Political advertising lifted Townsquare Media’s third quarter, but it could not hide the pressures local clients are feeling. With costs and interest rates up, the company is leaning on programmatic growth and new partner markets while bracing for a tough Q4.
Townsquare reported third-quarter net revenue of $110.9 million, up 3.9% year-over-year and 1.4% excluding political, above its guidance range of $108 million to $110 million. Net loss narrowed by $1.5 million to $4.0 million.
Digital Advertising net revenue grew 12.7% to $45.3 million, accelerating for the third consecutive quarter, with programmatic revenue up 22.5%. The segment enjoyed 6.8% growth in May and 11% in August. The Media Partnerships business now serves 18 partners and extends Townsquare’s digital programmatic platform to 122 markets across the United States, up from 16 partners and 115 markets in the second quarter.
Townsquare expects Media Partnerships revenue to more than double by the end of 2026.
Townsquare Interactive net revenue decreased 8.5% to $17.1 million, with Segment Profit margins of 36%. The company does not expect the business to return to sequential revenue growth in the fourth quarter as it had projected, citing lower-than-anticipated sales velocity. Total digital net revenue increased 6.0% to $62.4 million, while total digital Segment Profit decreased 1.1%. Digital accounted for 57% of September year-to-date net revenue and 56% of Segment Profit, compared with 57% and 59% through the first half.
Townsquare Media CEO Bill Wilson noted, “We want to be candid about the challenges we face. Our local clients continue to feel pressure from higher operating costs and interest rates, and they are scrutinizing every marketing dollar, particularly those spent on traditional media.”
Broadcast advertising net revenue rose 0.4% to $47.2 million and fell 5.2% to $44.4 million excluding political, which totaled $2.9 million company-wide in the quarter. Broadcast segment profit increased 9.0%. Wilson remarked, “We expect those declines to deepen in the fourth quarter, partly as political advertising crowds out other inventory. In addition, while Townsquare Interactive’s profit remains strong, lower-than-anticipated sales velocity means it will not return to sequential revenue growth in Q4 2026 as we had projected.”
The company’s board approved suspending the quarterly cash dividend, which the company says will preserve approximately $14 million annually. Wilson said, “We do not believe that the market is ascribing value to the dividend, and we believe this cash can generate greater value for shareholders elsewhere. Suspending the dividend will preserve approximately $14 million of cash annually, which we will use for general corporate liquidity and to opportunistically pursue higher-return opportunities.”
