Despite experiencing an 11% year-over-year quarterly decline in revenue, Cumulus Media has come up with a win over its financial forecast, following the Friday release of its Q2 2023 results. The company recorded a net loss of $1.1 million, in comparison to net income of $8.7 million in Q2 2022.
Cumulus posted a total net revenue of $210.1 million, marking that 11% loss. However, President and CEO Mary Berner, revealed that the company’s earnings per share for Q2 2023 exceeded analysts’ high estimate of -$0.03 after extreme performance from the digital division. This boosted Cumulus stock on Friday, post-release.
Digital marketing services grew 21% YoY to $37.5 million, generating 18% of Cumulus’ total income. Broadcast radio revenue saw a decline, with spot revenue falling 15.7% and network revenue down 18.5%. During the earnings call, Cumulus CFO Frank López-Balboa lamented the soft overall advertising market, especially for Westwood One, calling it, “A timing issue, rather than a permanent reallocation of dollars.”
Cumulus’ path forward for the rest of the year appears to be based on cost reductions and debt management. The company is also streamlining its workforce and emphasizing a live and local presence across its markets. Cumulus also recently agreed to sell WDRQ-FM in Detroit to Family Life Radio for $10 million.
López-Balboa and Berner also shared other positive aspects such as a reduction in net debt by 42% since 2019 and retirement of some 10% of outstanding Cumulus shares through a tender offer. The total debt of the company at the end of Q2 2023 was reported to be $680.9 million, the lowest in over a decade, but the due date of 2026 still remains a challenge on the horizon.
