IHRT - Earnings call transcript Q4 2024

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Operator

Good afternoon, and welcome to the iHeartMedia Q4 2024 Earnings Call. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to Mike McGuinness, Head of Investor Relations. Thank you. Please go ahead.

Michael McGuinness

Good afternoon, everyone, and thank you for taking the time to join us on our fourth quarter 2024 earnings call.

discussion Bressler, Pittman, CFO. our today's CEO; Chairman for Rich and President, me are our Bob and Joining COO and the prepared questions. our conclusion will At your take remarks, management of

have is In our financial statements our that this our can addition company's could stated on based management's you regarding expectations, differ are call certain performance from results identified X-K with presentation and what to along note including press a we our website statements today's follow to use These remarks. Please results. recent available factors as and an current of release, SEC result call may on actual operating earnings and our that filing. forward-looking on include in filings, the

refer between I'll website. And measures. non-GAAP in are are Bob. will to the presentation financial release, measures which Relations Additionally, certain GAAP our call in non-GAAP our section during Reconciliations now our earnings over and available to turn Investor included the earnings call, financial and filings, this SEC we of

Bob Pittman

and everyone. afternoon, Mike, good Thanks,

I the discussed call. fourth comprehensive results, and transaction share will redundancies provides capital with of we and want to and flattening and it completed easier our to it do third our as from one, quarter key well. It for improved accomplished that to We of another exchange the take down XXXX, accelerate our shareholder flexibility business highlights creating to be business flat; you extended growth I interest easier provided debt X us significant us done our get things: This the company. kept took last value. And that part In financial X important on This continued step X year. Before exchange the help quarter overall earnings focused reduction. structure the our on three, through of two, needs creating cash the breaking successfully our silos. with in to it will by essentially expense modernization it company that journey, majority value debt years; is eliminating organization, maturities current annual we an consolidated remain

fourth course we actions generate million cost As savings which course of be $XX with million approximately $XXX EBITDA million. And quarter I'll results generated of some will over $XXX over adjusted versus fourth that, reductions. year. the up our the quarter, add-backs net million, annual the XXXX in turn of of prior There quarter, we expense of took to $XXX discussed base, will financial results. last ordinary to we our approximately In XX.X%

quarter. were consolidated Our compared the revenues the for prior to year X.X% quarter up

of Excluding down our X.X%. the political, revenues impact were consolidated

Group billion revenue. Turning year, quarter company's adjusted approximately EBITDA versus individual Audio of represents to $XXX fourth up quarter operating Audio Digital generated which our generated million, prior $XXX up Digital The X.X% segments, of the of XX% the Group full year, X.X% revenues XX%. of the Audio best on million, fourth versus revenue $X.X generating record, also were the prior adjusted and Audio EBITDA. note Group's approximately margins Group's of performance adjusted was that this year EBITDA million over and $XXX Digital Digital I'll

to Digital compared and revenues Group, X.X% year, our the grew prior our non-podcast X.X% prior revenues Within to grew Audio digital compared podcast year.

States. financial podcasting profitable what podcasting in the fuel business Our continues most discipline is believe we to United the

To leadership that Jay downloads with sales and iHeart teens. In largest Xx of network EBITDA to similar largest in discuss to validation the Monday, including as according Government podcast with a publisher are in in announced the partnership official the our this will U.S. panel Middle podcasting and podcast network continued ranked the well. expected and EBITDA talent, partner Office to our discussions. And the well iHeart led for globally of total company help Communications expand Rich later, approximately global podcasting market in again the sales XXXX podcast to East #X multiyear as Shetty, And we high industry the Podtrac, accretive once Web U.S. remain January, margins. end, our according our a as where the We groundbreaking the Summit the as week, U.S. further a the on to in our of podcasting the potential with is see QX Qatar as podcasting revenues leadership iHeart the our and #X ability was of Podcast North audience State this Additionally, served grow Gladwell margins and well. to Africa. as industry position, of Malcolm Qatar, the growth thriving to monthly Podtrac, the as of create next publisher podcast position marquee

streaming addition #X the industry-leading closest In our business, has to radio also Xx podcast our digital have competitor. the which listening of we service,

