1963, with a focus on adapting U.K. formats and producing critically acclaimed series for global audiences [11]. - The company launched the 80's Sitcom Flashback channel in May 2024, which has quickly grown to nearly double its distribution platforms within a year [5][11]. Industry Context - The 80's Sitcom Flashback FAST Channel is the first of its kind, dedicated to celebrating iconic sitcoms from the 1980s, featuring popular shows like "Three's Company," "The Ropers," and "Too Close For Comfort" [2][10]. - The CW, as a major broadcast network, reaches 100% of U.S. television households and has over 100 million downloads for its app, making it a significant platform for content distribution [7]. Distribution and Partnerships - The new distribution deals with The CW and TCLtv+ will allow the 80's Sitcom Flashback channel to be available on multiple streaming platforms, including Plex and Free Movies Plus [4][5]. - Amagi serves as the technical service partner for managing the distribution of the channel across FAST streaming platforms [8].

Core Insights - Gabelli Funds will host its 17th Annual Media & Entertainment Symposium on June 5, 2025, at the Harvard Club in New York City, focusing on industry dynamics, current trends, and business fundamentals [1] - The symposium will include discussions on Sports Investing, Media & Telecom Regulatory issues, and Advertising Panels, providing a platform for attendees to engage with leading companies in the media ecosystem [1][3] - A webcast option will be available for those unable to attend in person, ensuring broader access to the discussions and insights shared during the event [1] Presenting Companies - Notable companies participating in one-on-one meetings include Atlanta Braves Holdings, AMC Networks, Lionsgate Studios, Churchill Downs, Nexstar Media Group, Genius Sports, Reservoir Media, Gray Television, Rogers Communications, Live Nation Entertainment, Sinclair Inc., Sportradar Group, TEGNA Inc., TKO Group, and The E.W. Scripps Company [2] Panel Discussions - The symposium will feature several panel discussions, including "Sports Investing: Ways to Play," a TV Bureau of Advertising (TVB) Panel, and a Media & Telecom Regulatory Expert Session led by former FCC Commissioner Rob McDowell [3]

[PART I FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) Presents unaudited condensed consolidated financial statements for Nexstar Media Group, Inc. as of March 31, 2025, detailing assets, liabilities, operations, and cash flows, with total assets at **$11.41 billion** and net income of **$97 million** Condensed Consolidated Balance Sheet Highlights (As of March 31, 2025) | Metric | Amount (in millions) | | :--- | :--- | | **Total Assets** | **$11,414** | | Total Current Assets | $1,402 | | Goodwill | $2,924 | | FCC Licenses | $2,949 | | **Total Liabilities** | **$9,164** | | Total Current Liabilities | $805 | | Debt | $6,371 | | **Total Stockholders' Equity** | **$2,231** | Condensed Consolidated Statement of Operations (Three Months Ended March 31) | Metric | 2025 (in millions) | 2024 (in millions) | | :--- | :--- | :--- | | Net Revenue | $1,234 | $1,284 | | Income from Operations | $220 | $275 | | Net Income | $97 | $167 | | **Net Income Attributable to Nexstar** | **$108** | **$175** | | Diluted EPS | $3.37 | $5.16 | Condensed Consolidated Statement of Cash Flows (Three Months Ended March 31) | Metric | 2025 (in millions) | 2024 (in millions) | | :--- | :--- | :--- | | Net cash provided by operating activities | $337 | $276 | | Net cash used in investing activities | ($61) | ($4) | | Net cash used in financing activities | ($167) | ($182) | | **Net increase in cash and cash equivalents** | **$109** | **$90** | [Note 1: Organization and Business Operations](index=8&type=section&id=Note%201%3A%20Organization%20and%20Business%20Operations) Nexstar is a leading diversified media company operating 201 television stations across 116 markets, with significant ownership in The CW Network and TV Food Network - The company's portfolio includes **201 full power television stations** in **116 markets**, affiliated with major networks like CBS, FOX, NBC, and ABC[16](index=16&type=chunk) - Nexstar holds a **77.7% ownership interest** in The CW Network, owns NewsNation, and has a **31.3% stake** in