What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2025-02-27 compared with 2024-02-29 · 164 added, 164 removed, 349 unchanged (48% of the section changed)

6 unchanged sentences

▪ the Digital Audio Group, which includes our Digital businesses, including Podcasting;

▪ the Audio & Media Services Group, which includes Katz Media, our full-service media representation business, and RCS, a provider of scheduling and broadcast software and services.

▪ the Audio & Media Services Group, which includes Katz Media Group ("Katz Media"), our 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.

This structure provides visibility into the underlying performance, results, and margin profiles of our distinct businesses and enables senior management to 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.

Our segment profitability metric is Segment Adjusted EBITDA, which is 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.

Our segment profitability metric is Segment Adjusted EBITDA, which is reported to the Company's Chief Operating Decision Maker ("CODM") for purposes of making decisions about allocation of resources to, and assessing performance of, each reportable segment.

The Company’s CODM is our Chief Executive Officer.

Segment Adjusted EBITDA is calculated as Revenue less operating expenses, excluding Restructuring expenses (as defined below) and share-based compensation expenses.

We have transitioned our business from a single platform radio broadcast operator to a company with multiple platforms including digital, podcasting, networks and events, as well as ad technology capabilities.

We have also invested in numerous technologies and businesses to increase the competitiveness of our inventory with our advertisers and our audience.

We believe the presentation of our results by segment provides insight into our broadcast radio business and our digital business.

8 unchanged sentences

Our Multiplatform Group also generates revenue from network syndication, nationally recognized events and other miscellaneous transactions.

Management looks at our Multiplatform Group's operations’ overall revenue as well as from each revenue stream including Broadcast Spot, Networks, and Sponsorship and Events.

Management looks at our Multiplatform Group's operations’ overall revenue as well as each revenue stream including Broadcast Radio, Networks, and Sponsorship and Events.

We periodically review and refine our selling structures in all regions and markets in an effort to maximize the value of our offering to advertisers and, therefore, our revenue.

10 unchanged sentences

A portion of our Multiplatform Group segment’s expenses vary in connection with changes in revenue.

These variable expenses primarily relate to costs in our programming and sales departments, including profit sharing fees and commissions, and bad debt.

Our content costs vary with the volume and mix of songs played on our stations.

These variable expenses primarily relate to costs in our programming and sales departments, including profit sharing fees and commissions.

Digital Audio Group

7 unchanged sentences

A portion of our Digital Audio Group segment’s expenses vary in connection with changes in revenue.

These variable expenses primarily relate to our content costs including profit sharing fees and third-party content costs, as well as sales commissions and bad debt.

These variable expenses primarily relate to our content costs including profit sharing fees and third-party content costs, as well as sales commissions.

Certain of our content costs, including digital music performance royalties, vary with the volume of listening hours on our digital platforms.

1 unchanged sentence

Audio & Media Services Group revenue is generated by services provided to broadcast industry participants through our 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 software and media streaming, along with research services for radio stations, broadcast television stations, cable channels, record labels, ad agencies 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 and research services for radio stations, broadcast television stations, cable channels, record labels, ad agencies and Internet stations worldwide.

Economic Conditions

Our advertising revenue, cash flows, and cost of capital are impacted by changes in economic conditions.

Higher interest rates and high inflation have contributed to a challenging macroeconomic environment since 2022.

Higher interest rates and inflation have contributed to a challenging macroeconomic environment since 2022.

This challenging environment has led to broader market uncertainty which has impacted our revenues and cash flows.

The current market

uncertainty and macroeconomic conditions, a recession, or a downturn in the U.S.

The current market uncertainty and macroeconomic conditions, a recession, or a downturn in the U.S.

economy could have a significant impact on our ability to generate revenue and cash flows.

Cost Savings Initiatives

We have implemented key modernization initiatives and operating-expense-saving initiatives to take advantage of the significant investments we have made in new technologies to deliver incremental cost efficiencies, including initiatives to streamline our real estate footprint.

We implemented operating expense savings initiatives during the year to streamline our organization and increase automation and the use of technology.

These initiatives included headcount reductions and other actions and are anticipated to have approximately $150 million of net savings for full year 2025.

We continue to explore opportunities for further efficiencies.

1 unchanged sentence

Economic uncertainty due to inflation and higher interest rates since 2022 has resulted in, among other things, lower advertising spending by businesses.

This challenging environment has led to broader market uncertainty, has delayed our expected recovery, and has had an adverse impact on our revenue and cash flows.

This challenging environment could have a significant impact on our financial results.

In addition, the economic uncertainty has had a significant impact on the trading values of our debt and equity securities for a sustained period.

As a result, we performed an interim impairment test as of June 30, 2023 on our indefinite-lived Federal Communication Commission ("FCC") licenses and goodwill.

The June 30, 2023 testing resulted in non-cash impairment charges of $363.6 million and $595.5 million to reduce the FCC license and goodwill balances, respectively.

This economic uncertainty has delayed our expected recovery and has had an adverse impact on our revenue, cash flows, and the trading values of our debt and equity securities for a sustained period.

This challenging environment could continue to have a significant impact on our financial results.

We performed an interim impairment test as of June 30, 2024 on our indefinite-lived Federal Communications Commission ("FCC") licenses and goodwill.

The June 30, 2024 testing resulted in non-cash impairment charges of $304.1 million and $616.1 million to reduce our FCC license and goodwill balances, respectively.

Additionally, we recognized non-cash impairment charges of $363.6 million and $595.5 million to our FCC license and goodwill balances, respectively, as a result of our June 30, 2023 interim testing.

We perform our annual impairment test on our goodwill and indefinite-lived intangible assets, including FCC licenses, as of July 1 of each year.

No impairment was required as part of the 2023 annual impairment testing .

We recognized a non-cash impairment charge of $302.1 million on our FCC licenses as part of our 2022 annual impairment testing performed in the third quarter of 2022.

No impairment was required as part of the 2024 or 2023 annual impairment testing .

For more information, see Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill for a further description of the impairment charges and annual impairment tests.

1 unchanged sentence

If our actual results are not consistent with our estimates, we could be exposed to future impairment losses that could be material to our results of operations.

As part of our operating-expense-savings initiatives, we have taken proactive steps to streamline our real estate footprint and reduce related lease and operating expenses incurred by the Company.

These strategic actions typically result in impairment charges due to the write-down of the affected right-of-use assets and related fixed assets, including leasehold improvements.

For the years ended December 31, 2023 and 2022, we recognized non-cash impairment charges of $6.0 million and $9.4 million, respectively, as a result of these cost-savings initiatives.

