Townsquare Media Conference Call Summary Company Overview - **Company**: Townsquare Media - **Stock Symbol**: TSQ - **Current Rating**: Outperform with a price target of $21, indicating significant upside potential from current stock levels [1][1][1] - **Dividend Yield**: 12.7% annualized, considered one of the best total return opportunities in the coverage universe [1][1][1] Industry Insights - **Market Focus**: Townsquare Media operates in small markets outside the top 50 in the U.S., which are often underserved in terms of local news and entertainment [3][3][3] - **Market Penetration**: The company reaches 50% of adults weekly through AM/FM broadcasts and 77% when including online audiences [4][4][4] - **Competition**: There is less competition in digital marketing solutions in these smaller markets, allowing Townsquare Media to build a competitive moat [4][4][4] Digital Business Growth - **Revenue Composition**: Digital revenue now constitutes over 50% of total revenues and cash flow [6][6][6] - **Townsquare Interactive**: This subscription-based service provides digital marketing solutions for small and medium-sized businesses (SMBs) [8][8][8] - **Historical Growth**: From 2013 to 2023, revenue grew by $7 million to $10 million annually, with profits increasing by $2.5 million to $3 million [9][9][9] - **Recent Challenges**: The company faced disruptions due to a return-to-office mandate and a shift to a call center service model, resulting in a loss of approximately $7 million in cash flow over two years [12][12][12][13][13][13] - **Future Outlook**: Expected profit growth of over $3 million in 2025, with a return to historical revenue growth levels anticipated by 2026 [13][13][13] Service Offerings and Innovations - **CRM Adoption**: 100% of Townsquare Interactive's customers are now using the CRM, which was not available four to five years ago [16][16][16] - **Pricing Strategy**: The average revenue per user (ARPU) is approximately $300 per month, with a focus on maintaining current pricing while improving efficiency and profit margins [17][17][17] - **AI Integration**: AI tools are being deployed to enhance service efficiency and customer insights, expected to significantly aid margin expansion in the coming years [19][19][19][20][20][20] Townsquare Ignite - **Digital Advertising Segment**: Townsquare Ignite is experiencing rapid growth, particularly in programmatic advertising and streaming TV [21][21][21][22][22][22] - **Market Trends**: The digital advertising market in the U.S. is growing at a high single-digit CAGR, with streaming TV and social media advertising growing at double-digit rates [22][22][22][23][23][23] - **Partnerships**: The company is expanding its white-label digital advertising partnerships, projecting $50 million in revenue from this segment within five years [26][26][26][27][27][27] Radio Business Insights - **Industry Reach**: Radio remains the number one reach medium in the U.S., with 93% of Americans listening weekly [31][31][31] - **Current Performance**: The radio industry is facing challenges, with Townsquare Media's performance slightly declining but still outperforming the broader industry [32][32][32][34][34][34] - **Future Projections**: Expected moderation of industry decline, with potential for low single-digit declines over the next five years [34][34][34][35][35][35] Financial Health and Capital Management - **Debt Management**: The company has a gross debt of $470 million, with plans to pay down $20 million to $30 million annually [39][39][39][40][40][40] - **Interest Rate Sensitivity**: Each quarter-point reduction in interest rates equates to approximately $1.2 million in interest expense savings [40][40][40][41][41][41] - **Share Buybacks**: Townsquare Media has repurchased 16.6 million shares since 2021, with a focus on opportunistic buybacks and maintaining a high dividend yield [46][46][46] Conclusion - **Growth Strategy**: Townsquare Media is focused on expanding its digital business while managing its traditional radio segment effectively. The company is well-positioned for future growth, particularly in digital advertising and marketing solutions, while maintaining a strong commitment to shareholder returns through dividends and share buybacks [50][50][50]

Core Points - Townsquare Media, Inc. will release its third quarter 2025 financial results on November 10, 2025, before the market opens [2] - A conference call to discuss these results will take place on the same day at 8:00 a.m. Eastern Time [2][3] - The company will also participate in Noble Capital Markets' Emerging Growth Virtual Equity Conference on October 8, 2025, at 2:30 PM Eastern Time [5] Company Overview - Townsquare Media is a community-focused digital and broadcast media and digital marketing solutions company, primarily targeting markets outside the top 50 in the U.S. [8] - The company operates Townsquare Ignite, a digital advertising division that utilizes proprietary programmatic advertising technology and a portfolio of over 400 local news and entertainment websites and mobile apps [8] - Townsquare Interactive provides subscription digital marketing services to small and medium-sized businesses (SMBs), offering a SAAS business management platform, website design, and search engine optimization [8] Investor Relations - Interested parties can access a live webcast of the conference call and the press release on the investor relations page of Townsquare's website [3][4] - A telephone replay of the conference call will be available until November 17, 2025 [4] - For the Noble Capital Markets conference, registration is available at no cost, and qualified investors can arrange one-on-one meetings with management [6]