of we key strong each features app, our generation the and social combines had largest We've by and X, the million quarter, and footprint radio listeners. which response launched the the of a enhancements. with XXX the in States operate national car technological month. And the positive than fourth know next of a of factor iHeartRadio innovative love that our listeners from we more X,XXX websites users in with United local audio service have any unique We

to So out I encourage done redesigned for check so and if everyone you've already, iHeartRadio see not yourselves. the app

revenues Multiplatform our In $XXX X%. million, was now were and EBITDA radio, prior versus the which down includes $XXX prior quarter, fourth Turning adjusted The the events were advertising, X.X% Multiplatform year. revenues up And year. impact networks the Group's excluding flat to versus political businesses. million, broadcast Group, of

we which our broadcast and business. listeners in environment at XX take and radio audiences to In remained did to me broadcast a we is As growth medium audiences Multiplatform compared for TV is reach have and broadcast not our let audience radio radio, our growth engine audiences print advertising radio it's have company, has cable front, the broadcast not moment a look as but dwindled Facebook. And today On audience. on radio Google look continue is to when the ago. radio at variable broadcast undisputed than focus the you what's declining happening tell and advertising Broadcast any strong, for we why only important for on in the more and a Group, that years leader an it monthly most disappeared, believe broadcast to have robust. opportunities even healthy

improve more Additionally, to other media can we jumps when their is response rates for the consumers potential response evidence to more meaningfully XX% added advertisers, reaching powerful a campaign, social addition by that for in rate This, innovations radio audio than inject the the rolling also digital well. inventory tech ad with programmatic, as broadcast out combined the including data-infused of media growth to radio in makes us into we're platforms, ever revenue. our confident buying broadcast

Services million, adjusted the up and XX.X% Group, million, Audio was Media million revenues year-over-year to $XX and were up $XX prior EBITDA from the year. XXX% $XX Turning in

of political, Services impact down and were the revenues Audio X.X%. Media Group's the Excluding

into the As to value radio finding businesses to we platforms. as on new remain assets, the year and our integrate ahead, we before, high-growth look to ongoing including unlock broadcast ways inventory focused programmatic like work said while, supporting our broadcast power I radio of our podcasting, our

our broadcast buyers our aligning alongside inventory and the will Google's early programmatic participate in announce to programmatic to purchase digital on Yahoo! behavior, cost the is advantage and to of of will results. grow, radio of allow and assets assets and technologies broadcast which our continue iHeart's growing AI be we TAMs. critical excited our CTV. This radio programmatic take new assets And efficiency digital efficiencies I'm evidence evolving DSP on progress, broadcast to we with success, relentlessly and step March available for DVXXX operational long-term to and this as is like both to a to that and short- our remain in via in critical other As buying deliver like and innovate digital year, our commitment focused

Rich, incredible local the of Rich. and last the briefly moments Angeles devastating turn the teams do, everything take to want mention to is Serving moment becomes at it heart I'd a crisis. over the what our to do I turn I we that the work acknowledge of this ground that Before of I'll hurricanes we during communities our over to the of like to Los wildfires. value and now time on dramatic apparent. And fall It's like it

Rich Bressler

you, and afternoon, Bob, Thank everyone. good

we XXXX had before QX primarily originally revenues consolidated year-over-year, than both provided the political digits single guidance we Our were below high expected, up the of revenue advertising to election. after and lower X.X% due up

advertising election. be end, presidential before saw just on as reexpressed call, the we we which, revenue slowdown the QX a not. we in election, was it Additionally, In said had hoped would non-political our after the

to incurred X.X% as by for increased variable primarily expenses cost digital increase the higher increase revenues in in with in costs connection Our content implemented quarter. consolidated operating costs as was quarter. direct the initiatives fourth related savings the driven This well

