Cumulus Media is the latest major radio broadcaster to run afoul of Nasdaq listing qualifications and be at risk of being delisted from the stock market. The company revealed it received a letter from Nasdaq on December 16 regarding non-compliance.
The notification states that the company’s Class A common stock has closed below $1.00 per share for 30 consecutive business days, failing to meet the required bid price threshold. Cumulus now has until June 16, 2025, to regain compliance by ensuring the stock’s closing bid price reaches at least $1.00 per share for a minimum of 10 consecutive business days.
Cumulus’ stock price has been below the $1.00 threshold since its Q3 earnings release on November 1.
If Cumulus fails to regain compliance by the June deadline, it may qualify for an additional 180-day compliance period, provided it meets the market value requirement for publicly held shares and other initial listing standards, excluding the bid price rule. The company would also need to submit a written plan to Nasdaq outlining its intention to address the deficiency during the extended period.
Should the company fail to meet the requirements within the extended timeframe, its Class A common stock could face delisting.
Per an SEC filing, Cumulus said it, “Intends to actively monitor the closing bid price for its Class A common stock and will evaluate potential options to resolve the deficiency and regain compliance with the Rule. There can be no assurance that the Company will be able to regain compliance with the Rule or will otherwise be in compliance with other applicable NASDAQ listing rules or that any appeal of a delisting determination will be successful.”
The notification has no immediate impact on the listing or trading of Cumulus Media’s Class A common stock on the Nasdaq Global Market.
The Q3 financials showed revenue declining 1.8% to $203.6 million from $207.4 million in 2023, resulting in a $10.3 million net loss compared to a $2.7 million profit in the prior year. While digital marketing services saw a 40% revenue increase, broadcast radio revenue fell 5% to $139 million due to a 9% drop in spot revenue tied to political ad displacement. Total political revenue was $4.4 million for the quarter.
CEO Mary Berner highlighted the company’s focus on controllable areas, including investments in its digital division, which grew 7.5% to $40 million. CFO Frank López-Balboa noted that Q4 revenue is pacing slightly down, with national ad weakness but some growth in local spots and digital. Advertisers remain cautious, waiting to assess the economic climate post-election.
As stated, Cumulus is not alone when it comes to maintaining its share price. Beasley Media Group received a delisting warning from Nasdaq in October 2023 after its Class A common stock traded below the $1.00 minimum bid price requirement. The broadcaster underwent a 1-for-20 reverse stock split in September of this year to regain compliance.
In June 2023, Salem Media Group was notified by Nasdaq that it failed to meet the $1.00 minimum bid price requirement for continued listing. That December, Salem announced plans to voluntarily delist, citing anticipated financial savings and a reduction in compliance costs.
As a former Cumulus employee I am disheartened that Mary Berner is still in the top seat. She has done absolutely nothing (other than taking a massive salary) and terminating talent. She must have the CMLS board wrapped around her finger. She needs to go back to overseeing the Readers Digest. The CMLS board needs someone who can resurrect this company.
To be fair, these Cumulus stock certificates work as great gift wrapping paper!
Merry Christmas!
Mary sure has done a great job. Bet the board is effusive with her performance.
This is the same company that blew out the CEO and founder of the company for results that were far superior to what they are delivering today. Once again radio is living up to the old axiom “it’s where the C students went”