Debt Exchange Transaction

On December 20, 2024 (the “Settlement Date”), iHeartCommunications completed its previously announced exchange offers and consent solicitations (the "Debt Exchange Transaction") whereby iHeartCommunications exchanged:

(i) $755.4 million principal amount of the existing 6.375% Senior Secured Notes due 2026 (the “2026 Secured Notes”) for $717.6 million principal amount of the new 9.125% Senior Secured First Lien Notes due 2029 (the “2029 First Lien Notes”) and cash consideration of $37.6 million,

(ii) $743.0 million principal amount of the existing 5.250% Senior Secured Notes due 2027 (the “2027 Secured Notes”) for $661.3 million principal amount of the new 7.750% Senior Secured First Lien Notes due 2030 (the “2030 First Lien Notes”),

(iii) $223.1 million principal amount of the existing 4.750% Senior Secured Notes due 2028 for $178.4 million principal amount of the new 7.000% Senior Secured First Lien Notes due 2031 (the “2031 First Lien Notes” and, together with the 2029 First Lien Notes and the 2030 First Lien Notes, the “First Lien Notes”),

(iv) $844.0 million principal amount of the existing 8.375% Senior Notes due 2027 (the “Unsecured Notes”) for $675.2 million principal amount of the new 10.875% Senior Secured Second Lien Notes due 2030 (the “Second Lien Notes” and, together with the First Lien Notes, the “New Notes”), and

(v) $2,258.7 million principal amount of the existing senior secured first lien term loans due 2026 (the “Existing Term Loans”) for $2,145.7 million principal amount of the new senior secured first lien term loans due 2029 (the “New Term Loans” and, together with the First Lien Notes, the “First Lien Debt”;

the First Lien Debt together with the Second Lien Notes, the “New Debt”) and cash consideration of $112.9 million pursuant to a term loan exchange agreement (the “Term Loan Exchange Agreement”).

In connection with the completed exchange offers, we performed an assessment by debt holder and determined that a portion met the criteria for the exchange transactions to be accounted for as a troubled debt restructuring under ASC 470-60 and a portion met the criteria for exchange transactions to be accounted for as a modification under ASC 470-50.

In both instances, the carrying value of the applicable new debt was established at the carrying value of the applicable existing debt and we established new effective interest rates based on the carrying value of the existing debt prior to the debt exchange.

The difference between the carrying value of the existing debt and the new debt is reflected as debt premium.

For more information regarding the Debt Exchange Transaction, including the previously announced exchange offers and consent solicitations, refer to Note 6, Long-Term Debt .

Executive Summary

Our revenues for the year ended December 31, 2023 decreased for our Multiplatform Group segment primarily due to lower spending on radio advertising in connection with the uncertain market conditions and a decrease in political revenue as 2022 was a mid-term election year, decreased for our Audio & Media Services Group segment primarily due to a decrease in political revenue, and increased for our Digital Audio Group segment primarily due to increased demand for podcast advertising.

Consolidated revenues for the year ended December 31, 2024 increased due to a continued increase in demand for digital advertising and increased political revenues as 2024 was a presidential election year, partially offset by lower spending on radio advertising as a result of continued uncertain market conditions.

The key developments in our business for the year ended December 31, 2024 are summarized below:

• Consolidated Revenue of $3,751.0 million decreased $161.3 million, or 4.1%, during 2023 compared to Consolidated Revenue of $3,912.3 million in 2022.

• Consolidated Revenue of $3,854.5 million increased $103.5 million, or 2.8%, during 2024 compared to Consolidated Revenue of $3,751.0 million in 2023.

• Multiplatform Group Revenue decreased $62.5 million, or 2.6%, and Segment Adjusted EBITDA decreased $92.2 million, or 16.7%, compared to 2023.

• Digital Audio Group Revenue increased $95.3 million, or 8.9%, and Segment Adjusted EBITDA increased $30.1 million, or 8.6%, compared to 2023.

• Audio & Media Services Group Revenue decreased $47.6 million, or 15.6%, and Segment Adjusted EBITDA decreased $41.4 million, or 36.7%, compared to 2022.

• Operating loss of $797.3 million decreased $854.2 million from Operating income of $56.9 million in 2022.

2023 included $965.1 million of non-cash impairment charges, primarily related to our goodwill and indefinite-lived intangible assets balances;

2022 included $311.5 million of non-cash impairment charges, primarily related to our indefinite-lived intangible asset balance.

• Net loss of $1,100.3 million in 2023 increased $837.6 million compared to Net loss of $262.7 million in 2022.

2023 included $965.1 million of non-cash impairment charges, primarily related to our goodwill and indefinite-lived intangible assets balances;

2022 included $311.5 million of non-cash impairment charges, primarily related to our indefinite-lived intangible asset balance.

• Audio & Media Services Group Revenue increased $70.4 million, or 27.4%, and Segment Adjusted EBITDA increased $69.2 million, or 96.9%, compared to 2023.

• Operating loss of $763.1 million decreased $34.2 million from Operating loss of $797.3 million in 2023.

2024 and 2023 included $922.7 million and $965.1 million of non-cash impairment charges, respectively, primarily related to our goodwill and indefinite-lived intangible assets balances.

• Net loss of $1,009.5 million decreased $90.8 million compared to Net loss of $1,100.3 million in 2023.

The decrease was primarily driven by the $96.1 million increase in the Income tax benefit, primarily related to tax benefits recorded in connection with the excluded cancellation of debt income related to the Debt Exchange Transaction, partially offset by $97.3 million of costs incurred in 2024 related to exchange fees incurred to facilitate the Debt Exchange Transaction.

• On the Settlement Date, iHeartCommunications completed the Debt Exchange Transaction resulting in a $150.5 million partial repayment of debt and a $56.5 million payment for accrued interest.

• Cash flows provided by operating activities of $71.4 million decreased $141.6 million compared to 2023.

• Adjusted EBITDA (1) of $696.6 million was down $253.7 million from $950.3 million in 2022.

• Free cash flow (2) of $110.4 million decreased $148.7 million compared to 2022.

• In addition, we received proceeds of $45.3 million upon the sale of certain broadcast tower sites and related assets;

we are leasing back tower site space under long-term operating leases.

• During the years ended December 31, 2023 and 2022, we repurchased $204.0 million and $329.6 million, respectively, of aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $147.3 million and $299.4 million in cash, excluding accrued interest.

The repurchased notes were subsequently cancelled and retired, resulting in a gain on extinguishment of debt of $56.7 million and $30.2 million for the years ended December 31, 2023 and 2022, respectively.

• Adjusted EBITDA (1) of $705.6 million increased $9.0 million from $696.6 million in 2023.

• Free cash flow (2) of $(26.2) million decreased $136.6 million compared to 2023 and included $89.0 million of Debt Exchange fees, and $46.3 million of the accrued interest paid for the Debt Exchange Transaction that would have been paid in 2025 under the old debt terms.

The table below presents a summary of our historical results of operations for the periods presented:

1 unchanged sentence

Revenue $ 3,854,532 $ 3,751,025

Operating income (loss) (797,311) 56,860

Operating loss (763,108) (797,311)

Net loss (1,009,494) (1,100,339)

4 unchanged sentences

(26,165) 110,392

(1) For a definition of Adjusted EBITDA, and a reconciliation to Operating income (loss), the most closely comparable GAAP measure, and to Net Loss, please see “Reconciliation of Operating Income (Loss) to Adjusted EBITDA” and “Reconciliation of Net Loss to EBITDA and Adjusted EBITDA” in this MD&A.