SG&A consolidated expenses was fourth of advertising incurred approximately offset GAAP was $XXX in the year, partially implemented guidance marketing non-cash expense savings The operating iHeartRadio compensation just the I impacts by Music primarily versus generated driven to X.X% in due quarter. We million by million We quarter. mentioned. million, income quarter. quarter due of $XX.X to XX.X% timing decreased quarter Our prior in Festival, of up million adjusted initiatives $XXX which generated the decrease for expense cost the income the the and lower fourth costs EBITDA connection the $XXX.X of year of to fourth compared with prior below

the reminder, of line EBITDA digits. presentation the And of X.X% now Digital Audio segment year-over-year, XX%. The our earnings single and segments. slides Turning up fourth QX margins are a Audio were performance in million, Digital high Group's as million, were the $XXX revenues our guidance Group's $XXX with adjusted up in our the quarter, to our X.X% and performances. operating was on there up year-over-year In

of Within full are our year-over-year. up the Group Audio XX% million, Digital podcasting X% year, grew which revenues podcasting year-over-year. $XXX for were revenues our And the

year-over-year digital quarter to revenues X% first non-podcasting Our million. $XXX grew

margin QX revenues that and non-podcasting reflected us revenues know, saw podcasting those this revenue mix. have higher the our follow of than typically our in As we flow-through you a digital

as Multiplatform expansion. The Audio turn comprise podcasting the the below flat guidance high margin the compared to mid-single of Group's growth, expect Digital first around to to the help years digital quarter revenues continue year-over-year and which our We our and digits. our performance in prior our million, us mentioned, of $XXX were Group will majority flow-through Bob up revenues revenue to teens, with in

X.X% Excluding XX.X% prior Multiplatform compared year the margins million impact to quarter. Group's Multiplatform up of EBITDA Adjusted EBITDA revenues were in adjusted quarter. Group revenues, $XXX $XXX million, the year from the in X%. prior was political our XX.X% were down

million, up Audio up Services from in XX.X% Turning to and $XX EBITDA $XX Media $XX million the XXX% million, year. and revenues were was prior year-over-year adjusted the Group,

the billion of in were Excluding company, Group and impact quarter Services the had of the the Audio end, debt of the political, approximately lowest $X.XX history Media we revenues position down debt net outstanding. net X.X%. At

Our $XXX total includes million which a liquidity $XXX quarter at end, million. cash balance of was

and net X.Xx, XXXX. X.Xx year remain achieving end by to approximately Our the was adjusted to goal track our we ratio debt expect on quarter of of to and ending EBITDA X.Xx the attain at end

in debt. the we financial quarter, company's To essentially his company. of mentioned flat. exchange aggregate debt basis, result outstanding of total providing highlights, on exchange representing the comprehensive iHeart on levels $XX holders Bob while ranging transaction, of of acceleration negative transactions debt to annual with flow fees flexibility, and This with As transaction initiatives. In with group to transaction impact the cash cash million. any runway the of have our capitalization some new approximately our remains importantly, certain the completed none a strategic key XXXX expense our achieve growth debt our have XXXX to strengthens And XX% and exchange payments a interest the the an maturities equity reiterate company's of fourth remarks, notes as and the the transaction, notably, related interest due ample free had to was from loans reduced term of the the

Our million when the expenses. flow have been $XXX debt transaction-related would adjusting free cash for

further fourth cash to our that, impacting free with addition the modernization were program. In flow costs quarter associated

the in payments As a free a flow. our restructuring quarter of QX portion reference, those point cash we negatively $XX.X with QX impacting expenses of recorded million of hitting and fourth

confidence rates optimism, uncertainty, look with ahead the February largest XXXX, which now to August into inflation the their I'm many on impact since businesses, seen, our to is in our sure tariffs, of best of we incorporate An interest that conference guidance. that this measure As element an are focusing uncertainty single potential saw higher uncertainty. decline began of companies as QX you've how consumer year impact although indication the consumer the and monthly done may XXXX. of board introducing confidence, reported We've

that also revenue adjusted wildfires for market, we Our largest as but the the in million impacted to by only which quarter first just our well, is our QX $XXX of that EBITDA first by revenue always generate Angeles compared the mind, the compounded our quarter L.A., affecting prior Not in range to fact expect account be based results there to the of beyond major Los revenue is million national will $XXX quarter in quarter. $XXX is sales L.A. year smallest is million in consolidated year. With all team

prior revenues year. consolidated We XXXX QX, low to expect to digits single down the be our compared

the rolled our is down our the of the approximately then up uncertainty X%. As revenues pacing a January year X.X% were that and and began later, with in February reflection optimism

the QX. to for segments individual Turning

We low to expect revenues high to in be digits with teens. revenues Group's double Digital the Audio expected the up grow podcasting

