Radio’s “digital-first” archetype hit its Q3 targets despite revenue headwinds, leaning on digital growth and cost controls to preserve margins. Townquare Media’s digital operations now drive 55% of both revenue and profits, as the company still seeks the 60% mark.
For the quarter ended September 30, total net revenue slipped 7.4% year-over-year to $106.8 million, or 4.5% sans political advertising. Broadcast ad revenue tumbled 13.8%, while digital advertising dipped just 1.5% and subscription-based Townsquare Interactive crept down 2.3%.
The company swung to a $5.5 million net loss from $11.3 million in profit a year earlier.
“Despite numerous headwinds that we have encountered, we are proud that the execution of our Digital First Local Media strategy has allowed us to deliver excellent results for our clients, while also producing strong cash flow from operations due to the thoughtful and deliberate management of our expense base,” commented CEO Bill Wilson.
Wilson singled out direct digital advertising as a performance driver, noting “the strong performance of our Direct Digital Advertising revenue streams, including the direct sales of our owned and operated digital properties and our programmatic offering, which increased 7% year-over-year in the third quarter,” helped cushion the blow from “short-term headwinds…due to the deterioration in online audience trends.”
“The strong profit performance of Townsquare Interactive delivered Segment Profit growth of 21% year-over-year in the third quarter and 19% year-over-year in the September year-to-date period,” Wilson noted.
Since refinancing in February, Townsquare has chipped away $17 million in debt, including $6 million in discounted term loan repurchases during Q3.
“Since the refinancing, we have applied our cash flow towards organic investment in our digital growth engine and debt repayment, while also maintaining our high-yielding dividend,” Wilson said. “Looking forward, we remain confident in our ability to build shareholder value for our investors through long-term net revenue, Adjusted EBITDA and cash flow growth, net leverage reduction, and future dividend payments.”
For Q4, management expects net revenue between $105 million and $109 million. Full-year 2025 guidance calls for net revenue of $426 million to $430 million.