(1) For a definition of Adjusted EBITDA, and a reconciliation to Operating loss, the most closely comparable U.S.

generally accepted accounting principles ("GAAP") measure, and to Net loss, please see “Reconciliation of Operating loss to Adjusted EBITDA” and “Reconciliation of Net loss to EBITDA and Adjusted EBITDA” in this MD&A.

(2) For a definition of Free cash flow and a reconciliation to Cash provided by operating activities, the most closely comparable GAAP measure, please see “Reconciliation of Cash provided by operating activities to Free cash flow” in this MD&A.

10 unchanged sentences

Other operating expense, net 2,767 4,361

Operating income (loss) (797,311) 56,860

Operating loss (763,108) (797,311)

Interest expense, net 379,434 389,775

Loss on investments, net (28,130) (1,045)

Gain (loss) on investments, net 75,523 (28,130)

Equity in loss of nonconsolidated affiliates (2,646) (3,530)

Gain on extinguishment of debt 56,724 30,214

Gain (loss) on extinguishment of debt and exchange costs (97,305) 56,724

Other expense, net (926) (655)

Loss before income taxes (1,167,896) (1,162,677)

Income tax benefit (expense) 62,338 (4,719)

Income tax benefit 158,402 62,338

Net loss (1,009,494) (1,100,339)

17 unchanged sentences

Consolidated results for the year ended December 31, 2024 compared to the consolidated results for the year ended December 31, 2023 were as follows:

Consolidated revenue decreased $161.3 million during the year ended December 31, 2023 compared to 2022.

Multiplatform Group revenue decreased $161.8 million, primarily resulting from a decrease in broadcast advertising due to the challenging macroeconomic environment as discussed above and a decline in political advertising, partially offset by an increase in trade and barter revenues.

Digital Audio Group revenue increased $47.3 million, driven primarily by continuing increases in demand for podcast advertising.

Audio & Media Services revenue decreased $47.6 million primarily due to a decrease in political revenue.

Consolidated revenue increased $103.5 million during the year ended December 31, 2024 compared to 2023.

Multiplatform Group revenue decreased $62.5 million, primarily resulting from a decrease in broadcast advertising in connection with continued uncertain market conditions, partially offset by increases in political revenues as 2024 was a presidential election year.

Digital Audio Group revenue increased $95.3 million, driven primarily by continuing increases in demand for digital advertising, including podcast advertising.

Audio & Media Services revenue increased $70.4 million primarily as a result of higher political revenue and digital revenue.

Direct operating expenses

Consolidated direct operating expenses increased $94.7 million during the year ended December 31, 2024 compared to 2023.

The increase in consolidated direct operating expenses was primarily driven by higher variable content costs, including digital profit sharing costs, third-party broadcast costs, and production costs, as well as higher broadcast music license fees.

These increases were partially offset by lower third-party digital costs in connection with COVID-19 related advertisers, lower employee compensation as a result of cost savings initiatives and lower digital performance royalty fees.

The increase was primarily driven by higher variable content costs, including higher third-party digital costs related to the increase in digital revenues and podcast profit sharing expenses, as well as higher music license fees.

Selling, general and administrative (“SG&A”) expenses

Consolidated SG&A expenses increased $37.5 million during the year ended December 31, 2024 compared to 2023.

The increase in consolidated SG&A expenses was driven primarily by higher trade and barter expense, variable bonus expense, and bad debt expense.

These increases were partially offset by a decrease in costs incurred in connection with executing on our cost reduction initiatives and lower sales commissions.

The increase was driven primarily by higher non-cash trade expense, as well as an increase in costs incurred in connection with executing on our cost savings initiatives and higher sales commissions, partially offset by lower bonus expense and lower bad debt expense.

Depreciation and amortization

Depreciation and amortization decreased $17.2 million during 2023 compared to 2022, primarily as a result of a lower fixed asset base due to properties sold in 2022 in connection with our real estate optimization initiatives and the Q3 2023 tower sale-leaseback transaction described under “Sources of Liquidity and Anticipated Cash Requirements” below, as well as lower amortization expense due to certain intangible assets being fully amortized.

Depreciation and amortization decreased $18.9 million during 2024 compared to 2023, primarily as a result of a lower fixed asset base due to lower levels of capital expenditures.

Impairment charges

Economic uncertainty due to inflation and higher interest rates since 2022 has resulted in, among other things, lower advertising spending by businesses.

In addition, the economic uncertainty has had a significant impact on the trading values of our debt and equity securities for a sustained period.

As a result, we performed an interim impairment test as of June 30, 2023 on our indefinite-lived FCC licenses and goodwill.

We recorded a non-cash impairment charge of $959.1 million in the second quarter of 2023 to reduce the carrying values of our indefinite-lived FCC licenses and our goodwill to their estimated fair values.

See Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill , to the consolidated financial statements for a further description of the impairment charges.

During the years ended December 31, 2024 and 2023, we recorded non-cash impairment charges of $922.7 million and $965.1 million, respectively, to reduce the carrying values of our indefinite-lived FCC licenses and our goodwill to their estimated fair values as a result of the interim impairment assessments performed in the second quarter of 2024 and 2023, respectively.

The impairment charges resulted from the economic uncertainty due to inflation and higher interest rates that has had an adverse impact on our results and has resulted in a significant decrease in the trading values of our debt and equity securities for a sustained period.

See Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill , to our consolidated financial statements located in Part II, Item 8 of this Annual Report on Form 10-K for more information.

We perform our annual impairment test on our goodwill and FCC licenses as of July 1 of each year.

No impairment was required for our goodwill and FCC licenses as part of the 2023 annual impairment testing.

We recognized non-cash impairment charges of $302.1 million on our indefinite-lived FCC licenses during the year ended December 31, 2022 primarily as a result of an increase in the discount rate used in our fair value calculations due to higher market interest rates at that time compared to the prior year.

See above under “Impairment Charges” and Item 8, Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill , for further discussion of the impairment charges.

No impairment charges were recorded for our goodwill for the year ended December 31, 2022.

In addition, as part of our operating expense-savings initiatives, we have taken strategic actions to streamline our real estate footprint and related expenses, resulting in impairment charges due to the write-down of right-of-use assets and related fixed assets, including leasehold improvements.

During the years ended December 31, 2023 and 2022, we recognized non-cash impairment charges of $6.0 million and $9.4 million, respectively, as a result of these cost-savings initiatives, primarily related to changes in sublease assumptions for certain operating leases previously determined to be subleased as part of strategic actions to streamline our real estate footprint.

Other Operating Expense, Net

Other operating expense, net of $4.4 million in 2023 and $25.0 million in 2022, related primarily to non-cash net book losses recognized on asset disposals in connection with our real estate optimization initiatives.

No impairment was required for our goodwill and FCC licenses as part of the 2024 or 2023 annual impairment testing.

