UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 20222023
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE TRANSITION PERIOD FROM _________ TO __________
Commission File Number
001-38987
IHEARTMEDIA, INC.
(Exact name of registrant as specified in its charter)
Delaware26-0241222
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer Identification No.)
20880 Stone Oak Parkway
San Antonio,Texas78258
(Address of principal executive offices)(Zip Code)
(210) 822-2828
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A Common StockIHRTThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company  
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No 
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
ClassOutstanding at August 1, 20223, 2023
~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~
Class A Common Stock, $.001 par value121,548,419123,169,201 
Class B Common Stock, $.001 par value21,390,17921,347,363 



IHEARTMEDIA, INC.
INDEX
Page No.
Part I – Financial Information
Item 1.
Item 2.
Item 3.
Item 4.
Part II – Other Information
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.



PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
IHEARTMEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)June 30,
2022
December 31,
2021
(Unaudited)
CURRENT ASSETS
Cash and cash equivalents$294,831 $352,129 
Accounts receivable, net of allowance of $32,304 in 2022 and $29,270 in 2021967,120 1,030,380 
Prepaid expenses94,099 65,927 
Other current assets16,067 24,431 
Total Current Assets1,372,117 1,472,867 
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, net716,241 782,093 
INTANGIBLE ASSETS AND GOODWILL
Indefinite-lived intangibles - licenses and other1,778,405 1,778,045 
Other intangibles, net1,540,092 1,666,600 
Goodwill2,313,349 2,313,581 
OTHER ASSETS
Operating lease right-of-use assets807,994 741,410 
Other assets172,919 126,713 
Total Assets$8,701,117 $8,881,309 
CURRENT LIABILITIES  
Accounts payable$198,983 $206,007 
Current operating lease liabilities41,962 88,585 
Accrued expenses288,363 353,045 
Accrued interest66,276 67,983 
Deferred revenue161,921 133,123 
Current portion of long-term debt675 673 
Total Current Liabilities758,180 849,416 
Long-term debt5,626,744 5,738,195 
Noncurrent operating lease liabilities859,417 738,814 
Deferred income taxes497,638 558,222 
Other long-term liabilities65,717 80,897 
Commitments and contingent liabilities (Note 6)00
STOCKHOLDERS’ EQUITY
Noncontrolling interest8,659 8,410 
Preferred stock, par value $.001 per share, 100,000,000 shares authorized, no shares issued and outstanding— — 
Class A Common Stock, par value $.001 per share, authorized 1,000,000,000 shares, issued 122,068,221 and 120,633,937 shares in 2022 and 2021, respectively122 120 
Class B Common Stock, par value $.001 per share, authorized 1,000,000,000 shares, issued 21,391,972 and 21,590,192 shares in 2022 and 2021, respectively21 22 
Special Warrants, 5,293,055 and 5,304,430 issued and outstanding in 2022 and 2021, respectively— — 
Additional paid-in capital2,891,129 2,876,571 
Accumulated deficit(1,997,000)(1,962,819)
Accumulated other comprehensive loss(1,154)(257)
Cost of shares (538,709 in 2022 and 389,814 in 2021) held in treasury(8,356)(6,282)
Total Stockholders' Equity893,421 915,765 
Total Liabilities and Stockholders' Equity$8,701,117 $8,881,309 

(In thousands, except share and per share data)June 30,
2023
December 31,
2022
(Unaudited)
CURRENT ASSETS
Cash and cash equivalents$165,325 $336,236 
Accounts receivable, net of allowance of $36,022 in 2023 and $29,171 in 20221,004,807 1,037,827 
Prepaid expenses127,380 79,098 
Other current assets38,880 19,618 
Total Current Assets1,336,392 1,472,779 
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, net649,687 694,842 
INTANGIBLE ASSETS AND GOODWILL
Indefinite-lived intangibles - licenses and other1,112,751 1,476,319 
Other intangibles, net1,296,099 1,419,670 
Goodwill1,721,410 2,313,403 
OTHER ASSETS
Operating lease right-of-use assets700,720 788,280 
Other assets166,751 170,594 
Total Assets$6,983,810 $8,335,887 
CURRENT LIABILITIES  
Accounts payable$199,947 $240,454 
Current operating lease liabilities75,749 70,024 
Accrued expenses232,234 325,427 
Accrued interest62,349 64,165 
Deferred revenue160,099 131,084 
Current portion of long-term debt440 664 
Total Current Liabilities730,818 831,818 
Long-term debt5,315,955 5,413,503 
Noncurrent operating lease liabilities762,787 848,918 
Deferred income taxes425,454 483,810 
Other long-term liabilities152,254 73,332 
Commitments and contingent liabilities (Note 6)
STOCKHOLDERS’ EQUITY (DEFICIT)
Noncontrolling interest10,351 9,609 
Preferred stock, par value $.001 per share, 100,000,000 shares authorized, no shares issued and outstanding— — 
Class A Common Stock, par value $.001 per share, authorized 1,000,000,000 shares, issued 124,046,612 and 122,370,425 shares in 2023 and 2022, respectively124 123 
Class B Common Stock, par value $.001 per share, authorized 1,000,000,000 shares, issued 21,347,363 and 21,477,181 shares in 2023 and 2022, respectively21 21 
Special Warrants, 5,111,055 and 5,111,312 issued and outstanding in 2023 and 2022, respectively— — 
Additional paid-in capital2,931,598 2,912,500 
Accumulated deficit(3,334,212)(2,227,482)
Accumulated other comprehensive loss(1,454)(1,331)
Cost of shares (916,632 in 2023 and 597,482 in 2022) held in treasury(9,886)(8,934)
Total Stockholders' Equity (Deficit)(403,458)684,506 
Total Liabilities and Stockholders' Equity (Deficit)$6,983,810 $8,335,887 
See Notes to Consolidated Financial Statements
1


IHEARTMEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
(In thousands, except per share data)(In thousands, except per share data)Three Months Ended June 30,Six Months Ended June 30,(In thousands, except per share data)Three Months Ended June 30,Six Months Ended June 30,
20222021202220212023202220232022
RevenueRevenue$954,005 $861,605 $1,797,463 $1,568,270 Revenue$920,014 $954,005 $1,731,253 $1,797,463 
Operating expenses:Operating expenses:Operating expenses:
Direct operating expenses (excludes depreciation and amortization)Direct operating expenses (excludes depreciation and amortization)365,382 320,515 695,906 613,328 Direct operating expenses (excludes depreciation and amortization)355,061 365,382 699,681 695,906 
Selling, general and administrative expenses (excludes depreciation and amortization)Selling, general and administrative expenses (excludes depreciation and amortization)379,057 372,640 763,401 714,970 Selling, general and administrative expenses (excludes depreciation and amortization)393,773 379,057 796,574 763,401 
Depreciation and amortizationDepreciation and amortization110,788 127,945 224,839 235,308 Depreciation and amortization108,065 110,788 216,577 224,839 
Impairment chargesImpairment charges245 — 1,579 37,744 Impairment charges960,570 245 964,517 1,579 
Other operating expense, net15,664 12,379 16,534 15,150 
Other operating (income) expense, netOther operating (income) expense, net(261)15,664 (40)16,534 
Operating income (loss)Operating income (loss)82,869 28,126 95,204 (48,230)Operating income (loss)(897,194)82,869 (946,056)95,204 
Interest expense, netInterest expense, net81,494 84,887 160,713 170,008 Interest expense, net98,693 81,494 194,150 160,713 
Gain on investments, net9,590 49,644 7,825 49,835 
Gain (loss) on investments, netGain (loss) on investments, net(6,038)9,590 (12,543)7,825 
Equity in loss of nonconsolidated affiliatesEquity in loss of nonconsolidated affiliates(29)(31)(58)(59)Equity in loss of nonconsolidated affiliates(44)(29)(4)(58)
Gain on extinguishment of debtGain on extinguishment of debt8,203 — 8,203 — Gain on extinguishment of debt22,902 8,203 27,527 8,203 
Other expense, netOther expense, net(2,175)(363)(2,445)(1,170)Other expense, net(272)(2,175)(371)(2,445)
Income (loss) before income taxes16,964 (7,511)(51,984)(169,632)
Earnings (Loss) before income taxesEarnings (Loss) before income taxes(979,339)16,964 (1,125,597)(51,984)
Income tax benefit (expense)Income tax benefit (expense)(1,782)(24,449)18,427 (104,384)Income tax benefit (expense)96,357 (1,782)20,252 18,427 
Net income (loss)Net income (loss)15,182 (31,960)(33,557)(274,016)Net income (loss)(882,982)15,182 (1,105,345)(33,557)
Less amount attributable to noncontrolling interestLess amount attributable to noncontrolling interest781 326 624 (7)Less amount attributable to noncontrolling interest1,488 781 1,385 624 
Net income (loss) attributable to the CompanyNet income (loss) attributable to the Company$14,401 $(32,286)$(34,181)$(274,009)Net income (loss) attributable to the Company$(884,470)$14,401 $(1,106,730)$(34,181)
Other comprehensive loss, net of tax:Other comprehensive loss, net of tax:Other comprehensive loss, net of tax:
Foreign currency translation adjustmentsForeign currency translation adjustments(650)(40)(897)(256)Foreign currency translation adjustments(77)(650)(123)(897)
Other comprehensive loss, net of taxOther comprehensive loss, net of tax(650)(40)(897)(256)Other comprehensive loss, net of tax(77)(650)(123)(897)
Comprehensive income (loss)Comprehensive income (loss)13,751 (32,326)(35,078)(274,265)Comprehensive income (loss)(884,547)13,751 (1,106,853)(35,078)
Less amount attributable to noncontrolling interestLess amount attributable to noncontrolling interest— — — — Less amount attributable to noncontrolling interest— — — — 
Comprehensive income (loss) attributable to the CompanyComprehensive income (loss) attributable to the Company$13,751 $(32,326)$(35,078)$(274,265)Comprehensive income (loss) attributable to the Company$(884,547)$13,751 $(1,106,853)$(35,078)
Net income (loss) attributable to the Company per common share:Net income (loss) attributable to the Company per common share:Net income (loss) attributable to the Company per common share:
Basic Basic$0.10 $(0.22)$(0.23)$(1.87) Basic$(5.93)$0.10 $(7.44)$(0.23)
Weighted average common shares outstanding - BasicWeighted average common shares outstanding - Basic148,050 146,509 147,783 146,362 Weighted average common shares outstanding - Basic149,179 148,050 148,774 147,783 
Diluted Diluted$0.10 $(0.22)$(0.23)$(1.87) Diluted$(5.93)$0.10 $(7.44)$(0.23)
Weighted average common shares outstanding - DilutedWeighted average common shares outstanding - Diluted149,131 146,509 147,783 146,362 Weighted average common shares outstanding - Diluted149,179 149,131 148,774 147,783 

See Notes to Consolidated Financial Statements
2


IHEARTMEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
(UNAUDITED)
(In thousands, except share data)(In thousands, except share data)Controlling Interest(In thousands, except share data)Controlling Interest
Common Shares(1)
Non-
controlling
Interest
Common
Stock
Additional
Paid-in
Capital
Retained Earnings (Accumulated Deficit)Accumulated
Other
Comprehensive Loss
Treasury
Stock
Common Shares(1)
Non-
controlling
Interest
Common
Stock
Additional
Paid-in
Capital
Accumulated DeficitAccumulated
Other
Comprehensive Loss
Treasury
Stock
Class A
Shares
Class B
Shares
Special WarrantsTotalClass A
Shares
Class B
Shares
Special WarrantsTotal
Balances at
March 31, 2022
121,402,390 21,430,500 5,293,069 $8,066 $143 $2,882,515 $(2,011,401)$(504)$(6,798)$872,021 
Net income781 — — 14,401 — — 15,182 
Balances at
March 31, 2023
Balances at
March 31, 2023
122,385,200 21,469,919 5,111,312 $9,185 $144 $2,922,652 $(2,449,742)$(1,377)$(8,958)$471,904 
Net income (loss)Net income (loss)1,488 — — (884,470)— — (882,982)
Vesting of restricted stock and otherVesting of restricted stock and other627,289 — — — — (1,558)(1,554)Vesting of restricted stock and other1,538,599 — (1)— — (928)(928)
Share-based compensationShare-based compensation— — 8,610 — — — 8,610 Share-based compensation— — 8,947 — — — 8,947 
Conversion of Special Warrants to Class A Shares14 (14)— — — — — — — 
Conversion of Special Warrants to Class A or Class B SharesConversion of Special Warrants to Class A or Class B Shares198 59 (257)— — — — — — — 
Conversion of Class B Shares to Class A SharesConversion of Class B Shares to Class A Shares38,528 (38,528)— — — — — — — Conversion of Class B Shares to Class A Shares122,615 (122,615)— — — — — — — 
OtherOther(188)— — — — — (188)Other(322)— — — — — (322)
Other comprehensive lossOther comprehensive loss— — — — (650)— (650)Other comprehensive loss— — — — (77)— (77)
Balances at
June 30, 2022
122,068,221 21,391,972 5,293,055 $8,659 $143 $2,891,129 $(1,997,000)$(1,154)$(8,356)$893,421 
Balances at
June 30, 2023
Balances at
June 30, 2023
124,046,612 21,347,363 5,111,055 $10,351 $145 $2,931,598 $(3,334,212)$(1,454)$(9,886)$(403,458)


(In thousands, except share data)Controlling Interest
Common Shares(1)
Non-
controlling
Interest
Common
Stock
Additional
Paid-in
Capital
Accumulated DeficitAccumulated
Other
Comprehensive Loss
Treasury
Stock
Class A SharesClass B
Shares
Special WarrantsTotal
Balances at
March 31, 2022
121,402,390 21,430,500 5,293,069 $8,066 $143 $2,882,515 $(2,011,401)$(504)$(6,798)$872,021 
Net income781 — — 14,401 — — 15,182 
Vesting of restricted stock and other627,289 — — — — (1,558)(1,554)
Share-based compensation— — 8,610 — — — 8,610 
Conversion of Special Warrants to Class A and Class B Shares14 (14)— — — — — — — 
Conversion of Class B Shares to Class A Shares38,528 (38,528)— — — — — — — 
Other(188)— — — — — (188)
Other comprehensive loss— — — — (650)— (650)
Balances at
June 30, 2022
122,068,221 21,391,972 5,293,055 $8,659 $143 $2,891,129 $(1,997,000)$(1,154)$(8,356)$893,421 
(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in 2023 or 2022.
See Notes to Consolidated Financial Statements




















3


IHEARTMEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
(UNAUDITED)
(In thousands, except share data)(In thousands, except share data)Controlling Interest(In thousands, except share data)Controlling Interest
Common Shares(1)
Non-
controlling
Interest
Common
Stock
Additional
Paid-in
Capital
Accumulated DeficitAccumulated
Other
Comprehensive Loss
Treasury
Stock
Common Shares(1)
Non-
controlling
Interest
Common
Stock
Additional
Paid-in
Capital
Accumulated DeficitAccumulated
Other
Comprehensive Loss
Treasury
Stock
Class A SharesClass B
Shares
Special WarrantsTotalClass A SharesClass B
Shares
Special WarrantsTotal
Balances at
March 31, 2021
112,033,028 29,070,192 5,379,822 $7,830 $141 $2,854,647 $(2,045,343)$(22)$(3,302)$813,951 
Balances at
December 31, 2022
Balances at
December 31, 2022
122,370,425 21,477,181 5,111,312 $9,609 $144 $2,912,500 $(2,227,482)$(1,331)$(8,934)$684,506 
Net income (loss)Net income (loss)326 — — (32,286)— — (31,960)Net income (loss)1,385 — — (1,106,730)— — (1,105,345)
Vesting of restricted stock and otherVesting of restricted stock and other780,173 — 3,107 — — (1,929)1,179 Vesting of restricted stock and other1,546,112 — (1)— — (952)(952)
Share-based compensationShare-based compensation— — 5,903 — — — 5,903 Share-based compensation— — 19,099 — — — 19,099 
Dividend declared and paid to noncontrolling interests(188)— — — — — (188)
Conversion of Special Warrants to Class A Shares14,694 (14,694)— — — — — — — 
Conversion of Special Warrants to Class A and Class B SharesConversion of Special Warrants to Class A and Class B Shares198 59 (257)— — — — — — — 
Conversion of Class B Shares to Class A SharesConversion of Class B Shares to Class A Shares5,433,680 (5,433,680)— — — — — — — Conversion of Class B Shares to Class A Shares129,877 (129,877)— — — — — — — 
OtherOther(643)— — — — — (643)
Other comprehensive lossOther comprehensive loss— — — — (123)— (123)
Balances at
June 30, 2023
Balances at
June 30, 2023
124,046,612 21,347,363 5,111,055 $10,351 $145 $2,931,598 $(3,334,212)$(1,454)$(9,886)$(403,458)
Other comprehensive loss— — — — (40)— (40)
Balances at
June 30, 2021
118,261,575 23,636,512 5,365,128 $7,968 $142 $2,863,657 $(2,077,629)$(62)$(5,231)$788,845 

(In thousands, except share data)Controlling Interest
Common Shares(1)
Non-
controlling
Interest
Common
Stock
Additional
Paid-in
Capital
Accumulated DeficitAccumulated
Other
Comprehensive Loss
Treasury
Stock
Class A SharesClass B
Shares
Special WarrantsTotal
Balances at
December 31, 2021
120,633,937 21,590,192 5,304,430 $8,410 $142 $2,876,571 $(1,962,819)$(257)$(6,282)$915,765 
Net income (loss)624 — — (34,181)— — (33,557)
Vesting of restricted stock and other1,224,689 — 413 — — (2,074)(1,660)
Share-based compensation— — 14,145 — — — 14,145 
Conversion of Special Warrants to Class A and Class B Shares11,375 (11,375)— — — — — — — 
Conversion of Class B Shares to Class A Shares198,220 (198,220)— — — — — — — 
Other(375)— — — — — (375)
Other comprehensive loss— — — — (897)— (897)
Balances at
June 30, 2022
122,068,221 21,391,972 5,293,055 $8,659 $143 $2,891,129 $(1,997,000)$(1,154)$(8,356)$893,421 
(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in 2021.
See Notes to Consolidated Financial Statements

4


IHEARTMEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)
(In thousands, except share data)Controlling Interest
Common Shares(1)
Non-
controlling
Interest
Common
Stock
Additional
Paid-in
Capital
Accumulated
Deficit
Accumulated
Other
Comprehensive Loss
Treasury
Stock
Class A
Shares
Class B
Shares
Special WarrantsTotal
Balances at
December 31, 2021
120,633,937 21,590,192 5,304,430 $8,410 $142 $2,876,571 $(1,962,819)$(257)$(6,282)$915,765 
Net income (loss)624  — (34,181)— — (33,557)
Vesting of restricted stock and other1,224,689  413 — — (2,074)(1,660)
Share-based compensation  14,145 — — — 14,145 
Conversion of Special Warrants to Class A Shares11,375 (11,375)— — — — — — — 
Conversion of Class B Shares to Class A Shares198,220 (198,220)—  — — — — — 
Other(375) — — — — (375)
Other comprehensive loss  — — (897)— (897)
Balances at
June 30, 2022
122,068,221 21,391,972 5,293,055 $8,659 $143 $2,891,129 $(1,997,000)$(1,154)$(8,356)$893,421 

(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in2023, 2022 or 2021.

See Notes to Consolidated Financial Statements


















5


IHEARTMEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)
(In thousands, except share data)Controlling Interest
Common Shares(1)
Non- controlling InterestCommon StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Treasury Stock
Class A SharesClass B SharesSpecial WarrantsTotal
Balances at
December 31, 2020
64,726,864 6,886,925 74,835,899 $8,350 $72 $2,849,020 $(1,803,620)$194 $(3,199)$1,050,817 
Net loss(7) — (274,009)— — (274,016)
Vesting of restricted stock810,545  3,118 — — (2,032)1,087 
Share-based compensation  11,588 — — — 11,588 
Conversion of Special Warrants to Class A and Class B Shares47,136,441 22,337,312 (69,473,753)— 69 (69)— — — — 
Conversion of Class B Shares to Class A Shares5,587,725 (5,587,725)—  — — — — — 
Other2,982 (375) — — — — (375)
Other comprehensive loss  — — (256)— (256)
Balances at
June 30, 2021
118,261,575 23,636,512 5,365,128 $7,968 $142 $2,863,657 $(2,077,629)$(62)$(5,231)$788,845 

(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in 2022 or 2021.

