Q2 2026 Urban One Inc Earnings Call Transcript
Key Points
- Urban One Inc (UONE) reduced long-term debt by $60.2 million year-to-date through market repurchases of its 2031 second lien notes at a discount, resulting in annual interest savings of $4.6 million.
- The company completed the acquisition of Service Broadcasting Group in Dallas, Texas, which is expected to contribute significantly to revenue in the last five and a half months of the year.
- Political advertising is expected to be a tailwind in Q3 and Q4, with competitive races in key markets like Ohio, Texas, Georgia, North Carolina, and Indiana, and the company has budgeted $11.1 million for political radio revenue.
- Operating expenses decreased by 4% year-over-year, driven by reductions in sales and marketing, professional service fees, and other compensation-related costs.
- The company outperformed the market in national advertising sales, with national ad sales down 1.5% versus the market down 4.6%.
- TV One's prime-time delivery improved by 4% in the first four weeks of Q3 2026 compared to Q2 2026, and is only down 3% year-over-year.
- The company completed the sale of two Charlotte radio stations and one Dallas station, generating gains of $4.7 million and $3.2 million, respectively.
- Management expects to avoid future large non-cash impairments, as radio FCC licenses are now amortized and all goodwill at Reach Media has been written down.
- Consolidated net revenues decreased 6.4% year-over-year in Q2 2026, with radio, digital, and cable television segments all reporting declines.
- Local radio ad sales underperformed the market, down 10.1% versus the market's 7.8% decline, leading to a miss on Q2 guidance.
- Cable television advertising sales fell 9.6% due to strong competition from NBA playoffs, prime-time delivery declines, and a weak scatter market, forcing more inventory to be allocated to lower-rate direct response.
- TV One's linear subscriber base continues to decline, with traditional subscribers down to 27.3 million from 34.3 million a year ago, reflecting ongoing cord-cutting.
- Reach Media's net revenue declined 10.6% and adjusted EBITDA was a loss of $1 million, leading to a $13.9 million goodwill impairment charge.
- The company lowered its full-year adjusted EBITDA guidance from $60 million to the mid-$50s due to a tough first half and uncertainty around political spending.
- Digital segment revenue decreased 8.4%, driven by reductions in DEI-focused spending and lower client spending due to macroeconomic concerns.
- Interest expense, while lower, still requires significant cash payments, with the next semi-annual interest payment of approximately $12.1 million due on October 1st.
- The company's leverage ratio remains high at 6.66 times, and it drew an additional $10 million on its asset-backed facility during the quarter, increasing total draws to $20 million.
Ladies and gentlemen, thank you for standing by and welcome to the UrbanOne 2026 Second Quarter Earnings Call. As a reminder, this conference is being recorded. We will begin this call with the following safe harbor statement. During this conference call, UrbanOne will be sharing with your certain projections or other forward-looking statements regarding future events or its future performance.
UrbanOne cautions you that certain factors, including risks and uncertainties referred to in the 10-Ks, 10-Qs, and other reports it periodically files with the Securities and Exchange Commission could cause the company's actual results to differ materially from those indicated by its projections or forward-looking statements.
This call will present information as of August 4, 2026. Please note that Urban One disclaims any duty to update any forward-looking statements made in the presentation. In this call, Urban One may also discuss some non-GAAP financial measures in talking about its performance. These measures will be reconciled to GAAP either during the course of this call or in the company's
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