Interest expense, net

Interest expense, net increased $48.1 million during 2023 compared to 2022 primarily as a result of an increase in floating borrowing rates, partially offset by the lower outstanding aggregate principal of iHeartCommunications, Inc.’s 8.375% Senior Unsecured Notes due 2027 due to the repurchases of $533.6 million of the notes for $446.7 million in cash made during 2023 and 2022.

Loss on Investments, net

During the years ended December 31, 2023 and 2022, we recognized a loss on investments, net of $28.1 million and $1.0 million, respectively, in connection with changes in the value of our investments.

Gain on Extinguishment of Debt

During the year ended December 31, 2023, we recognized a gain on extinguishment of debt of $56.7 million in connection with the repurchase of $204.0 million aggregate principal amount of iHeartCommunications, Inc.’s 8.375% Senior Unsecured Notes due 2027 for $147.3 million in cash.

During the year ended December 31, 2022, we recognized a gain on extinguishment of debt of $30.2 million in connection with the repurchase of $329.6 million aggregate principal amount of iHeartCommunications, Inc.’s 8.375% Senior Unsecured Notes due 2027 for $299.4 million in cash.

Interest expense, net decreased $10.3 million during 2024 compared to 2023 primarily due to lower outstanding aggregate principal of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 due to the repurchases of $204.0 million of the notes for $147.3 million in cash during 2023 and higher interest income earned on larger cash balances, partially offset by an increase in floating interest rates during 2024.

Gain (loss) on investments, net

During the year ended December 31, 2024, we recognized a gain on investments, net of $75.5 million primarily due to the $101.4 million gain recognized on the sale of our investment in Broadcast Music, Inc.

("BMI") in the first quarter of 2024, partially offset by declines in the value of certain investments.

During the year ended December 31, 2023, we recognized a loss on investments, net of $28.1 million related to declines in the value of certain investments.

Gain (loss) on extinguishment of debt and exchange costs

In connection with the Debt Exchange Transaction discussed above, we recognized costs of $97.3 million, primarily related to exchange fees incurred to facilitate the Debt Exchange Transaction.

During the year ended December 31, 2023, we recognized a gain of $56.7 million in connection with the repurchase of $204.0 million aggregate principal amount of iHeartCommunications, Inc.’s 8.375% Senior Unsecured Notes due 2027 for $147.3 million in cash.

There were no repurchases during the year ended December 31, 2024.

Income tax benefit (expense)

The effective tax rates for the years ended December 31, 2024 and 2023 were 13.6% and 5.4%, respectively.

The effective tax rate in 2023 was primarily impacted by the impairment charges to non-deductible goodwill as discussed in Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill .

The effective tax rate for 2022 was primarily impacted by the forecasted increase in valuation allowances 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 rate in 2024 was primarily impacted by the impairment charges to non-deductible goodwill as discussed in Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill , and deferred tax expenses recorded for valuation allowances against disallowed interest carryforwards and net operating losses, partially offset by tax benefits recorded in connection with the excluded cancellation of debt income related to the Debt Exchange Transaction as discussed in Note 6, Long-Term Debt, completed in the fourth quarter of 2024.

The effective tax rate for 2023 was primarily impacted by the impairment charges to non-deductible goodwill recorded during the second quarter of 2023.

Net loss attributable to the Company

Net loss attributable to the Company increased to $1,102.7 million during the year ended December 31, 2023 compared to Net loss attributable to the Company of $264.7 million during the year ended December 31, 2022, mainly due to the non-cash impairment charges of $965.1 million recorded in 2023, primarily related to our goodwill and indefinite-lived intangible assets balance, an increase in non-cash impairment charges compared to the $311.5 million recorded in 2022, related to our indefinite-lived intangible asset balance.

Net loss attributable to the Company of $1,009.9 million for the year ended December 31, 2024 decreased $92.7 million compared to Net loss attributable to the Company of $1,102.7 million during the year ended December 31, 2023, largely due to the increase in the income tax benefit as described in the section above, partially offset by $97.3 million of transaction fees incurred to facilitate the Debt Exchange Transaction.

Multiplatform Group Results

8 unchanged sentences

(1) Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring expenses.

Revenue from our Multiplatform Group decreased $161.8 million compared to 2022, primarily as a result of lower broadcast revenue due to the challenging macroeconomic environment and a decline in political advertising as 2022 was a mid-term election year, partially offset by increases in trade and barter revenues .

Broadcast revenue decreased $131.2 million, or 7.0%, year-over-year, while Networks revenue decreased $36.8 million or 7.3% year-over-year.

Revenue from Sponsorship and Events increased $2.4 million, or 1.3%, year-over-year.

Operating expenses increased $50.4 million, driven primarily by higher trade and barter expense in connection with the increase in trade and barter revenues, bad debt expense, third-party broadcast costs, and variable bonus expense, partially offset by lower sales commissions and a decrease in costs as a result of our cost reduction initiatives.

Revenue from our Multiplatform Group decreased $62.5 million compared to 2023, primarily due to a decrease in broadcast advertising in connection with continued uncertain market conditions, partially offset by an increase in political revenues.

Broadcast revenue decreased $25.2 million, or 1.4%, year-over-year driven by lower spot revenue, partially offset by an increase in political advertising.

Networks revenue decreased $29.2 million or 6.3% year-over-year due primarily to the impact of non-returning advertisers.

Revenue from Sponsorship and Events decreased $4.1 million, or 2.1%, year-over-year.

Operating expenses increased $29.7 million, driven primarily by higher non-cash trade expense related to the 2024 iHeartRadio Music Festival, the 2024 Summer Olympics, and the 2024 iHeartRadio Music Awards, as well as higher broadcast music license fees, and an increase in tower rent as a result of the tower sale leaseback transaction completed at the end of the third quarter of 2023.

These increases were partially offset by lower employee compensation in connection with our cost savings initiatives, lower bad debt expense and lower bonus expense.

Digital Audio Group Results

8 unchanged sentences

(1) Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring expenses.

Revenue from our Digital Audio Group increased $47.3 million compared to the prior year, led by Podcast revenue which increased $49.4 million, or 13.8%, year-over-year, driven primarily by increased demand for podcasting from advertisers, as well as higher trade and barter revenue.

Digital, excluding Podcast revenue, decreased $2.1 million year-over-year, primarily driven by a decrease in COVID-19 related advertisers.

Operating expenses increased $7.5 million primarily driven by higher variable content costs, including digital profit sharing costs and production costs, as well as higher trade and barter expenses, partially offset by lower third-party digital costs in connection with COVID-19 related advertisers and lower digital performance royalty fees.

Revenue from our Digital Audio Group increased $95.3 million compared to the prior year, led by Digital, excluding Podcast revenue which increased $54.4 million, or 8.2% year-over-year, primarily due to an increase in demand for digital advertising.

Podcast revenue increased $40.9 million, or 10.0%, year-over-year, driven primarily by increased demand for podcasting from advertisers.

Operating expenses increased $65.3 million primarily driven by higher variable content costs, including third-party digital costs and podcast profit sharing costs related to the increase in revenues.