Financial Data and Key Metrics Changes - In Q2 2025, total net revenue declined approximately 2% year over year, aligning with the guidance of negative 2% to negative 4% [6][25] - Adjusted EBITDA increased by 1% year over year, exceeding the guidance of negative 1% to negative 5% [6][25] - Net leverage decreased to 4.58 times [6][29] Business Line Data and Key Metrics Changes - Digital solutions accounted for approximately 55% of total net revenue in the first half of 2025, with digital revenue growing 4% year over year [7][8] - Townsquare Interactive's segment profit increased by 19% year over year, with profit margins expanding to 33% [16][26] - Broadcast advertising net revenue declined by 8% year over year, consistent with previous expectations [20][27] Market Data and Key Metrics Changes - The company reported a decline in broadcast revenue due to shifts in advertising from traditional to digital platforms, with local market spot share increasing to an all-time high of 39% [21][27] - Digital advertising revenue grew by 2% year over year despite challenges in the advertising marketplace [9][10] Company Strategy and Development Direction - The company is focused on being a digital-first local media company, emphasizing the growth of its digital platforms as the primary growth engine [8][20] - A new media partnership model was launched to expand digital advertising solutions without acquiring additional assets, with expectations of significant revenue growth in the coming years [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the digital advertising growth trajectory despite current challenges, citing strong direct sales performance [40][42] - The company anticipates continued strength in programmatic and direct sales, with expectations for Q3 revenue to align with Q2 performance [23][32] Other Important Information - The company plans to use excess cash flow for debt reduction and to support a high-yielding dividend, with a quarterly dividend of $0.20 per share approved [31][29] - The company has repaid $10 million of debt in Q2 2025, contributing to a total of $13 million repaid since February [29][30] Q&A Session Summary Question: Can you provide more color on the search engine referral traffic trends? - Management noted that search engine referral traffic has declined significantly, impacting indirect revenue, but direct sales remain strong [40][41] Question: Is the Q3 guidance softer than expected due to advertiser hesitance? - Management confirmed that advertisers are cautious but still spending, with a shift towards short-term placements [45][46] Question: How does the current referral traffic decline compare to past social media algorithm changes? - Management indicated that the current decline is similar to past changes in social media algorithms, but they expect traffic to plateau and grow again over time [55][56] Question: What is the outlook for Townsquare Interactive's revenue growth? - Management expressed confidence in returning to revenue growth in 2026, supported by strong profit performance in 2025 [63][66] Question: How is the Phoenix office performing in terms of staffing and growth? - Management reported positive progress in the Phoenix office, with around 40 employees and a focus on recruiting talent to support West Coast operations [76][78]

Company Overview & Strategy - Townsquare is a community-focused digital and broadcast media and digital marketing solutions company, primarily focusing on underserved small and mid-sized local markets outside the Top 50 markets in the U S[12] - The company has transformed into a Digital First Local Media Company, with over 55% of profit and revenue in the first half of 2025 sourced from digital advertising divisions and subscription digital marketing solutions[12] - The company's digital audience is approximately 5 times the size of its terrestrial radio audience[12] Financial Performance & Metrics - As of June 30, 2025, the Last Twelve Months (LTM) net revenue was $447 million and adjusted EBITDA was $101 million[16] - LTM digital net revenue reached $239 million, contributing to 53% of total net revenue and 52% of segment profit[18] - Digital subscription solutions (Townsquare Interactive) accounted for 18% of LTM total revenue and 26% of adjusted EBITDA as of June 30, 2025[18] - The company announced a quarterly dividend of $0 20 per share, representing an approximate 12% dividend yield as of August 5, 2025[17] Digital Segment Details - Digital Advertising segment's LTM net revenue was $162 million with a segment profit of $41 million, representing a 26% profit margin[24,63] - Subscription Digital Marketing Solutions segment's LTM net revenue was $76 million with a segment profit of $23 million[24,69] Broadcast Segment Details - Broadcast Advertising segment's LTM net revenue was $189 million with a segment profit of $49 million, representing a 26% profit margin[27] - The company's AM/FM terrestrial broadcast reaches 50% of adults in its local markets[42]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Presents Townsquare Media's unaudited consolidated financials for Q2 2025 and FY2024, covering key statements and notes [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Summarizes Townsquare Media's financial position, detailing total assets, liabilities, and stockholders' deficit | Metric | Dec 31, 2024 (in Thousands) | Jun 30, 2025 (in Thousands) | Change (in Thousands) | % Change | | :-------------------------------- | :-------------------------- | :-------------------------- | :-------------------- | :------- | | Total Assets | $580,414 | $545,729 | $(34,685) | (6.0)% | | Total Liabilities | $608,856 | $572,821 | $(36,035) | (5.9)% | | Total Stockholders' Deficit | $(28,442) | $(27,092) | $1,350 | 4.7% | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Details Townsquare Media's financial performance, including net revenue, operating income, net income, and EPS | Metric (in Thousands) | 3 Months Ended Jun 30, 2025 | 3 Months Ended Jun 30, 2024 | Change | % Change | | :------------------------------------------------ | :-------------------------- | :-------------------------- | :----- | :------- | | Net revenue | $115,448 | $118,225 | $(2,777) | (2.3)% | | Operating income (loss) | $21,050 | $(21,370) | $42,420 | N/A | | Net income (loss) | $2,009 | $(48,858) | $50,867 | N/A | | Basic income (loss) per share | $0.10 | $(3.26) | $3.36 | N/A | | Diluted income (loss) per share | $0.09 | $(3.26) | $3.35 | N/A | | Metric (in Thousands) | 6 Months Ended Jun 30, 2025 | 6 Months Ended Jun 30, 2024 | Change | % Change | | :------------------------------------------------ | :-------------------------- | :-------------------------- | :----- | :------- | | Net revenue | $214,123 | $217,858 | $(3,735) | (1.7)% | | Operating income (loss) | $28,183 | $(14,730) | $42,913 | N/A | | Net income (loss) | $498 | $(47,305) | $47,803 | N/A | | Basic income (loss) per share | $(0.03) | $(3.04) | $3.01 | N/A | | Diluted income (loss) per share | $(0.03) | $(3.04) | $3.01 | N/A | [Consolidated Statements of Stockholders' (Deficit) Equity](index=5&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20(Deficit)%20Equity) Outlines changes in Townsquare Media's stockholders' deficit, reflecting net income, dividends, and stock compensation | Metric (in Thousands) | Jan 1, 2025 | Jun 30, 2025 | Change | | :-------------------------------- | :---------- | :----------- | :----- | | Total Stockholders' Deficit | $(28,442) | $(27,092) | $1,350 | - Net income of **$2.0 million** for the three months ended June 30, 2025, contributed positively to equity, while dividends declared (**$0.20 per share**) resulted in a **$3.5 million** reduction[13](index=13&type=chunk)[99](index=99&type=chunk) - Stock-based compensation added **$2.6 million** to additional paid-in capital during the three months ended June 30, 2025[13](index=13&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Presents Townsquare Media's cash flows from operating, investing, and financing activities for H1 2025 and 2024 | Metric (in Thousands) | 6 Months Ended Jun 30, 2025 | 6 Months Ended Jun 30, 2024 | Change | | :------------------------------------ | :-------------------------- | :-------------------------- | :----- | | Net cash provided by operating activities | $10,129 | $10,684 | $(555) | | Net cash used in investing activities | $(1,906) | $(3,993) | $2,087 | | Net cash used in financing activities | $(37,707) | $(39,222) | $1,515 | | Net decrease in cash, cash equivalents and restricted cash | $(29,484) | $(32,531) | $3,047 | - Cash payments for interest increased to **$29.3 million** in H1 2025 from **$18.2 million** in H1 2024[19](index=19&type=chunk) [Notes to Unaudited Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Explains accounting policies, revenue recognition, asset valuations, debt, income taxes, equity, and segment reporting [Note 1. Organization and Basis of Presentation](index=9&type=section&id=Note%201.%20Organization%20and%20Basis%20of%20Presentation) Describes Townsquare Media's business, operating segments, and macroeconomic impacts on financial performance - Townsquare operates in digital advertising (Townsquare Ignite), subscription digital marketing solutions (Townsquare Interactive), and local radio stations, primarily outside the top 50 U.S. markets[21](index=21&type=chunk) - Current economic challenges (inflation, interest rates) pose risks of advertising/subscription cancellations, revenue declines, and increased operating expenses[22](index=22&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=10&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) Outlines the company's accounting policies and evaluation of recently issued accounting standards - No significant changes in accounting policies since December 31, 2024[27](index=27&type=chunk) - ASU 2023-09 (Income Tax Disclosures) and ASU 2024-03 (Expense Disaggregation Disclosures) are not expected to have a significant impact on financial statements, as they primarily require additional disclosures[28](index=28&type=chunk)[29](index=29&type=chunk) [Note 3. Revenue Recognition](index=10&type=section&id=Note%203.%20Revenue%20Recognition) Details revenue disaggregation by segment and political sources, with recognition policies for digital, broadcast, and subscription | Revenue Segment (in Thousands) | 3 Months Ended Jun 30, 2025 | 3 Months Ended Jun 30, 2024 | Change | % Change | | :----------------------------- | :-------------------------- | :-------------------------- | :----- | :------- | | Digital Advertising | $42,538 | $41,524 | $1,014 | 2.4% | | Subscription Digital Marketing Solutions | $18,767 | $18,515 | $252 | 1.4% | | Broadcast Advertising | $48,684 | $53,633 | $(4,949) | (9.2)% | | Other | $5,459 | $4,553 | $906 | 19.9% | | Political Revenue | $556 | $1,459 | $(903) | (61.9)% | | Revenue Segment (in Thousands) | 6 Months Ended Jun 30, 2025 | 6 Months Ended Jun 30, 2024 | Change | % Change | | :----------------------------- | :-------------------------- | :-------------------------- | :----- | :------- | | Digital Advertising | $79,289 | $75,680 | $3,609 | 4.8% | | Subscription Digital Marketing Solutions | $37,789 | $36,768 | $1,021 | 2.8% | | Broadcast Advertising | $89,999 | $99,088 | $(9,089) | (9.2)% | | Other | $7,046 | $6,322 | $724 | 11.5% | | Political Revenue | $1,123 | $2,519 | $(1,396) | (55.4)% | - Contract liabilities (deferred revenue) decreased from **$9.9 million** at December 31, 2024, to **$8.6 million** at June 30, 2025, primarily due to revenue recognition[38](index=38&type=chunk)[39](index=39&type=chunk) [Note 4. Property and Equipment, net](index=13&type=section&id=Note%204.