We of XXXX be expect down Group's due even to prior period. At impact in the approximately the full this and with advertising Media down political want ahead, the year to expect our mid-single the and Audio we economy, the and reiterate about XX% we guidance. to in point, Services Multiplatform year remain optimistic be revenue Group's spend digits, to we the revenues year the uncertainty

XXXX. to our flat revenues expect approximately full We compared XXXX year be to

generate adjusted and free expect flow free following year our expect assumptions are $XXX million, We we full of approximately of to cash to The $XXX cash included in million. flow approximately generate guidance. EBITDA

cash be of our expect adjusted to taxes our We approximately XX% EBITDA.

full capital our $XX expect be million. year We expenditures to approximately

goal and approximately adjusted expenses year-end debt to expect by At cash X.Xx, ratio our track on expect of achieve to we the be $XX approximately to EBITDA remain X.Xx restructuring be XXXX. of We our our we to million. end XXXX, net

the you. Now I take to will turn Thank operator your questions. to it over

Operator

[Operator Instructions] Jessica America.. Our from Ehrlich of first Reif Bank question comes from

Jessica Reif Cohen

of couple a Have questions, that's okay. if

AI. will about maybe broadcast know both I and How look that mover So you about context, Bob, you're know, first, the about of the resilience monetizing consistently mentioned What be? And I have then forward? that listening. I ramp like? programmatic going much in programmatic a Rich, and talked does follow-up. needle a talk how Bob you both Can you thinking of And

Bob Pittman

doing. market. an the which part listening And Sure. Look, essential I think is the how growing sort got they of a terms programmatic part of radio amount the need. is got, the relationships you're take I we ad broadcast of metrics we're answer incredible consumers. terms of performance strong this think the what It's question, implying delivering to of has marketers, do enormous when of the in way, the measured, our we've in performance with we've by And

buying, conversations, fit the people Programmatic broadcast is are is which this So there need way that inventory radio of have and be clearly, also make options. buying by digital-centric. the an side for they the It issue and live in It's automated it beginning systems it out can are other actually us is new but with to automated platform the we to it. sit through very execute part digital might buying. side

certainly a also there media, the radio these bias hope people making media. that different decisions we systems algorithms to considered Our is versus as human allocating old dollars putting about know together beings against are

performance makes very with looks in well. audience, a I think choices broadcast of a the beneficial facts -- going audience. as brush really when incredible we to to here that the I seen with think that's algorithm this we've And at radio and allocations, gotten be smart about are so print substantial or their TV have degradation incredible

I for progress. data progress it that's are accessed making progress automated be us, and so programmatic any inventory platform. of the anywhere, So great all needed into our putting making we're, We're making the key on think, can with platform any can seller from all great on time accessed be a

platforms. I beginning DSPs, probably as rolling which out in this talked it is year, to We're think the this we're year, last get year rolling our is, out. we

I result a but revenue following lot probably learn begin see I this year, year. is we [ impact as we ] next year will should some think So this a the year. and to the And probably think

Rich Bressler

only quickly for about and platforms. us. the is talked why ramp before Jess, is And the about Bob's ramp add Bob point what the and everything. said the I'd thing get the DVXXX Hey, into significant you just to platforms step first significant X of kind get very the that's learn is But the Yahoo! you to and

Jessica Reif Cohen

Right.