Television Food Network, G.P. (TV Food Network)[16](index=16&type=chunk) [Note 2: Summary of Significant Accounting Policies](index=8&type=section&id=Note%202%3A%20Summary%20of%20Significant%20Accounting%20Policies) Details significant accounting policies, including VIE consolidation, management estimates, redeemable noncontrolling interests, and retrospective adoption of ASU 2023-07 for segment reporting - Nexstar consolidates VIEs where it is the primary beneficiary, resulting from local service agreements (TBA, LMA, SSA, JSA) and purchase options[21](index=21&type=chunk)[22](index=22&type=chunk) - The company adopted new segment reporting disclosure requirements (ASU 2023-07) on January 1, 2025, and applied the changes retrospectively[32](index=32&type=chunk) - Redeemable noncontrolling interests, related to The CW, are presented as mezzanine equity and accreted to their redemption value, impacting net income available to common stockholders[29](index=29&type=chunk)[30](index=30&type=chunk) [Note 3: Acquisition](index=13&type=section&id=Note%203%3A%20Acquisition) Details the January 31, 2025 acquisition of WBNX-TV assets in Cleveland, Ohio - The acquisition of WBNX-TV assets was for a cash purchase price of **$22 million**, with **$20 million** allocated to the FCC license[35](index=35&type=chunk) [Note 4: Intangible Assets and Goodwill](index=13&type=section&id=Note%204%3A%20Intangible%20Assets%20and%20Goodwill) Presents significant intangible assets and goodwill as of March 31, 2025, with no impairment events identified during the quarter Goodwill and Intangible Assets (in millions, as of March 31, 2025) | Asset | Net Value | | :--- | :--- | | Goodwill | $2,924 | | FCC Licenses (Indefinite-lived) | $2,949 | | Network Affiliation Agreements (Definite-lived) | $1,447 | | Other Intangible Assets (Definite-lived) | $331 | - Estimated amortization expense for definite-lived intangible assets for the remainder of 2025 is **$218 million**[37](index=37&type=chunk) [Note 5: Investments](index=14&type=section&id=Note%205%3A%20Investments) Details the 31.3% equity method investment in TV Food Network, with a book value of **$753 million** as of March 31, 2025, and plans for partnership renewal - The book value of the investment in TV Food Network decreased from **$857 million** at year-end 2024 to **$753 million** as of March 31, 2025[42](index=42&type=chunk) TV Food Network Financials (Three Months Ended March 31) | Metric | 2025 (in millions) | 2024 (in millions) | | :--- | :--- | :--- | | Net Revenue | $202 | $249 | | Net Income | $81 | $119 | | Net Income Attributable to Nexstar | $27 | $37 | - Nexstar received cash distributions of **$114 million** from TV Food Network during the first quarter of 2025[44](index=44&type=chunk) [Note 7: Debt](index=15&type=section&id=Note%207%3A%20Debt) Outlines the company's **$6.495 billion** long-term debt as of March 31, 2025, including term loans and notes, with **$31 million** repaid and covenant compliance maintained Long-Term Debt Composition (as of March 31, 2025) | Debt Instrument | Principal (in millions) | | :--- | :--- | | Nexstar Term Loan A & B | $3,449 | | Nexstar 5.625% & 4.75% Notes | $2,714 | | Mission Term Loan B & Revolving Loans | $351 | | **Total Outstanding Principal** | **$6,514** | - During Q1 2025, the company repaid **$31 million** of its term loans[47](index=47&type=chunk) - As of March 31, 2025, Nexstar had **$530 million** of unused revolving loan commitments available[48](index=48&type=chunk) [Note 10: Commitments and Contingencies](index=19&type=section&id=Note%2010%3A%20Commitments%20and%20Contingencies) Outlines significant commitments and legal contingencies, including debt guarantees, multi-district antitrust litigation, a major IRS tax dispute, and an FCC Notice of Apparent Liability - The company is a defendant in a multi-district antitrust litigation regarding local TV advertising, with a trial date scheduled for April 2026[63](index=63&type=chunk)[65](index=65&type=chunk) - A significant tax contingency exists related to the 2009 Chicago Cubs transaction; the IRS has appealed a Tax Court decision favorable to the company, with a ruling from the Court of Appeals expected in the first half of 2025[67](index=67&type=chunk)[70](index=70&type=chunk) - The