What changed in this filing

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Item 1. Financial Statements

2022-05-05 compared with 2021-11-04 · 119 added, 381 removed, 448 unchanged (53% of the section changed)

3 unchanged sentences

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data) September 30,

(In thousands, except share and per share data) March 31,

2022 December 31,

24 unchanged sentences

Long-term debt 5,739,421 5,738,195

Series A Mandatorily Redeemable Preferred Stock, par value $ 0.001 , authorized 60,000 shares, 60,000 shares issued in 2021 and 2020

60,000 60,000

Noncurrent operating lease liabilities 727,143 738,814

10 unchanged sentences

Accumulated deficit ( 2,011,401 ) ( 1,962,819 )

Accumulated other comprehensive income (loss) ( 193 ) 194

Accumulated other comprehensive loss ( 504 ) ( 257 )

Cost of shares ( 414,950 in 2022 and 389,814 in 2021) held in treasury

5 unchanged sentences

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands, except per share data) Three Months Ended September 30, Nine Months Ended September 30,

2021 2020 2021 2020

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands, except per share data) Three Months Ended March 31,

Revenue $ 843,458 $ 706,665

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Income tax benefit (expense) 20,209 ( 79,935 )

Net income (loss) 3,673 ( 32,112 ) ( 270,343 ) ( 1,918,165 )

Net loss ( 48,739 ) ( 242,056 )

Less amount attributable to noncontrolling interest ( 157 ) ( 333 )

Net income (loss) attributable to the Company $ 3,180 $ ( 32,112 ) $ ( 270,829 ) $ ( 1,918,165 )

Other comprehensive income (loss), net of tax:

Net loss attributable to the Company $ ( 48,582 ) $ ( 241,723 )

Other comprehensive loss, net of tax:

Foreign currency translation adjustments ( 247 ) ( 216 )

Other comprehensive income (loss), net of tax ( 131 ) 267 ( 387 ) 455

Comprehensive income (loss) 3,049 ( 31,845 ) ( 271,216 ) ( 1,917,710 )

Other comprehensive loss, net of tax ( 247 ) ( 216 )

Comprehensive loss ( 48,829 ) ( 241,939 )

Less amount attributable to noncontrolling interest — —

Comprehensive income (loss) attributable to the Company $ 3,049 $ ( 31,845 ) $ ( 271,216 ) $ ( 1,917,710 )

Net income (loss) attributable to the Company per common share:

Comprehensive loss attributable to the Company $ ( 48,829 ) $ ( 241,939 )

Net loss attributable to the Company per common share:

Basic $ ( 0.33 ) $ ( 1.65 )

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Shares Special Warrants Total

June 30, 2021

December 31, 2021

120,633,937 21,590,192 5,304,430 $ 8,410 $ 142 $ 2,876,571 $ ( 1,962,819 ) $ ( 257 ) $ ( 6,282 ) $ 915,765

Net income 493 — — 3,180 — — 3,673

Net loss ( 157 ) — — ( 48,582 ) — — ( 48,739 )

Vesting of restricted stock and other

7 unchanged sentences

Other comprehensive loss — — — — ( 247 ) — ( 247 )

September 30, 2021

March 31, 2022

121,402,390 21,430,500 5,293,069 $ 8,066 $ 143 $ 2,882,515 $ ( 2,011,401 ) $ ( 504 ) $ ( 6,798 ) $ 872,021

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Capital Accumulated Deficit Accumulated

Comprehensive

Comprehensive Income

(Loss) Treasury

1 unchanged sentence

Shares Special Warrants Total

June 30, 2020

61,432,341 6,900,195 78,038,412 $ 9,123 $ 68 $ 2,835,005 $ ( 1,774,974 ) $ ( 562 ) $ ( 3,018 ) $ 1,065,642

Net loss — — — ( 32,112 ) — — ( 32,112 )

Vesting of restricted stock

21,270 — — — — — ( 34 ) ( 34 )

Share-based compensation

— — 5,885 — — — 5,885

Conversion of Special Warrants to Class A and Class B Shares 1,986,278 704 ( 1,986,982 ) — 2 ( 2 ) — — — —

Conversion of Class B Shares to Class A Shares 7,263 ( 7,263 ) — — — — — — —

Other comprehensive income — — — — 267 — 267

September 30, 2020

63,447,152 6,893,636 76,051,430 $ 9,123 $ 70 $ 2,840,888 $ ( 1,807,086 ) $ ( 295 ) $ ( 3,052 ) $ 1,039,648

(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in 2020.

See Notes to Consolidated Financial Statements

IHEARTMEDIA, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

(In thousands, except share data) Controlling Interest

Common Shares (1)

Interest Common

Stock Additional

Capital Accumulated

Deficit Accumulated

Comprehensive Income (Loss) Treasury

Shares Class B

Shares Special Warrants Total

December 31, 2020

64,726,864 6,886,925 74,835,899 $ 8,350 $ 72 $ 2,849,020 $ ( 1,803,620 ) $ 194 $ ( 3,199 ) $ 1,050,817

Net income (loss) 486 — — ( 270,829 ) — — ( 270,343 )

Net loss ( 333 ) — — ( 241,723 ) — — ( 242,056 )

Vesting of restricted stock and other 30,372 — — 11 — — ( 103 ) ( 92 )

1,027,252 — — 3,863 — — ( 2,948 ) 915

Share-based compensation

Conversion of Special Warrants to Class A and Class B Shares 47,197,139 22,337,312 ( 69,534,451 ) — 70 ( 70 ) — — — —

Conversion of Class B Shares to Class A Shares

— — 5,685 — — — 5,685

2,982 ( 562 ) — — — — — ( 562 )

Other comprehensive loss — — — — ( 387 ) — ( 387 )

September 30, 2021

119,669,831 22,505,661 5,304,430 $ 8,274 $ 142 $ 2,870,394 $ ( 2,074,449 ) $ ( 193 ) $ ( 6,147 ) $ 798,021

(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in 2021 or 2020.

See Notes to Consolidated Financial Statements

IHEARTMEDIA, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

(In thousands, except share data) Controlling Interest

Common Shares (1)

Non- controlling Interest Common Stock Additional Paid-in Capital Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Loss Treasury Stock

Class A Shares Class B Shares Special Warrants Total

December 31, 2019

57,776,204 6,904,910 81,046,593 $ 9,123 $ 65 $ 2,826,533 $ 112,548 $ ( 750 ) $ ( 2,078 ) $ 2,945,441

Net loss — — — ( 1,918,165 ) — — ( 1,918,165 )

Vesting of restricted stock 667,493 — — ( 23 ) — — ( 974 ) ( 997 )

Share-based compensation — — 14,383 — — — 14,383

Conversion of Special Warrants and Class B Shares to Class A Shares 4,990,132 2,049 ( 4,992,181 ) — 5 ( 5 ) — — — —

Dividend declared and paid to noncontrolling interests ( 187 ) — — — — — ( 187 )

Conversion of Special Warrants to Class A and Class B Shares 47,121,747 22,337,312 ( 69,459,059 ) — 69 ( 69 ) — — — —

Conversion of Class B Shares to Class A Shares 154,045 ( 154,045 ) — — — — — — —

Other 2,982 — — — — — — —

Other comprehensive income — — — — 455 — 455

September 30, 2020

Other comprehensive loss — — — — ( 216 ) — ( 216 )

March 31, 2021

112,033,028 29,070,192 5,379,822 $ 7,830 $ 141 $ 2,854,647 $ ( 2,045,343 ) $ ( 22 ) $ ( 3,302 ) $ 813,951

(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in 2019 or 2020.