] Spotify puts could podcasting. Okay. in that the on X But mean, it position market. a your opportunity? but video strong what give talking obviously, you forward? address you just and quick was then outlined, I be a looks And overall some a you takes, about then in ones. moving have guys outlook. biggest finally, lot market the [ the bit obviously on just QX as and maybe there's of been us Can impact have how really more has will And color podcasting and L.A. you is

Bob Pittman

love can't Sure. using lot the users I video watch. actually, They're podcasting. don't Why video doing them cooking. activities, eyes. talk it video, are actually YouTube they but it's to research, for use at everything be about where they other the video. overwhelming listen, look there's look, they so be because would their driving. are want experience would They're most They're prefer it great XX% podcasting to people you majority Clearly, look but because can running. the They about When a a don't podcasting. hit They're audio. to want Others of at podcast is looks podcasting video willing to like -- of first

listened TV know, you with a if personal. hosts, and also is lot these of not production. I many very is I style think conversational, very Jess, them, it to of It it's

a unlike is and it casual ] story radio easy going I is them this with, and is that out prefer. Podcasting about TV, As a more -- production-driven, regularly. [ to just sounds chosen hang hands is loving podcasting very out what of with hang It's often the I've lot is is home, matter and fact, at like which host-driven. people companionship. person who that And very

will. for adding there although it, we can are money video opportunities So if make to us, we more

we what wants it, to how publisher, with of Some and want on. do figure It's right, the a consumer. we it. have biggest terribly we've and podcasts you given again, really stable got It's focus And there. to always just deliver out you're video, our expensive. we're do the lot And not can by it. open if the #X are And we'll the to with, start far to play that podcast we there's consumer

Rich Bressler

just [ just continue Jess advertising for just And environment, fact, to ], at teen QX. on looking double-digit get to before Bob in in And we podcasting. revenue question the lower the double-digit just the a in a growth. gave guidance of growth bigger year, where we we turns growth terms we're coming off had numbers again, your revenue is high

the have we yes, looking at monitoring and we about, the Bob today. and the with podcasting business runway but So at usage, just still look talked facts we're have as consumer

Bob Pittman

video. a it's also, between in and there's big podcasting look, between CPMs. broadcast big terms And There's not video of and a -- delta delta radio

up a So bump if to video don't get we add in it. value really you

market a was is for us. L.A. It clearly, big disrupted front, the L.A. fires. by the On

which there. normal. sales our sales a I important our is based only beginning of disrupted, market back very company, the part it's not get to was but group, direct think is client national to And

of So put had struggle. the People went disruption -- houses, lost there. through sort we employees

our company any have we life. of and -- Fortunately, loss didn't

car. that a I of company cynical and hate is property. this traffic time L.A. think, a again, was more jams there's a probably that more but blip. Probably commute in impact getting from in office. little here, going market, think benefits the just in it's bigger the So to sound I again, market with are friend. the we Traffic people terms back of to longer L.A. people And our the is We're that bit and long

probably And that we the on a actually ironically so, think beneficial has effect company.

Rich Bressler

come the You're touched ] think I right. looking and in also terms and as in seeing we're I [ have piece think itself year companies to we out think overall that confidence we the go inflation uncertainty assets, in takes all the just the all terms puts year. think the we'll uncertainty, there the But and today, remarks. all of at I we And said the the consumer upon also the it's reiterated -- our optimistic, as tariffs, to at of same economy the going laid back we opening terms continue we is advertising rest just rates. But trends the other our out And time, Bob very between Again, and of forward, you and yesterday today, the same for we market, strength just of I kind remain in one interest in companies look the the about of earlier our confidence the ad-supported out, out of business release, this. and whether this and of sort start important, forward. what will through work

Bob Pittman

Yes.

understandable. But are think big between and And always adjust to this I what it one. going we is digesting there's with think is, unexpected uncertainty the the people a about and certainly last administration people and totally we're to move begins look, change, if happens the forward and to change. beat be continue lot, think year. way, back up and take I a optimistic and don't this that steady There's think, dealing and I we that, a change the

Operator

from comes from Research.. Patrick Our next Barrington question Sholl

Patrick Sholl

wondering year trends sort of difference to of bit a how like that a up the little the of the and talk buying result if comp. more make that could automated improving total as the about contributes was in you to I advertising, political much

Bob Pittman

good a Yes, really question.

a gradual movement. pieces. in and comes think I comes It's it in it

with of building have enhancements data which and First our suite audiences is it SmartAudio, is with that did out go a step we cohorts. we

use in some I or think pretty it's advertisers data that form of the today significant, number our another.

put second advertising, that addition in which Sort hands but there's is of keyboards on bidding the replacing And to, also the ways to traditional the we'll third buy let's and that on get automated phase phone into of is as well. it, not real-time of built instead programmatic advertising. And systems. stuff the is probably calls the of some