FCC issued a Notice of Apparent Liability for Forfeiture (NAL) to Nexstar and Mission for alleged violations related to station WPIX, which the company is vigorously disputing[73](index=73&type=chunk) [Note 11: Equity](index=21&type=section&id=Note%2011%3A%20Equity) Details shareholder return activities in Q1 2025, including common stock repurchases and an increased quarterly dividend - In Q1 2025, Nexstar repurchased **441,164 shares** of its common stock for **$75 million**[74](index=74&type=chunk) - As of March 31, 2025, **$1.5 billion** remained available under the share repurchase authorization[74](index=74&type=chunk) - On January 29, 2025, the board of directors approved a **10% increase** in the quarterly cash dividend to **$1.86 per share**[76](index=76&type=chunk) [Note 15: Segment Data](index=23&type=section&id=Note%2015%3A%20Segment%20Data) Provides a breakdown of financial performance by reportable segments, with the Broadcast segment contributing the majority of revenue and all segment profit Segment Performance (Three Months Ended March 31, 2025, in millions) | Segment | Net Revenue | Segment Profit (Loss) | | :--- | :--- | :--- | | Reportable Broadcast | $1,169 | $429 | | Other Segments | $77 | ($42) | | Corporate (unallocated) | $2 | ($50) | Consolidated Revenue by Source (Three Months Ended March 31, 2025, in millions) | Revenue Source | Amount | | :--- | :--- | | Distribution | $762 | | Advertising | $460 | | Other | $12 | | **Total Net Revenue** | **$1,234** | [Note 16: Subsequent Events](index=25&type=section&id=Note%2016%3A%20Subsequent%20Events) Reports key corporate actions post-Q1 2025, including a dividend declaration and continued share repurchase activity - On May 5, 2025, the Board of Directors declared a quarterly cash dividend of **$1.86 per share**[94](index=94&type=chunk) - Between April 1, 2025, and May 8, 2025, the company repurchased an additional **209,915 shares** for **$32 million**[94](index=94&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes Q1 2025 financial performance, highlighting a **3.9%** net revenue decrease due to lower political advertising, stable distribution revenue, and strong liquidity to manage its **$6.5 billion** debt [Results of Operations](index=28&type=section&id=Results%20of%20Operations) Net revenue decreased **3.9%** to **$1.234 billion** in Q1 2025, driven by a **$52 million** drop in advertising revenue, while distribution revenue remained stable Q1 2025 vs Q1 2024 Operating Results (in millions) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Distribution Revenue | $762 | $761 | 0.1% | | Advertising Revenue | $460 | $512 | (10.2)% | | **Net Revenue** | **$1,234** | **$1,284** | **(3.9)%** | | Income from Operations | $220 | $275 | (20.0)% | - The decrease in advertising revenue was due to a **$32 million** decline in political advertising (as 2025 is a non-election year) and a **$20 million** decrease in non-political revenue from market softness[112](index=112&type=chunk) - Interest expense decreased by **14.9%** to **$97 million**, primarily due to lower interest rates and reduced outstanding debt[115](index=115&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) Assesses liquidity and capital resources, reporting **$253 million** cash, **$543 million** available credit, increased operating cash flow, and compliance with financial covenants on **$6.495 billion** total debt - Net cash provided by operating activities increased by **$61 million** year-over-year, primarily due to the timing of working capital receipts and payments[123](index=123&type=chunk) - Total outstanding debt was **$6.495 billion** as of March 31, 2025, representing **74.3%** of the company's combined capitalization[128](index=128&type=chunk)[129](index=129&type=chunk) - The company is in compliance with its maximum consolidated first lien net leverage ratio covenant of **4.25 to 1.00**[135](index=135&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Identifies primary market risk as interest rate exposure on variable-rate long-term debt, with no hedging instruments in place as of March 31, 2025 - A hypothetical **100 basis point (1%)** increase in the SOFR benchmark rate would increase the company's annual interest expense by approximately **$38 million**[151](index=151&type=chunk) [Controls and Procedures](index=34&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The Chairman and CEO, along with the CFO, concluded that disclosure controls and procedures were effective as of the end of the reporting period[153](index=153&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, its internal controls[154](index=154&type=chunk) [PART II OTHER INFORMATION](index=34&type=section&id=PART%20II%20OTHER%20INFORMATION) [Legal Proceedings](index=34&type=section&id=ITEM%201.