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Nexstar‘s third-quarter earnings reflected the soft TV advertising market, with political ad revenue down 85 percent from last year, and so-called “core” advertising revenue down 2.3 percent.
Similarly, The CW keeps losing money for the broadcast TV giant, though its losses continue to narrow quarter by quarter. The CW lost $60 million in Q3, down from $78 million last quarter.
Overall in Q3, Nextsar had revenue of $1.1 billion (down 10.8 percent from a year ago), and net income of $8 million, down more than 97 percent from a year ago, reflecting the robust political ad market in Q3 of last year.
In a comment, Nexstar CEO Perry Sook said that reduced losses at The CW, ad spending for the 2024 presidential election, and an “improving economic environment” should turbocharge the company’s earnings over the coming months.
He also argued that the Disney-Charter deal and changing media environment could work to Nexstar’s benefit.
“Broadcast stations have the most watched television content, and we remain undercompensated for that viewership,” Sook said. “With our significant audience reach, the broadcast model remains the only and best way to maximize viewership – something that broadcast networks and sports organizations understand. We believe that recent changes in the television ecosystem brought on by the Charter/Disney agreement will have a further positive impact on our model by creating stability in our subscriber base and freeing up programming spend from derivative cable networks to be reallocated to premium content like ours. The terms of our recent distribution and affiliation agreements reflect this viewpoint and we are very pleased with the outcome.”
The CW, which Nexstar acquired last year, has been reprogramming its lineup, ordering fewer expensive scripted shows, and cutting deals for more unscripted and sports fare, including a deal with the WWE for NXT this week
The company also picked up some college sports rights, NASCAR Xfinity Cup rights, and LIV Golf rights, among others.