Audio & Media Services Group Results

8 unchanged sentences

(1) Operating expenses consist of Direct operating expenses and Selling, general and administrative expenses, excluding Restructuring expenses.

Revenue from our Audio & Media Services Group decreased $47.6 million compared to the prior year period primarily driven by a decrease in political revenue.

Operating expenses decreased $6.2 million primarily as a result of lower variable bonus expense.

Revenue from our Audio & Media Services Group increased $70.4 million compared to the prior year, primarily due to higher political revenue as 2024 was a presidential election year, as well as due to increased demand for digital advertising and contract termination fees earned by Katz Media.

Operating expenses increased $1.1 million primarily driven by higher variable bonus expense based on results and higher sales commissions due to increased revenue, partially offset by lower employee compensation in connection with our cost savings initiatives.

Non-GAAP Financial Measures

Reconciliations of Operating Income to Adjusted EBITDA

Reconciliations of Operating loss to Adjusted EBITDA

(In thousands) Year Ended December 31,

Operating income (loss) $ (797,311) $ 56,860

Operating loss $ (763,108) $ (797,311)

Depreciation and amortization 409,582 428,483

8 unchanged sentences

Net loss $ (1,009,494) $ (1,100,339)

Income tax (benefit) expense (62,338) 4,719

Income tax benefit (158,402) (62,338)

Interest expense, net 379,434 389,775

1 unchanged sentence

EBITDA $ (378,880) $ (344,419)

Loss on investments, net 28,130 1,045

Gain on extinguishment of debt (56,724) (30,214)

(Gain) loss on investments, net (75,523) 28,130

(Gain) loss on extinguishment of debt and exchange costs 97,305 (56,724)

Other expense, net 926 655

6 unchanged sentences

$ 705,617 $ 696,598

(1) We define Adjusted EBITDA as consolidated Operating income (loss) adjusted to exclude restructuring expenses included within Direct operating expenses and SG&A expenses, and share-based compensation expenses included within SG&A expenses, as well as the following line items presented in our Statements of Operations:

(1) We define Adjusted EBITDA as consolidated Operating loss adjusted to exclude restructuring expenses included within Direct operating expenses and SG&A expenses, and share-based compensation expenses included within SG&A expenses, as well as the following line items presented in our Statements of Operations:

Depreciation and amortization, Impairment charges and Other operating expense, net.

Alternatively, Adjusted EBITDA is calculated as Net loss, adjusted to exclude Income tax (benefit) expense, Interest expense, net, Depreciation and amortization, Loss on investments, net, Gain on extinguishment of debt, Other expense, net, Equity in loss of nonconsolidated affiliates, net, Impairment charges, Other operating expense, net, Share-based compensation expense, and restructuring expenses.

Alternatively, Adjusted EBITDA is calculated as Net loss, adjusted to exclude Income tax benefit, Interest expense, net, Depreciation and amortization, (Gain) loss on investments, net, (Gain) loss on extinguishment of debt and exchange costs, Other expense, net, Equity in loss of nonconsolidated affiliates, Impairment charges, Other operating expense, net, Share-based compensation expense, and restructuring expenses.

Restructuring expenses primarily include 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.

We use Adjusted EBITDA, among other measures, to evaluate the Company’s operating performance.

We use Adjusted EBITDA to evaluate the Company’s operating performance.

This measure is among the primary measures used by management for the planning and forecasting of future periods, as well as for measuring performance for compensation of executives and other members of management.

We believe this measure is an important indicator of our operational strength and performance of our business because it provides a link between operational performance and operating income.

It is also a primary measure used by management in evaluating companies as potential acquisition targets.

We believe this measure is an important indicator of our operational strength and performance of our business because it provides a link between operational performance and Operating loss.

We believe the presentation of this measure is relevant and useful for investors because it allows investors to view performance in a manner similar to the method used by management.

1 unchanged sentence

In addition, we believe this measure is also among the primary measures used externally by our investors, analysts and peers in our industry for purposes of valuation and comparing our operating performance to other companies in our industry.

Since Adjusted EBITDA is not a measure calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, operating income (loss) or net loss as an indicator of operating performance and may not be comparable to similarly titled measures employed by other companies.

Adjusted EBITDA is not necessarily a measure of our ability to fund our cash

Because it excludes certain financial information compared with operating income and compared with consolidated net loss, the most directly comparable GAAP financial measures, users of this financial information should consider the types of events and transactions which are excluded.

Since Adjusted EBITDA is not a measure calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, Operating loss or Net loss as an indicator of operating performance and may not be comparable to similarly titled measures employed by other companies.

Adjusted EBITDA is not necessarily a measure of our ability to fund our cash needs.

Because it excludes certain financial information compared with

Operating loss and compared with consolidated Net loss, the most directly comparable GAAP financial measures, users of this financial information should consider the types of events and transactions which are excluded.

Reconciliations of Cash provided by operating activities to Free cash flow

5 unchanged sentences

(1) We define Free cash flow as Cash provided by operating activities less capital expenditures, which is disclosed as Purchases of property, plant and equipment in the Company's Consolidated Statements of Cash Flows.

We use Free Cash Flow, among other measures, to evaluate the Company’s liquidity and its ability to generate cash flow.

We use Free Cash Flow to evaluate the Company’s liquidity and its ability to generate cash flow.

We believe that Free Cash Flow is meaningful to investors because we review cash flows generated from operations after taking into consideration capital expenditures due to the fact that these expenditures are considered to be a necessary component of ongoing operations.

8 unchanged sentences

Share-based compensation expenses are recorded in the statement of comprehensive loss as Selling, general and administrative expenses and were $32.3 million and $35.6 million for the years ended December 31, 2024 and 2023, respectively.

As of December 31, 2023 there was $50.8 million of unrecognized compensation cost related to unvested share-based compensation arrangements.

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

See Note 9, Stockholders' Equity , for more information.

As of December 31, 2024 there was $30.1 million of unrecognized compensation cost related to unvested share-based compensation arrangements with vesting based solely on service conditions.

This cost is expected to be recognized over a weighted average period of approximately 1.5 years and assumes Performance RSUs will be fully earned at target.

See Note 9, Stockholders' Deficit , for more information.

LIQUIDITY AND CAPITAL RESOURCES

10 unchanged sentences

Cash provided by operating activities was $71.4 million in 2024 compared to $213.1 million of cash provided by operating activities in 2023.

The decrease was primarily due to a decrease in broadcast radio revenue due to a more challenging macroeconomic environment and a decrease in political revenue as 2022 was a mid-term election year, as well as higher interest expense due to an increase in borrowing rates, and timing of payments.

These impacts were partially offset by lower bonus payments in 2023 compared to 2022.

The decrease was primarily related to the payment of $89.0 million of cash paid for Debt Exchange fees and $46.3 million of accrued interest paid for the Debt Exchange Transaction that would have been paid in 2025 under the old debt terms.

The decrease was also driven by the decrease in revenue from our Multiplatform Group and an increase in cash bonus payments in 2024 compared to 2023.

These decreases were partially offset by an improvement in the timing of receivable collections.