%20Property%20and%20Equipment,%20net) Summarizes net property and equipment, depreciation, and gains/losses from asset sales, including a major land sale | Metric (in Thousands) | Dec 31, 2024 | Jun 30, 2025 | Change | | :-------------------- | :----------- | :----------- | :----- | | Total property and equipment, net | $110,269 | $110,273 | $4 | | Metric (in Thousands) | 3 Months Ended Jun 30, 20

Executive Summary & Highlights Townsquare Media's Q2 2025 results exceeded guidance, driven by digital growth, with the CEO emphasizing profitable growth and a new dividend announcement [Q2 2025 Performance Overview](index=1&type=section&id=Q2%202025%20Performance%20Overview) Townsquare Media exceeded Q2 Adjusted EBITDA guidance, driven by strong digital growth, with digital segments becoming the primary engine for revenue and profit - Townsquare Media's Q2 2025 results met or exceeded previously issued guidance, with **Adjusted EBITDA above expectations**[2](index=2&type=chunk) | Metric | Q2 2025 (YoY Change) | Q2 2025 (YoY Change, Excl. Political) | | :-------------------------------- | :-------------------- | :------------------------------------ | | Net Revenue | -2.3% | -1.6% | | Adjusted EBITDA | +0.7% | +3.8% | | Net Income | +$50.9 million (to $2.0 million) | N/A | - Digital segments are the Company's growth engine, representing **55% of total net revenue** and **56% of total Segment Profit** in the first half of 2025[1](index=1&type=chunk)[2](index=2&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Bill Wilson highlighted robust local presence and digital solutions, driving strong Adjusted EBITDA and emphasizing digital as the key growth engine for profitable, sustainable growth and shareholder value - CEO Bill Wilson stated that Townsquare's robust local presence and holistic local and digital marketing solutions helped navigate revenue pressures and achieve guidance[2](index=2&type=chunk) - Digital is identified as Townsquare's key growth engine, driving profitable and sustainable growth, which is a key differentiator for the Company[2](index=2&type=chunk) - The business model delivers solid results and strong cash flow, which is being applied to organic investment and debt paydown, with a commitment to building shareholder value through growth, leverage reduction, and future dividends[2](index=2&type=chunk) [Dividend Announcement](index=1&type=section&id=Dividend%20Announcement) The Board of Directors approved a quarterly cash dividend of $0.20 per share, payable in November 2025 | Metric | Value | | :-------------------- | :---- | | Quarterly Cash Dividend | $0.20 per share | | Payable Date | November 3, 2025 | | Record Date | October 27, 2025 | | Dividend Yield | Approximately 12% | Business Segments Townsquare Media operates through three primary reportable segments: Digital Advertising, Subscription Digital Marketing Solutions, and Broadcast Advertising [Description of Reportable Segments](index=1&type=section&id=Description%20of%20Reportable%20Segments) Townsquare Media operates three reportable segments: Digital Advertising (Townsquare Ignite), Subscription Digital Marketing Solutions (Townsquare Interactive), and Broadcast Advertising, with other activities under 'Other' - The Company has three reportable operating segments: Digital Advertising (Townsquare Ignite), Subscription Digital Marketing Solutions (Townsquare Interactive), and Broadcast Advertising[4](index=4&type=chunk) - Digital Advertising includes digital advertising on programmatic platforms and owned/operated digital properties, utilizing first-party data[4](index=4&type=chunk) - Subscription Digital Marketing Solutions (Townsquare Interactive) provides subscription-based digital marketing services[4](index=4&type=chunk) - Broadcast Advertising covers local, regional, and national advertising via terrestrial radio, with 'Other' including live events[4](index=4&type=chunk) Financial Performance & Outlook This section reviews Q2 and year-to-date 2025 financial highlights, including revenue, net income, and Adjusted EBITDA, along with future guidance [Q2 2025 Key Financial Highlights](index=1&type=section&id=Q2%202025%20Key%20Financial%20Highlights) Q2 2025 saw a slight net revenue decrease but significant net income improvement, with digital segments growing and Broadcast Advertising declining | Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :------------------------------------ | :-------- | :-------- | :----------- | | Net Revenue | -$2.8 million | N/A | -2.3% | | Net Revenue (Excl. Political) | -$1.9 million | N/A | -1.6% | | Net Income (Loss) | $2.0 million | -$48.9 million | +$50.9 million | | Adjusted EBITDA | +$0.2 million | N/A | +0.7% | | Adjusted EBITDA (Excl. Political) | +$1.0 million | N/A | +3.8% | | Total Digital Net Revenue | N/A | N/A | +2.1% | | Digital Advertising Net Revenue | N/A | N/A | +2.4% | | Subscription Digital Marketing Net Revenue | N/A | N/A | +1.4% | | Total Digital Segment Profit | N/A | N/A | +4.3% | | Broadcast Advertising Net Revenue | N/A | N/A | -9.2% | [Year-to-Date 2025 Key Financial Highlights](index=2&type=section&id=Year-to-Date%202025%20Key%20Financial%20Highlights) The first half of 2025 showed a modest net revenue decrease but significant net income improvement, with digital segments growing and Broadcast Advertising declining | Metric | H1 2025 (YoY Change) | H1 2025 (YoY Change, Excl. Political) | | :------------------------------------ | :------------------- | :------------------------------------ | | Net Revenue | -1.7% | -1.1% | | Net Income (Loss) | +$47.8 million (to $0.5 million) | N/A | | Adjusted EBITDA | +1.8% | N/A | | Total Digital Net Revenue | +4.1% | N/A | | Digital Advertising Net Revenue | +4.8% | N/A |\ | Subscription Digital Marketing Net Revenue | +2.8% | N/A | | Total Digital Segment Profit | +9.4% | N/A | | Broadcast Advertising Net Revenue | -9.2% | -8.0% | - The company entered into a five-year **$490 million Credit Agreement** and redeemed **$467.4 million** of outstanding 2026 Senior Secured Notes[11](index=11&type=chunk) - Repaid **$12.9 million** of the Senior Secured Credit Facility, including **$10.0 million** of the Revolver and **$2.9 million** of Term Loan[11](index=11&type=chunk) [Financial Guidance (Q3 & Full Year 2025)](index=2&type=section&id=Financial%20Guidance%20%28Q3%20%26%20Full%20Year%202025%29) Townsquare Media provided Q3 and full-year 2025 guidance, projecting net revenue and Adjusted EBITDA within specified ranges | Metric | Q3 2025 Guidance | Full Year 2025 Guidance | | :---------------- | :--------------------- | :---------------------- | | Net Revenue | $106.5 million - $108.5 million | $435 million - $440 million | | Adjusted EBITDA | $22.0 million - $23.0 million | $90 million - $94 million | Detailed Financial Review This section provides a detailed analysis of the company's financial performance for Q2 and the first half of 2025, covering revenue, net income, and Adjusted EBITDA [Q2 2025 Financial Performance](index=2&type=section&id=Q2%202025%20Financial%20Performance) Q2 2025 experienced a slight total net revenue decline, offset by digital growth, with net income significantly improving due to reduced impairment charges and modest Adjusted EBITDA growth [Net Revenue Analysis (Q2)](index=2&type=section&id=Net%20Revenue%20Analysis%20%28Q2%29) Total net revenue decreased by 2.3% in Q2 2025, or 1.6% excluding political revenue, driven by Broadcast Advertising declines offset by digital and other revenue growth | Segment | Q2 2025 Net Revenue (in millions) | YoY Change (%) | | :-------------------------------- | :-------------------------------- | :------------- | | Total Net Revenue | $115.4 | -2.3% | | Total Net Revenue (Excl. Political) | $114.9 | -1.6% | | Broadcast Advertising | N/A | -9.2% | | Broadcast Advertising (Excl. Political) | $48.2 | -7.8% | | Digital Advertising | N/A | +2.4% | | Digital Advertising (Excl. Political) | $42.4 | +2.5% | | Subscription Digital Marketing Solutions | N/A | +1.4% | | Other | N/A | +19.9% | [Net Income (Loss) Analysis (Q2)](index=3&type=section&id=Net%20Income%20%28Loss%29%20Analysis%20%28Q2%29) Q2 2025 net income significantly improved to $2.0 million from a $48.9 million net loss, primarily due to decreased non-cash impairment charges and increased gain on asset sales | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :-------------------- | :-------------------- | :-------------------- | :----------- |\ | Net Income (Loss) | $2.0 | -$48.9 | +$50.9 | | Adjusted Net Income | $3.6 | $2.3 | +55.9% | - The increase in net income was primarily driven by a **$31.1 million** decrease in non-cash impairment charges, a **$5.9 million** increase in gain on sale and retirement of assets, and a **$4.5 million** decrease in stock-based compensation[12](index=12&type=chunk) - Partially offset by a **$3.4 million** increase in interest expense[12](index=12&type=chunk) [Adjusted EBITDA Analysis (Q2)](index=3&type=section&id=Adjusted%20EBITDA%20Analysis%20%28Q2%29) Adjusted EBITDA increased modestly by 0.7% in Q2 2025, with a 3.8% growth excluding political revenue, indicating underlying operational strength | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | | :-------------------------------- | :-------------------- | :-------------------- | :----------- | | Adjusted EBITDA | $26.4 | $26.2 | +0.7% | | Adjusted EBITDA (Excl. Political) | $25.9 | $25.0 | +3.8% | [Six Months Ended June 30, 2025 Financial Performance](index=3&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20Financial%20Performance) The first half of 2025 saw a slight net revenue decrease, primarily from Broadcast Advertising, offset by digital growth, with net income significantly improving and Adjusted EBITDA showing a positive trend [Net Revenue Analysis (H1)](index=3&type=section&id=Net%20Revenue%20Analysis%20%28H1%29) Total net revenue for H1 2025 decreased by 1.7%, or 1.1% excluding political revenue, due to Broadcast Advertising declines partially offset by digital and other revenue growth | Segment | H1 2025 Net Revenue (in millions) | YoY Change (%) | | :-------------------------------- | :-------------------------------- | :------------- | | Total Net Revenue | $214.1 | -1.7% | | Total Net Revenue (Excl. Political) | $213.0 | -1.1% | | Broadcast Advertising | N/A | -9.2% | | Broadcast Advertising (Excl. Political) | $89.0 | -7.8% | | Digital Advertising | N/A | +4.8% | | Digital Advertising (Excl. Political) | $79.1 | +4.9% | | Subscription Digital Marketing Solutions | N/A | +2.8% | | Other | N/A | +11.5% | [Net Income (Loss) Analysis (H1)](index=3&type=section&id=Net%20Income%20%28Loss%29%20Analysis%20%28H1%29) H1 2025 net income improved to $0.5 million from a $47.3 million net loss, driven by reduced non-cash impairment charges and increased gain on asset sales | Metric | H1 2025 (in millions) | H1 2024 (in millions) | Change (YoY) | | :-------------------- | :-------------------- | :-------------------- | :----------- | | Net Income (Loss) | $0.5 | -$47.3 | +$47.8 | | Adjusted Net Income | $2.8 | $2.8 | 0.0% | - The increase in net income was due to a **$32.8 million** decrease in non-cash impairment charges, a **$5.9 million** increase in gain on sale and retirement of assets, and a **$3.2 million** decrease in stock-based compensation[16](index=16&type=chunk) - These positive impacts were partially offset by a **$4.8 million** decrease in other income (primarily a 2024 gain on acquisition of an investee), a **$4.6 million** increase in interest expense, and a **$1.5 million** loss on early repayment of 2026 Notes[16](index=16&type=chunk) [Adjusted EBITDA Analysis (H1)](index=3&type=section&id=Adjusted%20EBITDA%20Analysis%20%28H1%29) Adjusted EBITDA for H1 2025 increased by 1.8%, with a 4.8% growth excluding political revenue, reflecting consistent operational performance | Metric | H1 2025 (in millions) | H1 2024 (in millions) | Change (YoY) | | :-------------------------------- | :-------------------- | :-------------------- | :----------- | | Adjusted EBITDA | $44.6 | $43.8 | +1.8% | | Adjusted EBITDA (Excl. Political) | $43.6 | $41.6 | +4.8% | Liquidity and Capital Structure This section details the company's liquidity position, including cash, debt, leverage ratios, and outstanding common stock as of June 30, 2025 [Cash, Debt, and Leverage](index=4&type=section&id=Cash%2C%20Debt%2C%20and%20Leverage) As of June 30, 2025, Townsquare Media held $3.2 million in cash, $467.1 million in debt, with gross and net leverage ratios of 4.62x and 4.58x respectively | Metric | As of June 30, 2025 (in millions) | | :-------------------------------- | :-------------------------------- | | Cash and Cash Equivalents | $3.2 | | Outstanding Indebtedness | $467.1 | | Gross Leverage (LTM Adjusted EBITDA) | 4.62x | | Net Leverage (LTM Adjusted EBITDA) | 4.58x | [Outstanding Common Stock](index=4&type=section&id=Outstanding%20Common%20Stock) As of August 1, 2025, the company had 16,445,452 shares of common stock outstanding across Class A, B, and C, each with distinct voting rights | Security | Number Outstanding | | :----------------- | :----------------- | | Class A common stock | 15,130,156 | | Class B common stock | 815,296 | | Class C common stock | 500,000 | | Total | 16,445,452 | - Class A common stock carries one vote per share, Class B carries 10 votes per share, and Class C has no votes[20](index=20&type=chunk) Company Information This section provides details on the Q2 2025 conference call, an overview of Townsquare Media's business, and investor relations contact information [Conference Call Details](index=4&type=section&id=Conference%20Call%20Details) Townsquare Media hosted a conference call on August 6, 2025, to discuss Q2 2025 results and 2025 guidance, with replay options available - A conference call was held on Wednesday, August 6, 2025, at 8:00 a.m. Eastern Time[20](index=20&type=chunk) - A replay of the conference call is available through August 13, 2025, via dial-in and web-based archive[21](index=21&type=chunk) [About Townsquare Media, Inc.](index=4&type=section&id=About%20Townsquare%20Media%2C%20Inc.) Townsquare is a community-focused digital and broadcast media and marketing solutions company, operating outside top U.S. markets, leveraging digital advertising, subscription services, and local radio - Townsquare is a community-focused digital and broadcast media and digital marketing solutions company, primarily focused outside the top 50 U.S. markets[22](index=22&type=chunk) - Townsquare Ignite, the digital advertising division, uses proprietary programmatic advertising technology and a portfolio of over 400 local news/entertainment websites[22](index=22&type=chunk) - Townsquare Interactive, the subscription digital marketing services business, helps SMBs manage their digital presence with a SAAS platform, website design, SEO, and other digital services[22](index=22&type=chunk) - The company also operates a portfolio of local radio stations for advertising solutions and local content[22](index=22&type=chunk) [Investor Relations Contact](index=5&type=section&id=Investor%20Relations%20Contact) Investor relations contact information is provided for inquiries - Investor Relations contact: Claire Yenicay, (203) 900-5555, investors@townsquaremedia.com[28](index=28&type=chunk) Legal & Non-GAAP Disclosures This section outlines forward-looking statements and provides definitions and explanations for the non-GAAP financial measures used in the report [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) The report contains forward-looking statements about future financial condition, operations, and business plans, subject to risks that could cause actual results to differ materially - The document includes forward-looking statements about financial condition, results of operations, plans, objectives, future performance, and business[23](index=23&type=chunk) - Actual events or results may differ materially due to factors such as general economic conditions, industry competition, technological changes, advertising cancellations, ability to develop digital technologies, dependence on key personnel, capital expenditure requirements, acquisitions, regulatory requirements, leverage, interest rates, and access