%20Legal%20Proceedings) Discusses legal proceedings arising from ordinary business, referring to Note 10 for detailed information on significant ongoing litigation not expected to have a material adverse effect - The company refers to Note 10, "Commitments and Contingencies," for a detailed discussion of ongoing litigation[156](index=156&type=chunk) [Risk Factors](index=34&type=section&id=ITEM%201A.%20Risk%20Factors) Reports no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to risk factors from the most recent Form 10-K were reported[157](index=157&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details common stock repurchase activity in Q1 2025, including **441,164 shares** repurchased for **$75 million**, with **$1.5 billion** remaining under authorization Share Repurchases (Q1 2025) | Period | Total Shares Purchased | Average Price Paid | Total Cost (millions) | | :--- | :--- | :--- | :--- | | Jan 3 - 31, 2025 | 92,159 | $155.81 | ~$14.4 | | Feb 3 - 7, 2025 | 20,423 | $153.75 | ~$3.1 | | Mar 4 - 28, 2025 | 328,582 | $174.98 | ~$57.5 | | **Total** | **441,164** | **$169.99** | **$75.0** | - As of March 31, 2025, the remaining amount available for share repurchases was **$1.5 billion**[158](index=158&type=chunk) [Other Information](index=35&type=section&id=ITEM%205.%20Other%20Information) Reports an amendment to Sean Compton's employment agreement regarding annual bonus criteria and confirms no Rule 10b5-1 trading arrangement changes by directors or officers - An amendment was made to Sean Compton's employment agreement, altering the criteria for his annual bonus to be based **30%** on company-wide financial metrics (Net Revenue or Adjusted EBITDA) and **70%** on discretionary targets specific to his business line[163](index=163&type=chunk) - No directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement during the first quarter of 2025[165](index=165&type=chunk)

Financial Data and Key Metrics Changes - Nexstar reported first quarter net revenues of $1.23 billion, a decline of 3.9% year-over-year, primarily due to reduced political advertising [18] - Adjusted EBITDA for the first quarter was $381 million, down $71 million from $452 million in the prior year [26] - Adjusted free cash flow for the first quarter was $348 million, compared to $389 million last year [29] Business Line Data and Key Metrics Changes - Distribution revenue reached a record $762 million, an increase of $1 million or 0.1% year-over-year, driven by retransmission rate growth and new CW affiliations [18] - Advertising revenue decreased to $460 million, down $52 million or 10.2% year-over-year, with a notable decline in political advertising [19] - CW's profitability declined by mid-teens millions in Q1 due to increased sports programming amortization, but improved profitability is expected in 2025 [22] Market Data and Key Metrics Changes - Approximately 63% of Nexstar's revenue in Q1 came from distribution and other revenue sources, while 37% was from non-political advertising [10] - Non-political advertising revenue is forecasted to decline in the mid-single digits year-over-year for Q2, similar to Q1 results [56] Company Strategy and Development Direction - The company is focused on deregulation as a key strategic priority, aiming to reform local broadcast ownership rules [6] - Nexstar plans to capitalize on deregulation through mergers and acquisitions (M&A), with a well-defined playbook for identifying attractive assets [9] - The company is also pursuing a transition to ATSC 3.0 standards to enhance high-speed data transmission and monetize spectrum [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the stability of revenue streams, with over 60% derived from subscription-based sources [23] - The company remains optimistic about the