(1) The Company's Preferred Stock is not presented in the data above as there were no shares issued and outstanding in 2021.

See Notes to Consolidated Financial Statements

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CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands) Nine Months Ended September 30,

(In thousands) Three Months Ended March 31,

Cash flows from operating activities:

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Changes in operating assets and liabilities, net of effects of acquisitions and dispositions:

(Increase) decrease in accounts receivable ( 37,776 ) 224,044

Decrease in accounts receivable 121,339 113,170

Increase in prepaid expenses and other current assets ( 39,983 ) ( 35,647 )

Increase in other long-term assets ( 2,610 ) ( 3,317 )

Increase (decrease) in accounts payable and accrued expenses 74,534 ( 31,343 )

Increase (decrease) in accrued interest 1,766 ( 13,959 )

Decrease in accounts payable ( 49,129 ) ( 7,423 )

Decrease in accrued expenses ( 151,853 ) ( 9,521 )

Increase in accrued interest 1,829 1,789

Increase in deferred income 19,602 18,881

Increase in other long-term liabilities 1,051 544

Cash provided by operating activities 196,593 136,161

Cash provided by (used for) operating activities ( 52,212 ) 71,728

Cash flows from investing activities:

Business combinations — ( 230,816 )

Proceeds from sale of other investments 50,757 —

Purchases of property, plant and equipment ( 22,557 ) ( 18,950 )

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Cash flows from financing activities:

Proceeds from long-term debt and credit facilities — 779,750

Payments on long-term debt and credit facilities ( 168 ) ( 13,547 )

Change in other, net ( 293 ) ( 264 )

Cash provided by (used for) financing activities ( 288,118 ) 248,637

Cash used for financing activities ( 461 ) ( 13,811 )

Effect of exchange rate changes on cash, cash equivalents and restricted cash ( 83 ) ( 122 )

Net increase (decrease) in cash, cash equivalents and restricted cash ( 351,667 ) 313,511

Net decrease in cash, cash equivalents and restricted cash ( 72,446 ) ( 191,529 )

Cash, cash equivalents and restricted cash at beginning of period 352,554 721,187

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The financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

As of January 1, 2021, the Company began reporting based on three reportable segments:

▪ the iHeartMedia Multiplatform Group, which includes the Company's Broadcast radio, Networks and Sponsorships and Events businesses;

▪ the iHeartMedia Digital Audio Group, which includes all of the Company's Digital businesses, including Podcasting;

The Company's reportable segments are:

▪ the Multiplatform Group, which includes the Company's Broadcast radio, Networks and Sponsorships and Events businesses;

▪ the Digital Audio Group, which includes all of the Company's Digital businesses, including Podcasting;

▪ the Audio & Media Services Group, which includes Katz Media Group (“Katz Media”), a full-service media representation business, and RCS Sound Software ("RCS"), a provider of scheduling and broadcast software and services.

These reporting segments reflect how senior management operates the Company and align with certain leadership and organizational changes implemented in the first quarter 2021.

This structure provides improved visibility into the underlying performances, results, and margin profiles of our distinct businesses and enables senior management to better monitor trends at the operational level and address opportunities or issues as they arise via regular review of segment-level results and forecasts with operational leaders.

Additionally, as of January 1, 2021, Segment Adjusted EBITDA is the segment profitability metric reported to the Company's Chief Operating Decision Maker for purposes of making decisions about allocation of resources to, and assessing performance of, each reportable segment.

Segment Adjusted EBITDA is calculated as Revenue less operating expenses, excluding restructuring expenses and share-based compensation expenses.

Restructuring expenses primarily include severance expenses incurred in connection with cost saving initiatives, as well as certain expenses, which, in the view of management, are outside the ordinary course of business or otherwise not representative of the Company's operations during a normal business cycle.

The corresponding current and prior period segment disclosures have been recast to reflect the current segment presentation.

See Note 9, Segment Data .

The consolidated financial statements include the accounts of the Company and its subsidiaries.

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Our business has been adversely impacted by the novel coronavirus pandemic (“COVID-19”), its impact on the operating and economic environment and related, near-term advertiser spending decisions.

The Company's revenue in the latter half of the month ended March 31, 2020, through the remainder of 2020 and into 2021 was significantly and negatively impacted as a result of a decline in advertising spend driven by COVID-19, and the Company's management took proactive actions during 2020, which are continuing into 2021, to expand the Company’s financial flexibility by reducing expenses and preserving cash as a result of such impact.

Although our results for the third quarter of 2021 continued to be impacted by the effects of the COVID-19 pandemic, our revenue for both the three months ended June 30, 2021 and September 30, 2021 increased

IHEARTMEDIA, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

significantly compared to the three months ended June 30, 2020 and September 30, 2020, including revenue from our Multiplatform segment, which includes our broadcast radio, networks and sponsorship and events businesses.

Beginning in March 2020 and continuing through the remainder of 2020 and into 2021 revenue was significantly and negatively impacted as a result of a decline in advertising spend driven by COVID-19.

As a result of continued recovery from the impact of COVID-19, our revenue for the three months ended March 31, 2022 increased significantly compared to the three months ended March 31, 2021 across each of our reportable segments.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES Act”) was signed into law.

The CARES Act, among other things, includes provisions relating to refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods, alternative minimum tax credit refunds, modifications to the net interest deduction limitations and technical corrections to tax depreciation methods for qualified improvement property.

The provisions of the CARES Act resulted in an increase to allowable interest deductions of $ 179.4 million during 2020.

In addition, the Company was able to defer the payment of $ 29.3 million in certain employment taxes during 2020, half of which will be due on December 31, 2021 and the other half will be due on December 31, 2022.

As of September 30, 2021, the Company has claimed $ 12.4 million in refundable payroll tax credits related to the CARES Act provisions.

As of September 30, 2021, the Company had approximately $ 369.1 million in cash and cash equivalents.

While the Company expects COVID-19 to continue to negatively impact the results of operations, cash flows and financial position of the Company, the related financial impact cannot be reasonably estimated at this time.

The Company was able to defer the payment of $ 29.3 million in certain employment taxes during 2020, half of which was due and paid on January 3, 2022 and the other half will be due on January 3, 2023.

In addition, the Company claimed $ 12.4 million in refundable payroll tax credits related to the CARES Act provisions, of which $ 0.7 million was received in 2020, $ 3.8 million was received in 2021 and $ 7.9 million was received in January 2022.

As of March 31, 2022, the Company had approximately $ 279.7 million in cash and cash equivalents.

While the effects of COVID-19 may continue to negatively impact the results of operations, cash flows and financial position of the Company, the related financial impact cannot be reasonably estimated at this time.

Based on current available liquidity, the Company expects to be able to meet its obligations as they become due over the coming year.

Reclassifications and New Segment Presentation

Reclassifications

Certain prior period amounts have been reclassified to conform to the 2022 presentation.

In connection with the organization and leadership changes resulting in the realignment of its reportable segments as discussed above, the Company also determined that all selling, general and administrative expenses incurred by its reportable segments and by its corporate functions would be reported together as Selling, general and administrative expenses.

Amounts presented in prior years as Corporate expenses have been reclassified as Selling, general and administrative expenses to conform to the current presentation.

IHEARTMEDIA, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Restricted Cash

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported in the Consolidated Balance Sheets to the total of the amounts reported in the Consolidated Statements of Cash Flows:

(In thousands) September 30,

(In thousands) March 31,

2022 December 31,

2 unchanged sentences

Other current assets 425 425

Other assets — 525

Total cash, cash equivalents and restricted cash in the Statement of Cash Flows $ 280,108 $ 352,554

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The Company is currently evaluating the future impact of adoption of this standard.

