The downturn of DEI in the current political atmosphere has done no favors for radio’s largest Black-focused broadcaster. With revenue down 16% in the third quarter, Urban One is cutting its full-year guidance, but its leadership remains optimistic about a brighter 2026.
After taxes, the company reported a net loss of $2.8 million in Q3, which is a large improvement from a $31.4 million loss during the same quarter last year. Total consolidated net revenue for the third quarter was $92.7 million, down 16% year over year. Of that, Radio revenue dropped 12.6% to $34.7 million. Excluding political, revenue was down 8.1%.
CEO Alfred Liggins said revenue came in “a bit softer than usual,” prompting a downward revision to the company’s full-year EBITDA guidance from $60 million to $56 to $58 million.
CFO Peter Thompson said local ad sales outperformed the broader market, declining 6.5% compared to a 10.1% market drop, while national ad sales fell 29.1% against a 21.5% market decline. Services and financial advertising grew 22.9% and 17.9% respectively, while government, health, retail, entertainment, auto, telecom, and food categories all declined.
The company’s hardest hit segment was its Reach Media network, which posted a sharp 40% year-over-year decline, generating $6.1 million in revenue. Thompson attributed the downturn to “a lower overall network audio market, lower national sales, renewals, and probably a drying up of DEI that drove the decline at Reach.”
“Reach Media’s had a very tough year because we got caught flat-footed with a big, big decline in our largest advertiser,” Liggins added, without elaborating. “We weren’t able to replace those ad dollars once we had committed that inventory, but we were able to get ahead of that, so we’ll be more prepared going forward.”
Digital operations were also weaker, down 30.6% year over year to $12.7 million. Thompson said digital direct and indirect sales fell by about $4.4 million, pointing to a “decline in DEI money, back-to-school, political, and overall softer client demand.” Audio streaming revenue was off by $1.3 million.
On the expense side, total operating costs were $83.7 million, down 4.2% year over year. Urban One completed its second round of staff reductions during the quarter, totaling $3 million in annualized cost savings, following $5 million in cuts earlier in 2025.
Payroll, corporate, and professional fees declined, as did cable programming amortization. The company also recorded $3.1 million in retroactive music royalty expenses from a recent industry settlement with ASCAP and BMI. Debt reduction remains a focus, in addition. Thompson said Urban One repurchased $4.5 million of its 2028 notes at an average price of 52% of face value, bringing total debt down to $487.8 million as of September 30. Net debt stood at $408.5 million with $79.3 million in cash.
Looking further ahead, Liggins said the company is monitoring potential FCC deregulation of radio ownership limits. “That’s going to create some opportunities for people to align assets in markets in a much more efficient manner,” he said, adding that Urban One is not pursuing any major M&A transactions currently but is exploring future opportunities.
While 2025 has proved challenging, Liggins expects a stronger 2026 for several reasons: the return of political advertising with midterm elections, strategic adjustments within its audio operations, and new radio formats designed to reach more diverse audiences, including a new Hispanic-targeted format in Washington, DC.