Investing Activities

Cash provided by investing activities of $0.5 million in 2024 primarily reflects $101.4 million of proceeds received from the sale of our investment in BMI, partially offset by $97.6 million in cash used for capital expenditures.

For capital expenditures during the period, we spent $52.2 million for capital expenditures in our Multiplatform Group segment primarily related to our real estate optimization initiatives and software purchases, $22.5 million in our Digital Audio Group segment primarily related to IT infrastructure, $10.4 million in our Audio & Media Services Group segment, primarily related to software, and $12.5 million in Corporate primarily related to equipment and software purchases.

Cash used for investing activities of $51.3 million in 2023 primarily reflects $102.7 million in cash used for capital expenditures.

We spent $58.0 million for capital expenditures in our Multiplatform Group segment, primarily related to our real estate optimization initiatives and software purchases, $23.2 million in our Digital Audio Group segment, primarily related to IT infrastructure, $7.4 million in our Audio & Media Services Group segment, primarily related to software, and $14.1 million in Corporate primarily related to equipment and software purchases.

These were offset by the proceeds from the disposal of assets, which mainly consists of $45.3 million related to the sale of broadcast tower sites and related assets.

These were partially offset by the proceeds from the disposal of assets, which mainly consists of $45.3 million related to the sale of broadcast tower sites and related assets.

We are leasing back space on the broadcast towers and related assets under long-term operating leases.

Refer to Note 3 - Leases and Note 4 - Property, Plant and Equipment, Intangible Assets and Goodwill for more information.

Cash used for investing activities in 2023 includes $12.7 million of cash paid related to assets acquired in the fourth quarter of 2022.

Cash used for investing activities of $129.2 million in 2022 primarily reflects $161.0 million in cash used for capital expenditures.

We spent $119.6 million for capital expenditures in our Multiplatform Group segment, primarily related to our real estate optimization initiatives, $21.3 million in our Digital Audio Group segment, primarily related to IT infrastructure, $8.2 million in our Audio & Media Services Group segment, primarily related to software and $11.9 million in Corporate primarily related to equipment and software purchases.

Cash used for investing activities was partially offset by proceeds from the sale of certain properties related to our real estate optimization initiatives.

Financing Activities

Cash used for financing activities totaled $152.2 million in 2023 primarily due to the 2023 repurchases of $204.0 million aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $147.3 million in cash.

Cash used for financing activities of $158.3 million in 2024 primarily relates to $150.5 million of cash paid as partial principal repayment in connection with the Debt Exchange Transaction.

Cash used for financing activities of $152.2 million in 2023 primarily related to the 2023 repurchases of $204.0 million aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $147.3 million in cash .

Sources of Liquidity and Anticipated Cash Requirements

Our primary sources of liquidity are cash on hand, which consisted of cash and cash equivalents of $346.4 million as of December 31, 2023, cash flows from operations and borrowing capacity under our $450.0 million senior secured asset-based revolving credit facility entered into on May 17, 2022 (the "ABL Facility").

Our primary sources of liquidity are cash on hand, which consisted of cash and cash equivalents of $259.6 million as of December 31, 2024, cash flows from operations and borrowing capacity under our $450.0 million senior secured asset-based revolving credit facility (the "ABL Facility") provided for under the Company's ABL Credit Agreement, dated as of May 17, 2022 (as amended, supplemented, or otherwise modified, the "ABL Credit Agreement").

On November 6, 2024, we amended the ABL Credit Agreement, providing for, among other things, the applicable rate with respect to the loans provided thereunder to be increased by 0.50% and the amendment of certain of the covenants and default provisions.

For more information, refer to Note 6, Long-Term Debt .

As of December 31, 2024, iHeartCommunications had no amounts outstanding under the ABL Facility, a facility size of $450.0 million and $23.7 million in outstanding letters of credit, resulting in $426.3 million of borrowing base availability.

Together with our cash balance of $346.4 million as of December 31, 2023 and our borrowing capacity under the ABL Facility, our total available liquidity 1 was approximately $772.1 million.

In September 2023, we sold 122 of our broadcast tower sites and related assets for net proceeds of $45.3 million.

We simultaneously leased back space on 121 of the broadcast towers and related assets under long-term operating leases.

We intend to use the proceeds from this transaction to fund working capital needs and for general corporate purposes.

Together with our cash balance of $259.6 million and our borrowing capacity under the ABL Facility, our total available liquidity 1 was approximately $685.9 million as of December 31, 2024.

We regularly evaluate the impact of economic conditions on our business.

A challenging macroeconomic environment has led to market uncertainty which negatively impacted our 2024 revenue and cash flows.

For the year ended December 31, 2023, our revenues decreased compared to the year ended December 31, 2022 due to the decrease in broadcast radio revenue driven by market uncertainty from the challenging macroeconomic environment, among other factors discussed in the Results of Operations section of the MD&A.

For the year ended December 31, 2024, our revenues increased compared to the year ended December 31, 2023 primarily due to revenue growth in our Digital Audio Group, as well as political revenue, partially offset by lower revenue in our Multiplatform Group, among other factors discussed in the Results of Operations section of the MD&A.

Although we cannot predict future economic conditions or the impact of any potential contraction of economic growth on our business, we believe that we have sufficient liquidity to continue to fund our operations for at least the next twelve months.

2 unchanged sentences

Certain contractual obligations are reflected on the Consolidated Balance Sheet as of December 31, 2024, while others are considered future commitments.

Our contractual obligations primarily consist of long-term debt and related interest payments, commitments under non-cancelable operating lease agreements, and employment and talent contracts.

Our contractual obligations primarily consist of long-term debt and related interest payments, commitments under non-cancelable operating lease agreements, employment and talent contracts, and music license fees.

In addition to our contractual obligations, we expect that our primary anticipated uses of liquidity in 2025 will be to fund our working capital, make interest and tax payments, fund capital expenditures, make voluntary debt repayments and pursue other strategic opportunities, and maintain operations.

On June 15, 2023, iHeartCommunications, Inc.

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

The amendment replaces the prior Eurocurrency interest rate, based upon LIBOR, with the Secured Overnight Financing Rate (“SOFR”) successor rate plus a SOFR adjustment as specified in the credit agreement.

The Term Loan Facility margins remain the same with the Term Loan Facility due 2026 containing margins of 3.00% for Term SOFR Loans (as defined in the credit agreement) and 2.00% for Base Rate Loans (as defined in the credit agreement), and the Incremental Term Loan Facility due 2026 containing margins of 3.25% for Term SOFR Loans with a floor of 0.50% and 2.25% for Base Rate Loans with a floor of 1.50%.

Assuming the level of borrowings and interest rates at December 31, 2023, we anticipate that we will have approximately $391.0 million of cash interest payments in 2024 compared to $392.7 million of cash interest payments in 2023, due to the lower outstanding debt balance related to the note repurchases conducted in 2023, largely offset by the increase in floating interest rates during 2023.

