What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-11 compared with 2025-05-12 · 130 added, 87 removed, 314 unchanged (41% of the section changed)

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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 the revenue from each revenue stream including Broadcast Radio, Networks, and Sponsorship and Events.

Management reviews Multiplatform Group's operations’ overall revenue as well as the revenue from 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.

Management also looks at Multiplatform Group's revenue by region and market size.

Management also reviews Multiplatform Group's revenue by region and market size.

Typically, larger markets can reach larger audiences with wider demographics than smaller markets.

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This metric gauges how well our formats are attracting and retaining listeners.

Management also monitors revenue generated through our programmatic ad-buying platform, and our data analytics advertising product, to measure the success of our enhanced marketing optimization tools.

Management monitors revenue generated through our programmatic ad-buying platform, and our data analytics advertising product, to measure the success of our enhanced marketing optimization tools.

We have made significant investments so we can provide the same ad-buying experience that once was only available from digital-only companies and enable our clients to better understand how our assets can successfully reach their target audiences.

Management monitors average advertising rates and cost per mille, the cost of every 1,000 advertisement impressions, which are principally based on the length of the spot and how many people in a targeted audience listen to our stations, as measured by an independent ratings service.

Management also monitors average advertising rates and cost per mille, the cost of every 1,000 advertisement impressions, which are principally based on the length of the spot and how many people in a targeted audience listen to our stations, as measured by an independent ratings service.

In addition, our advertising rates are influenced by the time of day the advertisement airs, with morning and evening drive-time hours typically priced the highest.

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

On July 4, 2025, the U.S.

government enacted a sweeping tax and spending reform law known as the One Big Beautiful Bill Act ("OBBBA"), which builds upon and expands the provisions of the 2017 Tax Cuts and Jobs Act and introduces significant changes to the U.S.

federal income tax system, effective beginning with the 2025 calendar year.

Key provisions of the legislation include the restoration of 100% bonus depreciation, immediate expensing of domestic research and development costs under a new Section 174A, and the reinstatement of the EBITDA-based limitation for the deductibility of business interest under Section 163(j).

These provisions were made permanent by the OBBBA.

We are currently assessing the impact of the new law on our consolidated financial statements, including the remeasurement of deferred tax assets and liabilities.

At this time, we are unable to reasonably estimate the full financial effect of the legislation, but we expect significant reductions in our cash taxes paid.

Modernization Initiatives

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Executive Summary

Consolidated revenues for the first quarter of 2025 increased due to a continued increase in demand for digital advertising, partially offset by lower spending on radio advertising as a result of continued uncertain market conditions.

Consolidated revenues for the second quarter of 2025 increased due to a continued increase in demand for digital advertising, partially offset by lower spending on radio advertising as a result of continued uncertain market conditions.

The key developments that impacted our business during the quarter are summarized below:

• Consolidated Revenue of $807.1 million increased $8.1 million, or 1.0%, during the quarter ended March 31, 2025 compared to Consolidated Revenue of $799.0 million in the prior year's first quarter.

• Multiplatform Group Revenue decreased $20.5 million, or 4.2%, and Segment Adjusted EBITDA decreased $7.2 million, or 9.3%, compared to the prior year's first quarter, respectively.

• Digital Audio Group Revenue increased $38.3 million, or 16.0%, and Segment Adjusted EBITDA increased $19.0 million, or 27.8%, compared to the prior year's first quarter, respectively.

• Audio & Media Services Group Revenue decreased $9.8 million, or 14.2%, and Segment Adjusted EBITDA decreased $7.9 million, or 33.3%, compared to the prior year's first quarter, respectively.

• Operating loss of $25.4 million improved $9.3 million from $34.7 million in the prior year’s first quarter.

• Net loss of $280.9 million increased $262.8 million from $18.1 million in the prior year's first quarter.

• Cash flows used for operating activities of $60.9 million increased from $59.3 million in the prior year's first quarter.

• Adjusted EBITDA (1) of $104.6 million, was flat compared to the prior year.

• Free cash flow (2) of $(80.7) million improved slightly from $(80.9) million in the prior year's first quarter.

• Consolidated Revenue of $933.7 million increased $4.6 million, or 0.5%, during the quarter ended June 30, 2025 compared to Consolidated Revenue of $929.1 million in the prior year's second quarter.

• Multiplatform Group Revenue decreased $31.3 million, or 5.4%, and Segment Adjusted EBITDA decreased $7.9 million, or 7.6%, compared to the prior year's second quarter, respectively.