New Accounting Pronouncements Not Yet Adopted

In October 2021, the FASB issued ASU No.

2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers which requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with Accounting Standards Codification 606.

The amendments of ASU 2021-08 are effective for interim and annual periods beginning after December 15, 2022.

The Company is currently evaluating the future impact of adoption of this standard.

IHEARTMEDIA, INC.

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Disaggregation of Revenue

The following tables show revenue streams for the three and nine months ended September 30, 2021 and 2020:

(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Eliminations Consolidated

Three Months Ended September 30, 2021

Revenue from contracts with customers:

Broadcast Radio (1)

$ 483,456 $ — $ — $ — $ 483,456

127,920 — — — 127,920

Sponsorship and Events (3)

42,663 — — — 42,663

Digital, excluding Podcast (4)

— 141,573 — ( 1,475 ) 140,098

— 64,196 — — 64,196

Audio & Media Services (6)

— — 66,078 ( 1,188 ) 64,890

4,636 — — ( 112 ) 4,524

Total 658,675 205,769 66,078 ( 2,775 ) 927,747

Revenue from leases (8)

304 — — — 304

Revenue, total $ 658,979 $ 205,769 $ 66,078 $ ( 2,775 ) $ 928,051

Three Months Ended September 30, 2020

Revenue from contracts with customers:

Broadcast Radio (1)

$ 404,460 $ — $ — $ — $ 404,460

118,982 — — — 118,982

Sponsorship and Events (3)

28,898 — — — 28,898

Digital, excluding Podcast (4)

— 93,574 — — 93,574

— 22,626 — — 22,626

Audio & Media Services (6)

— — 75,039 ( 1,762 ) 73,277

2,180 — — ( 168 ) 2,012

Total 554,520 116,200 75,039 ( 1,930 ) 743,829

Revenue from leases (8)

577 — — — 577

Revenue, total $ 555,097 $ 116,200 $ 75,039 $ ( 1,930 ) $ 744,406

IHEARTMEDIA, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following tables show revenue streams for the three months ended March 31, 2022 and 2021:

(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Eliminations Consolidated

Nine Months Ended September 30, 2021

Three Months Ended March 31, 2022

Revenue from contracts with customers:

1 unchanged sentence

$ 416,481 $ — $ — $ — $ 416,481

366,592 — — — 366,592

Sponsorship and Events (3)

10 unchanged sentences

Revenue, total $ 571,160 $ 214,219 $ 60,857 $ ( 2,778 ) $ 843,458

Nine Months Ended September 30, 2020

Three Months Ended March 31, 2021

Revenue from contracts with customers:

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(6) Audio & Media Services revenue is generated by services provided to broadcast industry participants through the Company’s Katz Media and RCS businesses.

As a media representation firm, Katz Media generates revenue via commissions on media sold on behalf of the radio and television stations that it represents, while RCS generates revenue by providing broadcast and webcast software and technology and services to radio stations, television music channels, cable companies, satellite music networks and Internet stations worldwide.

As a media representation firm, Katz Media generates revenue via commissions on media sold on behalf of the radio and television stations that it represents, while RCS generates revenue by providing broadcast software and media streaming, along with research services for radio stations, broadcast television stations, cable channels, record labels, ad agencies and Internet stations worldwide.

(7) Other revenue represents fees earned for miscellaneous services, including on-site promotions, activations, and local marketing agreements.

8 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

(In thousands) 2022 2021

1 unchanged sentence

Trade and barter expenses 46,415 27,998

The Company recognized barter revenue of $ 4.9 million and $ 2.3 million during the three months ended September 30, 2021 and 2020, respectively, and $ 9.4 million and $ 7.5 million during the nine months ended September 30, 2021 and 2020, respectively, in connection with investments made in companies in exchange for advertising services.

The Company recognized barter revenue of $ 7.0 million and $ 2.2 million during the three months ended March 31, 2022 and 2021, respectively, in connection with investments made in companies in exchange for advertising services.

The following tables show the Company’s deferred revenue balance from contracts with customers:

Three Months Ended

September 30, Nine Months Ended

September 30,

(In thousands) 2022 2021

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The Company’s contracts with customers generally have terms of one year or less;

however, as of September 30, 2021, the Company expects to recognize $ 220.5 million of revenue in future periods for remaining performance obligations from current contracts with customers that have an original expected duration greater than one year, with substantially all of this amount to be recognized over the next five years .

however, as of March 31, 2022, the Company expects to recognize $ 395.1 million of revenue in future periods for remaining performance obligations from current contracts with customers that have an original expected duration greater than one year, with substantially all of this amount to be recognized over the next five years .

Commissions related to the Company’s media representation business have been excluded from this amount as they are contingent upon future sales.

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Revenue from Leases

As of September 30, 2021, the future lease payments to be received by the Company are as follows:

As of March 31, 2022, the future lease payments to be received by the Company are as follows:

(In thousands)

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The Company tests for impairment of assets whenever events and circumstances indicate that such assets might be impaired.

During the nine months ended September 30, 2021, the Company recognized non-cash impairment charges of $ 49.4 million, including $ 38.0 million related to ROU assets, and $ 11.4 million related to leasehold improvements as a result of proactive decisions by management to abandon and sublease a number of operating leases in connection with strategic actions to streamline the Company’s real estate footprint as part of the Company’s modernization initiatives.

During the three months ended March 31, 2022, the Company recognized non-cash impairment charges of $ 1.3 million, including $ 1.2 million related to ROU assets, and $ 0.1 million related to leasehold improvements as a result of proactive decisions by management to abandon and sublease a number of operating leases in connection with strategic actions to streamline the Company’s real estate footprint as part of the Company’s modernization initiatives.

During the three months ended March 31, 2021, the Company recognized non-cash impairment charges of $ 37.7 million, including $ 28.8 million related to ROU assets, and $ 8.9 million related to leasehold improvements also as a result of the proactive decisions by management discussed above.

The implicit rate within the Company's lease agreements is generally not determinable.

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The following table provides supplemental cash flow information related to leases for the periods presented:

Nine Months Ended September 30,

Three Months Ended March 31,

(In thousands) 2022 2021

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Lease liabilities arising from obtaining right-of-use assets (1)

35,317 41,982

(1) Lease liabilities from obtaining right-of-use assets include new leases entered into during the nine months ended September 30, 2021 and 2020, respectively.

(1) Lease liabilities from obtaining right-of-use assets include new leases entered into during the three months ended March 31, 2022 and 2021, respectively.

The Company reflects changes in the lease liability and changes in the ROU asset on a net basis in the Statements of Cash Flows.

The non-cash operating lease expense was $ 75.8 million and $ 78.2 million for the nine months ended September 30, 2021 and September 30, 2020, respectively.

The non-cash operating lease expense was $ 23.4 million and $ 24.8 million for the three months ended March 31, 2022 and March 31, 2021, respectively.

NOTE 4– PROPERTY, PLANT AND EQUIPMENT, INTANGIBLE ASSETS AND GOODWILL

On March 31, 2021, the Company acquired Triton Digital, a global leader in digital audio and podcast technology and measurement services, from The E.W.

Scripps Company for $ 228.5 million in cash.

The assets acquired as part of this transaction consisted of $ 69.4 million in current and fixed assets, consisting primarily of accounts receivable and technology, and $ 191.5 million in intangible assets, consisting primarily of customer relationships, along with $ 168.2 million in goodwill (of which $ 6.9 million is tax-deductible).