See Notes to Consolidated Financial Statements
64


IHEARTMEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)(In thousands)Six Months Ended June 30,(In thousands)Six Months Ended June 30,
2022202120232022
Cash flows from operating activities:Cash flows from operating activities:Cash flows from operating activities:
Net lossNet loss$(33,557)$(274,016)Net loss$(1,105,345)$(33,557)
Reconciling items:Reconciling items:Reconciling items:
Impairment chargesImpairment charges1,579 37,744 Impairment charges964,517 1,579 
Depreciation and amortizationDepreciation and amortization224,839 235,308 Depreciation and amortization216,577 224,839 
Deferred taxesDeferred taxes(60,587)99,318 Deferred taxes(58,898)(60,587)
Provision for doubtful accountsProvision for doubtful accounts8,815 (2,003)Provision for doubtful accounts18,565 8,815 
Amortization of deferred financing charges and note discounts, netAmortization of deferred financing charges and note discounts, net2,942 3,055 Amortization of deferred financing charges and note discounts, net3,331 2,942 
Share-based compensationShare-based compensation14,145 11,588 Share-based compensation19,099 14,145 
Loss on disposal of operating and other assets15,583 11,347 
Gain on investments(7,825)(49,835)
(Gain) Loss on disposal of operating and other assets(Gain) Loss on disposal of operating and other assets(1,216)15,583 
(Gain) Loss on investments(Gain) Loss on investments12,543 (7,825)
Equity in loss of nonconsolidated affiliatesEquity in loss of nonconsolidated affiliates58 59 Equity in loss of nonconsolidated affiliates58 
Gain on extinguishment of debtGain on extinguishment of debt(8,203)— Gain on extinguishment of debt(27,527)(8,203)
Barter and trade incomeBarter and trade income(12,250)(4,469)Barter and trade income(11,728)(12,250)
Other reconciling items, netOther reconciling items, net680 278 Other reconciling items, net199 680 
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:
Decrease in accounts receivableDecrease in accounts receivable54,240 36,289 Decrease in accounts receivable14,061 54,240 
Increase in prepaid expenses and other current assetsIncrease in prepaid expenses and other current assets(24,996)(40,651)Increase in prepaid expenses and other current assets(54,641)(24,996)
Increase in other long-term assetsIncrease in other long-term assets(5,371)(6,919)Increase in other long-term assets(2,447)(5,371)
Increase (decrease) in accounts payable(6,963)18,783 
Increase (decrease) in accrued expenses(75,154)17,455 
Decrease in accounts payableDecrease in accounts payable(40,518)(6,963)
Decrease in accrued expensesDecrease in accrued expenses(48,809)(75,154)
Decrease in accrued interestDecrease in accrued interest(1,706)(31)Decrease in accrued interest(1,816)(1,706)
Increase in deferred incomeIncrease in deferred income15,261 6,847 Increase in deferred income35,742 15,261 
Increase in other long-term liabilitiesIncrease in other long-term liabilities2,059 710 Increase in other long-term liabilities31,096 2,059 
Cash provided by operating activities103,589 100,857 
Cash provided by (used for) operating activitiesCash provided by (used for) operating activities(37,211)103,589 
Cash flows from investing activities:Cash flows from investing activities:Cash flows from investing activities:
Business combinations— (230,816)
Proceeds from sale of other investments— 50,757 
Purchases of property, plant and equipmentPurchases of property, plant and equipment(72,210)(51,061)Purchases of property, plant and equipment(61,938)(72,210)
Proceeds from disposal of assetsProceeds from disposal of assets26,754 13,016 Proceeds from disposal of assets6,875 26,754 
Change in other, netChange in other, net(4,201)(159)Change in other, net(4,197)(4,201)
Cash used for investing activitiesCash used for investing activities(49,657)(218,263)Cash used for investing activities(59,260)(49,657)
Cash flows from financing activities:Cash flows from financing activities:Cash flows from financing activities:
Payments on long-term debt and credit facilitiesPayments on long-term debt and credit facilities(105,749)(20,608)Payments on long-term debt and credit facilities(73,280)(105,749)
Change in other, netChange in other, net(4,962)726 Change in other, net(1,595)(4,962)
Cash used for financing activitiesCash used for financing activities(110,711)(19,882)Cash used for financing activities(74,875)(110,711)
Effect of exchange rate changes on cash, cash equivalents and restricted cashEffect of exchange rate changes on cash, cash equivalents and restricted cash(519)(134)Effect of exchange rate changes on cash, cash equivalents and restricted cash10 (519)
Net decrease in cash, cash equivalents and restricted cashNet decrease in cash, cash equivalents and restricted cash(57,298)(137,422)Net decrease in cash, cash equivalents and restricted cash(171,336)(57,298)
Cash, cash equivalents and restricted cash at beginning of periodCash, cash equivalents and restricted cash at beginning of period352,554 721,187 Cash, cash equivalents and restricted cash at beginning of period336,661 352,554 
Cash, cash equivalents and restricted cash at end of periodCash, cash equivalents and restricted cash at end of period$295,256 $583,765 Cash, cash equivalents and restricted cash at end of period$165,325 $295,256 
SUPPLEMENTAL DISCLOSURES:SUPPLEMENTAL DISCLOSURES:SUPPLEMENTAL DISCLOSURES:
Cash paid for interestCash paid for interest$160,003 $168,294 Cash paid for interest$195,482 $160,003 
Cash paid for income taxesCash paid for income taxes6,835 3,027 Cash paid for income taxes11,000 6,835 
See Notes to Consolidated Financial Statements
75



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 – BASIS OF PRESENTATION
Preparation of Interim Financial Statements
All references in this Quarterly Report on Form 10-Q to the “Company,” “we,” “us” and “our” refer to iHeartMedia, Inc. and its consolidated subsidiaries. The accompanying consolidated financial statements were prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and, in the opinion of management, include all normal and recurring adjustments necessary to present fairly the results of the interim periods shown. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such SEC rules and regulations. Management believes that the disclosures made are adequate to make the information presented not misleading. The financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.2022.
The Company'sCompany reports based on three reportable segments are:segments:
the Multiplatform Group, which includes the Company's Broadcast radio, Networks and Sponsorships and Events businesses;
the Digital Audio Group, which includes all of the Company's Digital businesses, including Podcasting; and
the Audio & Media Services Group, which includes Katz Media Group (“Katz Media”), a full-service media representation business, and RCS Sound Software ("RCS"), a provider of scheduling and broadcast software and services.
The consolidated financial statements include the accounts of the Company and its subsidiaries. Also included in the consolidated financial statements are entities for which the Company has a controlling interest or is the primary beneficiary. Investments in companies which the Company does not control, but exercises significant influence over operating and financial policies of the company are accounted for under the equity method. All significant intercompany transactions are eliminated in the consolidation process.
COVID-19Economic Conditions
Our businessThe Company's advertising revenue is correlated to changes in economic conditions. Increasing interest rates and high inflation have contributed to a challenging macroeconomic environment since 2022. This challenging environment has been adversely impacted byled to broader market uncertainty, and has delayed the novel coronavirus pandemic (“COVID-19”), itsCompany's expected recovery and has had an adverse impact on the operatingCompany's revenues and economic environmentcash flows. The current market uncertainty and related, near-term advertiser spending decisions. Beginningmacroeconomic conditions, a recession, or a downturn in March 2020 and continuing through the remainder of 2020 and into 2021 revenue was significantly and negatively impacted asU.S. economy could have a result of a decline in advertising spend driven by COVID-19. As a result of continued recovery fromsignificant impact on the impact of COVID-19, our revenue for the three months ended June 30, 2022 increased comparedCompany's ability to the three months ended June 30, 2021 across each of our reportable segments.generate revenue.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES Act”) was signed into law. The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property. The Company was able to defer the payment of $29.3 million in certain employment taxes during 2020, half of which was due and paid on January 3, 2022 and the other half will beof which was due and paid on January 3, 2023. In addition, the Company claimed $12.4 million in refundable payroll tax credits related to the CARES Act provisions, of which $0.7 million was received in 2020, $3.8 million was received in 2021 and $7.9 million was received in January 2022.

As of June 30, 2022,2023, the Company had approximately $294.8$165.3 million in cash and cash equivalents. Whileequivalents, and the effects$450.0 million senior secured asset-based revolving credit facility entered into on May 17, 2022 (the "ABL Facility") had a borrowing base of COVID-19 may continue to negatively impact$444.5 million, no outstanding borrowings and $24.9 million of outstanding letters of credit, resulting in $419.6 million of borrowing base availability. Together with the resultsCompany's cash balance of operations, cash flows$165.3 million as of June 30, 2023 and financial position ofits borrowing capacity under the Company,ABL Facility, the related financial impact cannot be reasonably estimated at this time.Company's total available liquidity was approximately $585 million. Based on current available liquidity, the Company expects to be able to meet its obligations as they become due over the coming year.

Reclassifications
Certain prior period amounts have been reclassifiedEconomic uncertainty due to conform toinflation and higher interest rates since 2022 has resulted in, among other things, lower advertising spending by businesses. This economic uncertainty has had an adverse impact on the 2022 presentation.

Company's revenues and cash flows. In
86



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
addition, the economic uncertainty has had a significant impact on the trading values of the Company's debt and equity securities for a sustained period, indicating a need for the Company to perform an impairment test as of June 30, 2023 on the goodwill recorded in its reporting units. In connection with testing goodwill for impairment, the Company also tested its indefinite-lived Federal Communication Commission ("FCC") licenses.

The estimated fair values of the Company’s FCC licenses, which have indefinite lives, are based on broadcast industry information, including industry-wide projections. The factors discussed above negatively impacted certain assumptions in the discounted cash flow models used to value the Company's FCC licenses. The Company's June 30, 2023 testing indicated that the fair values of its FCC licenses were below their carrying values, which resulted in a non-cash impairment charge of$363.6 million.

Based on the valuation analysis that the Company performed in connection with the interim goodwill impairment testing as of June 30, 2023, the Company determined that the estimated fair values of three of itsreporting units were below their carrying values, including goodwill, which required the Company to recognize a non-cash impairment charge of $595.5 million to reduce the Company's goodwill balance.

The Company believes it has made reasonable estimates and utilized reasonable assumptions to calculate the fair values of its indefinite-lived FCC licenses and reporting units. It is possible a material change could occur to the estimated fair value of these assets as a result of the uncertainty regarding the magnitude of the impact of current market conditions, as well as the timing of any recovery. If the Company's actual results are not consistent with its estimates, the Company could be exposed to future impairment losses that could be material to its results of operations.

Reclassifications
Certain prior period amounts have been reclassified to conform to the 2023 presentation.

Restricted Cash 
The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the Consolidated Balance Sheets to the total of the amounts reported in the Consolidated Statements of Cash Flows:
(In thousands)(In thousands)June 30,
2022
December 31,
2021
(In thousands)June 30,
2023
December 31,
2022
Cash and cash equivalentsCash and cash equivalents$294,831 $352,129 Cash and cash equivalents$165,325 $336,236 
Restricted cash included in:Restricted cash included in:Restricted cash included in:
Other current assets Other current assets425 425  Other current assets— 425 
Total cash, cash equivalents and restricted cash in the Statement of Cash FlowsTotal cash, cash equivalents and restricted cash in the Statement of Cash Flows$295,256 $352,554 Total cash, cash equivalents and restricted cash in the Statement of Cash Flows$165,325 $336,661 
Certain Relationships and Related Party Transactions
From time to time, certain companies in which the Company holds minority equity interests, purchase advertising in the ordinary course. None of these ordinary course transactions have had a material impact on the Company.
New Accounting Pronouncements Recently Adopted
In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) - Facilitation of the Effects of the Interbank Offered Rate Transition on Financial Reporting to provide optional relief from applying generally accepted accounting principles to contracts, hedging relationships and other transactions affected by reference rate reform. In addition, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) – Scope, to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company does not expect the adoption of this standard to materially impact the financial position, results of operations or cash flows.
New Accounting Pronouncements Not Yet Adopted
In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers which requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with Accounting Standards Codification 606. The amendmentsCompany adopted this guidance during the first quarter of ASU 2021-08 are effective for interim and annual periods beginning after December 15, 2022.2023. The Company is currently evaluatingadoption did not have a material impact on the future impactCompany’s financial position, results of adoption of this standard.



operations or cash flows.
97



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 2 – REVENUE
Disaggregation of Revenue
The following tables show revenue streams for the three and six months ended June 30, 20222023 and 2021:2022:
(In thousands)(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupEliminationsConsolidated(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupEliminationsConsolidated
Three Months Ended June 30, 2023Three Months Ended June 30, 2023
Revenue from contracts with customers:Revenue from contracts with customers:
Broadcast Radio(1)
Broadcast Radio(1)
$429,152 $— $— $— $429,152 
Networks(2)
Networks(2)
122,168 — — — 122,168 
Sponsorship and Events(3)
Sponsorship and Events(3)
38,210 — — — 38,210 
Digital, excluding Podcast(4)
Digital, excluding Podcast(4)
— 164,147 — (1,216)162,931 
Podcast(5)
Podcast(5)
— 96,707 — — 96,707 
Audio & Media Services(6)
Audio & Media Services(6)
— — 65,804 (1,372)64,432 
Other(7)
Other(7)
5,585 — — — 5,585 
Total Total595,115 260,854 65,804 (2,588)919,185 
Revenue from leases(8)
Revenue from leases(8)
829 — — — 829 
Revenue, totalRevenue, total$595,944 $260,854 $65,804 $(2,588)$920,014 
Three Months Ended June 30, 2022Three Months Ended June 30, 2022Three Months Ended June 30, 2022
Revenue from contracts with customers:Revenue from contracts with customers:Revenue from contracts with customers:
Broadcast Radio(1)
Broadcast Radio(1)
$463,304 $— $— $— $463,304 
Broadcast Radio(1)
$462,547 $— $— $— $462,547 
Networks(2)
Networks(2)
127,532 .— — 127,532 
Networks(2)
127,532 — — — 127,532 
Sponsorship and Events(3)
Sponsorship and Events(3)
38,064 — — — 38,064 
Sponsorship and Events(3)
38,064 — — — 38,064 
Digital, excluding Podcast(4)
Digital, excluding Podcast(4)
— 166,880 — (1,376)165,504 
Digital, excluding Podcast(4)
— 166,880 — (1,376)165,504 
Podcast(5)
Podcast(5)
— 85,681 — — 85,681 
Podcast(5)
— 85,681 — — 85,681 
Audio & Media Services(6)
Audio & Media Services(6)
— — 71,065 (1,378)69,687 
Audio & Media Services(6)
— — 71,065 (1,378)69,687 
Other(7)
Other(7)
4,035 — — (167)3,868 
Other(7)
4,792 — — (167)4,625 
Total Total632,935 252,561 71,065 (2,921)953,640 Total632,935 252,561 71,065 (2,921)953,640 
Revenue from leases(8)
Revenue from leases(8)
365 — — — 365 
Revenue from leases(8)
365 365 
Revenue, totalRevenue, total$633,300 $252,561 $71,065 $(2,921)$954,005 Revenue, total$633,300 $252,561 $71,065 $(2,921)$954,005 
Three Months Ended June 30, 2021
Revenue from contracts with customers:
Broadcast Radio(1)
$451,142 $— $— $— $451,142 
Networks(2)
123,586 — — — 123,586 
Sponsorship and Events(3)
28,585 — — — 28,585 
Digital, excluding Podcast(4)
— 144,502 — (1,178)143,324 
Podcast(5)
— 53,428 — — 53,428 
Audio & Media Services(6)
— — 61,175 (2,004)59,171 
Other(7)
2,192 — — (168)2,024 
Total605,505 197,930 61,175 (3,350)861,260 
Revenue from leases(8)
345 — — — 345 
Revenue, total$605,850 $197,930 $61,175 $(3,350)$861,605 

108



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(In thousands)(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupEliminationsConsolidated(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupEliminationsConsolidated
Six Months Ended June 30, 2023Six Months Ended June 30, 2023
Revenue from contracts with customers:Revenue from contracts with customers:
Broadcast Radio(1)
Broadcast Radio(1)
$812,390 $— $— $— $812,390 
Networks(2)
Networks(2)
230,122 — — — 230,122 
Sponsorship and Events(3)
Sponsorship and Events(3)
70,797 — — — 70,797 
Digital, excluding Podcast(4)
Digital, excluding Podcast(4)
— 310,732 — (2,405)308,327 
Podcast(5)
Podcast(5)
— 173,518 — — 173,518 
Audio & Media Services(6)
Audio & Media Services(6)
— — 127,155 (2,704)124,451 
Other(7)
Other(7)
10,509 — — — 10,509 
Total Total1,123,818 484,250 127,155 (5,109)1,730,114 
Revenue from leases(8)
Revenue from leases(8)
1,139 — — — 1,139 
Revenue, totalRevenue, total$1,124,957 $484,250 $127,155 $(5,109)$1,731,253 
Six Months Ended June 30, 2022Six Months Ended June 30, 2022Six Months Ended June 30, 2022
Revenue from contracts with customers:Revenue from contracts with customers:Revenue from contracts with customers:
Broadcast Radio(1)
Broadcast Radio(1)
$879,785 $— $— $— $879,785 
Broadcast Radio(1)
$877,789 $— $— $— $877,789 
Networks(2)
Networks(2)
245,090 — — — 245,090 
Networks(2)
245,090 — — — 245,090 
Sponsorship and Events(3)
Sponsorship and Events(3)
71,665 — — — 71,665 
Sponsorship and Events(3)
71,665 — — — 71,665 
Digital, excluding Podcast(4)
Digital, excluding Podcast(4)
— 312,555 — (2,645)309,910 
Digital, excluding Podcast(4)
— 312,555 — (2,645)309,910 
Podcast(5)
Podcast(5)
— 154,225 — — 154,225 
Podcast(5)
— 154,225 — — 154,225 
Audio & Media Services(6)
Audio & Media Services(6)
— — 131,922 (2,719)129,203 
Audio & Media Services(6)
— — 131,922 (2,719)129,203 
Other(7)
Other(7)
7,265 — — (335)6,930 
Other(7)
9,261 — — (335)8,926 
Total Total1,203,805 466,780 131,922 (5,699)1,796,808 Total1,203,805 466,780 131,922 (5,699)1,796,808 
Revenue from leases(8)
Revenue from leases(8)
655 — — — 655 
Revenue from leases(8)
655 — — — 655 
Revenue, totalRevenue, total$1,204,460 $466,780 $131,922 $(5,699)$1,797,463 Revenue, total$1,204,460 $466,780 $131,922 $(5,699)$1,797,463 
Six Months Ended June 30, 2021
Revenue from contracts with customers:
Broadcast Radio(1)
$809,678 $— $— $— $809,678 
Networks(2)
238,672 — — — 238,672 
Sponsorship and Events(3)
50,978 — — — 50,978 
Digital, excluding Podcast(4)
— 263,703 — (3,072)260,631 
Podcast(5)
— 91,780 — — 91,780 
Audio & Media Services(6)
— — 116,312 (3,865)112,447 
Other(7)
3,590 — — (335)3,255 
Total1,102,918 355,483 116,312 (7,272)1,567,441 
Revenue from leases(8)
829 — — — 829 
Revenue, total$1,103,747 $355,483 $116,312 $(7,272)$1,568,270 

(1)Broadcast Radio revenue is generated through the sale of advertising time on the Company’s domestic radio stations.
(2)Networks revenue is generated through the sale of advertising on the Company’s Premiere and Total Traffic & Weather network programs and through the syndication of network programming to other media companies.
(3)Sponsorship and events revenue is generated through local events and major nationally-recognized tent pole events and include sponsorship and other advertising revenue, ticket sales, and licensing, as well as endorsement and appearance fees generated by on-air talent.
(4)Digital, excluding Podcast revenue is generated through the sale of streaming and display advertisements on digital platforms and through subscriptions to iHeartRadio streaming services.
(5)Podcast revenue is generated through the sale of advertising on the Company's podcast network.
(6)Audio & Media Services revenue is generated by services provided to broadcast industry participants through the Company’s Katz Media and RCS businesses. As a media representation firm, Katz Media generates revenue via commissions on media sold on behalf of the radio and television stations that it represents, while RCS generates revenue by providing broadcast software and media streaming, along with research services for radio stations, broadcast television stations, cable channels, record labels, ad agencies and Internet stations worldwide.
(7)Other revenue represents fees earned for miscellaneous services, including on-site promotions, activations, and local marketing agreements.
(8)Revenue from leases is primarily generated by the lease of towers to other media companies, which are all categorized as operating leases.
119



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

Trade and Barter
Trade and barter transactions represent the exchange of advertising spots for merchandise, services, advertising and promotion or other assets in the ordinary course of business. The transaction price for these contracts is measured at the estimated fair value of the non-cash consideration received unless this is not reasonably estimable, in which case the consideration is measured based on the standalone selling price of the advertising spots promised to the customer. The revenues and expenses may not be recognized in the same period depending on the timing of the services, advertising or promotion received in exchange for advertising spots. Trade and barter revenues and expenses, which are included in consolidated revenue and selling, general and administrative expenses, respectively, were as follows:
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands)(In thousands)2022202120222021(In thousands)2023202220232022
Trade and barter revenues Trade and barter revenues$38,222 $46,508 $85,591 $78,454  Trade and barter revenues$53,235 $32,993 $98,264 $73,341 
Trade and barter expenses Trade and barter expenses29,336 40,045 75,751 68,043  Trade and barter expenses31,521 29,336 78,907 75,751 

TradeIn addition to the trade and barter revenue includes $5.3in the table above, the Company recognized $3.7 million and $2.3$5.2 million during the three months ended June 30, 20222023 and 2021,2022, respectively, and $12.3$11.7 million and $4.5$12.3 million during the six months ended June 30, 20222023 and 2021,2022, respectively, in connection with investments made in companies in exchange for advertising services.

