Radio Earnings: iHeartMedia Revenue Ticks Up, Cumulus Media Revenue Down Slightly in 2024

iHeartMedia expects first-quarter revenue to decline in the low single digits and full-year revenue to be flat, suggesting the radio giant hasn’t yet turned the proverbial corner financially, according to the company’s latest earnings release. After revenue was up 5.5% in January, February is on track for a 7% decline as consumer sentiment dropped to a level not seen since 2021, CFO Rich Bressler said during Thursday’s earnings call.

The company ended 2024 with fourth-quarter revenue up 4.8% to $1.11 billion, while adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) spiked 18.2% to $246.2 million. Revenue growth was below the company’s previous guidance due to lower-than-expected political advertising and a slowdown in non-political advertising before the election, said Bressler.

The fires in Los Angeles created a disruption to iHeartMedia’s business in the first quarter, although CEO Bob Pittman called it “a little bit of a blip” and said a larger impact comes from people returning to work. “Traffic is getting long again, and I hate to sound cynical here, but traffic jams are our friend,” he said. “We’re a company that benefits from people with longer commutes and more time in the car.”

Mired in a weak advertising market for broadcast radio, iHeartMedia is busy finding ways to create value from its broadcast assets. To that end, in March the company will make its broadcast advertising inventory available to programmatic buyers through Yahoo DSP and Google’s DV360 ad-buying platforms. “This is a critical early step in aligning our broadcast assets with digital buying behavior,” said Pittman, “which will allow iHeart’s broadcast radio assets to participate in the growing digital and programmatic [total addressable markets].”

Last year, iHeartMedia took steps to cut costs and improve its balance sheet. The company expects to have net savings of $150 million in 2025 and beyond — $200 million from cost reductions undertaken in 2024 and an additional $50 million of expenses. In December, iHeart reduced its debt load and extended maturity dates through a debt exchange that attracted a 92.2% participation rate.

For the full year, iHeartMedia’s revenue totaled $3.86 billion, up 3% year-over-year (and flat if political advertising is excluded). Adjusted EBITDA increased 1% to $705.6 million while EBITDA margin improved to 22.0% in 2024 from 19.5% in 2023. The multiplatform group, which includes the company’s core broadcast stations, saw its revenue decline 2.6% to $2.37 billion, while the digital audio group’s revenue increased 8.9% to $1.16 billion due to increased advertising demand for podcasting. The audio and media services group had revenue of $327 million, up 27.4%.

Cumulus Media, the country’s third-largest radio company by revenue, fared a bit worse in 2024. For the full year, Cumulus’ revenue fell 2.1% to $827.1 million and adjusted EBITDA dropped 8.8% to $82.7 million. While digital revenue grew 5.3% to $154.2 million, broadcast revenue slipped 5.1% to $564.1 million. In the fourth quarter, revenue dipped 1.2% to $218.6 million and adjusted EBITDA grew 9.8% to $25 million.

Cutting costs and restructuring debt are common tactics in the radio business. Just as iHeartMedia shaved its expenses, Cumulus will realize $43 million in annualized cost savings, with $15 million of savings coming in 2024. In addition, in May, Cumulus completed a debt exchange, which lowered its outstanding debt by $33 million and extended maturity dates while securing “attractive” interest rates.

iHeartMedia shares fell 7.9% to $2.09 before earnings were released, and dropped another 9.9%, to $1.90, in after-hours trading. Through Thursday, iHeartMedia shares are down 1.9% year-to-date but have more than doubled since May 2024.

Cumulus, which reported earnings earlier in the day, saw its share price decline only 0.3% to $0.90. Year-to-date, Cumulus shares have gained 16.9%.