• Digital Audio Group Revenue increased $38.2 million, or 13.4%, and Segment Adjusted EBITDA increased $15.7 million, or 17.1%, compared to the prior year's second quarter, respectively.

• Audio & Media Services Group Revenue decreased $2.3 million, or 3.3%, and Segment Adjusted EBITDA decreased $0.1 million, or 0.5%, compared to the prior year's second quarter, respectively.

• Operating income of $35.4 million increased $945.0 million from an Operating loss of $909.7 million in the prior year’s second quarter primarily due non-cash impairment charges of $920.2 million recognized in the second quarter of 2024.

• Net loss of $84.0 million improved $898.0 million from $982.0 million in the prior year's second quarter.

• Cash flows provided by operating activities of $6.8 million decreased from cash flows provided by operating activities of $26.7 million in the prior year's second quarter.

• Adjusted EBITDA (1) of $156.1 million, increased $5.9 million from $150.2 million in the prior year's second quarter.

• Free cash flow (2) of $(13.2) million decreased from $5.6 million in the prior year's second quarter.

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

(In thousands) Three Months Ended

2025 2024 Change

Revenue $ 933,653 $ 929,092

Operating loss (25,434) (34,708) (26.7) %

Operating income (loss) 35,370 (909,667)

Net loss (83,988) (981,989)

Cash used for operating activities (60,944) (59,277) 2.8 %

Cash provided by operating activities 6,821 26,729

Adjusted EBITDA (1)

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(13,176) 5,557

(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 used for operating activities, the most closely comparable GAAP measure, please see “Reconciliation of Cash used for operating activities to Free cash flow” in this MD&A.

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

generally accepted accounting principles ("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.

(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 (used for) operating activities to Free cash flow” in this MD&A.

Results of Operations

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(In thousands) Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Revenue $ 933,653 $ 929,092 $ 1,740,754 $ 1,728,130

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Other operating expense 1,086 516 1,745 1,088

Operating loss (25,434) (34,708)

Operating income (loss) 35,370 (909,667) 9,936 (944,375)

Interest expense, net 100,894 95,577 201,280 191,092

Gain (loss) on investments, net (901) (412) (19,495) 91,582

Equity in earnings (loss) of nonconsolidated affiliates 50 (45)

Equity in loss of nonconsolidated affiliates (51) (61) (1) (106)

Loss on extinguishment of debt (263) — (1,460) —

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Less amount attributable to noncontrolling interest

(508) (331) (167) 69

Net loss attributable to the Company $ (83,480) $ (981,658) $ (364,704) $ (1,000,166)

The table below presents the comparison of our revenue streams for the three months ended March 31, 2025 to the three months ended March 31, 2024:

The table below presents the comparison of our revenue streams for the three and six months ended June 30, 2025 to the three and six months ended June 30, 2024:

(In thousands) Three Months Ended

2025 2024 Change

June 30, % Six Months Ended

2025 2024 Change 2025 2024 Change

Broadcast Radio $ 395,789 $ 425,490 (7.0) % $ 736,525 $ 784,828 (6.2) %

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Revenue, total $ 933,653 $ 929,092 0.5 % $ 1,740,754 $ 1,728,130 0.7 %

Consolidated results for the three months ended March 31, 2025 compared to the consolidated results for the three months ended March 31, 2024 were as follows:

Consolidated revenue increased $8.1 million during the three months ended March 31, 2025 compared to the same period of 2024.

Consolidated results for the three and six months ended June 30, 2025 compared to the consolidated results for the three and six months ended June 30, 2024 were as follows:

Consolidated revenue increased $4.6 million during the three months ended June 30, 2025 compared to the same period of 2024.

Multiplatform Group revenue decreased $31.3 million, or 5.4%, primarily resulting from a decrease in broadcast advertising in connection with continued uncertain market conditions.

Digital Audio Group revenue increased $38.2 million, or 13.4%, driven primarily by continuing increases in demand for digital advertising, including podcast advertising.

Audio & Media Services revenue decreased $9.8 million, or 14.2%, primarily as a result of Katz Media revenue due to nonrecurring contract termination fees earned by Katz Media in 2024 and a decrease in broadcast advertising in connection with uncertain market conditions, partially offset by an increase in digital advertising.

Audio & Media Services revenue decreased $2.3 million, or 3.3%, primarily as a result of lower political revenues at Katz Media, as 2024 was a presidential election year, partially offset by an increase in digital advertising.

Consolidated revenue increased $12.6 million during the six months ended June 30, 2025 compared to the same period of 2024.