The following tables show the Company’s deferred revenue balance from contracts with customers:
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands)(In thousands)2022202120222021(In thousands)2023202220232022
Deferred revenue from contracts with customers:Deferred revenue from contracts with customers:Deferred revenue from contracts with customers:
Beginning balance(1)
Beginning balance(1)
$184,056 $165,330 $161,114 $145,493 
Beginning balance(1)
$170,681 $184,056 $157,910 $161,114 
Revenue recognized, included in beginning balance Revenue recognized, included in beginning balance(61,973)(55,762)(90,406)(60,185) Revenue recognized, included in beginning balance(57,532)(61,973)(83,307)(90,406)
Additions, net of revenue recognized during period, and other Additions, net of revenue recognized during period, and other67,596 40,163 118,971 64,423  Additions, net of revenue recognized during period, and other71,678 67,596 110,224 118,971 
Ending balance Ending balance$189,679 $149,731 $189,679 $149,731  Ending balance$184,827 $189,679 $184,827 $189,679 
(1) Deferred revenue from contracts with customers, which excludes other sources of deferred revenue that are not related to contracts with customers, is included within deferred revenue and other long-term liabilities on the Consolidated Balance Sheets, depending upon when revenue is expected to be recognized.

The Company’s contracts with customers generally have terms of one year or less; however, as of June 30, 2022,2023, the Company expects to recognize $391.9$317.8 million of revenue in future periods for remaining performance obligations from current contracts with customers that have an original expected duration greater than one year, with substantially all of this amount to be recognized over the next five years. Commissions related to the Company’s media representation business have been excluded from this amount as they are contingent upon future sales.

1210



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Revenue from Leases
As of June 30, 2022,2023, the future lease payments to be received by the Company are as follows:
(In thousands)(In thousands)(In thousands)
2022$534 
20232023782 2023$410 
20242024590 2024474 
20252025405 2025264 
20262026321 2026140 
2027202781 
ThereafterThereafter1,526 Thereafter96 
Total Total$4,158  Total$1,465 

NOTE 3 – LEASES
The Company enters into operating lease contracts for land, buildings, structures and other equipment. Arrangements are evaluated at inception to determine whether such arrangements contain a lease. Operating leases primarily include land and building lease contracts and leases of radio towers. Arrangements to lease building space consist primarily of the rental of office space, but may also include leases of other equipment, including automobiles and copiers. Operating leases are reflected on the Company's balance sheet within Operating lease right-of-use assets ("ROU assets") and the related short-term and long-term liabilities are included within Current and Noncurrent operating lease liabilities, respectively.
The Company's finance leases are included within Property, plant and equipment with the related liabilities included within Long-term debt.
ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the respective lease term. Lease expense is recognized on a straight-line basis over the lease term.
The Company tests for impairment of assets whenever events and circumstances indicate that such assets might be impaired. During the three and six months ended June 30, 2023, the Company recognized non-cash impairment charges of $1.5 million and $5.5 million, respectively, due to changes in sublease assumptions for ROU assets related to certain operating leases for which management has made proactive decisions to abandon and sublease in connection with strategic actions to streamline the Company’s real estate footprint. During the three and six months ended June 30, 2023, there were no non-cash impairment charges related to leasehold improvements.
During the three months ended June 30, 2022, the Company recognized non-cash impairment charges of $0.3 million, including $0.2 million related to ROU assets and $0.1 million related to leasehold improvements. During the six months ended June 30, 2022, the Company recognized non-cash impairment charges of $1.6 million, including $1.4 million related to ROU assets, and $0.2 million related to leasehold improvements as a result of proactive decisions by management to abandon and sublease a number of operating leases in connection with strategic actionsimprovements. These charges were primarily to streamline the Company’sCompany's real estate footprint as part of the Company’s modernization initiatives. During the six months ended June 30, 2021, the Company recognized non-cash impairment charges of $37.7 million, including $28.8 million related to ROU assets, and $8.9 million related to leasehold improvements also as a result of the proactive decisions by management discussed above.footprint.
The implicit rate within the Company's lease agreements is generally not determinable. As such, the Company uses the incremental borrowing rate ("IBR") to determine the present value of lease payments at the commencement of the lease. The IBR, as defined in ASC 842, is "the rate of interest that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment."
1311



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following table provides supplemental cash flow information related to leases for the periods presented:
Six Months Ended June 30,
(In thousands)20222021
Cash paid for amounts included in measurement of operating lease liabilities$76,153 $65,150 
Lease liabilities arising from obtaining right-of-use assets(1)
135,128 17,156 

Six Months Ended June 30,
(In thousands)20232022
Cash paid for amounts included in measurement of operating lease liabilities$67,329 $76,153 
Lease liabilities arising from obtaining right-of-use assets(1)
7,280 135,128 
(1) Lease liabilities from obtaining right-of-use assets include new leases entered into during the six months ended June 30, 20222023 and 2021,2022, respectively.
The Company reflects changes in the lease liability and changes in the ROU asset on a net basis in the Statements of Cash Flows. The non-cash operating lease expense was $43.3$34.5 million and $49.4$43.3 million for the six months ended June 30, 20222023 and June 30, 2021,2022, respectively.

NOTE 4– PROPERTY, PLANT AND EQUIPMENT, INTANGIBLE ASSETS AND GOODWILL
Property, Plant and Equipment
The Company’s property, plant and equipment consisted of the following classes of assets as of June 30, 20222023 and December 31, 2021,2022, respectively:
(In thousands)(In thousands)June 30,
2022
December 31,
2021
(In thousands)June 30,
2023
December 31,
2022
Land, buildings and improvementsLand, buildings and improvements$319,463 $355,474 Land, buildings and improvements$352,112 $340,692 
Towers, transmitters and studio equipmentTowers, transmitters and studio equipment195,860 180,571 Towers, transmitters and studio equipment226,491 215,655 
Computer equipment and softwareComputer equipment and software557,926 521,872 Computer equipment and software641,133 617,794 
Furniture and other equipmentFurniture and other equipment37,572 35,390 Furniture and other equipment42,350 41,924 
Construction in progressConstruction in progress68,588 64,732 Construction in progress27,277 29,091 
1,179,409 1,158,039 1,289,363 1,245,156 
Less: accumulated depreciationLess: accumulated depreciation463,168 375,946 Less: accumulated depreciation639,676 550,314 
Property, plant and equipment, netProperty, plant and equipment, net$716,241 $782,093 Property, plant and equipment, net$649,687 $694,842 

Indefinite-lived Intangible Assets

The Company’s indefinite-lived intangible assets primarily consist of Federal Communications Commission ("FCC") broadcast licenses in its Multiplatform Group segment.

The Company performs its annual impairment test on goodwill and indefinite-lived intangible assets, including FCC licenses, as of July 1 of each year. In addition, the Company tests for impairment of other intangible assets whenever events and circumstances indicate that such assets might be impaired.

As discussed in Note 1, Basis of Presentation, economic uncertainty due to inflation and higher interest rates since 2022 has resulted in, among other things, lower advertising spending by businesses. This economic uncertainty has had an adverse impact on the Company's revenues and cash flows. In addition, the economic uncertainty has had a significant impact on the trading values of the Company's debt and equity securities for a sustained period. As a result, the Company performed an impairment test as of June 30, 2023 on its goodwill balances. In connection with its goodwill impairment testing, the Company also performed an interim impairment test on its indefinite-lived FCC licenses.

The uncertainty surrounding the demand for advertising impacted the key industry assumptions used in the models that are utilized to value the Company's FCC licenses. As a result, the fair values of certain of the Company's FCC licenses have decreased.

12



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The Company's FCC licenses are valued using a direct valuation approach, with the key assumptions being market revenue growth rates, profit margin, and the risk-adjusted discount rate as well as other assumptions including market share, duration and profile of the build-up period, estimated start-up costs, and capital expenditures. This data is populated using industry normalized information representing an average asset within a market. The Company obtained the most recent broadcast radio industry revenue projections for use in the valuation model, as well as various other sources to analyze media and broadcast industry market forecasts and other data in developing the assumptions used for purposes of performing impairment testing on the Company's FCC licenses as of June 30, 2023.

Considerations in developing these assumptions included the expected impact on advertising revenues given the current market uncertainty, ranges of expected timing of recovery, discount rates and other factors. Based on the Company's interim testing, the estimated fair values of its FCC licenses were below their carrying values. As a result, the Company recognized a non-cash impairment charge of $363.6 millionon its FCC licenses.

Other Intangible Assets

Other intangible assets consists of definite-lived intangible assets, which primarily include customer and advertiser relationships, talent and representation contracts, trademarks and tradenames and other contractual rights, all of which are amortized over the shorter of either the respective lives of the agreements or over the period of time that the assets are expected to contribute directly or indirectly to the Company’s future cash flows. The Company periodically reviews the appropriateness of the amortization periods related to its definite-lived intangible assets. These assets are recorded at amortized cost.
14


The Company tests for possible impairment of other intangible assets whenever events and circumstances indicate that they might be impaired. When specific assets are determined to be unrecoverable, the cost basis of the asset is reduced to reflect the current fair market value.

IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
In connection with its impairment testing, the Company also assessed its other intangible assets. Based on the Company’s assessment, no impairment indicators were identified related to the definite-lived intangible assets.
The following table presents the gross carrying amount and accumulated amortization for each major class of other intangible assets as of June 30, 20222023 and December 31, 2021,2022, respectively:
(In thousands)(In thousands)June 30, 2022December 31, 2021(In thousands)June 30, 2023December 31, 2022
Gross Carrying AmountAccumulated AmortizationGross Carrying AmountAccumulated AmortizationGross Carrying AmountAccumulated AmortizationGross Carrying AmountAccumulated Amortization
Customer / advertiser relationshipsCustomer / advertiser relationships$1,646,402 $(546,135)$1,646,402 $(459,620)Customer / advertiser relationships$1,652,455 $(716,983)$1,652,455 $(633,352)
Talent and other contractsTalent and other contracts338,900 (138,956)338,900 (117,337)Talent and other contracts338,900 (182,043)338,900 (160,500)
Trademarks and tradenamesTrademarks and tradenames335,862 (105,328)335,862 (88,252)Trademarks and tradenames335,862 (139,479)335,862 (122,403)
OtherOther17,794 (8,447)17,794 (7,149)Other18,443 (11,056)18,443 (9,735)
TotalTotal$2,338,958 $(798,866)$2,338,958 $(672,358)Total$2,345,660 $(1,049,561)$2,345,660 $(925,990)

Total amortization expense related to definite-lived intangible assets for the Company for the three months ended June 30, 2023 and 2022 and 2021 was $63.4$61.8 million and $87.4$63.4 million, respectively. Total amortization expense related to definite-lived intangible assets for the Company for the six months ended June 30, 2023 and 2022 was $123.6 million and 2021 was $126.5 million, and $153.7 million, respectively.
13



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
As acquisitions and dispositions occur in the future, amortization expense may vary. The following table presents the Company’s estimate of amortization expense for each of the five succeeding fiscal years for definite-lived intangible assets:
(In thousands)(In thousands)(In thousands)
2023$244,387 
20242024243,194 2024$244,707 
20252025212,001 2025213,514 
20262026200,251 2026201,512 
20272027176,171 2027176,171 
20282028160,395 

Goodwill
The following table presents the changes in the carrying amount of goodwill:
(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupConsolidated
Balance as of January 1, 2021$1,462,217 $579,319 $104,399 $2,145,935 
Acquisitions1,267 168,031 — 169,298 
Dispositions(1,446)— — (1,446)
Foreign currency— — (206)(206)
Balance as of December 31, 2021$1,462,038 $747,350 $104,193 $2,313,581 
Dispositions(15)— — (15)
Foreign currency— — (217)(217)
Balance as of June 30, 2022$1,462,023 $747,350 $103,976 $2,313,349 
(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupConsolidated
Balance as of January 1, 2023(1)
$1,462,022 $747,350 $104,031 $2,313,403 
Impairment$(121,563)$(439,383)$(34,515)(595,461)
Acquisitions— 3,375 — 3,375 
Foreign currency— 43 50 93 
Balance as of June 30, 2023$1,340,459 $311,385 $69,566 $1,721,410 
(1) Beginning goodwill balance is presented net of prior accumulated impairment losses of $1.2 billion related to the Multiplatform Group segment. Refer to the table above for impairments recorded in 2023.
Goodwill Impairment
At least annually, the Company performs its impairment test for each reporting unit’s goodwill. The Company also tests goodwill at interim dates if events or changes in circumstances indicate that goodwill might be impaired.

As discussed above, economic uncertainty has had a significant impact on the Company's revenue and cash flows, as well as the trading values of the Company's debt and equity securities for a sustained period. As a result, the Company performed an impairment test as of June 30, 2023 on its goodwill. The uncertainty surrounding the demand for advertising impacted the key assumptions used in the models which are utilized to value the Company's goodwill.

The goodwill impairment test requires measurement of the fair value of the Company's reporting units, which is compared to the carrying value of the reporting units, including goodwill. Each of the Company's reporting units is valued using a discounted cash flow model which requires estimating future cash flows expected to be generated from the reporting unit, discounted to their present value using a risk-adjusted discount rate. Terminal values were also estimated and discounted to their present value. Assessing the recoverability of goodwill requires the Company to make estimates and assumptions about sales, operating margins, growth rates and discount rates based on the Company's budgets, business plans, economic projections, anticipated future cash flows and marketplace data. There are inherent uncertainties related to these factors and in management’s judgment in applying these factors. The economic environment resulting from inflation, higher interest rates, and the related uncertainty in the markets impacted the trading values of the Company's debt and equity securities and certain assumptions used to estimate the fair values of the Company's reporting units for purposes of performing the interim goodwill impairment test. Based on the Company's valuation analysis, it determined that the estimated fair values of three of its reporting units were below their carrying value, including goodwill, which required the Company to recognize a non-cash impairment charge of $595.5 million to reduce its goodwill balance.

While the Company believes it has made reasonable estimates and utilized reasonable assumptions to calculate the fair values of its other intangible assets, indefinite-lived FCC licenses and reporting units, it is possible a material change could occur to the estimated fair value of these assets as a result of the uncertainty regarding the magnitude of the impact of current market
15
14



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
conditions, as well as the timing of any recovery. If the Company's actual results are not consistent with its estimates, the Company could be exposed to future impairment losses that could be material to its results of operations.

NOTE 5 – LONG-TERM DEBT
Long-term debt outstanding for the Company as of June 30, 20222023 and December 31, 20212022 consisted of the following:
(In thousands)(In thousands)June 30, 2022December 31, 2021(In thousands)June 30, 2023December 31, 2022
Term Loan Facility due 2026Term Loan Facility due 2026$1,864,032 $1,864,032 Term Loan Facility due 2026$1,864,032 $1,864,032 
Incremental Term Loan Facility due 2026Incremental Term Loan Facility due 2026401,220 401,220 Incremental Term Loan Facility due 2026401,220 401,220 
Asset-based Revolving Credit Facility due 2023(1)
— — 
Asset-based Revolving Credit Facility due 2027(1)(2)
— — 
Asset-based Revolving Credit Facility due 2027(1)
Asset-based Revolving Credit Facility due 2027(1)
— — 
6.375% Senior Secured Notes due 20266.375% Senior Secured Notes due 2026800,000 800,000 6.375% Senior Secured Notes due 2026800,000 800,000 
5.25% Senior Secured Notes due 20275.25% Senior Secured Notes due 2027750,000 750,000 5.25% Senior Secured Notes due 2027750,000 750,000 
4.75% Senior Secured Notes due 20284.75% Senior Secured Notes due 2028500,000 500,000 4.75% Senior Secured Notes due 2028500,000 500,000 
Other secured subsidiary debt(3)
4,577 5,350 
Other secured subsidiary debt(2)
Other secured subsidiary debt(2)
3,618 4,462 
Total consolidated secured debtTotal consolidated secured debt4,319,829 4,320,602 Total consolidated secured debt4,318,870 4,319,714 
8.375% Senior Unsecured Notes due 2027(4)
1,336,450 1,450,000 
8.375% Senior Unsecured Notes due 2027(3)
8.375% Senior Unsecured Notes due 2027(3)
1,020,457 1,120,366 
Other unsecured subsidiary debtOther unsecured subsidiary debt69 90 Other unsecured subsidiary debt— 52 
Original issue discountOriginal issue discount(12,027)(13,454)Original issue discount(9,080)(10,569)
Long-term debt feesLong-term debt fees(16,902)(18,370)Long-term debt fees(13,852)(15,396)
Total debtTotal debt5,627,419 5,738,868 Total debt5,316,395 5,414,167 
Less: Current portionLess: Current portion675 673 Less: Current portion440 664 
Total long-term debtTotal long-term debt$5,626,744 $5,738,195 Total long-term debt$5,315,955 $5,413,503 
(1)On May 17, 2022, we entered into a $450.0 million New ABL Facility, maturing in 2027, which refinanced and replaced in its entirety the Existing ABL Facility. Refer to the 'Asset-based Revolving Credit Facility due 2027' section below for more information.
(2)As of June 30, 2022,2023, the New ABL Facility had a facility sizeborrowing base of $450.0$444.5 million, no outstanding borrowings and $29.4$24.9 million of outstanding letters of credit, resulting in $420.6$419.6 million of borrowing base availability.
(3)(2)Other secured subsidiary debt consists of finance lease obligations maturing at various dates from 20232024 through 2045.
(4)(3)During the three months ended June 30, 2023, the Company repurchased $79.9 million aggregate principal amount of iHeartCommunications Inc.'s 8.375% Senior Unsecured Notes due 2027 for $57.0 million in cash, excluding accrued interest, via open market transactions. The repurchased notes were subsequently cancelled and retired, resulting in a gain on extinguishment of debt of $22.9 million. During the six months ended June 30, 2023, the Company repurchased $99.9 million aggregate principal amount of iHeartCommunications Inc.'s 8.375% Senior Unsecured Notes due 2027 for $72.4 million in cash, excluding accrued interest, via open market transactions. The repurchased notes were subsequently cancelled and retired, resulting in a gain on extinguishment of debt of $27.5 million. During the three and six months ended, June 30, 2022, wethe Company repurchased $113.5 million aggregate principal amount of iHeartCommunications Inc.'s 8.375% Senior Unsecured Notes due 2027 for $105.3 million in cash, excluding accrued interest, via open market transactions. The repurchased notes were subsequently cancelled and retired, resulting in a gain on extinguishment of debt of $8.2 million.

The Company’s weighted average interest rate was 5.9%7.2% and 5.4%6.9% as of June 30, 20222023 and December 31, 2021,2022, respectively. The aggregate market value of the Company’s debt based on market prices for which quotes were available was approximately $4.9$4.2 billion and $5.9$4.8 billion as of June 30, 20222023 and December 31, 2021,2022, respectively. Under the fair value hierarchy established by ASC 820-10-35, the market value of the Company’s debt is classified as either Level 1 or Level 2.

Asset-based Revolving CreditOn June 15, 2023, iHeartCommunications, Inc. ("iHeartCommunications") entered into an amendment to the credit agreement governing its term loan credit facilities (the "Term Loan Facility"). The amendment replaces the prior Eurocurrency interest rate, based upon LIBOR, with the Secured Overnight Financing Rate (“SOFR”) successor rate plus a SOFR adjustment as specified in the credit agreement. The Term Loan Facility margins remain the same with the Term Loan Facility due 2027

On May 17, 2022, iHeartCommunications, Inc., as borrower, entered into a Credit Agreement (the “New ABL Credit Agreement”) with iHeartMedia Capital I, LLC, the direct parent2026 containing margins of iHeartCommunications, Inc., as parent guarantor, certain subsidiaries of iHeartCommunications, Inc. party thereto, Bank of America, N.A., as administrative and collateral agent, and each other lender party thereto from time to time, governing a new $450.0 million New ABL Facility, maturing in 2027, which refinanced and replaced in its entirety the Existing ABL Facility. The New ABL Facility includes a letter of credit sub-facility and a swingline loan sub-facility.

Size and Availability
The New ABL Facility provides3.00% for a senior secured asset-based revolving credit facilityTerm SOFR Loans (as defined in the aggregate principal amountcredit agreement) and 2.00% for Base Rate Loans (as defined in the credit agreement), and the incremental Term Loan Facility due 2026 containing margins of up to $450.0 million,3.25% for Term SOFR Loans with amounts available from time to time (including in respecta floor of letters0.50% and 2.25% for Base Rate Loans with a floor of credit) equal to the lesser of (A) the borrowing base, which equals the sum of (i) 90.0% of the eligible accounts receivable of iHeartCommunications and the1.50%.
1615



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
subsidiary guarantors and (ii) 100% of qualified cash, each subject to customary reserves and eligibility criteria, and (B) the aggregate revolving credit commitments. Subject to certain conditions, iHeartCommunications may at any time request one or more increases in the amount of revolving credit commitments, in an amount up to the sum of (x) $150.0 million and (y) the amount by which the borrowing base exceeds the aggregate revolving credit commitments. As of June 30, 2022, the New ABL Facility had a facility size of $450.0 million, no outstanding borrowings and $29.4 million of outstanding letters of credit, resulting in $420.6 million of borrowing base availability.
Interest Rate and Fees

Borrowings under the New ABL Facility bear interest at a rate per annum equal to the applicable rate plus, at iHeartCommunications’ option, either (1) a base rate, (2) a term secured overnight financing rate ("SOFR") (which includes a credit spread adjustment of 10 basis points) or (3) for certain foreign currencies, a eurocurrency rate. The applicable margin for borrowings under the New ABL Facility range from 1.25% to 1.75% for both eurocurrency and term SOFR borrowings and from 0.25% to 0.75% for base-rate borrowings, in each case, depending on average excess availability under the New ABL Facility based on the most recently ended fiscal quarter.