The Company also assumed liabilities of $ 32.4 million, consisting primarily of accounts payable and deferred tax liabilities.

The assessment of fair value of assets acquired and liabilities assumed is preliminary and is based on information that was available to management at the time these consolidated financial statements were prepared.

The finalization of the Company’s acquisition accounting assessment could result in changes in the valuation of assets acquired and liabilities assumed, which could be material.

Property, Plant and Equipment

The Company’s property, plant and equipment consisted of the following classes of assets as of September 30, 2021 and December 31, 2020, respectively:

(In thousands) September 30,

The Company’s property, plant and equipment consisted of the following classes of assets as of March 31, 2022 and December 31, 2021, respectively:

(In thousands) March 31,

2022 December 31,

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Indefinite-lived Intangible Assets

The Company’s indefinite-lived intangible assets consist of FCC broadcast licenses in its Multiplatform Group segment.

IHEARTMEDIA, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company performs its annual impairment test on goodwill and indefinite-lived intangible assets, including FCC licenses, as of July 1 of each year.

The impairment tests for indefinite-lived intangible assets consist of a comparison between the fair value of the indefinite-lived intangible asset at the market level with its carrying amount.

If the carrying amount of the indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized equal to that excess.

After an impairment loss is recognized, the adjusted carrying amount of the indefinite-lived asset is its new accounting basis.

The fair value of the indefinite-lived asset is determined using the direct valuation method as prescribed in ASC 805-20-S99.

Under the direct valuation method, the fair value of the indefinite-lived assets is calculated at the market level as prescribed by ASC 350-30-35.

The Company engaged a third-party valuation firm to assist it in the development of the assumptions and the Company’s determination of the fair value of its indefinite-lived intangible assets.

The application of the direct valuation method attempts to isolate the income that is attributable to the indefinite-lived intangible asset alone (that is, apart from tangible and identified intangible assets and goodwill).

It is based upon modeling a hypothetical “greenfield” build-up to a “normalized” enterprise that, by design, lacks inherent goodwill and whose only other assets have essentially been paid for (or added) as part of the build-up process.

The Company forecasts revenue, expenses, and cash flows over a ten-year period for each of its markets in its application of the direct valuation method.

The Company also calculates a “normalized” residual year which represents the perpetual cash flows of each market.

The residual year cash flow was capitalized to arrive at the terminal value of the licenses in each market.

Under the direct valuation method, it is assumed that rather than acquiring indefinite-lived intangible assets as part of a going concern business, the buyer hypothetically develops indefinite-lived intangible assets and builds a new operation with similar attributes from scratch.

Thus, the buyer incurs start-up costs during the build-up phase which are normally associated with going concern value.

Initial capital costs are deducted from the discounted cash flow model which results in value that is directly attributable to the indefinite-lived intangible assets.

The key assumptions used in applying the direct valuation method are market revenue growth rates, market share, profit margin, duration and profile of the build-up period, estimated start-up capital costs and losses incurred during the build-up period, the risk-adjusted discount rate and terminal values.

This data is populated using industry normalized information representing an average FCC license within a market.

No impairment was recognized as a result of the Company's annual impairment test on indefinite-lived intangible assets.

In addition, the Company tests for impairment of intangible assets whenever events and circumstances indicate that such assets might be impaired.

As a result of the COVID-19 pandemic and the economic downturn starting in March 2020, the Company performed an interim impairment test as of March 31, 2020 on its indefinite-lived FCC licenses, resulting in a non-cash impairment charge of $ 502.7 million on its FCC licenses.

The Company’s indefinite-lived intangible assets consist of Federal Communications Commission ("FCC") broadcast licenses in its Multiplatform Group segment.

Other Intangible Assets

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These assets are recorded at amortized cost.

The Company tests for possible impairment of other intangible assets whenever events and circumstances indicate that they might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amounts of those assets.

When specific assets are determined to be unrecoverable, the cost basis of the asset is reduced to reflect the current fair market value.

The Company performed interim impairment tests as of March 31, 2020 on its other intangible assets as a result of the COVID-19 pandemic and economic slowdown.

Based on the Company’s test of recoverability using estimated undiscounted future cash flows, the carrying values of the Company’s definite-lived intangible assets were determined to be recoverable, and no impairment was recognized.

IHEARTMEDIA, INC.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table presents the gross carrying amount and accumulated amortization for each major class of other intangible assets as of September 30, 2021 and December 31, 2020, respectively:

(In thousands) September 30, 2021 December 31, 2020

The following table presents the gross carrying amount and accumulated amortization for each major class of other intangible assets as of March 31, 2022 and December 31, 2021, respectively:

(In thousands) March 31, 2022 December 31, 2021

Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization

4 unchanged sentences

Total $ 2,338,958 $ ( 735,445 ) $ 2,338,958 $ ( 672,358 )

Total amortization expense related to definite-lived intangible assets for the Company for the three months ended September 30, 2021 and 2020 was $ 64.3 million and $ 64.5 million, respectively.

Total amortization expense related to definite-lived intangible assets for the Company for the nine months ended September 30, 2021 and 2020 was $ 218.0 million and $ 193.0 million, respectively.

Total amortization expense related to definite-lived intangible assets for the Company for the three months ended March 31, 2022 and 2021 was $ 63.1 million and $ 66.3 million, respectively.

As acquisitions and dispositions occur in the future, amortization expense may vary.

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2023 $ 244,387

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table presents the changes in the carrying amount of goodwill:

(In thousands) Audio Audio & Media Services Consolidated

Balance as of December 31, 2019 $ 3,221,468 $ 104,154 $ 3,325,622

Impairment ( 1,224,374 ) — ( 1,224,374 )

(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Consolidated

Balance as of January 1, 2021 $ 1,462,217 $ 579,319 $ 104,399 $ 2,145,935

Acquisitions 1,267 168,031 — 169,298

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Balance as of December 31, 2021 $ 1,462,038 $ 747,350 $ 104,193 $ 2,313,581

(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Consolidated

Balance as of January 1, 2021 $ 1,462,217 $ 579,319 $ 104,399 $ 2,145,935

Acquisitions 1,267 168,224 — 169,491

Dispositions ( 15 ) — — ( 15 )

Foreign currency — — ( 75 ) ( 75 )

Balance as of September 30, 2021

Balance as of March 31, 2022

$ 1,462,023 $ 747,350 $ 104,118 $ 2,313,491

As a result of the leadership and organizational changes implemented in the first quarter 2021, as described in Note 1, Basis of Presentation , the Company re-evaluated its reporting units and allocated goodwill to these new reporting units.

Refer to Note 9, Segment Data, for additional information on our segments.

Goodwill was allocated to these new reporting units based on the relative fair values of these reporting units.

Fair value was calculated using the expected present value of future cash flows, and included estimates, judgments and assumptions consistent with those of a market participant that management believes were appropriate in the circumstances.

The estimates and judgments that most significantly affect the fair value calculations are assumptions related to long-term growth rates, expected profit margins and discount rates.

The Company did not recast prior-period goodwill balances to the new reporting units as it was impractical to do so.

Goodwill Impairment

The Company performs its annual impairment test on goodwill as of July 1 of each year.

The Company also tests goodwill at interim dates if events or changes in circumstances indicate that goodwill might be impaired.

The goodwill impairment test requires measurement of the fair value of the Company's reporting units, which is compared to the carrying value of the reporting units, including goodwill.

Each reporting unit is valued using a discounted cash flow model which requires estimating future cash flows expected to be generated from the reporting unit, discounted to their present value using a risk-adjusted discount rate.

