Townsquare Media — Second Quarter 2026 Earnings Summary

Financial Performance

• Net revenue for the quarter ended June 30, 2026, was $115.4 million, a decrease of 0.1% year-over-year (0.8% decrease excluding political revenue).
• Net loss for the quarter was $41.8 million, compared to net income of $2.0 million in the prior year period; the decrease was primarily driven by $25.1 million in non-cash impairment charges related to FCC licenses.
• Adjusted EBITDA was $24.8 million for the quarter, a decrease of 6.2% year-over-year (8.8% decrease excluding political revenue).
• Adjusted Net Income was $3.7 million for the quarter, an increase of $0.1 million year-over-year.
• Net loss per diluted share was $(2.36); Adjusted Net Income per diluted share was $0.21.
• For the six months ended June 30, 2026, net revenue decreased 0.9% year-over-year to $212.1 million (1.3% decrease excluding political revenue).
• Net loss for the first six months was $38.8 million, compared to net income of $0.5 million in the prior year period.
• Adjusted EBITDA for the first six months was $41.2 million, a decrease of 7.6% year-over-year (9.4% decrease excluding political revenue).
• Adjusted Net Income for the first six months was $1.0 million, a decrease of $1.8 million year-over-year.
• Total digital net revenue increased 5.0% in the quarter and 3.5% year-to-date.
• Digital Advertising net revenue increased 11.0% in the quarter and 9.1% year-to-date.
• Subscription Digital Marketing Solutions net revenue decreased 8.5% in the quarter and 8.2% year-to-date.
• Broadcast Advertising net revenue decreased 5.5% in the quarter and 6.0% year-to-date.
• Total Digital Segment Profit increased 1.2% in the quarter and decreased 1.5% year-to-date.
• Digital businesses represented 57% of net revenue and 59% of segment profit in the first six months of 2026.
• As of June 30, 2026, the company had $1.2 million in cash and cash equivalents and $462.2 million in outstanding indebtedness.
• Net leverage was 5.44x based on Adjusted EBITDA for the twelve months ended June 30, 2026.
• Deferred revenue was $8.4 million as of June 30, 2026.

Guidance and Future Outlook

• Third quarter 2026 net revenue guidance is $108 million to $110 million; Adjusted EBITDA guidance is $22.5 million to $23.5 million.
• Full year 2026 net revenue guidance is $425 million to $431 million; Adjusted EBITDA guidance is $87 million to $90 million, both within original ranges.
• Digital Advertising growth is expected to strengthen in the third quarter following 11% growth in Q2 and 7% in Q1.
• Media Partnership revenue is expected to more than double in 2026.
• Management anticipates long-term opportunities to drive shareholder value through sustained net revenue, Adjusted EBITDA, and cash flow growth, net leverage reduction, and future dividend payments.

Business Segments and Product Lines

• Digital Advertising (Townsquare Ignite): Revenue grew 11% year-over-year in Q2, accelerating from 7% in Q1 and 2% in 2025.
• Media Partnerships: The business now serves 16 partners, extending the digital advertising platform into 41 incremental markets. Combined with 74 owned markets, the company has a digital programmatic presence in 115 markets.
• Subscription Digital Marketing Solutions (Townsquare Interactive): Delivered record segment profit margins of nearly 38% in Q2; revenue stabilized sequentially but decreased year-over-year.
• Broadcast Advertising: Generated meaningful cash flow and outperformed the industry despite revenue declines.
• Other: Includes the live events business, which saw revenue decreases in both the quarter and year-to-date periods.

Market and Competitive Landscape

• The company focuses principally on markets outside the top 50 in the U.S.
• Digital Advertising growth is attributed to increased client purchases of advertising.
• Broadcast Advertising declines were due to decreased client purchases of advertising.
• Subscription Digital Marketing Solutions declines were attributed to reduced sales velocity resulting from lower sales headcount.
• Media Partnerships are scaling rapidly, having not existed just over two years ago.

Risks and Challenges

• Significant non-cash impairment charges related to FCC licenses impacted net income ($25.1 million in Q2, $33.7 million year-to-date).
• Income tax provision increased due to valuation allowances for interest expense carryforwards resulting from higher non-cash impairment charges and non-deductible compensation.
• Broadcast and Subscription Digital Marketing Solutions revenues declined due to client purchasing behavior and sales headcount reductions.
• Forward-looking statements note risks including general economic conditions, inflation, labor shortages, industry competition, AI and future competitive technologies, radio popularity, advertising schedule cancellations, technology development, talent retention, capital expenditure requirements, acquisition integration, regulatory requirements, and leverage/interest rate risks.

Management Commentary and Tone

• CEO Bill Wilson stated results were in line with net revenue and Adjusted EBITDA guidance, reflecting continued execution of the "Digital First Local Media Strategy."
• Management highlighted accelerating digital growth, rapid scaling of Media Partnerships, record profitability in Townsquare Interactive, and strong cash flow from Broadcast.
• The tone was confident regarding the combination of scalable digital platforms and durable broadcast cash flow creating long-term shareholder value opportunities.

Other Key Points

• The Board of Directors approved a quarterly cash dividend of $0.20 per share, payable November 2, 2026, to shareholders of record as of October 26, 2026.
• The dividend reflects a yield of approximately 13% based on the last closing price.
• Conference call held on August 6, 2026, with webcast available on the investor relations page.
• Segment profit for Digital Advertising was essentially flat in Q2 but decreased 2.1% year-to-date.
• Segment profit for Subscription Digital Marketing Solutions increased 3.4% in Q2 but decreased 0.5% year-to-date.
• Segment profit for Broadcast Advertising decreased 8.2% in Q2 and 9.3% year-to-date.
• Total Segment Profit decreased 5.4% in Q2 and 6.2% year-to-date.