In addition to paying interest on outstanding principal under the New ABL Facility, iHeartCommunications is required to pay a commitment fee to the lenders under the New ABL Facility in respect of the unutilized commitments thereunder. The commitment fee rate ranges from 0.25% to 0.375% per annum dependent upon average unused commitments during the prior quarter. iHeartCommunications may also pay customary letter of credit fees.

Maturity

Borrowings under the New ABL Facility will mature, and commitments thereunder will terminate, on May 17, 2027.

Prepayments

If at any time, the sum of the outstanding amounts under the New ABL Facility exceeds the lesser of (i) the borrowing base and (ii) the aggregate commitments under the facility (such lesser amount, the “line cap”), iHeartCommunications is required to repay outstanding loans and cash collateralize letters of credit in an aggregate amount equal to such excess. iHeartCommunications may voluntarily repay outstanding loans under the New ABL Facility at any time without premium or penalty, other than customary “breakage” costs with respect to eurocurrency rate loans. Any voluntary prepayments made by iHeartCommunications will not reduce iHeartCommunications’ commitments under the New ABL Facility.

Guarantees and Security

The New ABL Facility is guaranteed by the guarantors of iHeartCommunications’ existing Term Loan Facility. All obligations under the New ABL Facility, and the guarantees of those obligations, are secured by a perfected security interest in the accounts receivable and related assets of iHeartCommunications’ and all of the guarantors’ accounts receivable, qualified cash and related assets and proceeds thereof that is senior to the security interest of iHeartCommunications’ existing Term Loan Facility in such accounts receivable, qualified cash and related assets and proceeds thereof, subject to permitted liens and certain exceptions.

Certain Covenants and Events of Default

If borrowing availability is less than the greater of (a) $40.0 million and (b) 10% of the aggregate commitments under the New ABL Facility, in each case, for 2 consecutive business days (a “Trigger Event”), iHeartCommunications will be required to comply with a minimum fixed charge coverage ratio of at least 1.00 to 1.00 for fiscal quarters ending on or after the occurrence of the Trigger Event, and must continue to comply with this minimum fixed charge coverage ratio until borrowing availability exceeds the greater of (x) $40.0 million and (y) 10% of the aggregate commitments under the New ABL Facility, in each case, for 20 consecutive calendar days, at which time the Trigger Event shall no longer be deemed to be occurring. As of June 30, 2022, no Trigger Event had occurred, and iHeartCommunications was not required to comply with this minimum fixed charge coverage ratio.


17



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Surety Bonds and Letters of Credit and Guarantees

As of June 30, 2022,2023, the Company and its subsidiaries had outstanding surety bonds and commercial standby letters of credit and bank guarantees of $8.3 million, $29.8$8.7 million and $0.2$24.9 million, respectively. These surety bonds and letters of credit and bank guarantees relate to various operational matters including insurance, lease and performance bonds as well as other items.

NOTE 6 – COMMITMENTS AND CONTINGENCIES
The Company and its subsidiaries are involved in certain legal proceedings arising in the ordinary course of business and, as required, have accrued an estimate of the probable costs for the resolution of those claims for which the occurrence of loss is probable and the amount can be reasonably estimated. These estimates have been developed in consultation with counsel and are based upon an analysis of potential results, assuming a combination of litigation and settlement strategies. It is possible, however, that future results of operations for any particular period could be materially affected by changes in the Company’s assumptions or the effectiveness of its strategies related to these proceedings. Additionally, due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on the Company’s financial condition or results of operations.
Although the Company is involved in a variety of legal proceedings in the ordinary course of business, a large portion of the Company’s litigation arises in the following contexts: commercial/contract disputes; defamation matters; employment and benefits related claims; intellectual property claims; real estate matters; governmental investigations; and tax disputes.
Alien Ownership Restrictions and FCC Declaratory Ruling
The Communications Act and FCC regulation prohibit foreign entities and individuals from having direct or indirect ownership or voting rights of more than 25 percent in a corporation controlling the licensee of a radio broadcast station unless the FCC finds greater foreign ownership to be in the public interest. On November 5, 2020, the FCC issued a declaratory ruling, which permits the Company to be up to 100% foreign owned, subject to certain conditions as described further in Note 8, Stockholders' Equity(the "2020 Declaratory Ruling").

NOTE 7 – INCOME TAXES
The Company’s income tax benefit (expense) for the three and six months ended June 30, 20222023 and the three and six months ended June 30, 20212022 consisted of the following components:
(In thousands)(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
20222021202220212023202220232022
Current tax expenseCurrent tax expense$(38,581)$(3,477)$(42,160)$(5,066)Current tax expense$(35,161)$(38,581)$(38,646)$(42,160)
Deferred tax benefit (expense)Deferred tax benefit (expense)36,799 (20,972)60,587 (99,318)Deferred tax benefit (expense)131,518 36,799 58,898 60,587 
Income tax benefit (expense)Income tax benefit (expense)$(1,782)$(24,449)$18,427 $(104,384)Income tax benefit (expense)$96,357 $(1,782)$20,252 $18,427 

The effective tax rates for the three and six months ended June 30, 2023 were 9.8% and 1.8%, respectively. The effective tax rates were primarily impacted by the forecasted increase in valuation allowance against certain deferred tax assets, related primarily to disallowed interest expense carryforwards, due to uncertainty regarding the Company’s ability to utilize those assets in future periods, as well as to impairment charges to non-deductible goodwill as discussed in Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill. The deferred tax benefit primarily consists of $92.9 million related to the FCC license impairment charges recorded during the period.

The effective tax rates for the three and six months ended June 30, 2022 were 10.5% and 35.4%, respectively. The effective tax rates were primarily impacted by the forecasted increase in valuation allowance against certain deferred tax assets, related primarily to disallowed interest expense carryforwards and net operating loss carryforwards, due to uncertainty regarding the Company’s ability to utilize those assets in future periods.

The effective tax rates for the three and six months ended June 30, 2021 were (325.5)% and (61.5)%, respectively.The effective tax rates were primarily impacted by the deferred tax expense recorded for the valuation allowance against certain deferred tax assets for disallowed interest expense and net operating loss carryforwards due to the uncertainty of the Company’s ability to utilize those assets in future periods.


1816



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 8 – STOCKHOLDERS' EQUITY (DEFICIT)
Pursuant to the Company's 2019 Equity Incentive Plan (the "2019 Plan"), the Company historically granted restricted stock units and options to purchase shares of the Company's Class A common stock to certain key individuals. On April 21, 2021, ourthe 2021 Long-Term Incentive Award Plan (the “2021 Plan”) was approved by stockholders and replaced the 2019 Plan. Pursuant to ourthe 2021 Plan, wethe Company will continue to grant equity awards covering shares of the Company's Class A common stock to certain key individuals.

Share-based Compensation
Share-based compensation expenses are recorded in Selling, general and administrative expenses and were $8.6$9.2 million and $5.9$8.6 millionfor the Company for the three months ended June 30, 20222023 and June 30, 2021,2022, respectively. Share-based compensation expenses were $19.4 million and $14.1 million and $11.6 millionfor the Company for the six months ended June 30, 2023 and 2022, and June 30, 2021, respectively.
In August 2020, theThe Company issued performance-basedperiodically issues restricted stock units ("RSUs") and performance-based RSUs ("Performance RSUs") to certain key employees. SuchThe RSUs vest solely due to continued service over time. The Performance RSUs vest upon the achievement of critical operational (cost savings) improvements and specific environmental, social and governance initiatives, which were being measured over an approximately 18-month period from the date of issuance. In the three and six months ended June 30, 2021, the Company recognized $0.5 million and $1.0 million in relation to these Performance RSUs.
On March 28, 2022, the Company issued performance-based restricted stock units ("Q1 2022 Performance RSUs") to certain key employees. Such Q1 2022 Performance RSUs vest upon the achievement of total stockholder return goals and continued service, which are being measured over an approximately 50-month period from the date of issuance. In the three and six months ended June 30, 2022, the Company recognized $0.8 million in relation to these Q1 2022 Performance RSUs.
On May 9, 2022, the Company issued performance-based restricted stock units ("Q2 2022 Performance RSUs") and restricted stock units ("2022 RSUs") to certain key employees. Such Q2 2022 Performance RSUsgenerally vest upon the achievement of certain total stockholder return goals, Adjusted EBITDA goals, Diversity, Equity and Inclusion goals, and continued service. Such 2022 RSUs vest upon continued service. TheseThe majority of these awards are being recognized ratablymeasured over aan approximately 3-year period from the date of issuance, while certain Performance RSUs are measured over a 50-month period from the date of issuance. InOn May 18, 2023, the Company issued additional RSUs and Performance RSUs to certain key employees.

The following tables present the Company's total share based compensation expense by award type for the three and six months ended June 30, 2022, the Company recognized $0.7 million in relation to these Q2 2022 Performance RSUs.2023 and 2022:

(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
2023202220232022
RSUs$5,536 $4,902 $11,638 $8,252 
Performance RSUs2,300 1,500 4,232 1,500 
Options1,376 2,208 3,494 4,393 
Total Share Based Compensation Expense$9,212 $8,610 $19,364 $14,145 


As of June 30, 2022,2023, there was $62.0$42.3 million of unrecognized compensation cost related to unvested share-based compensation arrangements with vesting based solely on service conditions. This cost is expected to be recognized over a weighted average period of approximately 3.82.8 years. In addition, as of June 30, 2022,2023, there were unrecognized compensation costs of $11.7$24.6 million for the Q1 2022 Performance RSUs and $14.7 million for the Q2 2022 Performance RSUs related to unvested share-based compensation arrangements that will vest based on certain performance and service conditions. These costs will be recognized over a 3-year or 50-month period from the date of issuance for the Q1 2022 Performance RSUs and over the 3-year period from the date of issuance for the Q2 2022 Performance RSUs.
Common Stock and Special Warrants
The Company is authorized to issue 2,100,000,000 shares, consisting of (a) 1,000,000,000 shares of Class A Common Stock, par value $0.001 per share (the “Class A Common Stock”), (b) 1,000,000,000 shares of Class B Common Stock, par value $0.001 per share (the “Class B Common Stock”), and (c) 100,000,000 shares of preferred stock, par value $0.001 per share (the “Preferred Stock”).
19



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following table presents the Company's Class A Common Stock, Class B Common Stock and Special Warrants issued as of June 30, 2022:
June 30,
2022
Class A Common Stock, par value $.001 per share, 1,000,000,000 shares authorized122,068,221 
Class B Common Stock, par value $.001 per share, 1,000,000,000 shares authorized21,391,972 
Special Warrants5,293,055 
  Total Class A Common Stock, Class B Common Stock and Special Warrants issued148,753,248 

During the three and six months ended June 30, 2022, stockholders converted 38,528 and 198,220 shares of the Class B common stock into Class A common stock. During the three and six months ended June 30, 2021, stockholders converted 5,433,680 and 5,587,725 shares of the Class B common stock into Class A common stock.issuance.
Special Warrants
Each Special Warrant issued under the special warrant agreement entered into in connection with the Company's emergence from bankruptcy in 2019 may be exercised by its holder to purchase 1one share of Class A common stock or Class B common stock at an exercise price of $0.001 per share, unless the Company in its sole discretion believes such exercise would, alone or in combination with any other existing or proposed ownership of common stock, result in, subject to certain exceptions, (a) such exercising holder owning more than 4.99 percent of the Company's outstanding Class A common stock, (b) more than 22.5 percent of the Company's capital stock or voting interests being owned directly or indirectly by foreign individuals or entities, (c) the Company exceeding any other applicable foreign ownership threshold or (d) violation of any provision of the Communications Act or restrictions on ownership or transfer imposed by the Company's certificate of incorporation or the decisions, rules and policies of the FCC. Any holder exercising Special Warrants must complete and timely deliver to the warrant agent the required exercise forms and certifications required under the special warrant agreement. The Communications Act and FCC regulations prohibit foreign entities or individuals from indirectly (i.e., through a parent company) owning or voting more than 25 percent of a licensee’s equity, unless the FCC determines that greater indirect foreign ownership is in the public interest. As described furthermentioned in Note 6 above, on November 5, 2020, the FCC issued the 2020 Declaratory Ruling, which permits the Company to be up to 100% foreign owned.

During the three and six months ended June 30, 2022, stockholders exercised 14 and 11,375 Special Warrants for an equivalent number of shares of Class A common stock. There were no Special Warrants exercised for shares of Class B common stock during the three and six months ended June 30, 2022. During the three and six months ended June 30, 2021, stockholders exercised 14,694 and 47,136,441 Special Warrants for an equivalent number of shares of Class A common stock. During the six months ended June 30, 2021, stockholders exercised 22,337,312 Special Warrants for an equivalent number of shares of Class B common stock.

2017



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

During the three and six months ended June 30, 2023, there were 198 Special Warrants exercised for shares of Class A common stock. During the three and six months ended June 30, 2023, there were 59 Special Warrants exercised for shares of Class B common stock. During the three and six months ended June 30, 2022, stockholders exercised 14 and 11,375 Special Warrants, respectively, for an equivalent number of shares of Class A common stock. During the six months ended June 30, 2022, there were no Special Warrants exercised for shares of Class B common stock.

Computation of Income (Loss) per Share
(In thousands, except per share data)(In thousands, except per share data)Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands, except per share data)Three Months Ended
June 30,
Six Months Ended
June 30,
2022202120222021 2023202220232022
NUMERATOR:NUMERATOR:    NUMERATOR:    
Net income (loss) attributable to the Company – common sharesNet income (loss) attributable to the Company – common shares$14,401 $(32,286)$(34,181)$(274,009)Net income (loss) attributable to the Company – common shares$(884,470)$14,401 $(1,106,730)$(34,181)
DENOMINATOR(1):
DENOMINATOR(1):
   
DENOMINATOR(1):
   
Weighted average common shares outstanding - basicWeighted average common shares outstanding - basic148,050 146,509 147,783 146,362 Weighted average common shares outstanding - basic149,179 148,050 148,774 147,783 
Stock options and restricted stock(2):
Stock options and restricted stock(2):
1,081 — — — 
Stock options and restricted stock(2):
— 1,081 — — 
Weighted average common shares outstanding - dilutedWeighted average common shares outstanding - diluted149,131 146,509 147,783 146,362 Weighted average common shares outstanding - diluted149,179 149,131 148,774 147,783 
Net income (loss) attributable to the Company per common share:Net income (loss) attributable to the Company per common share:   Net income (loss) attributable to the Company per common share:   
BasicBasic$0.10 $(0.22)$(0.23)$(1.87)Basic$(5.93)$0.10 $(7.44)$(0.23)
DilutedDiluted$0.10 $(0.22)$(0.23)$(1.87)Diluted$(5.93)$0.10 $(7.44)$(0.23)
(1) All of the outstanding Special Warrants are included in both the basic and diluted weighted average common shares outstanding of the Company for the three and six months ended June 30, 20222023 and 2021.2022.
(2) Outstanding equity service awards representing 6.213.8 million and 10.86.2 million shares of Class A common stock of the Company for the three months ended June 30, 20222023 and 2021,2022, respectively, and 10.4$12.7 million and 10.8$10.4 million for the six months ended June 30, 20222023 and 2021,2022 respectively, were not included in the computation of diluted earnings per share because to do so would have been antidilutive.


NOTE 9 – SEGMENT DATA
The Company’s primary businesses are included in its Multiplatform Group and Digital Audio Group segments. Revenue and expenses earned and charged between Multiplatform Group, Digital Audio Group, Corporate and the Company's Audio & Media Services Group, and Corporate are eliminated in consolidation.  The Multiplatform Group provides media and entertainment services via broadcast delivery and also includes the Company’s events and national syndication businesses. The Digital Audio Group provides media and entertainment services via digital delivery.  The Audio & Media Services Group provides other audio and media services, including the Company’s media representation business (Katz Media) and its provider of scheduling and broadcast software (RCS).  Corporate includes infrastructure and support, including executive, information technology, human resources, legal, finance and administrative functions for the Company’s businesses. Share-based payments are recorded in Selling, general and administrative expense.

2118



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The following tables present the Company's segment results for the Company for the three and six months ended June 30, 20222023 and 2021:2022:
Segments
(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupCorporate and other reconciling itemsEliminationsConsolidated
Three Months Ended June 30, 2023
Revenue$595,944 $260,854 $65,804 $— $(2,588)$920,014 
Operating expenses(1)
433,542 176,272 47,305 74,302 (2,588)728,833 
Segment Adjusted EBITDA(2)
$162,402 $84,582 $18,499 $(74,302)$— $191,181 
Depreciation and amortization(108,065)
Impairment charges(960,570)
Other operating income, net261 
Restructuring expenses(10,789)
Share-based compensation expense(9,212)
Operating loss$(897,194)
Intersegment revenues$— $1,216 $1,372 $— $— $2,588 
Capital expenditures14,870 5,502 904 1,497 — 22,773 
Share-based compensation expense— — — 9,212 — 9,212 
Segments
(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupCorporate and other reconciling itemsEliminationsConsolidated
Three Months Ended June 30, 2022
Revenue$633,300 $252,561 $71,065 $— $(2,921)$954,005 
Operating expenses(1)
438,804 173,678 48,995 58,264 (2,921)716,820 
Segment Adjusted EBITDA(2)
$194,496 $78,883 $22,070 $(58,264)$— $237,185 
Depreciation and amortization(110,788)
Impairment charges(245)
Other operating expense, net(15,664)
Restructuring expenses(19,009)
Share-based compensation expense(8,610)
Operating income$82,869 
Intersegment revenues$167 $1,376 $1,378 $— $— $2,921 
Capital expenditures36,378 5,912 2,423 4,940 — 49,653 
Share-based compensation expense— — — 8,610 — 8,610 
Segments
(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupCorporate and other reconciling itemsEliminationsConsolidated
Three Months Ended June 30, 2021
Revenue$605,850 $197,930 $61,175 $— $(3,350)$861,605 
Operating expenses(1)
424,452 143,640 40,704 71,651 (3,350)677,097 
Segment Adjusted EBITDA(2)
$181,398 $54,290 $20,471 $(71,651)$— $184,508 
Depreciation and amortization(127,945)
Impairment charges— 
Other operating expense, net(12,379)
Restructuring expenses(10,155)
Share-based compensation expense(5,903)
Operating income$28,126 
Intersegment revenues$168 $1,178 $2,004 $— $— $3,350 
Capital expenditures21,371 6,286 1,144 3,310 — 32,111 
Share-based compensation expense— — — 5,903 — 5,903 

2219



IHEARTMEDIA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
SegmentsSegments
(In thousands)(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupCorporate and other reconciling itemsEliminationsConsolidated(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupCorporate and other reconciling itemsEliminationsConsolidated
Six Months Ended June 30, 2022
Six Months Ended June 30, 2023Six Months Ended June 30, 2023
RevenueRevenue$1,204,460 $466,780 $131,922 $— $(5,699)$1,797,463 Revenue$1,124,957 $484,250 $127,155 $— $(5,109)$1,731,253 
Operating expenses(1)
Operating expenses(1)
876,057 335,389 93,465 115,848 (5,699)1,415,060 
Operating expenses(1)
875,503 345,549 93,312 137,393 (5,109)1,446,648 
Segment Adjusted EBITDA(2)
Segment Adjusted EBITDA(2)
$328,403 $131,391 $38,457 $(115,848)$— $382,403 
Segment Adjusted EBITDA(2)
$249,454 $138,701 $33,843 $(137,393)$— $284,605 
Depreciation and amortizationDepreciation and amortization(224,839)Depreciation and amortization(216,577)
Impairment chargesImpairment charges(1,579)Impairment charges(964,517)
Other operating expense, net(16,534)
Other operating income, netOther operating income, net40 
Restructuring expensesRestructuring expenses(30,102)Restructuring expenses(30,243)
Share-based compensation expenseShare-based compensation expense(14,145)Share-based compensation expense(19,364)
Operating income$95,204 
Operating lossOperating loss$(946,056)
Intersegment revenuesIntersegment revenues$335 $2,645 $2,719 $— $— $5,699 Intersegment revenues$— $2,405 $2,704 $— $— $5,109 
Capital expendituresCapital expenditures48,716 11,068 4,122 8,304 — 72,210 Capital expenditures41,294 11,279 4,791 4,574 — 61,938 
Share-based compensation expenseShare-based compensation expense— — — 14,145 — 14,145 Share-based compensation expense— — — 19,364 — 19,364 
SegmentsSegments
(In thousands)(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupCorporate and other reconciling itemsEliminationsConsolidated(In thousands)Multiplatform GroupDigital Audio GroupAudio & Media Services GroupCorporate and other reconciling itemsEliminationsConsolidated
Six Months Ended June 30, 2021
Six Months Ended June 30, 2022Six Months Ended June 30, 2022
RevenueRevenue$1,103,747 $355,483 $116,312 $— $(7,272)$1,568,270 Revenue$1,204,460 $466,780 $131,922 $(5,699)$1,797,463 
Operating expenses(1)
Operating expenses(1)
817,558 261,182 80,492 129,555 (7,272)1,281,515 
Operating expenses(1)
876,057 335,389 93,465 115,848 (5,699)1,415,060 
Segment Adjusted EBITDA(2)
Segment Adjusted EBITDA(2)
$286,189 $94,301 $35,820 $(129,555)$— $286,755 
Segment Adjusted EBITDA(2)
$328,403 $131,391 $38,457 $(115,848)$— $382,403 
Depreciation and amortizationDepreciation and amortization(235,308)Depreciation and amortization(224,839)
Impairment chargesImpairment charges(37,744)Impairment charges(1,579)
Other operating expense, netOther operating expense, net(15,150)Other operating expense, net(16,534)
Restructuring expensesRestructuring expenses(35,195)Restructuring expenses(30,102)
Share-based compensation expenseShare-based compensation expense(11,588)Share-based compensation expense(14,145)
Operating loss$(48,230)
Operating incomeOperating income$95,204 
Intersegment revenuesIntersegment revenues$335 $3,072 $3,865 $— $— $7,272 Intersegment revenues$335 $2,645 $2,719 $— $5,699 
Capital expendituresCapital expenditures31,440 11,711 2,191 5,719 — 51,061 Capital expenditures48,716 11,068 4,122 8,304 72,210 
Share-based compensation expenseShare-based compensation expense— — — 11,588 — 11,588 Share-based compensation expense— — — 14,145 14,145 