advertising market, despite current softness, and expects to see improvements in the second half of the year [56] - Management highlighted the importance of upcoming distribution renewals and the 2026 midterm elections as significant opportunities [17] Other Important Information - Nexstar's outstanding debt as of March 31, 2025, was $6.5 billion, with a reduction of $28 million for the quarter [31] - The company returned $132 million to shareholders, including $57 million in dividends and $75 million in stock repurchases [31] Q&A Session Summary Question: What would the confirmation of the fifth commissioner mean for deregulation? - Management anticipates that an NPRM (Notice of Proposed Rulemaking) would likely be one of the first moves by the chairman to revisit ownership rules [38] Question: Are you comfortable beginning transactions under an NPRM? - Management indicated that it would depend on circumstances and the willingness of counterparties, but they are open to calculated risks [45][49] Question: When do you expect to see the impact of cord cutting on results? - Management has not seen a material change yet but remains cautiously optimistic about potential positive trends later in the year [54] Question: How does the company prioritize M&A opportunities? - Management stated that accretive acquisitions are the primary focus, with a preference for expanding the national footprint over adding additional stations in existing markets [60] Question: What is the outlook for the advertising market? - Management expects non-political advertising to decline in the mid-single digits for Q2, similar to Q1, but anticipates a pickup in the back half of the year [56]

Financial Data and Key Metrics Changes - Nexstar reported first quarter net revenues of $1.23 billion, a decline of 3.9% compared to the prior year, primarily due to a reduction in political advertising [17] - Adjusted EBITDA for the first quarter was $381 million, representing a decrease of $71 million from the previous year [25] - Adjusted free cash flow for the first quarter was $348 million, down from $389 million in the prior year [27] Business Line Data and Key Metrics Changes - Distribution revenue reached a record $762 million, an increase of $1 million or 0.1% year-over-year, driven by retransmission rate growth and new CW affiliations [17] - Advertising revenue decreased to $460 million, down $52 million or 10.2% year-over-year, with a notable decline in political advertising [18] - The CW's profitability declined by mid-teens millions in Q1 due to increased sports programming amortization, but improved profitability is expected in 2025 [21] Market Data and Key Metrics Changes - Approximately 63% of Nexstar's revenue in Q1 came from distribution and other revenue sources, while 37% was derived from non-political advertising [9] - Non-political advertising revenue is forecasted to decline in the mid-single digits year-over-year for Q2, similar to Q1 results [21] - The CW's primetime ratings have surpassed other broadcast networks 74 times across key demographics in Q1, a significant increase from the previous season [11] Company Strategy and Development Direction - The company is focused on deregulation as a key strategic priority, aiming to reform local broadcast ownership rules [5] - Nexstar plans to capitalize on deregulation through mergers and acquisitions, with a well-defined M&A playbook targeting attractive assets in strategic markets [6] - The company is also pursuing a transition to ATSC 3.0 standards to enhance high-speed data transmission and monetize ancillary spectrum uses [6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the stability of revenue streams, with 63% of revenues coming from subscription-based sources [9] - The company remains optimistic about the advertising market, noting growth in service-based advertising despite challenges in goods-based categories [19] - Management highlighted the importance of upcoming distribution renewals and the 2026 midterm elections as significant opportunities for revenue growth [22] Other Important Information - Nexstar's outstanding debt as of March 31, 2025, was $6.5 billion, a reduction of $28 million for the quarter [29] - The company returned $132 million to shareholders, including $57 million