Terminal values are also estimated and discounted to their present value.

Assessing the recoverability of goodwill requires estimates and assumptions about sales, operating margins, growth rates and discount rates based on budgets, business plans, economic projections, anticipated future cash flows and marketplace data.

As with the impairment testing performed on the Company’s FCC licenses described above, the significant deterioration in market conditions and uncertainty in the markets impacted the assumptions used to estimate the discounted future cash flows of the

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Company’s reporting units for purposes of performing the interim goodwill impairment test.

There are inherent uncertainties related to these factors and management’s judgment in applying these factors.

The Company engaged a third-party valuation firm to assist it in the development of the assumptions and the Company’s determination of the fair value of its reporting units as of July 1 as part of the annual impairment test.

No impairment was recognized as a result of the Company's annual impairment test on goodwill.

As a result of the changes in the Company's management structure and its reportable segments effective at the beginning of 2021, the Company performed an interim impairment test on goodwill as of January 1, 2021.

No impairment charges were recorded in the first quarter of 2021 in connection with the interim impairment test.

The Company performed an interim impairment test on goodwill in the first quarter of 2020 and recognized a non-cash impairment charge of $ 1.2 billion to reduce goodwill as a result of the COVID-19 pandemic and its adverse effect on the U.S.

NOTE 5 – LONG-TERM DEBT

Long-term debt outstanding for the Company as of September 30, 2021 and December 31, 2020 consisted of the following:

(In thousands) September 30, 2021 December 31, 2020

Long-term debt outstanding for the Company as of March 31, 2022 and December 31, 2021 consisted of the following:

(In thousands) March 31, 2022 December 31, 2021

Term Loan Facility due 2026 $ 1,864,032 $ 1,864,032

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Total long-term debt $ 5,739,421 $ 5,738,195

(1) As of September 30, 2021, the senior secured asset-based revolving credit facility (the “ABL Facility”) had a facility size of $ 450.0 million, no outstanding borrowings and $ 28.5 million of outstanding letters of credit, resulting in $ 421.5 million of borrowing base availability.

(1) As of March 31, 2022, the senior secured asset-based revolving credit facility (the “ABL Facility”) had a borrowing base of $ 443.6 million, no outstanding borrowings and $ 26.9 million of outstanding letters of credit, resulting in $ 416.7 million of borrowing base availability.

(2) Other secured subsidiary debt consists of finance lease obligations maturing at various dates from 2023 through 2045.

The Company’s weighted average interest rate was 5.4 % and 5.5 % as of September 30, 2021 and December 31, 2020, respectively.

The aggregate market value of the Company’s debt based on market prices for which quotes were available was approximately $ 5.9 billion and $ 6.2 billion as of September 30, 2021 and December 31, 2020, respectively.

The Company’s weighted average interest rate was 5.5 % and 5.4 % as of March 31, 2022 and December 31, 2021, respectively.

The aggregate market value of the Company’s debt based on market prices for which quotes were available was approximately $ 5.8 billion and $ 5.9 billion as of March 31, 2022 and December 31, 2021, respectively.

Under the fair value hierarchy established by ASC 820-10-35, the market value of the Company’s debt is classified as either Level 1 or Level 2.

On July 16, 2021, iHeartCommunications, Inc.

("iHeartCommunications") entered into an amendment to the credit agreement governing its Term Loan credit facilities.

The amendment reduced the interest rate of its Incremental Term Loan Facility due 2026 to a Eurocurrency Rate of LIBOR plus a margin of 3.25 % and floor of 0.50 % (from LIBOR plus a margin of 4.00 % and floor of 0.75 %).

The Base Rate interest amount was reduced to Base Rate plus a margin of 2.25 % and floor of 1.50 %.

In connection with the amendment, iHeartCommunications voluntarily prepaid $ 250.0 million of borrowings outstanding under

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the Term Loan credit facilities with cash on hand, resulting in a reduction of $ 44.3 million of the existing Incremental Term Loan Facility due 2026 and $ 205.7 million of the Term Loan Facility due 2026.

Under the terms of the Term Loan Facility Credit Agreement, iHeartCommunications made quarterly principal payments of $ 6.4 million during the three months ended March 31, 2021, June 30, 2021 and September 30, 2020, and previously made payments of $ 5.25 million during the three months ended March 31, 2020 and June 30, 2020.

Following the prepayment of $ 250.0 million of borrowings outstanding under the Term Loan credit facilities on July 16, 2021, iHeartCommunications is no longer required to make such quarterly payments.

Mandatorily Redeemable Preferred Stock

As previously disclosed, on March 14, 2018, the Company, iHeartCommunications and certain of the Company's direct and indirect domestic subsidiaries (collectively, the "Debtors") filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas, Houston Division (the "Bankruptcy Court").

On April 28, 2018, the Company and the other Debtors filed a plan of reorganization (as amended, the “Plan of Reorganization”) and a related disclosure statement with the Bankruptcy Court.

On January 22, 2019, the Plan of Reorganization was confirmed by the Bankruptcy Court.

On May 1, 2019 (the “Effective Date”), in accordance with the Plan of Reorganization, iHeart Operations issued 60,000 shares of its Series A Perpetual Preferred Stock, par value $ 0.001 per share (the "iHeart Operations Preferred Stock"), having an aggregate initial liquidation preference of $ 60.0 million for a cash purchase price of $ 60.0 million.

The iHeart Operations Preferred Stock was purchased by a third party investor.

As of September 30, 2021, the liquidation preference of the iHeart Operations Preferred Stock was $ 60.0 million.

The iHeart Operations Preferred Stock was mandatorily redeemable for cash at a date certain and therefore is classified as a liability in the Company's balance sheet.

On October 27, 2021, iHeart Operations repurchased all of the iHeart Operations Preferred Stock with cash on hand for an aggregate price of $ 64.4 million (“Redemption Price”), including accrued dividends, upon obtaining consent from the third party investor.

The Redemption Price included a negotiated make-whole premium as the redemption occurred prior to the optional redemption date set forth in the Certificate of Designation governing the iHeart Operations Preferred Stock.

Subsequent to the transaction, the preferred shares were retired and cancelled and are no longer outstanding.

Holders of the iHeart Operations Preferred Stock were entitled to receive, as declared by the board of directors of iHeart Operations, in respect of each share, cumulative dividends accruing daily and payable quarterly.

Dividends were payable on March 31, June 30, September 30 and December 31 of each year (or on the next business day if such date is not a business day).

During the three months ended September 30, 2021 and 2020 the Company recognized $ 2.3 million and $ 2.7 million, respectively, of interest expense related to dividends on mandatorily redeemable preferred stock.

During the nine months ended September 30, 2021 and 2020 the Company recognized $ 6.9 million and $ 6.9 million, respectively, of interest expense related to dividends on mandatorily redeemable preferred stock.

Surety Bonds, Letters of Credit and Guarantees

As of September 30, 2021, the Company and its subsidiaries had outstanding surety bonds, commercial standby letters of credit and bank guarantees of $ 8.8 million, $ 28.9 million and $ 0.2 million, respectively.

As of March 31, 2022, the Company and its subsidiaries had outstanding surety bonds, commercial standby letters of credit and bank guarantees of $ 8.4 million, $ 27.3 million and $ 0.2 million, respectively.

These surety bonds, letters of credit and bank guarantees relate to various operational matters including insurance, lease and performance bonds as well as other items.

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It is possible, however, that future results of operations for any particular period could be materially affected by changes in the Company’s assumptions or the effectiveness of its strategies related to these proceedings.