Assuming the level of borrowings and interest rates at December 31, 2024, we anticipate that we will have approximately $399.5 million of cash interest payments in 2025 compared to $427.5 million of cash interest payments in 2024 which included $46.3 million of the accrued interest paid for the Debt Exchange Transaction that would have been paid in 2025 under the old debt terms.

Future increases in interest rates could have a significant impact on our cash interest payments.

For a description of the Company's future maturities of long-term debt, see Note 6, Long-Term Debt , and for a description of the Company's non-cancelable operating lease agreements, see Note 7, Commitments and Contingencies .

In addition to the cash interest payments, we are required to make quarterly amortization payments on the New Term Loans (as defined below) in an amount equal to 0.25% of the original principal amount thereof beginning with the quarter ending March 31, 2025.

This will result in an additional $21.5 million in cash payments that we must make in 2025 to service our debt.

We believe that our cash balance, our cash flow from operations and availability under our ABL Facility provide us with sufficient liquidity to fund our core operations, maintain key personnel and meet our other material obligations for at least the next twelve months.

We acknowledge the challenges posed by the market uncertainty as a result of global economic weakness, the recent slowdown in economic activity, rising interest rates, historically high inflation and other macroeconomic trends, however, we remain confident in our business, our employees and our strategy.

We acknowledge the challenges posed by the market uncertainty as a result of global economic weakness and other macroeconomic and political trends, however, we remain confident in our business, our employees and our strategy.

Further, we believe our available liquidity will allow us to fund capital expenditures and other obligations and make interest payments on our long-term debt for at least the next twelve months.

2 unchanged sentences

We frequently evaluate strategic opportunities.

During the year ended December 31, 2023, we conducted repurchases of $204.0 million aggregate principal amount of iHeartCommunications, Inc.'s 8.375% Senior Unsecured Notes due 2027 for $147.3 million in cash, reflecting a discounted purchase price from the face value of the notes.

We expect from time to time to pursue other strategic opportunities such as acquisitions or disposals of certain businesses, which may or may not be material.

1 unchanged sentence

We use total available liquidity to evaluate our capacity to access cash to meet obligations and fund operations.

Subsequent Events

On February 8, 2024, the sale of Broadcast Music, Inc.

("BMI") to a shareholder group led by New Mountain Capital, LLC, was completed.

Based on the Company's equity interest in BMI, the sale resulted in cash proceeds of $101.4 million.

The Company plans to use the proceeds for general corporate purposes, which may include the repayment of debt.

Sources of Capital

On December 20, 2024, we competed the Debt Exchange Transaction.

For more information about the Debt Exchange Transaction, refer to Note 6, Long-Term Debt .

We had the following debt outstanding, net of cash and cash equivalents:

(In thousands) December 31,

Asset-based Revolving Credit Facility due 2027 (1)

Term Loan Facility due 2026 (2)

5,095 1,864,032

Incremental Term Loan Facility due 2026 (2)

Asset-based Revolving Credit Facility due 2027 — —

6.375% Senior Secured Notes due 2026 800,000 800,000

5.25% Senior Secured Notes due 2027 750,000 750,000

4.75% Senior Secured Notes due 2028 500,000 500,000

Other secured subsidiary debt 3,367 4,462

Total consolidated secured debt $ 4,318,619 $ 4,319,714

1,500 401,220

Term Loan Facility due 2029 (2)

6.375% Senior Notes due 2026 (2)(3)

44,644 800,000

5.25% Senior Notes due 2027 (2)(3)

6,983 750,000

8.375% Senior Unsecured Notes due 2027 (2)

72,388 916,357

4.75% Senior Secured Notes due 2028 (2)

276,868 500,000

9.125% First Lien Notes due 2029 (2)

7.75% First Lien Notes due 2030 (2)

7.00% First Lien Notes due 2031 (2)

10.875% Second Lien Notes due 2030 (2)

Other subsidiary debt 5,008 3,367

1 unchanged sentence

Long-term debt fees (8,974) (12,268)

Debt Premium (4)

Total Debt $ 5,071,469 $ 5,215,150

Debt Premium 293,999 —

Cash and cash equivalents 259,580 346,382

$ 4,517,890 $ 4,868,768

1 During 2023, we repurchased $204.0 million aggregate principal amount of iHeartCommunications, Inc.’s 8.375% Senior Unsecured Notes due 2027 for $147.3 million in cash, excluding accrued interest.

The repurchased notes were subsequently cancelled and retired, resulting in a gain on extinguishment of debt of $56.7 million.

(1) On November 6, 2024, we amended the ABL Credit Agreement providing for the ABL Facility, which, among other things, increased the applicable rate with respect to the loans provided thereunder by 0.50% and amended certain of the covenants and default provisions.

For more information about the ABL Facility, refer to Note 6, Long-Term Debt .

(2) On December 20, 2024, we completed our previously announced exchange offers and consent solicitations.

For more information about the Debt Exchange Transaction, see Note 6, Long-Term Debt .

(3) Subsequent to the Debt Exchange Transaction, the 6.375% Senior Notes and the 5.25% Senior Notes are no longer secured.

(4) The difference between the carrying value of the exchanged 5.25% Senior Secured Notes, 4.75% Senior Secured Notes, and 8.375% Senior Unsecured Notes and the principal amount of the 7.75% First Lien Notes due 2030, 7.00% First Lien Notes due 2031 and the 10.875% Second Lien Notes due 2030 was recorded as debt premium and will be reduced as contractual interest payments are made.

(5) Net Debt is a non-GAAP financial metric that is used by management and investors to assess our ability to meet financial obligations.

See above under “Sources of Liquidity and Cash Requirements” for details regarding the amendment to our Term Loan Facility entered into on June 15, 2023.

Our ABL Facility contains a springing fixed charge coverage ratio that is effective if certain triggering events related to borrowing capacity under the ABL Facility occur.

5 unchanged sentences

Such refinancings, repayments, exchanges or purchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

The amounts involved may be material.

involved may be material.

For a description of the Debt Exchange Transaction, see above under "Debt Exchange Transaction" and Note 6, Long-Term Debt .

We or our subsidiaries may also sell certain assets, securities, or properties.

12 unchanged sentences

Holders of shares of our Class A common stock are entitled to receive dividends, on a per share basis, when and if declared by our Board out of funds legally available therefor and whenever any dividend is made on the shares of our Class B common stock subject to certain exceptions set forth in our certificate.

See Note 9, Stockholders' Equity , to our consolidated financial statements located in Part II, Item 8 of this Annual Report on Form 10-K.

See Note 9, Stockholders' Deficit , to our consolidated financial statements located in Part II, Item 8 of this Annual Report on Form 10-K.

Commitments, Contingencies and Guarantees

19 unchanged sentences

Interest Rate Risk

On June 15, 2023, iHeartCommunications entered into an amendment to the Term Loan Facility.

The amendment replaces the prior Eurocurrency interest rate, based upon LIBOR, with the SOFR successor rate plus a SOFR adjustment as specified in the credit agreement.

A significant amount of our long-term debt bears interest at variable rates.