(1) Consolidated operating expenses consist of Direct operating expenses and Selling, general and administrative expenses and exclude Restructuring expenses, share-based compensation expenses and depreciation and amortization.
(2)For a definition of Adjusted EBITDA for the consolidated company and a reconciliation to Operating income (loss), the most closely comparable GAAP measure, and to Net income (loss),loss, please see "Reconciliation of Operating Income (Loss) to Adjusted EBITDA" and "Reconciliation of Net Income (Loss)Loss to EBITDA and Adjusted EBITDA" in Item 2 of this Quarterly Report on Form 10-Q. Beginning on January 1, 2021, Segment Adjusted EBITDA became the segment profitability metric reported to the Company's Chief Operating Decision Maker for purposes of making decisions about allocation of resources to, and assessing performance of, each reportable segment.
2320


ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Format of Presentation
Management’s discussion and analysis of financial condition and results of operations (“MD&A”) should be read in conjunction with the consolidated financial statements and related footnotes contained in Part I, Item 1 of this Quarterly Report on Form 10-Q of iHeartMedia, Inc. (the "Company," "iHeartMedia," "we," "our," or "us"). 
OurWe report based on three reportable segments are:segments:
the Multiplatform Group, which includes our Broadcast radio, Networks and Sponsorships and Events businesses;
the Digital Audio Group, which includes our Digital businesses, including Podcasting; and
the Audio & Media Services Group, which includes Katz Media Group (“Katz Media”), our full-service media representation business, and RCS Sound Software ("RCS"), a provider of scheduling and broadcast software and services.
These reporting segments reflect how senior management operates the Company. This structure provides visibility into the underlying performance, results, and margin profiles of our distinct businesses and enables senior management to monitor trends at the operational level and address opportunities or issues as they arise via regular review of segment-level results and forecasts with operational leaders.

Additionally,Our segment profitability metric is Segment Adjusted EBITDA, which is the segment profitability metric reported to the Company's Chief Operating Decision Maker for purposes of making decisions about allocation of resources to, and assessing performance of, each reportable segment. Segment Adjusted EBITDA is calculated as Revenue less operating expenses, excluding Restructuring expenses (as defined below) and share-based compensation expenses.

We operate ashave transitioned our business from a single platform radio broadcast operator to a company with multiple platforms including radio, digital, podcasting, networks and events, as well as ad technology capabilities. We have also invested in numerous technologies and businesses to increase the competitiveness of our inventory with our advertisers and our audience. We believe the presentation of our results by segment provides additional insight into our broadcast radio business and our fast-growing digital business. We believe that our ability to generate cash flow from operations from our business initiatives and our current cash on hand will provide sufficient resources to fund and operate our business, fund capital expenditures and other obligations and make interest payments on our long-term debt for at least the next twelve months.
Description of our Business
Our strategy centers on delivering entertaining and informative content where our listeners want to find us across our various platforms.
Multiplatform Group

The primary source of revenue for our Multiplatform Group is from selling local and national advertising time on our radio stations, with contracts typically less than one year in duration. The programming formats of our radio stations are designed to reach audiences with targeted demographic characteristics. We work closely with our advertising and marketing partners to develop tools and leverage data to enable advertisers to effectively reach their desired audiences. Our Multiplatform Group also generates revenue from network syndication, nationally recognized events and other miscellaneous transactions.

Management looks at our Multiplatform Group's operations’ overall revenue as well as the revenue from each type of advertising,revenue stream including local advertising, which is sold predominately in a station’s local market,Broadcast Spot, Networks, and national advertising, which is sold across multiple markets. Local advertising is sold by each radio station’s sales staff while national advertising is sold by our national sales team.Sponsorship and Events. We periodically review and refine our selling structures in all regions and markets in an effort to maximize the value of our offering to advertisers and, therefore, our revenue.

Management also looks at Multiplatform Group's revenue by region and market size. Typically, larger markets can reach larger audiences with wider demographics than smaller markets. Additionally, management reviews our share of audio advertising revenues in markets where such information is available, as well as our share of target demographics listening in an average quarter hour. This metric gauges how well our formats are attracting and retaining listeners.

24
21


Management also monitors revenue generated through our programmatic ad-buying platform, and our data analytics advertising product, SmartAudio, to measure the success of our enhanced marketing optimization tools. We have made significant investments so we can provide the same ad-buying experience that once was only available from digital-only companies and enable our clients to better understand how our assets can successfully reach their target audiences.

Management monitors average advertising rates and cost per mille, the cost of every 1,000 advertisement impressions (“CPM”), which are principally based on the length of the spot and how many people in a targeted audience listen to our stations, as measured by an independent ratings service. In addition, our advertising rates are influenced by the time of day the advertisement airs, with morning and evening drive-time hours typically priced the highest. Our price and yield information systems enable our station managers and sales teams to adjust commercial inventory and pricing based on local market demand, as well as to manage and monitor different commercial durations in order to provide more effective advertising for our customers at what we believe are optimal prices given market conditions. Yield is measured by management in a variety of ways, including revenue earned divided by minutes of advertising sold.

A portion of our Multiplatform Group segment’s expenses vary in connection with changes in revenue. These variable expenses primarily relate to costs in our programming and sales departments, including profit sharing fees and commissions, and bad debt. Our content costs, including music license fees for music delivered via broadcast, vary with the volume and mix of songs played on our stations.

Digital Audio Group

The primary source of revenue in the Digital Audio Group segment is the sale of advertising on the Company’sour podcast network, iHeartRadio mobile application and website, and station websites, and podcast network.websites. Revenues for digital advertising spots are recognized over time based on impressions delivered or time elapsed, depending upon the terms of the contract. Digital Audio Group’s contracts with advertisers are typically a year or less in duration and are generally billed monthly upon satisfaction of the performance obligations.

Through our Digital Audio Group, we continue to expand the choices for listeners. We derive revenue in this segment by developing and delivering our content and selling advertising across multiple digital distribution channels, including via our iHeartRadio mobile application, our station websites and other digital platforms that reach national, regional and local audiences.

Our strategy has enabled us to extend our leadership in the rapidly growing podcasting sector, and iHeartMedia is the number one podcast publisher in America. Our reach now extends across more than 250 platforms and 2,000thousands of different connected devices, and our digital business is comprised of streaming, subscription, display advertisements, and other content that is disseminated over digital platforms.

A portion of our Digital Audio Group segment’s expenses vary in connection with changes in revenue. These variable expenses primarily relate to our content costs including profit sharing fees and third-party content costs, as well as sales commissions and bad debt. Certain of our content costs, including digital music performance royalties, vary with the volume of listening hours on our digital platforms.

Audio & Media Services Group

Audio & Media Services Group revenue is generated by services provided to broadcast industry participants through our Katz Media and RCS businesses. As a media representation firm, Katz Media generates revenue via commissions on media sold on behalf of the radio and television stations that it represents, while RCS generates revenue by providing broadcast software and media streaming, along with research services for radio stations, broadcast television stations, cable channels, record labels, ad agencies and Internet stations worldwide.

Economic Conditions

Our advertising revenue is highly correlated to changes in gross domestic product (“GDP”) as advertising spendingeconomic conditions. Increasing interest rates and high inflation have contributed to a challenging macroeconomic environment since 2022. This challenging environment has historically trended in line with GDP. Aled to broader market uncertainty which has impacted our revenues and cash flows. The current market uncertainty and macroeconomic conditions, a recession, or a downturn in the U.S. economy could have a significant impact on the Company’sour ability to generate revenue.


2522


COVID-19

Beginning in March 2020 and continuing in the following months, we saw a sharp decline in each of our Broadcast radio, Networks and Sponsorships revenue streams as a result of the impact of the coronavirus pandemic ("COVID-19") and the resulting impact on the U.S. economy. Our Multiplatform Group revenues significantly increased during 2021, and continued to increase in the first half of 2022 compared to the first half of 2021 as a result of continued recovery from the impact of COVID-19. Our Digital Audio Group revenues, including podcasting, have continued to grow each quarter during COVID-19 and throughout the recovery. Our Audio & Media Services Group revenues have increased for the first half of 2022 compared to the first half of 2021 mainly due to the continued recovery from the impact of COVID-19. Refer to Note 1, Basis of Presentation, for more information regarding COVID-19 and its impact on our financial statements.

Cost Savings Initiatives

We have implemented key modernization initiatives and operating-expense-saving initiatives over recent years to take advantage of the significant investments we have made in new technologies to deliver incremental cost efficiencies, including initiatives to streamline our real estate footprint, and wefootprint. We continue to explore opportunities for further efficiencies.

Impairment Charges

Economic uncertainty due to inflation and higher interest rates since 2022 has resulted in, among other things, lower advertising spending by businesses. This challenging environment has led to broader market uncertainty, and has delayed our expected recovery and has had an adverse impact on our revenue and cash flows. This challenging environment could have a significant impact on our financial results. In addition, the economic uncertainty has had a significant impact on the trading values of our debt and equity securities for a sustained period. As a result, we performed impairment tests as of June 30, 2023 on our indefinite-lived Federal Communication Commission ("FCC") licenses and goodwill.

The uncertainty surrounding the demand for advertising and the adverse impact on the trading values of our debt and equity securities impacted the key assumptions used in the models that are utilized to value our FCC licenses and goodwill. As a result, the fair values of certain of our FCC licenses and reporting units have decreased.

Our FCC licenses are valued using a direct valuation approach, with the key assumptions being market revenue growth rates, profit margin, and the risk-adjusted discount rate as well as other assumptions including market share, duration and profile of the build-up period, estimated start-up costs and capital expenditures. This data is populated using industry normalized information representing an average asset within a market. We obtained the most recent broadcast radio industry revenue projections for use in our valuation model, as well as various other sources to analyze media and broadcast industry market forecasts and other data in developing the assumptions used for purposes of performing impairment testing on our FCC licenses as of June 30, 2023.

Considerations in developing these assumptions included the expected impact on advertising revenues given the current market uncertainty, ranges of expected timing of recovery, discount rates and other factors. Based on our interim testing, the estimated fair value of our FCC licenses was below their carrying values. As a result, we recognized a non-cash impairment charge of $363.6 million on our FCC licenses.

The goodwill impairment test requires us to measure the fair value of our reporting units, which is compared to the carrying value of the reporting units, including goodwill. Each of our reporting units is valued using a discounted cash flow model which requires estimating future cash flows expected to be generated from the reporting unit, discounted to their present value using a risk-adjusted discount rate. Terminal values were also estimated and discounted to their present value. Assessing the recoverability of goodwill requires us to make estimates and assumptions about sales, operating margins, growth rates and discount rates based on our budgets, business plans, economic projections, anticipated future cash flows and marketplace data. There are inherent uncertainties related to these factors and in management’s judgment in applying these factors. The economic environment resulting from inflation, higher interest rates, and the related uncertainty in the markets negatively impacted the trading values of our debt and equity securities and also impacted certain assumptions used to estimate the fair values of our reporting units for purposes of performing the interim goodwill impairment test. Based on our valuation analysis, we determined that the estimated fair values of three of our reporting units were below their carrying values, including goodwill, which required us to recognize a non-cash impairment charge of $595.5 million to reduce our goodwill balance.

While we believe we have made reasonable estimates and utilized reasonable assumptions to calculate the fair values of our long-lived assets, indefinite-lived FCC licenses and reporting units, it is possible a material change could occur to the estimated fair value of these assets as a result of the uncertainty regarding the magnitude of the impact of current market conditions, as well as the timing of any recovery. If our actual results are not consistent with our estimates, we could be exposed to future impairment losses that could be material to our results of operations.

As part of our operating-expense-savings initiatives, we have taken proactive steps to streamline our real estate footprint and reduce related lease and operating expenses incurred by the Company. These strategic actions typically result in impairment charges due to the write-down of the affected right-of-use assets and related fixed assets, including leasehold improvements.                     For the six months ended June 30, 2022 and 2021, we recognized non-cash impairment charges of $1.6 million and $37.7 million, respectively, as a result of these cost-savings initiatives.

2623


Executive Summary
Our revenuesRevenues for the second quarter of 2022 increased across2023 decreased for our Multiplatform Group segment due to lower spending on radio advertising in connection with the uncertain market conditions, and increased for our Digital Audio Group and Audio & Media Services Group segments as a result of the continued recovery from the impacts of the COVID-19 pandemic and the continued increased demand for digital advertising, including podcasting.segment.
The key developments that impacted our business during the quarter are summarized below:
Consolidated Revenue of $954.0$920.0 million increased $92.4decreased $34.0 million, or 10.7%3.6%, during the quarter ended June 30, 20222023 compared to Consolidated Revenue of $861.6$954.0 million in the prior year's second quarter.
Revenue and Segment Adjusted EBITDA from our Multiplatform Group increased $27.5decreased $37.4 million and $13.1$32.1 million compared to the prior year's second quarter, respectively.
Revenue and Segment Adjusted EBITDA from our Digital Audio Group increased $54.6$8.3 million and $24.6$5.7 million compared to the prior year's second quarter, respectively.
Revenue and Segment Adjusted EBITDA from our Audio & Media Services Group increased $9.9decreased $5.3 million and $1.6$3.6 million compared to the prior year's second quarter, respectively.
Operating loss of $897.2 million, decreased $980.1 million from Operating income of $82.9 million increased $54.8 million from $28.1 million in the prior year’s second quarter.quarter mainly due to the non-cash impairment charges of $960.6 million, primarily related to our goodwill and indefinite-lived intangible assets balances.
Net loss of $883.0 million, a decrease of $898.2 million from Net income of $15.2 million increased $47.2 million from a Net loss of $32.0 million in the prior year's second quarter.quarter primarily related to the non-cash impairment charge of $960.6 million, primarily related to our goodwill and indefinite-lived intangible assets.
Cash flows provided by operating activities of $56.8 million decreased from $155.8 million increased from $29.1 millionprovided by operating activities in the prior year's second quarter.
Adjusted EBITDA(1) of $237.2$191.2 million, was up $52.7down $46.0 million from $184.5$237.2 million in prior year's second quarter.
Free cash flow(2) of $106.1$34.0 million increaseddecreased from $(3.0)$106.1 million in the prior year's second quarter.

The table below presents a summary of our historical results of operations for the periods presented:
(In thousands)(In thousands)Three Months Ended
June 30,
(In thousands)Three Months Ended
June 30,
2022202120232022
RevenueRevenue$954,005 $861,605 Revenue$920,014 $954,005 
Operating income82,869 28,126 
Operating income (loss)Operating income (loss)(897,194)82,869 
Net income (loss)Net income (loss)15,182 (31,960)Net income (loss)(882,982)15,182 
Cash provided by operating activitiesCash provided by operating activities155,801 29,129 Cash provided by operating activities56,772 155,801 
Adjusted EBITDA(1)
Adjusted EBITDA(1)
$237,185 $184,508 
Adjusted EBITDA(1)
$191,181 $237,185 
Free cash flow(2)
Free cash flow(2)
106,148 (2,982)
Free cash flow(2)
33,999 106,148 
(1) For a definition of Adjusted EBITDA and a reconciliation to Operating income (loss), the most closely comparable GAAP measure, and to Net income (loss), please see "Reconciliation of Operating Income (Loss)income (loss) to Adjusted EBITDA" and "Reconciliation of Net Income (Loss)income (loss) to EBITDA and Adjusted EBITDA" in this MD&A.
(2) For a definition of Free cash flow and a reconciliation to Cash provided by operating activities, the most closely comparable GAAP measure, please see “Reconciliation of Cash provided by (used for) operating activities to Free cash flow” in this MD&A.



2724


Results of Operations
The tables below present the comparison of our historical results of operations for the three and six months ended June 30, 20222023 to the three and six months ended June 30, 2021:2022:
(In thousands)(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
20222021202220212023202220232022
RevenueRevenue$954,005 $861,605 $1,797,463 $1,568,270 Revenue$920,014 $954,005 $1,731,253 $1,797,463 
Operating expenses:Operating expenses:Operating expenses:
Direct operating expenses (excludes depreciation and amortization)Direct operating expenses (excludes depreciation and amortization)365,382 320,515 695,906 613,328 Direct operating expenses (excludes depreciation and amortization)355,061 365,382 699,681 695,906 
Selling, general and administrative expenses (excludes depreciation and amortization)Selling, general and administrative expenses (excludes depreciation and amortization)379,057 372,640 763,401 714,970 Selling, general and administrative expenses (excludes depreciation and amortization)393,773 379,057 796,574 763,401 
Depreciation and amortizationDepreciation and amortization110,788 127,945 224,839 235,308 Depreciation and amortization108,065 110,788 216,577 224,839 
Impairment chargesImpairment charges245 — 1,579 37,744 Impairment charges960,570 245 964,517 1,579 
Other operating expense, netOther operating expense, net15,664 12,379 16,534 15,150 Other operating expense, net(261)15,664 (40)16,534 
Operating income (loss)Operating income (loss)82,869 28,126 95,204 (48,230)Operating income (loss)(897,194)82,869 (946,056)95,204 
Interest expense, netInterest expense, net81,494 84,887 160,713 170,008 Interest expense, net98,693 81,494 194,150 160,713 
Gain on investments, net9,590 49,644 7,825 49,835 
Gain (loss) on investments, netGain (loss) on investments, net(6,038)9,590 (12,543)7,825 
Equity in loss of nonconsolidated affiliatesEquity in loss of nonconsolidated affiliates(29)(31)(58)(59)Equity in loss of nonconsolidated affiliates(44)(29)(4)(58)
Gain on extinguishment of debtGain on extinguishment of debt8,203 — 8,203 — Gain on extinguishment of debt22,902 8,203 27,527 8,203 
Other expense, netOther expense, net(2,175)(363)(2,445)(1,170)Other expense, net(272)(2,175)(371)(2,445)
Income (loss) before income taxesIncome (loss) before income taxes16,964 (7,511)(51,984)(169,632)Income (loss) before income taxes(979,339)16,964 (1,125,597)(51,984)
Income tax benefit (expense)Income tax benefit (expense)(1,782)(24,449)18,427 (104,384)Income tax benefit (expense)96,357 (1,782)20,252 18,427 
Net income (loss)Net income (loss)15,182 (31,960)(33,557)(274,016)Net income (loss)(882,982)15,182 (1,105,345)(33,557)
Less amount attributable to noncontrolling interestLess amount attributable to noncontrolling interest781 326 624 (7)Less amount attributable to noncontrolling interest1,488 781 1,385 624 
Net income (loss) attributable to the CompanyNet income (loss) attributable to the Company$14,401 $(32,286)$(34,181)$(274,009)Net income (loss) attributable to the Company$(884,470)$14,401 $(1,106,730)$(34,181)