Additionally, due to the inherent uncertainty of

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litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on the Company’s financial condition or results of operations.

Additionally, due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on the Company’s financial condition or results of operations.

Although the Company is involved in a variety of legal proceedings in the ordinary course of business, a large portion of the Company’s litigation arises in the following contexts:

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and tax disputes.

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Alien Ownership Restrictions and FCC Petitions for Declaratory Ruling

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Under the Plan of Reorganization, the Company committed to file a petition for declaratory ruling (the “PDR”) requesting the FCC to permit the Company to be up to 100% foreign-owned.

On November 5, 2020, the FCC issued a declaratory ruling granting the relief requested by the PDR (the “Declaratory Ruling”), subject to certain conditions, as described further in Note 8, Stockholder's Equity below.

On November 9, 2020, the Company notified the holders of Special Warrants of the commencement of an exchange process (the “Exchange Notice”).

On January 8, 2021, the Company exchanged a portion of the outstanding Special Warrants into Class A common stock or Class B common stock, in compliance with the Declaratory Ruling, the Communications Act and FCC rules (the “Exchange”).

On November 5, 2020, the FCC issued a declaratory ruling, which granted the relief requested by the PDR, subject to certain conditions, as described further in Note 8, Stockholders' Equity (the "2020 Declaratory Ruling").

On January 8, 2021, the Company exchanged a portion of the outstanding Special Warrants (refer to Note 6, Stockholders' Equity , for further discussion of the "Special Warrants") into Class A common stock or Class B common stock, in compliance with the Declaratory Ruling, the Communications Act and FCC rules (the “Exchange”).

Following the Exchange, the Company’s remaining Special Warrants continue to be exercisable for shares of Class A common stock or Class B common stock.

Business – Regulation of Our Business, Alien Ownership Restrictions” of our Annual Report on Form 10-K for the year ended December 31, 2020 and "Part II, Item 1A.

Risk Factors - Regulatory, Legislative and Litigation Risks, Regulations imposed by the Communications Act and the FCC limit the amount of foreign individuals or entities that may invest in our capital stock without FCC approval" in this Quarterly Report on Form 10-Q for additional information.

On March 8, 2021, the Company filed a remedial petition for declaratory ruling (the “Remedial PDR”) with the FCC.

The Remedial PDR relates to the acquisition by Global Media & Entertainment Investments Ltd (f/k/a Honeycomb Investments Limited) (“Global Investments”) of the Company’s Class A Common Stock.

Specifically, on February 5, 2021, Global Investments, The Global Media & Entertainment Investments Trust (the “GMEI Trust”), James Hill (as trustee of the GMEI Trust), Simon Groom (as trustee of the GMEI Trust) and Michael Tabor (as beneficiary of the GMEI Trust) (together with Global Investments and any affiliates or third parties to whom they may assign or transfer any of their rights or interests, the “GMEI Investors”) filed a Schedule 13D with the SEC, in which the GMEI Investors disclosed beneficial ownership of 9,631,329 shares of the Company’s Class A Common Stock, which at that time represented approximately 8.7 % of the Company’s outstanding Class A Common Stock.

This ownership interest is inconsistent with the FCC’s foreign ownership rules and the Declaratory Ruling issued by the FCC relating to the Company’s foreign ownership on November 5, 2020, both of which limit a foreign investor in the GMEI Investors’ position to holding no more than 5 % of the Company’s voting equity or total equity without prior FCC approval.

The Remedial PDR, which was filed pursuant to the rules and regulations of the FCC, seeks (a) specific approval for the more than 5 % equity and voting interests in the Company presently held by the GMEI Investors and (b) as amended, advance approval for the GMEI Investors to increase their equity and voting interest in the Company up to any non-controlling amount not to exceed 14.99 %.

The Remedial PDR remains pending before the FCC.

On March 26, 2021, the FCC conditioned the approval of applications by the Company to acquire certain radio stations, which were pending prior to the GMEI Investors’ Schedule 13D filing, on the Company taking certain actions with respect to the GMEI Investors' rights as stockholders of the Company.

On that same date, and in order to implement the conditions required by the FCC, the Company’s Board of Directors (the “Board”) resolved to take certain actions to limit the rights of the GMEI Investors, including, but not limited to, suspending all voting rights of GEMI Investors until and unless the FCC releases a declaratory ruling granting specific approval for each of the GMEI Investors to hold more than 5 percent of the equity and/or voting interests of the Company.

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Tax Matters Agreement

On the Effective Date, the Company emerged from Chapter 11 and effectuated a series of transactions through which Clear Channel Outdoor Holdings, Inc.

("CCOH"), its parent Clear Channel Holdings, Inc.

(“CCH”) and its subsidiaries (collectively with CCOH and CCH, the “Outdoor Group”) were separated from, and ceased to be controlled by, the Company and its subsidiaries (the “Separation”).

In connection with the Separation, the Company entered into the Tax Matters Agreement by and among iHeartMedia, iHeartCommunications, iHeart Operations, Inc., CCH, CCOH and Clear Channel Outdoor, Inc., to allocate the responsibility of iHeartMedia and its subsidiaries, on the one hand, and CCOH and its subsidiaries, on the other, for the payment of taxes arising prior and subsequent to, and in connection with, the Separation.

The Tax Matters Agreement requires that iHeartMedia and iHeartCommunications indemnify CCOH and its subsidiaries, and their respective directors, officers and employees, and hold them harmless, on an after-tax basis, from and against certain tax claims related to the Separation.

In addition, the Tax Matters Agreement requires that CCOH indemnify iHeartMedia for certain income taxes paid by iHeartMedia on behalf of CCOH and its subsidiaries.

The Remedial PDR relates to the acquisition by Global Media & Entertainment Investments Ltd (f/k/a Honeycomb Investments Limited) (“Global Investments”) of the Company’s Class A Common Stock in a manner inconsistent with the FCC’s foreign ownership rules and the 2020 Declaratory Ruling.

On December 22, 2021, the FCC issued another declaratory ruling which granted the Remedial PDR (the "GMEI Declaratory Ruling").

Subject to certain conditions set forth therein, the GMEI Declaratory Ruling (a) grants specific approval for the more than 5 % equity and/or voting interests in the Company presently held by the GMEI Investors, (b) grants advance approval for the GMEI Investors to increase their equity and/or voting interests in the Company up to any non-controlling amount not to exceed 14.99 %, and (c) restates the terms of the 2020 Declaratory Ruling, including that the Company may have up to 100 % of its voting stock and equity owned by non-U.S.

individuals and entities.

At such time, the actions previously taken by the Board of Directors to implement the conditions required by the FCC during the pendency of the Remedial PDR ceased to apply.

NOTE 7 – INCOME TAXES

On March 11, 2021 the President signed into law the American Rescue Plan Act, which included provisions on taxes, health care, unemployment benefits, direct payments, state and local funding and other issues.

The tax provisions will not have a material impact on the Company’s tax provision calculations.

The Company’s income tax benefit (expense) for the three and nine months ended September 30, 2021 and the three and nine months ended September 30, 2020 consisted of the following components:

The tax provisions did not have a material impact on the Company’s tax provision calculations.

The Company’s income tax benefit (expense) for the three months ended March 31, 2022 and the three months ended March 31, 2021 consisted of the following components:

(In thousands) Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Current tax expense $ ( 3,579 ) $ ( 1,589 )

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Income tax benefit (expense) $ 20,209 $ ( 79,935 )

The effective tax rates for the three and nine months ended September 30, 2021 were 115.6 % and ( 40.0 )%, respectively.

