Nexstar Media Group’s Q1 Earnings Call Highlights

Nexstar Media Group ((NXST)) has held its Q1 earnings call. Read on for the main highlights of the call.

Nexstar Media Group’s first quarter earnings call revealed a company adeptly maneuvering through industry challenges, achieving record distribution revenue and notable successes in its CW and NewsNation segments. Despite these accomplishments, the company faces financial pressures due to declines in net and advertising revenues, particularly in nonpolitical advertising. Nexstar’s strategic focus on sports programming, deregulation, and M&A opportunities underscores a forward-looking growth strategy, though concerns about decreased advertising revenue persist.

Record First Quarter Distribution Revenue

Nexstar Media Group reported a record first quarter distribution revenue of $762 million, marking a slight increase of 0.1% over the previous year. This achievement underscores the company’s ability to maintain steady growth in distribution revenue despite broader market challenges.

CW’s Strongest Primetime Performance

The CW network delivered its strongest primetime ratings in eight quarters during the first quarter of 2025, surpassing other broadcast networks 74 times in key demographics. This performance highlights the network’s growing appeal and strategic programming decisions.

NewsNation Audience Growth

NewsNation continued its upward trajectory, expanding its audience every month of the first quarter of 2025. Impressively, it outperformed major competitors MSNBC and CNN in the key adult 25 to 54 demographic, signaling a shift in viewer preferences.

Significant Sports Programming Success

CW Sports has become a significant player in live sports programming, offering over 400 hours annually. The NASCAR Xfinity series, in particular, saw a 19% increase in viewership year-over-year, averaging over 1.2 million viewers.

Strong Financial Position

Nexstar’s financial health remains robust, with an adjusted EBITDA of $381 million and a 30.9% margin. The company also reduced its net interest expense by $17 million compared to the previous year, reflecting prudent financial management.

Decline in Net Revenues

The first quarter saw a decline in net revenues to $1.23 billion, a 3.9% decrease from the prior year. This drop was primarily attributed to a reduction in political advertising, highlighting the impact of external factors on Nexstar’s revenue streams.

Decrease in Advertising Revenue

Advertising revenue fell by $52 million, or 10.2%, compared to the previous year, with significant pullbacks noted in the insurance and automotive sectors. This decline underscores the challenges faced in the advertising market.

Increased Losses at The CW

The CW experienced increased losses in the first quarter, with profitability declining by mid-teens million. This was due to additional sports programming and amortization costs not present in the same quarter last year.

Forward-Looking Guidance

Nexstar’s guidance for the future emphasizes a focus on deregulation and strategic consolidation to drive value. The company plans to renew distribution agreements covering 60% of its subscriber base and continue share repurchases. Despite a 3.9% decline in net revenue due to reduced political advertising, Nexstar remains optimistic about growth in vMVPD subscribers and CW affiliations.

In summary, Nexstar Media Group’s earnings call painted a picture of a company navigating both successes and challenges. While record distribution revenue and strong performances in certain segments are promising, declines in net and advertising revenues pose ongoing challenges. The company’s strategic initiatives and forward-looking guidance suggest a commitment to overcoming these hurdles and fostering growth.