The tablestable below presentpresents the comparison of our revenue streams for the three and six months ended June 30, 20222023 to the three and six months ended June 30, 2021:2022:
(In thousands)(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%
20222021Change20222021Change20232022Change20232022Change
Broadcast RadioBroadcast Radio$463,304 $451,142 2.7 %$879,785 $809,678 8.7 %Broadcast Radio$429,152 $462,547 (7.2)%$812,390 $877,789 (7.5)%
NetworksNetworks127,532 123,586 3.2 %245,090 238,672 2.7 %Networks122,168 127,532 (4.2)%230,122 245,090 (6.1)%
Sponsorship and EventsSponsorship and Events38,064 28,585 33.2 %71,665 50,978 40.6 %Sponsorship and Events38,210 38,064 0.4 %70,797 71,665 (1.2)%
OtherOther4,400 2,537 73.4 %7,920 4,419 79.2 %Other6,414 5,157 24.4 %11,648 9,916 17.5 %
Multiplatform GroupMultiplatform Group633,300 605,850 4.5 %1,204,460 1,103,747 9.1 %Multiplatform Group595,944 633,300 (5.9)%1,124,957 1,204,460 (6.6)%
Digital, excluding PodcastDigital, excluding Podcast166,880 144,502 15.5 %312,555 263,703 18.5 %Digital, excluding Podcast164,147 166,880 (1.6)%310,732 312,555 (0.6)%
PodcastPodcast85,681 53,428 60.4 %154,225 91,780 68.0 %Podcast96,707 85,681 12.9 %173,518 154,225 12.5 %
Digital Audio GroupDigital Audio Group252,561 197,930 27.6 %466,780 355,483 31.3 %Digital Audio Group260,854 252,561 3.3 %484,250 466,780 3.7 %
Audio & Media Services GroupAudio & Media Services Group71,065 61,175 16.2 %131,922 116,312 13.4 %Audio & Media Services Group65,804 71,065 (7.4)%127,155 131,922 (3.6)%
EliminationsEliminations(2,921)(3,350)(5,699)(7,272)Eliminations(2,588)(2,921)(5,109)(5,699)
Revenue, totalRevenue, total$954,005 $861,605 10.7 %$1,797,463 $1,568,270 14.6 %Revenue, total$920,014 $954,005 (3.6)%$1,731,253 $1,797,463 (3.7)%

2825


Consolidated results for the three and six months ended June 30, 20222023 compared to the consolidated results for the three and six months ended June 30, 20212022 were as follows:

Revenue
Consolidated revenue increased $92.4decreased $34.0 million during the three months ended June 30, 20222023 compared to the same period of 2021. The increase in Consolidated revenue is attributable to the continued recovery from the macroeconomic effects of COVID-19 and the continuing growth of our operating businesses.2022. Multiplatform Group revenue increased $27.5decreased $37.4 million, or 4.5%5.9%, primarily resulting from strengthening demand fora decrease in broadcast advertising the return of live events and an increasedue to a challenging macroeconomic environment as discussed above, as well as a decline in political advertising revenue as 2022 is a midterm election year.advertising. Digital Audio Group revenue increased $54.6$8.3 million, or 27.6%3.3%, driven primarily by continuing increases in demand for podcast advertising. Audio & Media Services revenue decreased $5.3 million primarily due to a decrease in political revenue, partially offset by continued growth in digital revenues.
Consolidated revenue decreased $66.2 million during the six months ended June 30, 2023 compared to the same period of 2022. Multiplatform Group revenue decreased $79.5 million, or 6.6%, primarily resulting from a decrease in broadcast advertising due to a more challenging macroeconomic environment as discussed above, as well as a decline in political advertising. Digital Audio Group revenue increased $17.5 million, or 3.7%, driven primarily by continuing increases in demand for digital advertising and the continued growth of podcasting.advertising. Audio & Media Services revenue increased $9.9decreased $4.8 million primarily due to the increasea decrease in political advertising revenue, as 2022 is a midterm election year andpartially offset by continued growth in digital revenues.
Direct Operating Expenses
Consolidated direct operating expenses decreased $10.3 million during the continued recovery fromthree months ended June 30, 2023 compared to the same period of 2022. The decrease in direct operating expenses was primarily driven by lower digital performance royalty fees including the impact of COVID-19.expenses recorded in 2022 upon the settlement of amounts related to prior years, as well as lower employee compensation as a result of cost savings initiatives. The decrease was partially offset by higher variable content costs resulting from an increase in digital revenue, including third-party digital costs and production costs.
Consolidated revenuedirect operating expenses increased $229.2$3.8 million during the six months ended June 30, 20222023 compared to the same period of 2021. The increase in Consolidated revenue is attributable to the continued recovery from the macroeconomic effects of COVID-19 and the continuing growth of our operating businesses. Multiplatform Group revenue increased $100.7 million, primarily resulting from strengthening demand for broadcast advertising, the return of live events during the six months ended June 30, 2022 compared to the same period of 2021, and an increase in political advertising revenue as 2022 is a midterm election year. Digital Audio Group revenue increased $111.3 million, driven primarily by continuing increases in demand for digital advertising, including continued growth in podcasting. Audio & Media Services revenue increased $15.6 million primarily due to the continued recovery from the impact of COVID-19 and an increase in political advertising revenue as 2022 is a midterm election year.
Direct Operating Expenses
Consolidated direct operating expenses increased $44.9 million during the three months ended June 30, 2022 compared to the same period of 2021.2022. The increase in direct operating expenses was primarily driven by higher variable content costs resulting from our significantan increase in digital revenue, including profit sharing expenses, third-party digital costs, and production costs related to the return of local and national live events.
Consolidated direct operating expenses increased $82.6 million during the six months ended June 30, 2022 compared to the same period of 2021.costs. The increase in direct operating expenses was primarily drivenpartially offset by higher variable content costs resulting from our significant increase in revenue, including profit sharing expenses, third-party digital costs, and production costs related to the return of local and national live events.lower performance royalty fees.
Selling, General and Administrative (“SG&A”) Expenses
Consolidated SG&A expenses increased $6.4$14.7 million during the three months ended June 30, 20222023 compared to the same period of 2021.2022. The increase in Consolidated SG&A expenses was driven primarily by increased employee compensation costs related to increased workforce due to the investments in key infrastructure to support our growing digital operations, increased sales commission expenses as a result of higher revenue,variable bonus expense and increasedhigher bad debt expense. These increases wereexpense, partially offset by lower variable bonus accruals and a decrease in national trade and barter expenses primarily related to the timing of the iHeartRadio Music Awards show.sales commissions.

Consolidated SG&A expenses increased $48.4$33.2 million during the six months ended June 30, 20222023 compared to the same period of 2021.2022. The increase in Consolidated SG&A expenses was driven primarily by higher employeevariable bonus expense, share-based compensation, costs related to increased workforce due to the investments in key infrastructure to support our growing digital operations, increased sales commission expenses as a result of higher revenue, increased bad debt and higher trade and barter expense.expense, as well as an increase in costs incurred in connection with executing on our cost reduction initiatives. These increases were partially offset by lower variable bonus accruals.sales commissions.

Depreciation and Amortization
Depreciation and amortization decreased $17.2$2.7 million and $10.5$8.3 million during the three and six months ended June 30, 20222023, respectively, compared to the same periods of 2021,2022, primarily as a result of a lower fixed asset base due to properties sold in 2022 in connection with our real estate optimization initiatives, and lower amortization expense due to certain intangible assets being fully amortized, partially offset by increased capital expenditures related to IT and real estate optimization initiatives.amortized.
Impairment Charges
AsWe recorded a non-cash impairment charge of $959.1 million in the second quarter of 2023 to reduce the carrying values of our indefinite-lived FCC licenses and our goodwill to their estimated fair values. This impairment charge resulted from the economic uncertainty due to inflation and higher interest rates that has had an adverse impact on our results, and has resulted in a significant decrease in the trading values of our debt and equity securities for a sustained period. See Note 5, Property, Plant and Equipment, Intangible Assets and Goodwill, to the consolidated financial statements located in Item 1 of this Quarterly Report on Form 10-Q for a further description of the impairment charges.
In addition, as part of our operating expense-savings initiatives, we have taken strategic actions to streamline our real estate footprint and related expenses, resulting inexpenses. During the three and six months ended June 30, 2023, we recognized non-cash impairment charges dueof $1.5 million and $5.5 million, respectively, primarily related to the write-down of right-of-use assets and related fixedchanges in sublease assumptions for
2926


assets, including leasehold improvements.certain operating leases previously determined to be subleased as part of strategic actions to streamline our real estate footprint. During the three and six months ended June 30, 2022, and 2021, we recognized non-cash impairment charges of $0.3 million and $1.6 million, respectively, due to the write-down of certain right-of-use assets and $37.7 million, respectively, as a result of these cost-savings initiatives.related fixed assets, including leasehold improvements.

Other Operating Expense, Netnet

Other operating expense, net of $15.7 million and $12.4$16.5 million for the three months ended June 30, 2022 and 2021, respectively, and Other operating expense, net of $16.5 million and $15.2 million for the six months ended June 30, 2022, and 2021, respectively, relaterelates primarily to non-cash net book losses recognized on asset disposals in connection with our real estate optimization initiatives.

Interest Expense
Interest expense decreased $3.4increased $17.2 million and $9.3$33.5 million respectively, during the three and six months ended June 30, 20222023 compared to the same periods of 2021,2022, primarily as a result of the interest rate reductionincrease in LIBOR borrowing rates, partially offset by the lower outstanding aggregate principal of our incremental term loan facility as amendediHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 due to the repurchases of $349.6 million of the notes for $314.8 million in July 2021cash made during 2022 and the $250.0 million voluntary repayment made in July 2021 on our term loan credit facilities in connection with the repricing transaction.first quarter of 2023.

GainLoss on Investments, Net
During the three and six months ended June 30, 2023, we recognized a loss on investments, net of $6.0 million and $12.5 million, respectively, related to declines in the value of our investments. During the three and six months ended June 30, 2022, we recognized a gain on investments, net of $9.6 million and $7.8 million, respectively, in connection with increases in the value of our investments. During the three and six months ended June 30, 2021, we recognized a gain of $49.6 million and $49.8 million, respectively, primarily related to the sale of our investment in the San Antonio Spurs.

Gain on Extinguishment of Debt

During the three months ended June 30, 2023, we recognized a gain on extinguishment of debt of $22.9 million in connection with the open market repurchases of $79.9 million aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $57.0 million in cash. During the six months ended June 30, 2023, we recognized a gain on extinguishment of debt of $27.5 million, in connection with the open market repurchases of $99.9 million aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $72.4 million in cash.

During the three and six months ended June 30, 2022, we recognized a gain on extinguishment of debt of $8.2 million in connection with the open market repurchases of $113.5 million aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $105.3 million in cash.

Income Tax Benefit (Expense)

The effective tax raterates for the Company for the three and six months ended June 30, 2022 was 10.5%2023 were 9.8% and 35.4%1.8%, respectively. The effective tax rate wasrates were primarily impacted by the forecasted increase in valuation allowance against certain deferred tax assets, related primarily to disallowed interest expense carryforwards and net operating loss carryforwards, due to uncertainty regarding the Company’s ability to utilize those assets in future periods.periods, as well as by impairment charges to non-deductible goodwill as discussed in Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill. The deferred tax benefit primarily consists of $92.9 million related to the FCC license impairment charges recorded during the period.

Net Income (Loss)Loss Attributable to the Company

Net loss attributable to the Company of $884.5 million during the three months ended June 30, 2023 reflected a decrease of $898.9 million compared to Net income attributable to the Company of $14.4 million during the three months ended June 30, 2022, increased $46.7primarily due to the non-cash impairment charges of $960.6 million compared to a our goodwill and indefinite-lived intangible assets balances.
Net loss attributable to the Company of $32.3$1,106.7 million during the threesix months ended June 30, 2021, primarily as a result of the increase in revenue from the continuing recovery from the macroeconomic effects of the COVID-19 pandemic and the continuing growth of our operating businesses.

2023 increased $1,072.5 million compared to Net loss attributable to the Company decreased $239.8 million toof $34.2 million during the six months ended June 30, 2022, compared to Net loss attributableprimarily due to the Companynon-cash impairment charges of $274.0$964.5 million during the six months ended June 30, 2021, primarily as a result of the increase in revenue from the continuing recovery from the macroeconomic effects of the COVID-19 pandemicto our goodwill and the continuing growth of our operating businesses.

indefinite-lived intangible assets balances.

3027


Multiplatform Group Results
(In thousands)(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%
20222021Change20222021Change20232022Change20232022Change
RevenueRevenue$633,300 $605,850 4.5 %$1,204,460 $1,103,747 9.1 %Revenue$595,944 $633,300 (5.9)%$1,124,957 $1,204,460 (6.6)%
Operating expenses(1)
Operating expenses(1)
438,804 424,452 3.4 %876,057 817,558 7.2 %
Operating expenses(1)
433,542 438,804 (1.2)%875,503 876,057 (0.1)%
Segment Adjusted EBITDASegment Adjusted EBITDA$194,496 $181,398 7.2 %$328,403 $286,189 14.8 %Segment Adjusted EBITDA$162,402 $194,496 (16.5)%$249,454 $328,403 (24.0)%
Segment Adjusted EBITDA marginSegment Adjusted EBITDA margin30.7 %29.9 %27.3 %25.9 %Segment Adjusted EBITDA margin27.3 %30.7 %22.2 %27.3 %
(1)Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring expenses.

Three Months

Revenue from our Multiplatform Group increased $27.5decreased $37.4 million compared to the prior year primarily as a result of the continued recovery from the impact of COVID-19.challenging macroeconomic environment and a decline in political advertising. Broadcast revenue grew $12.2declined $33.3 million, or 2.7%7.2%, year-over-year, driven by higherlower spot revenue and a decrease in political advertising revenue as 2022 is a midterm election year, partially offset by lower trade and barter revenue due to the impact of the timing of the iHeartRadio Music Awards show, whileadvertising. Networks grew $3.9declined $5.4 million, or 3.2%4.2%, year-over-year. Revenue from Sponsorship and Events increased by $9.5$0.1 million, or 33.2%0.3%, year-over-year, primarily as a result of the return of live events.year-over-year.

Operating expenses increased $14.4decreased $5.3 million, driven primarily by event costs related to the return of live events including the iHeart Country Festival, highercost savings initiatives and sales commissions, in connection with the increase in revenue, and an increase in bad debt expense due to a credit in Q2 2021 related to the recovery of COVID-19 reserves recorded in 2020. These increases were partially offset by a decrease in trade and barter expense due to the impact of the timing of the iHeartRadio Music Awards show and lower variable bonus accruals based on financial performance.higher bad debt expense.

Six MonthsMonths

Revenue from our Multiplatform Group increased $100.7decreased $79.5 million compared to the prior year primarily as a result of the continued recovery from the impact of COVID-19.challenging macroeconomic environment and a decline in political advertising. Broadcast revenue increased $70.1declined $65.4 million, or 8.7%7.5%, year-over-year, whiledriven by lower spot revenue. Networks grew $6.4declined $15.0 million, or 2.7%6.1%, year-over-year. Revenue from Sponsorship and Events increaseddecreased by $20.7$0.9 million, or 40.6%1.2%, year-over-year, primarily as a result of the return of live events. year-over-year.

Operating expenses increased $58.5decreased $0.6 million, driven primarily decreased sales commissions, offset by higher event costs in connection with the return of live events including the iHeart Country Festival, as well as higher sales commission, talent and profit share costs, all driven by higher revenue, and an increase in bad debt expense due to a credit in 2021 related to the recovery of COVID-19 reserves recorded in 2020. These increases were partially offset by lower rent and utilities in connection with our real estate optimization initiatives as well as lower variable bonus accruals based on financial performance.higher content and production costs.

Digital Audio Group Results
(In thousands)(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%
20222021Change20222021Change20232022Change20232022Change
RevenueRevenue$252,561 $197,930 27.6 %$466,780 $355,483 31.3 %Revenue$260,854 $252,561 3.3 %$484,250 $466,780 3.7 %
Operating expenses(1)
Operating expenses(1)
173,678 143,640 20.9 %335,389 261,182 28.4 %
Operating expenses(1)
176,272 173,678 1.5 %345,549 335,389 3.0 %
Segment Adjusted EBITDASegment Adjusted EBITDA$78,883 $54,290 45.3 %$131,391 $94,301 39.3 %Segment Adjusted EBITDA$84,582 $78,883 7.2 %$138,701 $131,391 5.6 %
Segment Adjusted EBITDA marginSegment Adjusted EBITDA margin31.2 %27.4 %28.1 %26.5 %Segment Adjusted EBITDA margin32.4 %31.2 %28.6 %28.1 %
(1)Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring expenses.



31




Three Months

Revenue from our Digital Audio Group increased $54.6$8.3 million compared to the prior year, including growthdriven by Podcast revenue which increased by $11.0 million, or 12.8%, year-over-year, driven primarily by continued increased demand for podcasting from advertisers, partially offset by Digital, excluding Podcast revenue, which grew $22.4declined $2.7 million, or 15.5%1.6%, year-over-year, driven by increased demand for digital advertising as well as Podcast revenue which increased by $32.3 million, or 60.4%, year-over-year, driven by higher revenues from the development of new podcasts as well as growth from existing podcasts. Digital Audio Group revenue increased as a result of general increased demand for digital advertising and the growing popularity of podcasting.

decrease in COVID-19 related advertisers.
Operating expenses increased $30.0$2.6 million due to higher employee compensationvariable costs, related to increased workforce due to the investments in key infrastructure to support our growing digital operations and higher variable content costs,including third-party digital costs and profit share expenses due tosales commissions primarily resulting from higher revenue, and the development of new podcasts.partially offset by a decrease in performance royalty fees.
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Six MonthsMonths

Revenue from our Digital Audio Group increased $111.3$17.5 million compared to the prior year, including growthdriven by Podcast revenue which increased by $19.3 million, or 12.5%, year-over-year, driven primarily by increased demand for podcasting from advertisers, partially offset by Digital, excluding Podcast revenue, which grew $48.9declined $1.8 million, or 18.5%0.6%, year-over-year, driven primarily by increased demand fora decrease in COVID-19 related advertisers and digital advertising. Podcast revenue also increased by $62.4 million, or 68.0%, year-over-year, driven by higher revenues from the development of new podcasts and growth from existing podcasts. Digital Audio Group revenues increased as a result of general increased demand for digital advertising, the growing popularity of podcasting, the continued addition of premium content to our industry-leading podcast business and our improving ability to monetize our digital audiences and inventory utilizing our sales force and advertising technology platforms, partially driven by investments in the digital space.subscriptions.
Operating expenses increased $74.2$10.2 million in connection with our Digital Audio Group’s significant revenue growth, including the impact of variable employee compensation expense, talent costs and third-party digital costs due to higher revenue, as well as increasedvariable content and production costs primarily resulting from the development of new podcasts. In addition, operating expenses increased due to investmentspodcasts, higher third-party digital costs, and sales commissions primarily resulting from higher revenue, partially offset by a decrease in key infrastructure to support our growing digital operations.performance royalty fees.
Audio & Media Services Group Results
(In thousands)(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%(In thousands)Three Months Ended
June 30,
%Six Months Ended
June 30,
%
20222021Change20222021Change20232022Change20232022Change
RevenueRevenue$71,065 $61,175 16.2 %$131,922 $116,312 13.4 %Revenue$65,804 $71,065 (7.4)%$127,155 $131,922 (3.6)%
Operating expenses(1)
Operating expenses(1)
48,995 40,704 20.4 %93,465 80,492 16.1 %
Operating expenses(1)
47,305 48,995 (3.4)%93,312 93,465 (0.2)%
Segment Adjusted EBITDASegment Adjusted EBITDA$22,070 $20,471 7.8 %$38,457 $35,820 7.4 %Segment Adjusted EBITDA$18,499 $22,070 (16.2)%$33,843 $38,457 (12.0)%
Segment Adjusted EBITDA marginSegment Adjusted EBITDA margin31.1 %33.5 %29.2 %30.8 %Segment Adjusted EBITDA margin28.1 %31.1 %26.6 %29.2 %
(1)Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring expenses.

Three Months

Revenue from our Audio & Media Services Group increased $9.9decreased $5.3 million compared to the comparative period in the prior year due to an increaseperiod driven by a decrease in political advertising revenue, as 2022 is a midterm election year and thepartially offset by continued recovery from the impact of COVID-19.

growth in digital revenues.
Operating expenses increased $8.3decreased $1.7 million primarily as a result of higher employee compensation relatedlower cost of sales due to seasonal (political) staffing, higher merchandising costs and a new purchase agreement with third-parties for specific inventory spots.lower revenues.

Six MonthsMonths

Revenue from our Audio & Media Services Group increased $15.6decreased $4.8 million compared to the comparative period in the prior year due to an increaseperiod driven by a decrease in political advertising revenue, as 2022 is a midterm election year and thepartially offset by continued recovery from the impact of COVID-19.growth in digital revenues.