The effective tax rates were primarily impacted by the forecasted increase in valuation allowance against certain deferred tax assets, related primarily to disallowed interest expense carryforwards, due to uncertainty regarding the Company’s ability to utilize those assets in future periods.

The effective tax rates for the three and nine months ended September 30, 2020 were 32.2 % and 9.8 %, respectively.

The effective tax rate for the nine months ended September 30, 2020 was primarily impacted by the impairment charges to non-deductible goodwill.

The deferred tax benefit primarily consists of $ 125.5 million related to the FCC license impairment charges recorded during the period.

NOTE 8 – STOCKHOLDER'S EQUITY

The effective tax rates for the three months ended March 31, 2022 and March 31, 2021 were 29.3 % and ( 49.3 )%, respectively.

The effective tax rates were primarily impacted by the forecasted increase in valuation allowance against certain deferred tax assets, related primarily to disallowed interest expense carryforwards and net operating loss carryforwards, due to uncertainty regarding the Company’s ability to utilize those assets in future periods.

NOTE 8 – STOCKHOLDERS' EQUITY

Pursuant to the Company's 2019 Eq uity Incentive Plan (the "2019 Plan"), the Company historically granted restricted stock units and options to purchase shares of the Company's Class A common stock to certain key individuals.

On April 21, 2021, our 2021 Long-Term Incentive Award Plan (the “2021 Plan”) was approved by stockholders and replaced the 2019 Plan.

Pursuant to our 2021 Plan, we will continue to grant restricted stock units and options to purchase shares of the Company's Class A common stock to certain key individuals.

On April 21, 2021,

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our 2021 Long-Term Incentive Award Plan (the “2021 Plan”) was approved by stockholders and replaced the 2019 Plan.

Pursuant to our 2021 Plan, we will continue to grant restricted stock units and options to purchase shares of the Company's Class A common stock to certain key individuals.

Share-based Compensation

Share-based compensation expenses are recorded in Selling, general and administrative expenses and were $ 6.0 million and $ 5.9 million for the Company for the three months ended September 30, 2021 and the three months ended September 30, 2020, respectively.

Share-based compensation expenses are recorded in Selling, general and administrative expenses and were $ 17.6 million and $ 14.7 million for the Company for the nine months ended September 30, 2021 and September 30, 2020, respectively.

Share-based compensation expenses are recorded in Selling, general and administrative expenses and were $ 5.5 million and $ 5.7 million for the Company for the three months ended March 31, 2022 and the three months ended March 31, 2021, respectively.

In August 2020, the Company issued performance-based restricted stock units ("Performance RSUs") to certain key employees.

Such Performance RSUs vest upon the achievement of critical operational (cost savings) improvements and specific environmental, social and governance initiatives, which are being measured over an approximately 18-month period from the date of issuance.

In the three and nine months ended September 30, 2021, the Company recognized $ 0.4 million and $ 1.4 million in relation to these Performance RSUs.

In the three and nine months ended September 30, 2020, the Company recognized $ 1.1 million in relation to these Performance RSUs.

As of September 30, 2021, there was $ 45.0 million of unrecognized compensation cost related to unvested share-based compensation arrangements with vesting based on service conditions.

Such Performance RSUs vest upon the achievement of critical operational (cost savings) improvements and specific environmental, social and governance initiatives, which were being measured over an approximately 18-month period from the date of issuance.

In the three months ended March 31, 2021, the Company recognized $ 0.5 million in relation to these Performance RSUs.

On March 28, 2022, the Company issued performance-based restricted stock units (“2022 Performance RSUs”) to certain key employees.

Such 2022 Performance RSUs vest upon the achievement of total stockholder return goals and continued service, which are being measured over an approximately 50-month period from the date of issuance.

As of March 31, 2022, there was $ 34.0 million of unrecognized compensation cost related to unvested share-based compensation arrangements with vesting based on service conditions.

This cost is expected to be recognized over a weighted average period of approximately 1.9 years.

In addition, as of September 30, 2021, there was $ 0.3 million of unrecognized compensation cost related to unvested share-based compensation arrangements that will vest based on certain performance conditions.

In addition, as of March 31, 2022, there was $ 12.5 million of unrecognized compensation cost related to unvested share-based compensation arrangements that will vest based on certain performance and service conditions.

This cost will be recognized over a 50-month period from the date of issuance.

Common Stock and Special Warrants

The Company is authorized to issue 2,100,000,000 shares, consisting of (a) 1,000,000,000 shares of Class A Common Stock, par value $ 0.001 per share (the “Class A Common Stock”), (b) 1,000,000,000 shares of Class B Common Stock, par value $ 0.001 per share (the “Class B Common Stock”), and (c) 100,000,000 shares of preferred stock, par value $ 0.001 per share (the “Preferred Stock”).

The following table presents the Company's Class A Common Stock, Class B Common Stock and Special Warrants issued and outstanding as of September 30, 2021:

September 30,

The following table presents the Company's Class A Common Stock, Class B Common Stock and Special Warrants issued as of March 31, 2022:

Class A Common Stock, par value $ .001 per share, 1,000,000,000 shares authorized

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Total Class A Common Stock, Class B Common Stock and Special Warrants issued 148,125,959

During the three and nine months ended September 30, 2021, stockholders converted 1,130,851 and 6,718,576 shares of the Class B common stock into Class A common stock.

During the three and nine months ended September 30, 2020, stockholders converted 7,263 and 13,323 shares of the Class B common stock into Class A common stock.

During the three months ended March 31, 2022, stockholders converted 159,692 shares of the Class B common stock into Class A common stock.

During the three months ended March 31, 2021, stockholders converted 154,045 shares of the Class B common stock into Class A common stock.

Special Warrants

Each Special Warrant issued under the special warrant agreement entered into in connection with the Reorganization may be exercised by its holder to purchase one share of Class A common stock or Class B common stock at an exercise price of $ 0.001 per share, unless the Company in its sole discretion believes such exercise would, alone or in combination with any other existing or proposed ownership of common stock, result in, subject to certain exceptions, (a) such exercising holder owning more than 4.99 percent of the Company's outstanding Class A common stock, (b) more than 22.5 percent of the Company's capital stock or voting interests being owned directly or indirectly by foreign individuals or entities, (c) the Company exceeding any other applicable foreign ownership threshold or (d) violation of any provision of the Communications Act or restrictions on ownership or transfer imposed by the Company's certificate of incorporation or the decisions, rules and policies of the FCC.

Any holder exercising Special Warrants must complete and timely deliver to the warrant agent the required exercise forms and

Each Special Warrant issued under the special warrant agreement entered into in connection with the emergence from bankruptcy in 2019 may be exercised by its holder to purchase one share of Class A common stock or Class B common stock at an exercise price of $ 0.001 per share, unless the Company in its sole discretion believes such exercise would, alone or in combination with any other existing or proposed ownership of common stock, result in, subject to certain exceptions, (a) such exercising holder owning more than 4.99 percent of the Company's outstanding Class A common stock, (b) more than 22.5 percent of the Company's capital stock or voting interests being owned directly or indirectly by foreign individuals or entities,

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certifications required under the special warrant agreement.

(c) the Company exceeding any other applicable foreign ownership threshold or (d) violation of any provision of the Communications Act or restrictions on ownership or transfer imposed by the Company's certificate of incorporation or the decisions, rules and policies of the FCC.

Any holder exercising Special Warrants must complete and timely deliver to the warrant agent the required exercise forms and certifications required under the special warrant agreement.