to capital markets[23](index=23&type=chunk) - The company undertakes no obligation to publicly update or revise any forward-looking statements, except as required by law[24](index=24&type=chunk) [Non-GAAP Financial Measures and Definitions](index=5&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Definitions) The report uses non-GAAP measures like Adjusted EBITDA, Adjusted Net Income, and Net Leverage to provide additional insights into operating performance and financial health - Non-GAAP measures used include Adjusted EBITDA, Adjusted EBITDA (Excluding Political), Adjusted Net Income, Adjusted Net Income Per Share, and Net Leverage[25](index=25&type=chunk) - Adjusted EBITDA is defined as net income before income taxes, interest expense, debt-related gains/losses, transaction/realignment costs, D&A, stock-based compensation, impairments, asset sale gains/losses, and other expense/income[26](index=26&type=chunk) - These non-GAAP measures are used to facilitate company-to-company and year-over-year operating performance comparisons by excluding certain non-operating or variable items like political revenue and capital structure differences[27](index=27&type=chunk) Consolidated Financial Statements This section presents the consolidated balance sheets, statements of operations, cash flows, and segment-level performance for the company [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets as of June 30, 2025, and December 31, 2024, show decreased total assets and liabilities, with a slight improvement in stockholders' deficit | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Total Assets | $545,729 | $580,414 | | Total Liabilities | $572,821 | $608,856 | | Total Stockholders' Deficit | $(27,092) | $(28,442) | | Cash and Cash Equivalents | $3,183 | $32,990 | | Long-term debt, net | $427,971 | $465,756 | [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) The consolidated statements of operations detail revenues and expenses for Q2 and H1 2025 and 2024, showing a shift from net loss to net income due to reduced impairment charges | Metric (in thousands) | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :-------------------- | :------ | :------ | :------ | :------ | | Net Revenue | $115,448 | $118,225 | $214,123 | $217,858 | | Operating Income (Loss) | $21,050 | $(21,370) | $28,183 | $(14,730) | | Net Income (Loss) | $2,009 | $(48,858) | $498 | $(47,305) | | Diluted Income (Loss) per Share | $0.09 | $(3.26) | $(0.03) | $(3.04) | - Impairment of intangible assets, investments, goodwill, and long-lived assets decreased significantly from **$32,638 thousand** in Q2 2024 to **$1,500 thousand** in Q2 2025, and from **$34,256 thousand** in H1 2024 to **$1,500 thousand** in H1 2025[32](index=32&type=chunk) - Net (gain) loss on sale and retirement of assets improved from a loss of **$30 thousand** in Q2 2024 to a gain of **$5,866 thousand** in Q2 2025[32](index=32&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated cash flows show decreased net cash from operating activities for H1 2025, reduced investing cash usage, and significant debt refinancing and repayments in financing activities | Metric (in thousands) | H1 2025 | H1 2024 | | :-------------------- | :------ | :------ | | Net Cash Provided by Operating Activities | $10,129 | $10,684 | | Net Cash Used in Investing Activities | $(1,906) | $(3,993) | | Net Cash Used in Financing Activities | $(37,707) | $(39,222) | | Net Decrease in Cash, Cash Equivalents and Restricted Cash | $(29,484) | $(32,531) | | Cash and Cash Equivalents, End of Period | $3,183 | $28,511 | - Financing activities included repayment and repurchases of **$467,436 thousand** of 2026 Notes and proceeds from a Term Loan of **$446,400 thousand** in H1 2025[34](index=34&type=chunk) - Cash payments for interest increased significantly to **$29,340 thousand** in H1 2025 from **$18,244 thousand** in H1 2024[36](index=36&type=chunk) [Consolidated Statements of Operations by Segment](index=10&type=section&id=Consolidated%20Statements%20of%20Operations%20by%20Segment) Segment operations show Digital Advertising and Subscription Digital Marketing Solutions grew in revenue and profit for Q2 and H1 2025, while Broadcast Advertising declined, with digital segments increasing their share | Segment (Net Revenue in thousands) | Q2 2025 | Q2 2024 | % Change | H1 2025 | H1 2024 | % Change | | :--------------------------------- | :------ | :------ | :------- | :------ | :------ | :------- | | Digital Advertising | $42,538 | $41,524 | 2.4% | $79,289 | $75,680 | 4.8% | | Subscription Digital Marketing Solutions | $18,767 | $18,515 | 1.4% | $37,789 | $36,768 | 2.8% | | Broadcast Advertising | $48,684 | $53,633 | (9.2)% | $89,999 | $99,088 | (9.2)% | | Other | $5,459 | $4,553 | 19.9% | $7,046 | $6,322 | 11.5% | | Total Net Revenue | $115,448 | $118,225 | (2.3)% | $214,123 | $217,858 | (1.7)% | | Segment (Segment Profit in thousands) | Q2 2025 | Q2 2024 | % Change | H1 2025 | H1 2024 | % Change | | :---------------------------------- | :------ | :------ | :------- | :------ | :------ | :------- | | Digital Advertising | $10,897 | $11,009 | (1.0)% | $18,797 | $18,065 | 4.1% | | Subscription Digital Marketing Solutions | $6,243 | $5,417 | 15.2% | $12,419 | $10,473 | 18.6% | | Broadcast Advertising | $14,677 | $16,021 | (8.4)% | $23,049 | $26,206 | (12.0)% | | Other | $802 | $266 | 201.5% | $1,213 | $707 | 71.6% | | Total Segment Profit | $32,619 | $32,713 | (0.3)% | $55,478 | $55,451 | 0.0% | [Reconciliation of Non-GAAP Financial Measures](index=12&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section reconciles