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Operating expenses increased $13.0decreased $0.2 million primarily as a result of higher employee compensation relatedlower cost of sales due to seasonal (political) staffing, higher merchandising costs andlower revenues, partially offset by a new purchase agreement with third-parties for specific inventory spots.
29



Reconciliation of Operating Income (Loss)income (loss) to Adjusted EBITDA
(In thousands)(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
20222021202220212023202220232022
Operating income (loss)Operating income (loss)$82,869 $28,126 $95,204 $(48,230)Operating income (loss)$(897,194)$82,869 $(946,056)$95,204 
Depreciation and amortizationDepreciation and amortization110,788 127,945 224,839 235,308 Depreciation and amortization108,065 110,788 216,577 224,839 
Impairment chargesImpairment charges245 — 1,579 37,744 Impairment charges960,570 245 964,517 1,579 
Other operating expense, net15,664 12,379 16,534 15,150 
Other operating (income) expense, netOther operating (income) expense, net(261)15,664 (40)16,534 
Restructuring expensesRestructuring expenses10,789 19,009 30,243 30,102 
Share-based compensation expenseShare-based compensation expense8,610 5,903 14,145 11,588 Share-based compensation expense9,212 8,610 19,364 14,145 
Restructuring expenses19,009 10,155 30,102 35,195 
Adjusted EBITDA(1)
Adjusted EBITDA(1)
$237,185 $184,508 $382,403 $286,755 
Adjusted EBITDA(1)
$191,181 $237,185 $284,605 $382,403 


Reconciliation of Net Income (Loss)income (loss) to EBITDA and Adjusted EBITDA
(In thousands)(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
20222021202220212023202220232022
Net income (loss)Net income (loss)$15,182 $(31,960)$(33,557)$(274,016)Net income (loss)$(882,982)$15,182 $(1,105,345)$(33,557)
Income tax (benefit) expense1,782 24,449 (18,427)104,384 
Income tax benefit (expense)Income tax benefit (expense)(96,357)1,782 (20,252)(18,427)
Interest expense, netInterest expense, net81,494 84,887 160,713 170,008 Interest expense, net98,693 81,494 194,150 160,713 
Depreciation and amortizationDepreciation and amortization110,788 127,945 224,839 235,308 Depreciation and amortization108,065 110,788 216,577 224,839 
EBITDAEBITDA$209,246 $205,321 $333,568 $235,684 EBITDA$(772,581)$209,246 $(714,870)$333,568 
Gain on investments, net(9,590)(49,644)(7,825)(49,835)
Gain (loss) on investments, netGain (loss) on investments, net6,038 (9,590)12,543 (7,825)
Gain on extinguishment of debtGain on extinguishment of debt(8,203)— (8,203)— Gain on extinguishment of debt(22,902)(8,203)(27,527)(8,203)
Other expense, netOther expense, net2,175 363 2,445 1,170 Other expense, net272 2,175 371 2,445 
Equity in loss of nonconsolidated affiliatesEquity in loss of nonconsolidated affiliates29 31 58 59 Equity in loss of nonconsolidated affiliates44 29 58 
Impairment chargesImpairment charges245 — 1,579 37,744 Impairment charges960,570 245 964,517 1,579 
Other operating expense, net15,664 12,379 16,534 15,150 
Other operating (income) expense, netOther operating (income) expense, net(261)15,664 (40)16,534 
Restructuring expensesRestructuring expenses10,789 19,009 30,243 30,102 
Share-based compensation expenseShare-based compensation expense8,610 5,903 14,145 11,588 Share-based compensation expense9,212 8,610 19,364 14,145 
Restructuring expenses19,009 10,155 30,102 35,195 
Adjusted EBITDA(1)
Adjusted EBITDA(1)
$237,185 $184,508 $382,403 $286,755 
Adjusted EBITDA(1)
$191,181 $237,185 $284,605 $382,403 
(1)We define Adjusted EBITDA as consolidated Operating income (loss) adjusted to exclude restructuring expenses included within Direct operating expenses and SG&A expenses, and share-based compensation expenses included within SG&A expenses, as well as the following line items presented in our Statements of Operations: Depreciation and amortization, Impairment charges and Other operating (income) expense, net. Alternatively, Adjusted EBITDA is calculated as Net income (loss), adjusted to exclude Income tax (benefit) expense, Interest expense, net, Depreciation and amortization, Loss (gain)(Gain) loss on investments, net, Gain on extinguishment of debt, Other expense, net, Equity in loss of nonconsolidated affiliates, net, Impairment charges, Other operating expense,income (expense), net, Share-based compensation expense, and restructuring expenses. Restructuring expenses primarily include expenses incurred in connection with cost-saving initiatives, as well as certain expenses, which, in the view of management, are outside the ordinary course of business or otherwise not representative of the Company's operations during a normal business cycle. We use Adjusted EBITDA, among other measures, to evaluate the Company’s operating performance. This measure is among the primary measures used by management for the planning and forecasting of future periods, as well as for measuring performance for compensation of executives and other members of management. We believe this measure is an important indicator of our operational strength and performance of our business because it provides a link between operational performance and operating income. It is also a primary measure used by management in evaluating companies as potential acquisition targets. We believe the presentation of this measure is relevant and useful for investors because it allows investors to view performance in a manner similar to the method used by management. We
33


believe it helps improve investors’ ability to understand our operating performance and makes it easier to compare our results with other companies that have different capital structures or tax rates. In addition, we believe this measure is also among the primary
30


measures used externally by our investors, analysts and peers in our industry for purposes of valuation and comparing our operating performance to other companies in our industry. Since Adjusted EBITDA is not a measure calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, operating income (loss) or net income (loss) as an indicator of operating performance and may not be comparable to similarly titled measures employed by other companies. Adjusted EBITDA is not necessarily a measure of our ability to fund our cash needs. Because it excludes certain financial information compared with operating income (loss) and compared with consolidated net income (loss), the most directly comparable GAAP financial measures, users of this financial information should consider the types of events and transactions which are excluded.
Reconciliation of Cash Providedprovided by Operating Activities(used for) operating activities to Free Cash Flow
(In thousands)(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
(In thousands)Three Months Ended
June 30,
Six Months Ended
June 30,
20222021202220212023202220232022
Cash provided by operating activities$155,801 $29,129 $103,589 $100,857 
Cash provided by (used for) operating activitiesCash provided by (used for) operating activities$56,772 $155,801 $(37,211)$103,589 
Purchases of property, plant and equipmentPurchases of property, plant and equipment(49,653)(32,111)(72,210)(51,061)Purchases of property, plant and equipment(22,773)(49,653)(61,938)(72,210)
Free cash flow(1)
Free cash flow(1)
$106,148 $(2,982)$31,379 $49,796 
Free cash flow(1)
$33,999 $106,148 $(99,149)$31,379 
(1)We define Free cash flow ("Free Cash Flow") as Cash provided by (used for) operating activities less capital expenditures, which is disclosed as Purchases of property, plant and equipment in the Company's Consolidated Statements of Cash Flows. We use Free Cash Flow, among other measures, to evaluate the Company’s liquidity and its ability to generate cash flow. We believe that Free Cash Flow is meaningful to investors because we review cash flows generated from operations after taking into consideration capital expenditures due to the fact that these expenditures are considered to be a necessary component of ongoing operations. In addition, we believe that Free Cash Flow helps improve investors' ability to compare our liquidity with other companies. Since Free Cash Flow is not a measure calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, Cash provided by (used for) operating activities and may not be comparable to similarly titled measures employed by other companies. Free Cash Flow is not necessarily a measure of our ability to fund our cash needs.
Share-Based Compensation Expense
On April 21, 2021, our 2021 Long-Term Incentive Award Plan (the "2021 Plan") was approved by stockholders and replaced the prior plan. At our 2023 Annual Meeting of Stockholders, an increase to the shares authorized for issuance under the 2021 Plan was approved. Pursuant to our 2021 Plan, we willmay grant restricted stock units and options to purchase shares of the Company's Class A common stock to certain key individuals.

Share-based compensation expenses are recorded in SG&A expenses and were $8.6$9.2 million and $5.9$8.6 million for the three months ended June 30, 20222023 and 2021,2022, respectively, and $14.1$19.4 million and $11.6$14.1 million for the six months ended June 30, 20222023 and 2021,2022, respectively.

On March 28, 2022, we issued performance-based restricted stock units ("Q1 2022 Performance RSUs") to certain key employees. The Q1 2022 Performance RSUs vest upon the achievement of certain total stockholder return goals and continued service, which are being measured over an approximately 50-month period from the date of issuance.

On May 9, 2022, we issued performance-based restricted stock units ("Q2 2022 Performance RSUs") and restricted stock units ("2022 RSUs") to certain key employees. The Q2 2022 Performance RSUs vest upon the achievement of certain total stockholder return goals, Adjusted EBITDA goals, Diversity, Equity and Inclusion goals, and continued service. The Q2 2022 Performance RSUs are measured over a 3-year period from the date of issuance. The 2022 RSUs vest upon continued service. The 2022 RSUs are being recognized ratably over a 3-year period from the date of issuance.

As of June 30, 2022,2023, there was $62.0$42.3 million of unrecognized compensation cost related to unvested share-based compensation arrangements with vesting based solely on service conditions. This cost is expected to be recognized over a weighted average period of approximately 3.82.8 years. In addition, as of June 30, 2022,2023, there were unrecognized compensation costs of $11.7$24.6 million of Q1 2022 Performance RSUs and $14.7 million of Q2 2022for the Performance RSUs related to unvested share-based compensation arrangements that will vest based on performance and service conditions. These costs will be recognized over a 3-year or 50-month period from the date of issuanceissuance. See Note 8, Stockholders' Equity, for the Q1 2022 Performance RSUs and over a 3-year period from the date of issuance for the Q2 2022 Performance RSUs.

more information


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LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
The following discussion highlights cash flow activities during the periods presented:
(In thousands)(In thousands)Six Months Ended
June 30,
(In thousands)Six Months Ended
June 30,
2022202120232022
Cash provided by (used for):Cash provided by (used for):Cash provided by (used for):
Operating activitiesOperating activities$103,589 $100,857 Operating activities$(37,211)$103,589 
Investing activitiesInvesting activities(49,657)(218,263)Investing activities(59,260)(49,657)
Financing activitiesFinancing activities(110,711)(19,882)Financing activities(74,875)(110,711)
Free Cash Flow(1)
Free Cash Flow(1)
31,379 49,796 
Free Cash Flow(1)
(99,149)31,379 
(1) For a definition of Free cash flow from operationsCash Flow and a reconciliation to Cash provided by (used for)used for operating activities, the most closely comparable GAAP measure, please see “Reconciliation of Cash provided by (used for)used for operating activities to Free cash flow from operations”Cash Flow” in this MD&A.
Operating Activities
Cash used for operating activities was $37.2 million during the six months ended June 30, 2023 compared to cash provided by operating activities of $103.6 million during the six months ended June 30, 2022 increased from $100.92022. The decrease was primarily due to a decrease in broadcast radio revenue due to a more challenging macroeconomic environment, higher interest expense due to an increase in borrowing rates, and timing of payments. These decreases were partially offset by a decrease in bonus payments in 2023 compared to 2022.

Investing Activities

Cash used for investing activities of $59.3 million during the six months ended June 30, 20212023 primarily due to an increasereflects $61.9 million in cash flows from operations as the Company's businesses continueused for capital expenditures. We spent $41.3 million for capital expenditures in our Multiplatform Group segment primarily related to recover from the impact of COVID-19, mostly offset by an increaseour real estate optimization initiatives, $11.3 million in our Digital Audio Group segment primarily related to IT infrastructure, $4.8 million in our Audio & Media Services Group segment, primarily related to software, and $4.6 million in Corporate primarily related to equipment and software purchases. Cash used for investing activities in the paymentsix months ended June 30, 2023 includes $12.7 million of bonuses and commissionscash paid in the firstcurrent period related to assets acquired in the fourth quarter of 2022. The Company did not pay bonuses to the vast majority of employees in the first quarter of 2021.

Investing Activities

Cash used for investing activities of $49.7 million during the six months ended June 30, 2022 primarily reflects $72.2 million in cash used for capital expenditures. We spent $48.7 million for capital expenditures in our Multiplatform Group segment primarily related to our real estate optimization initiatives, $11.1 million in our Digital Audio Group segment primarily related to IT infrastructure, $4.1 million in our Audio & Media Services Group segment, primarily related to software, and $8.3 million in Corporate primarily related to equipment and software purchases. Cash used for investing activities was partially offset by proceeds from the sale of certain properties related to our real estate optimization initiatives.

Financing Activities

Cash used for investingfinancing activities of $218.3totaled $74.9 million during the six months ended June 30, 20212023 primarily reflectsdue to the net cash payment made to acquire Triton Digitalrepurchases of $99.9 million aggregate principal amount of our 8.375% Senior Unsecured Notes due 2027 for $228.5 million. In addition, $51.1$72.4 million in cash, was used for capital expenditures. We spent $31.5 million for capital expenditures in our Multiplatform Group segment and $11.7 million for capital expenditures in our Digital Audio Group segment primarily related to IT infrastructure, $2.2 million in our Audio & Media Services Group segment, primarily related to software and $5.7 million in Corporate primarily related to equipment and software purchases. Cash used for investing activities was partially offset by cash provided by investing activities related to proceeds received of $50.8 millionreflecting a discounted purchase price from the saleface value of our investment in the San Antonio Spurs.

Financing Activitiesnotes.

Cash used for financing activities totaled $110.7 million during the six months ended June 30, 2022 primarily due to the open market repurchases of $113.5 million aggregate principal amount of our 8.375% Senior Unsecured Notes due 2027 for $105.3 million in cash, reflecting a discounted purchase price from the face value of the notes.

Cash used for financing activities of $19.9 million during the six months ended June 30, 2021 primarily resulted from required quarterly principal payments made on the Term Loan Facility and repayment of a subsidiary note payable.

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Sources of Liquidity and Anticipated Cash Requirements
Our primary sources of liquidity are cash on hand, which consisted of cash and cash equivalents of $294.8$165.3 million as of June 30, 2022,2023, cash flowflows from operations and borrowing capacity under our $450.0 million senior secured asset-based revolving credit facility entered into on May 17, 2022 (the "New ABL Facility") which refinanced and replaced in its entirety the existing ABL Facility (the "Existing ABL"ABL Facility"). As of June 30, 2022,2023, iHeartCommunications had no amounts outstanding under the ABL Facility, a facility sizeborrowing base of $450.0$444.5 million and $29.4$24.9 million in outstanding letters of credit, resulting in $420.6$419.6 million of borrowing base availability. Together with our cash balance of $294.8$165.3 million as of June 30, 20222023 and our borrowing capacity under the New ABL Facility, our total available liquidity1 was approximately $715$585 million.

We regularly evaluate economic conditions including the ongoing impact of COVID-19economic conditions on our business. A challenging macroeconomic environment has led to market uncertainty which has impacted 2023 revenues. For the six months ended June 30, 2022,2023, our revenues increaseddecreased compared to the six months ended June 30, 20212022 primarily due to recoverythe decrease in broadcast radio revenue driven by market uncertainty from the challenging macroeconomic effects of COVID-19,environment, among other factors discussed in the Results of Operations section of the MD&A. Although we cannot predict future economic conditions or the impact of any potential contraction of economic growth on our business, we believe that we have sufficient liquidity to continue to fund our operations for at least the next twelve months.

We are a party to many contractual obligations involving commitments to make payments to third parties. These obligations impact our short-term and long-term liquidity and capital resource needs. Certain contractual obligations are reflected on the Consolidated Balance Sheet as of June 30, 2022,2023, while others are considered future commitments. Our contractual obligations primarily consist of long-term debt and related interest payments, commitments under non-cancelable operating lease agreements, and employment and talent contracts. In addition to our contractual obligations, we expect that our primary anticipated uses of liquidity in 20222023 will be to fund our working capital, make interest and tax payments, fund capital expenditures, pursue certain strategic opportunities, and maintain operations.

On June 15, 2023, iHeartCommunications, Inc. ("iHeartCommunications") entered into an amendment to the credit agreement governing its term loan credit facilities (the "Term Loan Facility"). The amendment replaces the prior Eurocurrency interest rate, based upon LIBOR, with the Secured Overnight Financing Rate (“SOFR”) successor rate plus a SOFR adjustment as specified in the credit agreement. The Term Loan Facility margins remain the same with the Term Loan Facility due 2026 containing margins of 3.00% for Term SOFR Loans (as defined in the credit agreement) and 2.00% for Base Rate Loans (as defined in the credit agreement), and the Incremental Term Loan Facility due 2026 containing margins of 3.25% for Term SOFR Loans with a floor of 0.50% and 2.25% for Base Rate Loans with a floor of 1.50%.

Assuming the current level of borrowings and interest rates in effect at June 30, 2022,2023, we anticipate that we will have approximately $168$197.0 million of cash interest payments in the remainder of 2022.2023 compared to $182.4 million of cash interest payments during the same period in 2022, primarily related to the increase in interest rates, including SOFR. Future increases in interest rates could have a significant impact on our cash interest payments.

We believe that our cash balance, our cash flow from operations and availability under our New ABL Facility provide us with sufficient liquidity to fund our core operations, maintain key personnel and meet our other material obligations for at least the next twelve months. We acknowledge the challenges posed by the COVID-19 pandemic and any potential slow downmarket uncertainty as a result of global economic weakness, the recent slowdown in economic activity, rising inflation and interest rates, high inflation and other macroeconomic trends, however, we remain confident in our business, our employees and our strategy. Further, we believe our available liquidity will allow us to fund capital expenditures and other obligations and make interest payments on our long-term debt for at least the next twelve months.debt. If these sources of liquidity need to be augmented, additional cash requirements would likely be financed through the issuance of debt or equity securities; however, there can be no assurances that we will be able to obtain additional debt or equity financing on acceptable terms or at all in the future.

We frequently evaluate strategic opportunities. During the threesix months ended June 30, 2022,2023, we conducted open market repurchases of $113.5repurchased $99.9 million in aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $105.3$72.4 million in cash, reflecting a discounted purchase price from the face value of the notes. We expect from time to time to pursue other strategic opportunities such as acquisitions or disposals of certain businesses, which may or may not be material.

Tax Matters Agreement

In connection with the separation (the "Separation") of Clear Channel Outdoor Holdings, Inc. as part of our plan of reorganization, we entered into the Tax Matters Agreement by and among iHeartMedia, iHeartCommunications, iHeart Operations, Inc., Clear Channel Holdings, Inc., and Clear Channel Outdoor Holding, Inc. (the "Outdoor Group"), to allocate the
1 Total available liquidity is defined as cash and cash equivalents plus available borrowings under the New ABL Facility. We use total available liquidity to evaluate our capacity to access cash to meet obligations and fund operations.
3633


responsibility of iHeartMedia and its subsidiaries, on the one hand, and the Outdoor Group and its subsidiaries, on the other, for the payment of taxes arising prior and subsequent to, and in connection with, the Separation.

The Tax Matters Agreement requires that iHeartMedia and iHeartCommunications indemnify the Outdoor Group and its subsidiaries, their respective directors, officers and employees, and hold them harmless, on an after-tax basis, from and against certain tax claims related to the Separation. In addition, the Tax Matters Agreement requires that the Outdoor Group indemnify iHeartMedia for certain income taxes paid by iHeartMedia on behalf of the Outdoor Group and its subsidiaries.

Summary Debt Capital Structure
As of June 30, 20222023 and December 31, 2021,2022, we had the following debt outstanding, net of cash and cash equivalents:
(In thousands)June 30, 2022December 31, 2021
Term Loan Facility due 2026$1,864,032 $1,864,032 
Incremental Term Loan Facility due 2026401,220 401,220 
Asset-based Revolving Credit Facility due 20231
— — 
Asset-based Revolving Credit Facility due 20271
— — 
6.375% Senior Secured Notes due 2026800,000 800,000 
5.25% Senior Secured Notes due 2027750,000 750,000 
4.75% Senior Secured Notes due 2028500,000 500,000 
Other Secured Subsidiary Debt4,577 5,350 
Total Secured Debt$4,319,829 $4,320,602 
8.375% Senior Unsecured Notes due 20272
1,336,450 1,450,000 
Other Subsidiary Debt69 90 
Original issue discount(12,027)(13,454)
Long-term debt fees(16,902)(18,370)
Total Debt$5,627,419 $5,738,868 
Less: Cash and cash equivalents294,831 352,129 
$5,332,588 $5,386,739 

(In thousands)June 30, 2023December 31, 2022
Term Loan Facility due 2026$1,864,032 $1,864,032 
Incremental Term Loan Facility due 2026401,220 401,220 
Asset-based Revolving Credit Facility due 2027— — 
6.375% Senior Secured Notes due 2026800,000 800,000 
5.25% Senior Secured Notes due 2027750,000 750,000 
4.75% Senior Secured Notes due 2028500,000 500,000 
Other Secured Subsidiary Debt3,618 4,462 
Total Secured Debt$4,318,870 $4,319,714 
8.375% Senior Unsecured Notes due 20271
1,020,457 1,120,366 
Other Subsidiary Debt— 52 
Original issue discount(9,080)(10,569)
Long-term debt fees(13,852)(15,396)
Total Debt$5,316,395 $5,414,167 
Less: Cash and cash equivalents165,325 336,236 
Net Debt2
$5,151,070 $5,077,931 
1On May 17, 2022, we entered into a $450.0 million New ABL Facility, maturing in 2027, which refinanced and replaced in its entirety the Existing ABL Facility. For more information about the New ABL Facility, refer to Note 5, Long-Term Debt.

2 During the three and six months ended June 30, 2022,2023, we repurchased $113.5$79.9 million and $99.9 million, respectively, of aggregate principal amount of iHeartCommunications, Inc.’s 8.375% Senior Unsecured Notes due 2027 for $105.3$57.0 million and $72.4 million in cash, excluding accrued interest, via open market transactions. The repurchased notes were subsequently cancelled and retired, resulting in a gain on extinguishment of debt for the three and six months ended June 30, 2023 of $8.2 million.$22.9 million and $27.5 million, respectively.

2 Net Debt is a non-GAAP financial metric that is used by management and investors to assess our ability to meet financial obligations.