We have some already marketplaces up.

iHeart the adding that, radio for have up, have array We which network is, options in us broadcast broad advertisers audience great a of for pretty allows to it's to which are a digital. And opportunity. the us, we options

I think impact probably mean, has or I that, go radio back for that's advertisers. that one we've is again, remarkable. underappreciated to upside of underutilized asset I broadcast audience has, inventory. it's got asset else it biggest Again, no terms and the got pretty in

Rich Bressler

the contribution But clear on this to from be any we've learning, assuming year significant will excited of. we're not point, advantage that enable we're to assuming that. the gotten we're take just one and to systems And anything obviously, about not Bob's TAMs as into us point, incredibly

Patrick Sholl

Okay. like positive of year that And maybe was from the I of being January to slower-than-expected turnaround start? close the were realize you about and advertising that on then drivers up, the a least of talked short-lived, what some at kind -- to but

Bob Pittman

advertising in talked that saw in and it It We interesting. wasn't. election. pause reexpressed before the about hoped would We thought had December. It's be we

There rush by. that you January. turning longer of that, in sales reexpressed cycle a it optimism of little sort that saw argument an was there's on think and I

feel which It's to comfortable people first if and I keeping and wait the bit little of think tariffs, in advertise. Most as It's back the and a January, are think back it's issues, that what that people quarter. gone a inflation least all in saying, minute, confident lowest what set other a quarter stepping completely reality advertising is ever in not step a pressure a of X take don't. year. look, bit, and quarter February mind the little there's one there's It's I advertisers of probably quarters.

the unexpected. not and return to So totally a seeing some of we're digestion hopefully, change. absorption what But stability is and all and comfort

Operator

Our last question from Goldman Stephen Sachs. from comes Laszczyk

Stephen Laszczyk

the podcasting could this I the and podcasting largest I new bit perhaps podcasting to year, drivers between expected the your main as maybe drivers talk you platform, a then could. for first adding Rich. you if engagement, Two, in in growth the second, of little wondering see of revenue? And Bob What improving Maybe that if drivers on business content monetization. more do was growth about or expected just on might have political, you below think the that presidential in if been the political the the bit expected little case? up cycle. a why spending, about come came we curious in XXXX that as And had talk the just bit could was what you I if what do little on means, cycle? you few for anything, next rounds and we of midterms next a

Bob Pittman

podcasting, of in that growing. is we're them. fortunate which everything Sure. The I in phase all of podcasting are mean, drivers

a audience. the product and on People There's to pricing. the are podcasting got must expanding our demand. the expanding have beginning value We're We're are to say, We and I've platform. of buy. the expanding expanding sort

Rich political, talk least those I hopefully in through continuing data-driven to And more want So specifics. and that think and think lot year all this than drivers see political this let think, of that that political, as the probably well. On looking I'll lesson campaigns But for I year it's at is ever probably it's and beyond I -- that, at are of us, I the think been. now. a the again, here

know, learned. a that not ready -- programmatic now, to presidential midterm then and forward are is take from it that we're the to we actually this the midterms begin the learned on have in what's say political year games absorb And we that don't to you when like so, what into is it we the automated be and up for we you And [ we with our have right the well. though as sector surprise a while ] to the lessons even for working to

Rich Bressler

the be change Democratic by that about And at some QX, the materialize. might relatively coming time, growth number is, EBITDA add covered in in there and thing at might you which the election, X% QX, that more port on with the I that get at but it we thought, revenue. and did in to the QX if we everything the in we thought MPG the time, did way, one have And again, on we But of while candidates the overall in the that Yes. didn't knew side. happened money the same we didn't post flat talk just quite performance that look we

there's was other taking if follow-ups, listen, is Mike thank focus So with terrific. Well, time appreciate absolute spend you, starting everybody to we, the operator, myself it's just the and the questions, again. team any iHeart Bob, And and story. again, no to the available, for to the performance on -- time

Operator

This concludes for call. participation. your Thank conference you today's

now disconnect. may You

iHeartMedia (IHRT) 27 Feb 252024 Q4 Earnings call transcript