2 unchanged sentences

As of December 31, 2024, approximately 45% of our aggregate principal amount of long-term debt bore interest at floating rates.

Assuming the current level of borrowings and assuming a 100 bps change in floating interest rates, it is estimated that our interest expense for the year ended December 31, 2023 would have changed by $23.0 million.

Assuming the current level of borrowings and assuming a 100 bps change in floating interest rates, it is estimated that our interest expense would change by $21.7 million.

In the event of an adverse change in interest rates, management may take actions to mitigate our exposure.

5 unchanged sentences

NEW ACCOUNTING PRONOUNCEMENTS

For information regarding new accounting pronouncements, refer to Note 1, Summary of Significant Accounting Policies .

For information regarding new accounting pronouncements, refer to Note 1, Summary of Significant Accounting Policies , to our consolidated financial statements located in Part II, Item 8 of this Annual Report on Form 10-K.

CRITICAL ACCOUNTING ESTIMATES

8 unchanged sentences

Indefinite-lived Intangible Assets

Indefinite-lived intangible assets, such as our FCC licenses, are reviewed annually for possible impairment using the direct valuation method as prescribed in ASC 805-20-S99.

Indefinite-lived intangible assets, such as our FCC licenses, are reviewed for impairment using the direct valuation method as prescribed in ASC 805-20-S99.

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

2 unchanged sentences

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

Our key assumptions using the direct valuation method are market revenue growth rates, profit margin, and the risk-adjusted discount rate as well as other assumptions including market share, duration and profile of the build-up period, and estimated start-up capital costs.

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

6 unchanged sentences

• Operating margins of 8.0% in the first year gradually climb to the industry average margin in year 3 of up to 16.3%, depending on market size;

• Assumed discount rates of 10.0% for all markets.

• Assumed discount rates of 9.5% for large markets and 10.0% for small markets.

While we believe we have made reasonable estimates and utilized appropriate assumptions to calculate the fair value of our indefinite-lived intangible assets, it is possible a material change could occur.

5 unchanged sentences

$ 123,114 $ 120,132 $ 142,164

At June 30, 2023, both the carrying value and fair value of our FCC licenses after the impairment of $363.6 million was $1.1 billion.

Consequently, an increase in discount rates, a decrease in revenue growth rates or profit margins, or a decrease in BIA revenue forecasts could result in additional impairment to our FCC licenses.

We perform our annual impairment test on our goodwill as of July 1 of each year.

We also test goodwill at interim dates if events or changes in circumstances indicate that goodwill might be impaired.

At December 31, 2024, the carrying value of our FCC licenses was $809.9 million after the impairment of $304.1 million.

An increase in discount rates, a decrease in revenue growth rates or profit margins, or a decrease in BIA revenue forecasts could result in additional impairment to our FCC licenses.

We test goodwill at interim dates if events or changes in circumstances indicate that goodwill might be impaired.

The fair value of our reporting units is used to apply value to the net assets of each reporting unit.

1 unchanged sentence

The impairment testing performed as of June 30, 2024 has resulted in a decrease in the fair values of our reporting units.

The carrying values of our Multiplatform, Digital, and RCS reporting units exceeded their fair values.

The fair value of our Katz Media reporting unit exceeded its carrying value.

The valuation methodology we use for valuing goodwill involves considering the implied fair values of our reporting units based on market factors including the trading prices of our debt and equity securities, and estimating future cash flows expected to be generated from the related assets, discounted to their present value using a risk-adjusted discount rate.

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

On June 30, 2023, we performed an interim impairment test in accordance with ASC 350-30-35, resulting in $595.5 million impairment of goodwill.

The carrying values of our Multiplatform and RCS reporting units exceeded their fair values.

The fair values of our Digital and Katz reporting units exceeded their carrying values.

expected to be generated from the related assets, discounted to their present values using a risk-adjusted discount rate.

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

On June 30, 2024, we performed our interim impairment test in accordance with ASC 350-30-35, resulting in a $616.1 million impairment of goodwill.

In determining the fair value of our reporting units, we considered industry and market factors including trading multiples of similar businesses and the trading prices of our debt and equity securities.

2 unchanged sentences

Our cash flow assumptions are based on detailed, multi-year forecasts performed by each of our operating reporting units and reflect the current advertising outlook across our businesses.

• Revenues beyond 2027 are projected to grow at a perpetual growth rate, which we estimated at 2.0% for our Multiplatform and RCS reporting units, 3.0% for our Digital Audio reporting unit (beyond 2031), and 2.0% for our Katz Media reporting unit (beyond 2032).

• In order to risk adjust the cash flow projections in determining fair value, we utilized discounts rates between 15% and 18% for each of our reporting units.

There were no significant changes to assumptions used for the 2023 annual impairment test.

No impairment was identified related to our goodwill balance as a result of the 2023 annual impairment test performed during the third quarter.

• Revenues beyond 2028 are projected to grow at a perpetual growth rate, which we estimated at 1.0% for our Multiplatform Reporting unit beyond 2033, 3.0% for our Digital Audio Reporting unit beyond 2032, and 2.0% for our RCS and Katz Media Reporting units.

• Profit margins beyond 2028 utilize the 2028 margin implied in the multi-year forecasts.

• In order to risk adjust the cash flow projections in determining fair value, we utilized discount rates between 17% and 20% for each of our reporting units.

While we believe we have made reasonable estimates and utilized appropriate assumptions to calculate the estimated fair value of our reporting units, it is possible a material change could occur.

If future results are not consistent with our assumptions and estimates, we may be exposed to impairment charges in the future.

If future results are not consistent with our assumptions and estimates, we may be exposed to additional impairment charges in the future.

The following table shows the decline in the fair value of each of our reporting units that would result from a 100 basis point decline in our discrete and terminal period revenue growth rate and profit margin assumptions and a 100 basis point increase in our discount rate assumption:

5 unchanged sentences

RCS 8,342 4,356 6,684

An increase in discount rates or a decrease in revenue growth rates or profit margins could result in impairment charges being required to be recorded for one or more of our reporting units.

An increase in discount rates or a decrease in revenue growth rates or profit margins could result in additional impairment charges being required to be recorded for one or more of our reporting units.

Tax Provisions

2 unchanged sentences

We use our judgment to determine whether it is more likely than not that our deferred tax assets will be realized.

Deferred tax assets are reduced by valuation allowances if the Company believes it is more than likely than not that some portion or the entire asset will not be realized.

Deferred tax assets are reduced by valuation allowances if the Company believes it is more likely than not that some portion or the entire asset will not be realized.

We use our judgment to determine whether it is more likely than not that we will sustain positions that we have taken on tax returns and, if so, the amount of benefit to initially recognize within our financial statements.

We regularly review our uncertain tax positions and adjust our unrecognized tax benefits ("UTBs") in light of changes in facts and circumstances, such as changes in tax law, interactions with taxing authorities and developments in case law.

developments in case law and significant transactions.

These adjustments to our UTBs may affect our income tax expense.

3 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-K

Item 7. Management’s Discussion and Analysis