See above under “Sources of Liquidity and Cash Requirements” for details regarding the amendment to our Term Loan Facility entered into on June 15, 2023.

Our New ABL Facility contains a springing fixed charge coverage ratio that is effective if certain triggering events related to borrowing capacity under the New ABL Facility occur. As of June 30, 2022,2023, no triggering event had occurred and, as a result, we were not required to comply with any fixed charge coverage ratio as of or for the periodsperiod ended June 30, 2022.2023. Other than our New ABL Facility, none of our long-term debt includes maintenance covenants that could trigger early repayment. As of June 30, 2022,2023, we were in compliance with all covenants related to our debt agreements in all material respects. For additional information regarding our debt, refer to Note 5, Long-Term Debt.
Our subsidiaries have from time to time repurchased certain debt obligations of iHeartCommunications, and may in the future, as part of various financing and investment strategies, purchase additional outstanding indebtedness of iHeartCommunications or its subsidiaries or our outstanding equity securities, in tender offers, open market purchases, privately negotiated transactions or otherwise. We or our subsidiaries may also sell certain assets, securities, or properties. These purchases or sales, if any, could have a material positive or negative impact on our liquidity available to repay outstanding debt obligations or on our consolidated results of operations. These transactions could also require or result in amendments to the agreements governing outstanding debt obligations or changes in our leverage or other financial ratios, which could have a material positive or negative impact on our ability to comply with the covenants contained in iHeartCommunications’ debt agreements. These transactions, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

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Supplemental Financial Information under Debt Agreements

Pursuant to iHeartCommunications' material debt agreements, iHeartMedia Capital I, LLC ("Capital I"), the parent guarantor and a subsidiary of iHeartMedia, is permitted to satisfy its reporting obligations under such agreements by furnishing iHeartMedia’s consolidated financial information and an explanation of the material differences between iHeartMedia’s consolidated financial information, on the one hand, and the financial information of Capital I and its consolidated restricted subsidiaries, on the other hand. Because neither iHeartMedia nor iHeartMedia Capital II, LLC, a wholly-owned direct subsidiary of iHeartMedia and the parent of Capital I, have any operations or material assets or liabilities, there are no material differences between iHeartMedia’s consolidated financial information for the three and six months ended June 30, 2022,2023, and Capital I’s and its consolidated restricted subsidiaries’ financial information for the same period. Further, as of June 30, 2022,2023, we were in compliance with all covenants related to our debt agreements in all material respects.agreements.
Commitments, Contingencies and Guarantees
We are currently involved in certain legal proceedings arising in the ordinary course of business and, as required, have accrued our estimate of the probable costs for resolution of those claims for which the occurrence of loss is probable and the amount can be reasonably estimated. These estimates have been developed in consultation with counsel and are based upon an analysis of potential results, assuming a combination of litigation and settlement strategies. It is possible, however, that future results of operations for any particular period could be materially affected by changes in our assumptions or the effectiveness of our strategies related to these proceedings. Please refer to “Legal Proceedings” in Part II, Item 1 of this Quarterly Report on Form 10-Q.
Certain agreements relating to acquisitions provide for purchase price adjustments and other future contingent payments based on the financial performance of the acquired companies generally over a one to five-year period. The aggregate of these contingent payments, if performance targets are met, would not significantly impact our financial position or results of operations.
We have future cash obligations under various types of contracts. We lease office space, certain broadcast facilities and equipment. Some of our lease agreements contain renewal options and annual rental escalation clauses (generally tied to the consumer price index), as well as provisions for our payment of utilities and maintenance. We also have non-cancellable contracts in our radio broadcasting operations related to program rights and music license fees. In the normal course of business, our broadcasting operations have minimum future payments associated with employee and talent contracts. These contracts typically contain cancellation provisions that allow us to cancel the contract with good cause.

SEASONALITY
Typically, our businesses experience their lowest financial performance in the first quarter of the calendar year. We expect this trend to continue in the future. Due to this seasonality and certain other factors, the results for the interim periods may not be indicative of results for the full year. In addition, we are impacted by political cycles and generally experience higher revenues in congressional election years, and particularly in presidential election years. This may affect the comparability of results between years.
MARKET RISK
We are exposed to market risks arising from changes in market rates and prices, including movements in interest rates, foreign currency exchange rates and inflation.
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Interest Rate Risk
On June 15, 2023, iHeartCommunications, Inc. ("iHeartCommunications") entered into an amendment to the credit agreement governing its Term Loan credit facilities. The amendment replaces the prior Eurocurrency interest rate, based upon LIBOR, with the Secured Overnight Financing Rate (“SOFR”) successor rate plus a SOFR adjustment as specified in the credit agreement.

A significant amount of our long-term debt bears interest at variable rates. Additionally, certain assumptions used within management's estimates are impacted by changes in interest rates. Accordingly, our earnings will be affected by changes in interest rates. As of June 30, 2022,2023, approximately 40%42% of our aggregate principal amount of long-term debt bore interest at floating rates. Assuming the current level of borrowings and assuming a 50%100 bps change in LIBOR,floating interest rates, it is estimated that our interest expense for the six months ended June 30, 20222023 would have changed by $2.5$11.4 million.
In the event of an adverse change in interest rates, management may take actions to mitigate our exposure. However, due to the uncertainty of the actions that would be taken and their possible effects, the preceding interest rate sensitivity analysis assumes no such actions. Further, the analysis does not consider the effects of the change in the level of overall economic activity that could exist in such an environment.
Inflation
Inflation is a factor in our business and we continue to seek ways to mitigate its effect. Inflation has affected our performance in terms of higher costs for employee compensation, equipment and third party services. We believe the effects of inflation, if any, on our historical results of operations and financial condition have been immaterial. Although we are unable to determine the exact impact of inflation, we believe the impact will continue to be immaterial considering the actions we may take in response to these higher costs that may arise as a result of inflation.
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Critical Accounting Estimates
The preparation of our financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of expenses during the reporting period. On an ongoing basis, we evaluate our estimates that are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The result of these evaluations forms the basis for making judgments about the carrying values of assets and liabilities and the reported amount of expenses that are not readily apparent from other sources. Because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such difference could be material. ThereOther than the following, there have been no significant changes to our critical accounting policies and estimates disclosed in “Critical Accounting Estimates” of Item 7, Management’s Discussion and Analysis of our Annual Report on Form 10-K for the year ended December 31, 2021.2022.

Economic uncertainty due to higher interest rates since 2022 has resulted in, among other things, lower advertising spending by businesses. This challenging environment has led to broader market uncertainty, and has delayed our expected recovery and has had an adverse impact on our revenue and cash flows. This challenging environment could have a significant impact on our financial results. In addition, the economic uncertainty has had a significant impact on the trading values of our debt and equity securities for a sustained period. As a result, we performed an impairment test as of June 30, 2023 on our long-lived assets, intangible assets, indefinite-lived FCC licenses and goodwill.

Indefinite-lived Intangible Assets

Indefinite-lived intangible assets, such as our FCC licenses, are reviewed for impairment using the direct valuation method as prescribed in ASC 805-20-S99. Under the direct valuation method, the estimated fair value of the indefinite-lived intangible assets was calculated at the market level as prescribed by ASC 350-30-35. Under the direct valuation method, it is assumed that rather than acquiring indefinite-lived intangible assets as a part of a going concern business, the buyer hypothetically obtains indefinite-lived intangible assets and builds a new operation with similar attributes from scratch. Thus, the buyer incurs start-up costs during the build-up phase which are normally associated with going concern value. Initial capital costs are deducted from the discounted cash flows model, which results in value that is directly attributable to the indefinite-lived intangible assets.

Our key assumptions using the direct valuation method are market revenue growth rates, profit margin, and the risk-adjusted discount rate as well as other assumptions including market share, duration and profile of the build-up period, estimated start-up costs and capital expenditures. This data is populated using industry normalized information representing an average asset within a market.

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On June 30, 2023, we performed an interim impairment test in accordance with ASC 350-30-35 and we concluded that a $363.6 millionimpairment of the indefinite-lived intangible assets was required. In determining the fair value of our FCC licenses, the following key assumptions were used:

Revenue forecasts published by BIA Financial Network, Inc. (“BIA”), varying by market, and revenue growth projections made by industry analysts were used for the initial five-year period;
2.0% over-the-air revenue growth and 3.0% digital revenue growth was assumed beyond the initial five-year period and 2.0% revenue growth was assumed in the terminal period;
Revenue was grown proportionally over a build-up period, reaching market revenue forecast by year 3;
Operating margins of 8.0% in the first year gradually climb to the industry average margin in year 3 of up to 18.2%, depending on market size; and
Assumed discount rates of 10.0% for all markets.

While we believe we have made reasonable estimates and utilized appropriate assumptions to calculate the fair value of our indefinite-lived intangible assets, it is possible a material change could occur. If future results are not consistent with our assumptions and estimates, we may be exposed to impairment charges in the future. The following table shows the decrease in the fair value of our indefinite-lived intangible assets that would result from a 100 basis point decline in our discrete and terminal period revenue growth rate and profit margin assumptions and a 100 basis point increase in our discount rate assumption:

Impact on the Fair Value of our FCC Licenses due to 100 bps Change in:
Revenue Growth RateProfit MarginDiscount Rate
(in thousands)
$201,609 $155,590 $222,563 

At June 30, 2023, both the carrying value of our FCC licenses after the impairment of $363.6 million and the fair value of the FCC licenses was$1.1 billion. Consequently, an increase in discount rates, a decrease in revenue growth rates or profit margins, or a decrease in BIA revenue forecasts could result in additional impairment to our FCC licenses.

Goodwill

We test goodwill at interim dates if events or changes in circumstances indicate that goodwill might be impaired. The fair value of our reporting units is used to apply value to the net assets of each reporting unit. To the extent that the carrying amount of net assets would exceed the fair value, an impairment charge may be required to be recorded. The impairment testing performed as of June 30, 2023 has resulted in a decrease in the fair values of our reporting units. The carrying values of our Multiplatform, Digital, and RCS reporting units exceeded their fair values. The fair value of our Katz reporting unit exceeded its carrying value.

The valuation methodology we use for valuing goodwill involves considering the implied fair values of our reporting units based on market factors including the trading prices of our debt and equity securities, and estimating future cash flows expected to be generated from the related assets, discounted to their present values using a risk-adjusted discount rate. Terminal values are also estimated and discounted to their present values.

On June 30, 2023, we performed our interim impairment test in accordance with ASC 350-30-35, resulting in a $595.5 millionimpairment of goodwill. In determining the fair value of our reporting units, we considered industry and market factors including trading multiples of similar businesses and the trading prices of our debt and equity securities. For purposes of assessing the discounted future cash flows of our reporting units, we used the following assumptions:

Expected cash flows underlying our business plans for the periods 2023 through 2027. Our cash flow assumptions are based on detailed, multi-year forecasts performed by each of our operating reporting units, and reflect the current advertising outlook across our businesses.
Revenues beyond 2027 are projected to grow at a perpetual growth rate, which we estimated at 2.0% for our Multiplatform and RCS Reporting units, 3.0% for our Digital Audio Reporting unit (beyond 2031), and 2.0% for our Katz Media reporting unit (beyond 2032).
In order to risk adjust the cash flow projections in determining fair value, we utilized discounts rates between 15% and 18% for each of our reporting units.

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While we believe we have made reasonable estimates and utilized appropriate assumptions to calculate the estimated fair value of our reporting units, it is possible a material change could occur. If future results are not consistent with our assumptions and estimates, we may be exposed to additional impairment charges in the future. The following table shows the decline in the fair value of each of our reporting units that would result from a 100 basis point decline in our discrete and terminal period revenue growth rate and profit margin assumptions and a 100 basis point increase in our discount rate assumption:

(In thousands)Impact on the Fair Value of our Goodwill due to 100bps Change in:
Reporting UnitRevenue Growth RateProfit MarginDiscount Rate
Multiplatform$241,000 $137,000 $220,000 
Digital62,000 66,000 63,000 
Katz Media19,000 11,000 18,000 
RCS10,000 5,000 8,000 

An increase in discount rates or a decrease in revenue growth rates or profit margins could result in additional impairment charges being required to be recorded for one or more of our reporting units.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by us or on our behalf. This report contains various forward-looking statements which represent our expectations or beliefs concerning future events, including, without limitation, our future operating and financial performance, the anticipated impacts of and recovery from the COVID-19 pandemic on our business, financial position and results of operations, economicmacroeconomic trends including inflation, interest rates and potential recessionary indicators, our expected costs, savings and timing of our modernization initiatives and other capital and operating expense reduction initiatives, debt repurchases, our business plans, strategies and initiatives, benefits of acquisitions, our expectations about certain markets and businesses, expected cash interest payments, future impairment charges and our anticipated financial performance and liquidity. Statements expressing expectations and projections with respect to future matters are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We caution that these forward-looking statements involve a number of risks and uncertainties and are subject to many variables which could impact our future performance. These statements are made on the basis of management’s views and assumptions, as of the time the statements are made, regarding future events and performance. There can be no assurance, however, that management’s expectations will necessarily come to pass. Actual future events and performance may differ materially from the expectations reflected in our forward-looking statements. We do not intend, nor do we undertake any duty, to update any forward-looking statements.
A wide range of factors could materially affect future developments and performance, including but not limited to:
risks associated with weak or uncertain global economic conditions and their impact on the level of expenditures for advertising;
the impact ofrisks related to the COVID-19 pandemic on our business, financial position and results of operations;or other future pandemics;
intense competition including increased competition from alternative media platforms and technologies;
dependence upon the performance of on-air talent, program hosts and management as well as maintaining or enhancing our master brand;
fluctuations in operating costs;costs and other factors within or beyond our control;
technological changes and innovations;
shifts in population and other demographics;
the impact of our substantial indebtedness;
the impact of acquisitions, dispositions and other strategic transactions;
legislative or regulatory requirements;
the impact of legislation, or ongoing litigation or royalty audits on music licensing and royalties;
regulations and consumer concerns regarding privacy and data protection, and breaches of information security measures;
risks related to our Class A common stock, including our significant number of outstanding warrants;stock;
regulations impacting our business and the ownership of our securities; and
certain other factors set forth in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021,2022, as updated by other filings with the Securities and Exchange Commission (“SEC”).

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This list of factors that may affect future performance and the accuracy of forward-looking statements is illustrative and is not intended to be exhaustive. Accordingly, all forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Required information is presented under “Market Risk” within Item 2 of this Part I.

ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Limitations on Effectiveness of Controls and Procedures
In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). as of June 30, 2023. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2022.2023. 
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the quarter ended June 30, 20222023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II -- OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS
We currently are involved in certaina variety of legal proceedings arising in the ordinary course of business and asa large portion of our litigation arises in the following contexts: commercial/contract disputes; defamation matters; employment and benefits related claims; intellectual property claims; real estate matters; governmental investigations; and tax disputes. As required, we have accrued an estimate of the probable costs for the resolution of those claims for which the occurrence of loss is probable and the amount can be reasonably estimated. These estimates have been developed in consultation with counsel and are based upon an analysis of potential results, assuming a combination of litigation and settlement strategies. It is possible, however, that future results of operations for any particular period could be materially affected by changes in our assumptions or the effectiveness of our strategies related to these proceedings. Additionally, due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on our financial condition or results of operations.
We are involved in a variety of legal proceedings in the ordinary course of business and a large portion of our litigation arises in the following contexts: commercial/contract disputes; defamation matters; employment and benefits related claims; intellectual property claims; real estate matters; governmental investigations; and tax disputes.

ITEM 1A.  RISK FACTORS
There have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2021.2022.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES, AND USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES
The following table sets forth our purchases of shares of our Class A common stock made during the quarter ended June 30, 2022:2023:
PeriodPeriod
Total Number of Shares Purchased(1)
Average Price Paid per Share(1)
Total Number of Shares Purchased as Part of Publicly Announced Plans or ProgramsMaximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or ProgramsPeriod
Total Number of Shares Purchased(1)
Average Price Paid per Share(1)
Total Number of Shares Purchased as Part of Publicly Announced Plans or ProgramsMaximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
April 1 through April 30April 1 through April 30— $— — $— April 1 through April 3012,631 $3.98 — $— 
May 1 through May 31May 1 through May 31123,226 12.60 — — May 1 through May 31295,815 2.89 — — 
June 1 through June 30June 1 through June 30533 11.47 — — June 1 through June 307,661 3.10 — — 
TotalTotal123,759 $12.59 — $— Total316,107 $2.94 — $— 
(1)The shares indicated consist of shares of our Class A common stock tendered by employees to us during the three months ended June 30, 20222023 to satisfy the employees’ tax withholding obligation in connection with the vesting and release of restricted stock, which are repurchased by us based on their fair market value on the date the relevant transaction occurs.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES
    Not applicable.

ITEM 4.  MINE SAFETY DISCLOSURES
Not applicable.


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ITEM 5.  OTHER INFORMATION
On May 9, 2022,During the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”)three months ended June 30, 2023, no director or officer of the Company approved the grantadopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) covering shares of the Company’s Class A common stock to certain of the Company’s named executive officers, including Robert W. Pittman (Chairman and Chief Executive Officer), Richard J. Bressler (President, Chief Operating Officer and Chief Financial Officer), Michael B. McGuinness (Executive Vice President, Finance and Deputy Chief Financial Officer), Jordan R. Fasbender (Executive Vice President, General Counsel and Secretary) and Scott D. Hamilton (Senior Vice President, Chief Accounting Officer and Assistant Secretary) (collectively, the “Executives”). The RSU and PSU awards were granted under the 2021 Plan and are subject to RSU and PSU agreements, respectively.Regulation S-K.

RSU Awards

The RSU awards vest as to one-third of the total RSUs granted to each Executive on each of the first three anniversaries of the grant date (each, an “RSU Vesting Date”), subject to Executive’s continued service through the applicable date.

Termination of Employment. If an Executive is terminated without “cause” or resigns from the Company for “good reason” (each, a “Qualified Termination”), in either case, prior to the Company incurring a change in control, then:

with respect to Messrs. Pittman and Bressler, the Executive’s RSUs will vest in full as of the termination and be settled on the original vesting date; and

with respect to the other Executives, a portion of the RSUs that would have vested on the next scheduled RSU Vesting Date, prorated to reflect the number of days the Executive was in service with the Company during such vesting period, will vest as of the termination date and be settled on the original vesting date.

In the event of an Executive’s Qualifying Termination following a change in control, or upon a termination due to death or “disability,” the RSUs will vest in full and be settled in connection with such Qualified Termination. In addition, with respect to Messrs. Pittman and Bressler only, if either Executive experiences a “retirement termination” (which may not occur prior to June 1, 2026), the RSUs will vest in full if they were granted more than one year prior to the retirement date.

PSU Awards

The PSU awards will become earned based on the Company’s achievement of performance goals relating to (1) relative total shareholder return (“Relative TSR PSUs”), (2) Adjusted EBITDA performance (“EBITDA PSUs”) and (3) diversity, equity and inclusion metrics (“DE&I PSUs”) (together, the “Performance Goals”) over a performance period ending on the earlier of December 31, 2024 and a change in control of the Company (the “Performance Period”), and vest subject to the Executive’s continued employment through the third anniversary of the grant date. Each PSU award is weighted such that the total award opportunity is comprised of 50% Relative TSR PSUs, 25% EBITDA PSUs and 25% DE&I PSUs. The maximum number of PSUs that may vest is 150% of the target number of PSUs.

Termination of Employment. If an Executive experiences a Qualified Termination, in either case, prior to the Company incurring a change in control, then:

with respect to Messrs. Pittman and Bressler, the Executive’s PSU award will remain outstanding and eligible to vest in full, subject to the achievement of the Performance Goals, and will be settled on the original vesting date; and

with respect to the other Executives, the Executive’s PSU award will remain outstanding and eligible to vest with respect to a prorated number of PSUs (i.e., prorated to reflect the number of days the Executive was in service during the applicable Performance Period), and will be settled on the original vesting date.

Upon a termination due to death or “disability,” the PSUs will vest at “target.” With respect to Messrs. Pittman and Bressler only, if either Executive experiences a “retirement termination,” then the PSUs will vest at “target” if they were granted more than one year prior to the retirement date.

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Change in Control. If the Company incurs a change in control, then the PSUs will be earned based on the greater of “target” and actual performance through the consummation of such change in control, and such earned PSUs will vest on the earlier of December 31, 2024, a Qualifying Termination, or the Executive’s death, disability or (with respect to Messrs. Pittman and Bressler) retirement.

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ITEM 6. EXHIBITS
Exhibit
Number
Description
2.1

3.1

3.2

10.1*

10.2*10.2

10.3*

10.4*

10.5*

10.5*10.6*

10.610.7*

10.710.8*
10.8
31.1*

31.2*

32.1**

32.2**

101.INS*Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*Inline XBRL Taxonomy Extension Schema Document
101.CAL*Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*Inline XBRL Taxonomy Extension Definition Document
104*Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
____________
*    Filed herewith.
**    Furnished herewith.
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
IHEARTMEDIA, INC.
Date:August 4, 20228, 2023/s/ SCOTT D. HAMILTON
Scott D. Hamilton
Senior Vice President, Chief Accounting Officer and Assistant Secretary
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