The Communications Act and FCC regulations prohibit foreign entities or individuals from indirectly (i.e., through a parent company) owning or voting more than 25 percent of a licensee’s equity, unless the FCC determines that greater indirect foreign ownership is in the public interest.

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On November 5, 2020, the FCC issued the Declaratory Ruling granting the relief requested by the PDR.

On November 9, 2020, the Company sent Exchange Notices to the holders of Special Warrants, notifying them of the Exchange process.

Following the Exchange, the Company’s remaining Special Warrants continue to be exercisable for shares of Class A common stock or Class B common stock.

See "Part II, Item 1A.

Risk Factors - Regulations imposed by the Communications Act and the FCC limit the amount of foreign individuals or entities that may invest in our capital stock without FCC approval" of this Quarterly Report on Form 10-Q and "Part I, Item 1.

Business – Regulation of Our Business, Alien Ownership Restrictions" of our Annual Report on Form 10-K for the year ended December 31, 2020 for additional information.

During the three and nine months ended September 30, 2021, stockholders exercised 60,698 and 47,197,139 Special Warrants for an equivalent number of shares of Class A common stock, respectively.

There were no Special Warrants exercised for an equivalent number of shares of Class B common stock during the three months ended September 30, 2021.

During the nine months ended September 30, 2021, stockholders exercised 22,337,312 Special Warrants for an equivalent number of shares of Class B common stock.

During the three and nine months ended September 30, 2020 , stockholders exercised 1,986,278 and 4,990,132 Special Warrants for an equivalent number of shares of Class A common stock.

During the three and nine months ended September 30, 2020, stockholders exercised 704 and 2,049 Special Warrants for an equivalent number of shares of Class B common stock.

As further described in Note 6, Commitments and Contingencies above, on March 26, 2021, the Company’s Board resolved to take certain actions to limit the rights of the GMEI Investors in order to implement certain conditions required by the FCC.

Such actions, included, but are not limited to, suspending all voting rights of GMEI Investors until and unless the FCC releases a declaratory ruling granting specific approval for each of the GMEI Investors to hold more than 5% of the equity and/or voting interests of the Company.

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During the three months ended March 31, 2022, stockholders exercised 11,361 Special Warrants for an equivalent number of shares of Class A common stock.

There were no Special Warrants exercised for an equivalent number of shares of Class B common stock during the three months ended March 31, 2022.

During the three months ended March 31, 2021, stockholders exercised 47,121,747 Special Warrants for an equivalent number of shares of Class A common stock.

During the three months ended March 31, 2021, stockholders exercised 22,337,312 Special Warrants for an equivalent number of shares of Class B common stock.

Computation of Loss per Share

(In thousands, except per share data) Three Months Ended

September 30, Nine Months Ended

September 30,

2021 2020 2021 2020

Net income (loss) attributable to the Company – common shares $ 3,180 $ ( 32,112 ) $ ( 270,829 ) $ ( 1,918,165 )

Net loss attributable to the Company – common shares $ ( 48,582 ) $ ( 241,723 )

DENOMINATOR (1) :

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Weighted average common shares outstanding - diluted 147,513 146,214

Net income (loss) attributable to the Company per common share:

Net loss attributable to the Company per common share:

Basic $ ( 0.33 ) $ ( 1.65 )

Diluted $ ( 0.33 ) $ ( 1.65 )

(1) All of the outstanding Special Warrants are included in both the basic and diluted weighted average common shares outstanding of the Company for the three and nine months ended September 30, 2021 and 2020.

(2) Outstanding equity awards representing 0.3 million and 9.6 million shares of Class A common stock of the Company for the three months ended September 30, 2021 and 2020, respectively, and 10.6 million and 8.5 million for the nine months ended September 30, 2021 and 2020, respectively, were not included in the computation of diluted earnings per share because to do so would have been antidilutive.

On May 5, 2021, the Company’s short-term stockholder rights plan expired in accordance with its terms and the rights are no longer outstanding.

(1) All of the outstanding Special Warrants are included in both the basic and diluted weighted average common shares outstanding of the Company for the three months ended March 31, 2022 and 2021.

(2) Outstanding equity awards representing 10.0 million and 10.7 million shares of Class A common stock of the Company for the three months ended March 31, 2022 and 2021, respectively, were not included in the computation of diluted earnings per share because to do so would have been antidilutive.

NOTE 9 – SEGMENT DATA

As discussed in Note 1, in connection with certain leadership and organizational changes implemented in the first quarter 2021, the Company revised its segment reporting as of January 1, 2021.

The corresponding current and prior period segment disclosures were recast to reflect the current segment presentation.

Segment Adjusted EBITDA is the segment profitability metric reported to the Company’s Chief Operating Decision Maker for purposes of decisions about allocation of resources to, and assessing performance of, each reportable segment.

The Company’s primary businesses are included in its Multiplatform Group and Digital Audio Group segments.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following tables present the Company's segment results for the Company for the three and nine months ended September 30, 2021 and 2020:

(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Corporate and other reconciling items Eliminations Consolidated

Three Months Ended September 30, 2021

Revenue $ 658,979 $ 205,769 $ 66,078 $ — $ ( 2,775 ) $ 928,051

Operating expenses (1)

450,549 138,646 43,656 67,762 ( 2,775 ) 697,838

Segment Adjusted EBITDA (2)

$ 208,430 $ 67,123 $ 22,422 $ ( 67,762 ) $ — $ 230,213

Depreciation and amortization ( 108,100 )

Impairment charges ( 11,647 )

Other operating expense, net ( 12,341 )

Restructuring expenses ( 12,021 )

Share-based compensation expense ( 5,993 )

Operating income $ 80,111

Intersegment revenues $ 112 $ 1,475 $ 1,188 $ — $ — $ 2,775

Capital expenditures $ 35,082 $ 6,223 $ 3,967 $ 5,002 $ — $ 50,274

Share-based compensation expense $ — $ — $ — $ 5,993 $ — $ 5,993

(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Corporate and other reconciling items Eliminations Consolidated

Three Months Ended September 30, 2020

Revenue $ 555,097 $ 116,200 $ 75,039 $ — $ ( 1,930 ) $ 744,406

Operating expenses (1)

416,131 81,042 46,247 40,792 ( 1,930 ) 582,282

Segment Adjusted EBITDA (2)

$ 138,966 $ 35,158 $ 28,792 $ ( 40,792 ) $ — $ 162,124

Depreciation and amortization ( 99,379 )

Other operating expense, net ( 1,675 )

Restructuring expenses ( 15,790 )

Share-based compensation expense ( 5,885 )

Operating income $ 39,395

Intersegment revenues $ 168 $ — $ 1,762 $ — $ — $ 1,930

Capital expenditures $ 12,056 $ 4,029 $ 850 $ 2,042 $ — $ 18,977

Share-based compensation expense $ — $ — $ — $ 5,885 $ — $ 5,885

IHEARTMEDIA, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following tables present the Company's segment results for the Company for the three months ended March 31, 2022 and 2021:

(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Corporate and other reconciling items Eliminations Consolidated

Nine Months Ended September 30, 2021

Three Months Ended March 31, 2022

Revenue $ 571,160 $ 214,219 $ 60,857 $ — $ ( 2,778 ) $ 843,458

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(In thousands) Multiplatform Group Digital Audio Group Audio & Media Services Group Corporate and other reconciling items Eliminations Consolidated

Nine Months Ended September 30, 2020

Three Months Ended March 31, 2021

Revenue $ 497,897 $ 157,553 $ 55,137 $ — $ ( 3,922 ) $ 706,665

16 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements