Latest news with #TSQ
Globe and Mail
07-08-2025
- Business
- Globe and Mail
Townsquare (TSQ) Q2 Revenue Slips 2%
Key Points GAAP revenue edged past analyst estimates at $115.4 million in Q2 2025, though Net revenue (GAAP) declined 2.3% year-over-year. Digital net revenue became a clear majority, while digital growth slowed to 2.1% in Q2 2025, down from stronger recent quarters. Adjusted (Non-GAAP) EPS missed expectations, coming in at $0.22 versus the $0.26 analyst estimate. These 10 stocks could mint the next wave of millionaires › Townsquare Media (NYSE:TSQ), a local media and digital marketing company focused on mid-sized markets, released its second quarter 2025 earnings on August 6, 2025. The company's most notable news: GAAP revenue modestly exceeded Wall Street expectations, reaching $115.4 million compared to the $114.8 million consensus in Q2 2025. Adjusted earnings per diluted share (EPS, Non-GAAP) missed expectations at $0.22, below the $0.26 analyst estimate for Q2 2025. Net income (GAAP) swung strongly positive, moving from a loss in the prior-year period to a $2.0 million gain in Q2 2025—as Digital business accounted for approximately 52% of company revenue and 50% of segment profit in the first half of 2025. The overall quarter showed ongoing digital transformation, resilient profitability, and progress on leverage reduction, but also signs of slower digital growth, as Townsquare's total digital net revenue growth decelerated from +6.4% year-over-year in Q1 2025 to +4.1% for the first six months of 2025 and continued declines in legacy broadcast revenue, with broadcast advertising net revenue decreasing 9.2% year-over-year in Q2 2025 and for the first half of 2025. Metric Q2 2025 Q2 2025 Estimate Q2 2024 Y/Y Change EPS – Diluted (Non-GAAP) $0.22 $0.26 $0.14 57.1 % Revenue (GAAP) $115.4 million $114.8 million $118.2 million (2.3 %) Adjusted EBITDA (Non-GAAP) $26.4 million $26.2 million 0.8 % Net Income (GAAP) $2.0 million $(48.9 million) n/m Digital Net Revenue $61.3 million $60.0 million 2.2 % Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report. Company Profile and Key Strategic Areas Townsquare Media operates as a local media, digital marketing, and radio company, but its strategy has increasingly focused on digital products. It serves markets outside the top 50 largest U.S. cities, providing localized digital content, digital advertising, subscription marketing solutions, and broadcasting. The company positions itself as a 'digital first' business, prioritizing growth in digital advertising (the Ignite platform) and subscription marketing solutions (Townsquare Interactive). Recently, the company has worked to shift its revenue mix, moving digital services ahead of traditional broadcast radio. Success now relies on growing digital revenue, maintaining high engagement with local audiences, and leveraging its advantage in markets with fewer large competitors. The company's competitive position outside major media markets and its focus on local content remain central differentiators. Adhering to Federal Communications Commission (FCC) rules and diversifying revenue across business lines are also vital to operations and stability. Quarter in Review: Notable Developments and Segment Trends Digital net revenue grew 2.1% in Q2 2025, now representing 55% of company-wide net revenue in the first half of 2025. While this marked a slowdown versus recent quarters, the digital share both in revenue and profit underscores the strategic shift that is underway. Digital advertising revenue from the Ignite platform rose 2.4% year-over-year in Q2 2025, down from the 8% pace seen in Q1 2025. Subscription digital marketing solutions, delivered through Townsquare Interactive, registered revenue growth of 1.4% in Q2 2025, alongside a pronounced 15.2% jump in segment profit in Q2 2025. Digital segment profit increased 4.3% year-over-year in Q2 2025, with digital-related activities accounted for 56% of segment profit in the first half of 2025. Digital segment margins stood at 27% in the first half of 2025. However, within digital advertising, profit edged down 1.0% in Q2 2025. These results followed a brief dip in customer demand in April 2025, which management linked to heightened economic uncertainty, which rebounded by the latter half of the quarter. Townsquare Interactive's profitability increased sharply in Q1 2025, attributed to efficiencies and operational changes implemented over the past year. The company's legacy broadcast advertising continued to face headwinds. Broadcast ad revenue fell 9.2% in Q2 2025, with segment profit down 8.4% for broadcast advertising in Q2 2025. Management continues to see radio as a cash-generating—if shrinking—business. The focus outside the top 50 markets appears to help dampen some revenue declines as the company takes share in less contested spaces. Other revenue, such as from live events, surged 19.9% in Q2 2025 (GAAP), representing the fastest growth, but remaining a small share of total sales at roughly $5.5 million in Q2 2025. Progress on capital structure continued in the quarter. Townsquare Media repaid $10 million of debt in Q2 2025 and finished Q2 2025 with $467.1 million in outstanding debt and $3.2 million in cash on hand. Net leverage fell slightly to 4.58 times trailing adjusted EBITDA for the twelve months ended June 30, 2025. It maintained a quarterly dividend of $0.20 per share, consistent with prior quarters. Operating cash flow in the first half of 2025 totaled $10.1 million, slightly lower than a year ago. Capital expenditures for the six months ended June 30, 2025, were $8.3 million. Products and Revenue Breakdown Explained The Ignite platform is Townsquare's digital advertising business, offering programmatic—automated and data-driven—buying across online channels such as search, display ads, social media, and video for local businesses. About 60% of segment digital ad revenue came from programmatic in Q1 2025. The Subscription Digital Marketing Solutions segment, Townsquare Interactive, provides software services to small and medium-sized businesses—such as website design, management tools, and online marketing through monthly subscription fees. Each of these areas is targeted toward improving local client engagement and advertising reach in mid-sized markets. Digital revenue streams have surpassed both the company's traditional broadcast radio advertising and smaller 'other' categories, including local events. In Q1 2025, digital advertising comprised 37.3% of net revenue. Subscription digital marketing made up approximately 16% of net revenue in Q2 2025. Broadcast advertising represented 46.3% of total net revenue for the year ended December 31, 2024, and other lines contributed about 5 %. Looking Ahead: Guidance and Key Watch Areas For Q3 2025, management guided to net revenue of $106.5 million to $108.5 million and Adjusted EBITDA is expected to be between $22.0 million and $23.0 million for Q3 2025. For FY2025, Townsquare Media affirmed its outlook, targeting net revenue of $435 million to $440 million and adjusted EBITDA in the $90 million to $94 million range. Both sets of numbers match or slightly narrow the company's prior guidance for Q2 2025 and the full year, indicating management's measured confidence in current trends and spending patterns. Investors will want to monitor the speed of digital growth, which slowed in Q2 2025 after several periods of faster expansion. The shift could be due to maturation, strong prior-year results, or broader uncertainty in economic conditions affecting advertisers. Additionally, the company's cash balance and ongoing leverage will bear watching, especially as dividend payments continue and if advertising demand fluctuates. Townsquare Media continues to pay a quarterly dividend of $0.20 per share. Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted. Where to invest $1,000 right now When our analyst team has a stock tip, it can pay to listen. 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Yahoo
18-07-2025
- Business
- Yahoo
Townsquare (TSQ) Surges 6.9%: Is This an Indication of Further Gains?
Townsquare Media TSQ shares ended the last trading session 6.9% higher at $9.05. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 19.5% gain over the past four weeks. Townsquare is benefiting from the expansion of its programmatic digital advertising services, growth in its subscription-based marketing platform, and partnerships with local media companies across underserved markets. This operator of radio stations in small and mid-sized markets is expected to post quarterly earnings of $0.21 per share in its upcoming report, which represents a year-over-year change of +50%. Revenues are expected to be $114.77 million, down 2.9% from the year-ago quarter. Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements. For Townsquare, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on TSQ going forward to see if this recent jump can turn into more strength down the road. The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> Townsquare is a member of the Zacks Broadcast Radio and Television industry. One other stock in the same industry, iHeartMedia IHRT, finished the last trading session 0.5% lower at $1.97. IHRT has returned 11.9% over the past month. For iHeartMedia, the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.28. This represents a change of -21.7% from what the company reported a year ago. iHeartMedia currently has a Zacks Rank of #5 (Strong Sell). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Townsquare Media, Inc. (TSQ) : Free Stock Analysis Report iHeartMedia, Inc. (IHRT) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
02-04-2025
- Business
- Yahoo
Townsquare Media, Inc. (TSQ): A Bull Case Theory
We came across a bullish thesis on Townsquare Media, Inc. (TSQ) on Substack by Investing 501. In this article, we will summarize the bulls' thesis on TSQ. Townsquare Media, Inc. (TSQ)'s share was trading at $7.95 as of April 1st. TSQ's forward P/E was 9.35 according to Yahoo Finance. Townsquare Media (TSQ) presents a compelling investment opportunity as it transitions into a digital-first media company while maintaining a stable and cash-generative radio business. The company operates 344 radio stations across 74 markets, primarily outside the Top 50, reducing competition from major digital players. This radio segment, which contributes 45% of revenue, has remained resilient over the past five years, providing a consistent cash flow source to fund Townsquare's growing digital operations. The real growth engine lies in its digital business, which now accounts for 55% of total revenue. Townsquare Ignite, the programmatic digital advertising platform, generates 35% of revenue with high profit margins, leveraging the company's extensive local and national digital presence. Townsquare Interactive, a subscription-based digital marketing service, contributes 17% of revenue and has started to recover from subscriber losses in recent years, marking its first year-over-year revenue growth in Q4 2024. Management is highly aligned with shareholders, owning 29% of outstanding shares, and has executed strong capital allocation strategies. Since 2021, Townsquare has aggressively repurchased shares, reducing its count by 16.2 million at an average price of $7.19, including buybacks from Oaktree Capital and Madison Square Garden. The company has also repurchased $81 million in debt while refinancing its 2026 maturities with a new Term Loan B and a revolving credit facility, extending obligations to 2030. While this refinancing increased annual interest expenses by $9 million, it significantly improved near-term liquidity and removed debt-related risks. Townsquare's digital transformation is accelerating, with digital revenue growing at a 13% CAGR since 2014 and projected to reach 75-80% of total revenue and profit in the coming years. Townsquare Ignite continues to see high-single-digit growth, supported by its robust network of 400 local news and entertainment websites and proprietary programmatic advertising capabilities. Meanwhile, Townsquare Interactive, despite past challenges, is expected to add 3,000+ net new subscribers annually, contributing meaningful incremental revenue and operating profit. While competition from streaming services and economic downturns pose risks, the company's strong local focus and diversified revenue streams provide a competitive moat. A potential shift in FCC regulations could create opportunities for acquisitions or divestitures in the radio segment, adding optionality to the investment thesis. The company's valuation remains highly attractive, with a simple sum-of-the-parts (SOTP) analysis suggesting a price target above $22.50 per share. Even at a 50% discount to this valuation, investors could see a significant upside. Townsquare's stock has historically traded above $12, reinforcing strong support levels. With stable EBITDA, a well-covered 10% dividend yield, and a discounted valuation, investors are well-positioned for substantial gains, effectively being 'paid to wait' for a re-rating driven by digital growth or capital reallocation. Townsquare Media, Inc. (TSQ) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 8 hedge fund portfolios held TSQ at the end of the fourth quarter which was 7 in the previous quarter. While we acknowledge the risk and potential of TSQ as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than TSQ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. This article was originally published at Insider Monkey.
Yahoo
18-03-2025
- Business
- Yahoo
Townsquare Media Inc (TSQ) Q4 2024 Earnings Call Highlights: Digital Growth and Strategic ...
Cash on Balance Sheet: $33 million at the end of 2024. Cash Flow from Operations: $49 million in 2024. Digital Revenue Contribution: 52% of total net revenue in 2024. Digital Advertising Net Revenue: Increased 5.5% year-over-year to $159 million in 2024. Digital Advertising Segment Profit Margin: Approximately 26% in 2024. Townsquare Interactive Net Revenue: Declined 8% year-over-year in 2024. Townsquare Interactive Segment Profit Margin: Increased 10 basis points to 28.4% in 2024. Broadcast Advertising Net Revenue: Declined 1% year-over-year in 2024. Broadcast Segment Profit Margin: Approximately 30% in 2024. Fourth Quarter Net Revenue: Increased 2.6% year-over-year to $117.8 million. Full Year Net Revenue: Declined 0.7% year-over-year to $451 million. Adjusted EBITDA: Increased 25.8% year-over-year in Q4 to $31.2 million; full year adjusted EBITDA was approximately flat at $100.4 million. Net Income: $25 million or $1.42 per diluted share in Q4 2024. Debt Refinancing: Completed with a $490 million credit agreement, extending maturities until 2030. Dividend Increase: Raised to $0.20 per share, equating to $0.80 per share annually. Warning! GuruFocus has detected 6 Warning Signs with TSQ. Release Date: March 17, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Townsquare Media Inc (NYSE:TSQ) met its fourth quarter and full-year 2024 guidance for both net revenue and adjusted EBITDA. The company successfully refinanced its debt, extending maturities until 2030, which strengthens its financial position. Digital revenue contributed 52% of total net revenue, highlighting the success of TSQ's digital-first strategy. Townsquare Interactive achieved a turnaround, returning to year-over-year revenue growth and is expected to see strong profit growth in 2025. The digital advertising segment, Ignite, saw a 15.5% year-over-year revenue growth in Q4 2024, driven by strong programmatic advertising. Broadcast advertising net revenue declined by 1% year-over-year in 2024, with a 6% decline excluding political revenue. Full-year net revenue declined 0.7% year-over-year, indicating challenges in overall revenue growth. The company anticipates a decline in broadcast revenue to continue, viewing it as a mature cash cow business. Interest expenses are expected to increase by approximately $9 million annually due to the refinancing of debt. Townsquare Interactive's net revenue declined 8% in 2024, despite improvements in growth rates throughout the year. Q: Can you provide more details on Townsquare Interactive's subscriber numbers and expectations for Q1 2025? A: Bill Wilson, CEO, explained that while they stopped disclosing subscriber numbers, they expect revenue growth to double from Q4's 2% to at least 4% in Q1 2025. They anticipate strong profit growth, with a 20% increase expected in Q1, equating to about $1 million in incremental profit year-over-year. Q: What is the current average revenue per user (ARPU) for Townsquare Interactive, and how has it changed with enhanced product offerings? A: Bill Wilson stated that the ARPU remains around $300 per subscriber. While some offerings exceed $400, the introduction of SaaS-based tools has broadened their target market, maintaining the average ARPU at $300. Q: Are there plans to update the three-to-five-year revenue outlook for Townsquare Interactive and Ignite? A: Bill Wilson confirmed that they expect digital advertising to grow in the high single digits over the next three to five years. For Townsquare Interactive, they anticipate returning to historical profit levels of $2.5 million to $3 million annually, with top-line revenue growth expected to be more modest in the short term. Q: With potential changes in FCC regulations, would Townsquare Media consider acquiring more radio assets? A: Bill Wilson expressed optimism about deregulation and stated that Townsquare Media is well-positioned to acquire radio assets, particularly outside the Top 50 markets. They have a track record of managing broadcast assets effectively while growing digital businesses. Q: How is Townsquare managing economic uncertainty in relation to its Interactive and Ignite businesses? A: Bill Wilson noted that despite economic volatility, the advertising market remains healthy. They expect high single-digit growth in digital advertising and doubled growth in Interactive for Q1. The challenges faced by Townsquare Interactive were largely self-inflicted, and they are now performing well. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