in dividends and $75 million in stock repurchases [29] - The first lien covenant ratio was 1.67 times, well below the covenant limit of 4.25 times [29] Q&A Session Summary Question: What would the confirmation of the fifth commissioner mean for deregulation? - Management expects an NPRM to be one of the first moves by the new chairman, which could lead to revisiting ownership rules [35] Question: Are you comfortable beginning transactions during the NPRM phase? - Management indicated that it would depend on circumstances and the willingness of counterparties, but they are open to calculated risks [41] Question: When do you expect to see the impact of cord-cutting moderation? - Management has not seen a material change yet but is cautiously optimistic about potential positive trends in the future [49] Question: How would you prioritize M&A opportunities? - The focus is on accretive acquisitions, with a preference for expanding the national footprint over adding additional stations in existing markets [58] Question: What is the outlook on the advertising market? - Management noted that while non-political advertising is expected to decline in the near term, they anticipate a pickup in the second half of the year [54] Question: How does the DOJ view potential consolidation? - Management believes there is a consensus that current rules are indefensible and does not see DOJ as an impediment to in-market opportunities [82]

[Financial Performance Summary](index=1&type=section&id=Financial%20Performance%20Summary) Nexstar reported Q1 2025 net revenue of $1.23 billion, a 3.9% decrease, with record distribution revenue and $348 million Adjusted Free Cash Flow 2025 First Quarter Financial Summary | ($ in millions) | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | **Distribution** | $762 | $761 | 0.1% | | **Advertising** | $460 | $512 | (10.2)% | | **Other** | $12 | $11 | 9.1% | | **Net Revenue** | $1,234 | $1,284 | (3.9)% | | **Net Income** | $97 | $167 | (41.9)% | | **Adjusted EBITDA** | $381 | $452 | (15.7)% | | **Net Cash Provided by Operating Activities** | $337 | $276 | 22.1% | | **Adjusted Free Cash Flow** | $348 | $389 | (10.5)% | - CEO Perry A. Sook stated the company's focus for the remainder of 2025 includes renewing distribution contracts representing about **60%** of its subscriber base, continuing The CW's path to profitability, preparing for the 2026 political cycle, and pursuing deregulation[1](index=1&type=chunk) [Company and Business Highlights](index=2&type=section&id=Company%20and%20Business%20Highlights) Net revenue declined 3.9% to $1.23 billion due to lower advertising, while operational highlights include a 10% dividend increase and strategic acquisitions [Financial Results](index=2&type=section&id=Financial%20Results) - First quarter net revenue decreased **3.9% YoY** to **$1.23 billion**, primarily due to a **$32 million** decrease in political advertising revenue[6](index=6&type=chunk) - Distribution revenue reached a record for the first quarter at **$762 million**, a slight increase of **0.1% YoY**, driven by rate escalators and vMVPD growth, which offset MVPD subscriber attrition[6](index=6&type=chunk) - Net income decreased by **$70 million** to **$97 million**, primarily due to lower revenue, increased amortization of broadcast rights for The CW sports, and a Q1 2024 non-recurring **$40 million** gain from the sale of its BMI interest[6](index=6&type=chunk) - Adjusted EBITDA decreased **15.7%** to **$381 million**, reflecting lower revenue, reduced income from the TV Food Network equity investment, and higher amortization of broadcast rights at The CW[10](index=10&type=chunk) [Operational Highlights & Strategic Initiatives](index=2&type=section&id=Operational%20Highlights%20%26%20Strategic%20Initiatives) - The quarterly cash dividend was raised by **10%** to **$1.86 per share**, marking the twelfth consecutive annual dividend increase[6](index=6&type=chunk) - Viewership for key sports on The CW grew significantly, with NASCAR Xfinity Series and WWE NXT average viewership both increasing **19% year-over-year** in their respective periods[6](index=6&type=chunk) - Acquired WBNX-TV in Cleveland, Ohio, in January 2025, creating a new duopoly in the nation's 19th largest television market. WBNX will