GAAP net income (loss) to non-GAAP measures like Adjusted Net Income and Adjusted EBITDA for quarterly and year-to-date periods | Metric (in thousands) | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :-------------------- | :------ | :------ | :------ | :------ | | Net Income (Loss) | $2,009 | $(48,858) | $498 | $(47,305) | | Adjusted Net Income | $3,638 | $2,334 | $2,764 | $2,813 | | Adjusted Net Income Per Share (Diluted) | $0.22 | $0.14 | $0.17 | $0.16 | | Metric (in thousands) | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :-------------------------------- | :------ | :------ | :------ | :------ | | Adjusted EBITDA | $26,421 | $26,231 | $44,558 | $43,752 | | Adjusted EBITDA (Excluding Political) | $25,948 | $24,991 | $43,603 | $41,611 | | Adjusted EBITDA Less Interest, Capex and Taxes | $10,521 | $20,702 | $6,168 | $16,145 | | Metric (in thousands) | LTM Ended June 30, 2025 | | :-------------------- | :---------------------- | | Adjusted EBITDA | $101,191 |

Core Insights - Townsquare Media, Inc. reported a net revenue of $115.4 million for Q2 2025, a decrease of 2.3% year-over-year, while net income improved to $2.0 million from a loss of $48.9 million in the same period last year [2][5][11] - Digital revenue accounted for 55% of total net revenue and 56% of segment profit in the first half of 2025, with a year-over-year increase of 4.1% [2][5][12] - The company has approved a quarterly cash dividend of $0.20 per share, reflecting a yield of approximately 12% based on the last closing price [3] Financial Performance - Total net revenue for the first half of 2025 decreased by 1.7% to $214.1 million compared to $217.9 million in the same period in 2024 [14] - Adjusted EBITDA for Q2 2025 increased by 0.7% to $26.4 million, while for the first half of 2025, it rose by 1.8% to $44.6 million [13][17] - The company repurchased $10 million of debt in Q2 2025 and $13 million since the refinancing in February 2025 [1][12] Segment Analysis - Digital Advertising segment revenue increased by 2.4% to $42.5 million in Q2 2025, while Subscription Digital Marketing Solutions revenue rose by 1.4% to $18.8 million [9][35] - Broadcast Advertising revenue decreased by 9.2% to $48.7 million in Q2 2025, attributed to reduced advertising purchases by clients [9][12] - Total Digital Segment Profit increased by 4.3% in Q2 2025 compared to the previous year [5][12] Guidance and Future Outlook - For Q3 2025, net revenue is expected to be between $106.5 million and $108.5 million, with Adjusted EBITDA projected between $22.0 million and $23.0 million [8] - For the full year 2025, net revenue is anticipated to be between $435 million and $440 million, with Adjusted EBITDA expected between $90 million and $94 million [8] Capital Structure and Liquidity - As of June 30, 2025, the company had $3.2 million in cash and cash equivalents and $467.1 million in outstanding debt, resulting in a gross leverage ratio of 4.62x [18] - The company has maintained financial flexibility due to strong cash generation and successful refinancing earlier in the year [2][12]

Core Insights - Townsquare Media, Inc. has announced a strategic digital advertising partnership with Renda Media, expanding its reach into six new U.S. markets that do not overlap with its existing footprint [1][2] - The partnership aims to leverage Townsquare's proprietary programmatic platform and data-driven strategies to enhance Renda Media's digital capabilities and client growth [2][3] Company Overview - Townsquare Media focuses on digital advertising and marketing solutions primarily outside the top 50 U.S. markets, with digital revenue now comprising over 50% of its total revenue and profit [2][3] - Townsquare Ignite, the digital advertising division, provides a white-label service to local media companies, helping them implement effective digital advertising solutions [2][3] - Renda Media operates 18 radio stations across six markets, delivering entertainment, information, and news to a wide audience [4]

Core Insights - Townsquare Media (NYSE: TSQ) has been positively regarded by analysts for an extended period, indicating a favorable outlook for the company [1] Company Positioning - The management team of Townsquare Media is actively focused on strategically positioning the business to enhance its market presence and operational efficiency [1]

Company Overview - Townsquare Media (TSQ) shares increased by 6.9% to $9.05 in the last trading session, with a notable trading volume, and have gained 19.5% over the past four weeks [1] - The company is experiencing growth due to its programmatic digital advertising services, subscription-based marketing platform, and partnerships with local media in underserved markets [1] Earnings Expectations - Townsquare is projected to report quarterly earnings of $0.21 per share, reflecting a year-over-year increase of 50% [2] - Expected revenues for the upcoming quarter are $114.77 million, which is a decrease of 2.9% compared to the same quarter last year [2] Stock Performance Insights - Trends in earnings estimate revisions are closely linked to short-term stock price movements, indicating potential strength in TSQ's stock [3] - The consensus EPS estimate for Townsquare has remained stable over the last 30 days, suggesting that the stock's price may not continue to rise without changes in earnings estimates [4] Industry Context - Townsquare is part of the Zacks Broadcast Radio and Television industry, where iHeartMedia (IHRT) has a Zacks Rank of 5 (Strong Sell) and is expected to report an EPS of -$0.28, a decline of 21.7% year-over-year [4][5]