become a CW affiliate on September 1, 2025[6](index=6&type=chunk) - Expanded sports programming by adding Grand Slam Track, AVP volleyball, and the Men's HBCU All-Star Basketball Game to The CW, and partnering with the Texas Rangers for regional broadcasts[6](index=6&type=chunk) [Capital Allocation and Shareholder Returns](index=3&type=section&id=Capital%20Allocation%20and%20Shareholder%20Returns) Nexstar deployed capital in Q1 2025 through $31 million debt repayment, $22 million acquisition, and $132 million returned to shareholders Q1 2025 Capital Allocation | ($ in millions) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Cash Used For** | | | | Debt repayment | $31 | $30 | | Acquisitions | $22 | - | | **Stockholder return** | **$132** | **$168** | | Common stock dividends | $57 | $57 | | Stock repurchases | $75 | $111 | - In Q1 2025, the company repurchased **441,164 shares** of its common stock at an average price of approximately **$169.99 per share** for a total of **$75 million**[8](index=8&type=chunk) [Financial Position](index=4&type=section&id=Financial%20Position) As of March 31, 2025, Nexstar maintained a strong financial position with $6.5 billion total debt and healthy leverage ratios Debt and Cash Summary | ($ in millions) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash on Hand** | $253 | $144 | | **Total Debt** | $6,495 | $6,523 | - As of March 31, 2025, the company's first lien net leverage ratio was **1.67x**, compared to a covenant of **4.25x**, and its total net leverage ratio was **2.93x**[14](index=14&type=chunk) - Leverage ratios are calculated in accordance with credit agreements and exclude The CW Network's operations and its **$20 million** cash balance[14](index=14&type=chunk) [Appendix](index=5&type=section&id=Appendix) This section provides supplementary information, including forward-looking statements, non-GAAP financial measure definitions, and detailed financial statements [Condensed Consolidated Financial Statements](index=8&type=section&id=Condensed%20Consolidated%20Financial%20Statements) Condensed Consolidated Statements of Operations (Q1 2025 vs Q1 2024) | (in millions) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net revenue** | $1,234 | $1,284 | | **Income from operations** | $220 | $275 | | **Income before income taxes** | $138 | $228 | | **Net income** | $97 | $167 | | **Net income attributable to Nexstar** | $108 | $175 | | **Diluted EPS** | $3.37 | $5.16 | Condensed Consolidated Statements of Cash Flows (Q1 2025 vs Q1 2024) | (in millions) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $337 | $276 | | **Net cash used in investing activities** | ($61) | ($4) | | **Net cash used in financing activities** | ($167) | ($182) | | **Net increase in cash and cash equivalents** | $109 | $90 | | **Cash and cash equivalents at end of period** | $253 | $237 | [Reconciliation of Non-GAAP Financial Measures](index=10&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) Reconciliation of Net Income to Adjusted EBITDA | ($ in millions) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net income** | $97 | $167 | | **Adjustments** | $284 | $285 | | **Adjusted EBITDA** | $381 | $452 | Reconciliation to Free Cash Flow and Adjusted Free Cash Flow | ($ in millions) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $337 | $276 | | Capital expenditures | ($35) | ($44) | | **Free Cash Flow** | **$302** | **$232** | | Adjustments | $46 | $157 | | **Adjusted Free Cash Flow** | **$348** | **$389** | [Definitions and Disclosures](index=5&type=section&id=Definitions%20and%20Disclosures) - The report contains forward-looking statements subject to risks and uncertainties, protected under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995[15](index=15&type=chunk) - Adjusted EBITDA is defined as net income adjusted for items including one-time expenses, stock-based compensation, D&A, interest, taxes, and other specified items. It is considered an indicator of operating performance[17](index=17&type=chunk) - Adjusted Free Cash Flow is defined as Free Cash Flow (Net Cash from Operations minus capex) adjusted for items like one-time expenses, changes in operating assets and liabilities, and other specified cash items. It is considered an indicator of liquidity[19](index=19&type=chunk)