Multiplatform Group revenue decreased $51.8 million, or 4.8%, primarily resulting from a decrease in broadcast advertising in connection with continued uncertain market conditions.

Digital Audio Group revenue increased $76.6 million, or 14.6%, driven primarily by continuing increases in demand for digital advertising, including podcast advertising.

Audio & Media Services revenue decreased $12.2 million, or 8.8%, primarily as a result of Katz Media revenue largely due to lower political revenues, as 2024 was a presidential election year, as well as nonrecurring contract termination fees earned by Katz Media in 2024, partially offset by an increase in digital advertising.

Direct Operating Expenses

Consolidated direct operating expenses increased $15.0 million, or 4.4%, during the three months ended March 31, 2025 compared to the same period of 2024.

The increase was primarily driven by higher variable content costs, including higher podcast profit sharing expenses and third-party digital costs related to the increase in digital revenues, partially offset by a decrease in employee compensation cost in connection with modernization initiatives taken in 2024.

Consolidated direct operating expenses increased $9.1 million, or 2.4%, and $24.1 million, or 3.3%, during the three and six months ended June 30, 2025, respectively, compared to the same periods of 2024.

The increase was primarily driven by higher variable content costs, including higher podcast profit share and third-party digital costs related to the increase in digital revenues, partially offset by a decrease in employee compensation cost in connection with modernization initiatives taken in 2024.

Selling, General and Administrative Expenses

Consolidated SG&A expenses decreased $4.4 million, or 1.1%, during the three months ended March 31, 2025 compared to the same period of 2024.

The decrease was driven primarily by a decrease in costs incurred in connection with executing on our cost savings initiatives, including decreased employee compensation cost due to our modernization initiatives, partially offset by an increase in employee benefit expense related to the reestablishment of the 401(k) matching program during the first quarter of 2025.

Consolidated SG&A expenses decreased $18.5 million, or 4.3%, and $22.9 million, or 2.8%, during the three and six months ended June 30, 2025, respectively, compared to the same periods of 2024.

The decrease was driven primarily by a decrease in costs incurred in connection with executing on our cost savings initiatives, including decreased employee compensation cost due to our modernization initiatives and lower sales commissions related to the decline in broadcast revenue, partially offset by increases in non-cash trade and barter expense and employee benefit expense related to the reestablishment of the 401(k) match program during the first quarter of 2025.

Depreciation and Amortization

Depreciation and amortization decreased $13.3 million during the three months ended March 31, 2025 compared to the same period of 2024 primarily as a result of a lower fixed asset base due to lower levels of capital expenditures.

Depreciation and amortization decreased $14.0 million and $27.2 million during the three and six months ended June 30, 2025, respectively, compared to the same periods of 2024 primarily as a result of a lower fixed asset base due to lower levels of capital expenditures.

Impairment Charges

During the three months ended March 31, 2025 and 2024, we recorded non-cash impairment charges of $2.9 million and $1.5 million, respectively, related to changes in sublease assumptions for certain operating leases intended to be subleased.

During the three and six months ended June 30, 2025, we recorded non-cash impairment charges of $2.6 million and $5.4 million, respectively, primarily related to changes in sublease assumptions for certain operating leases intended to be subleased.

During the three and six months ended June 30, 2024, we recorded non-cash impairment charges of $920.2 million and $921.7 million, respectively, primarily to reduce the carrying values of our indefinite-lived FCC licenses and our goodwill to their estimated fair values.

No impairment related to our indefinite-lived FCC licenses or goodwill was recorded during the three and six months ended June 30, 2025.

Interest Expense, net

Interest expense increased $4.9 million during the three months ended March 31, 2025 compared to the same period of 2024 primarily as a result of an increase in contractual interest rates in connection with the debt exchange transaction that closed in the fourth quarter of 2024.

Interest expense increased $5.3 million and $10.2 million during the three and six months ended June 30, 2025, respectively, compared to the same periods of 2024 primarily as a result of an increase in contractual interest rates in connection with the debt exchange transaction that closed in the fourth quarter of 2024.

Gain (Loss) On Investments, Net

During the three months ended March 31, 2025, we recognized a loss on investments, net of $18.6 million, related to declines in the value of our investments.

During the three months ended March 31, 2024, we recogn ized a gain on in vestments, net of $92.0 million related primarily due to the $101.4 million gain recognized on the sale of our investment in Broadcast Music, Inc.

During the three and six months ended June 30, 2025, we recognized losses on investments, net of $0.9 million and $19.5 million, respectively, related to declines in the value of our investments.

During the three months ended June 30, 2024, we recognized a loss on investments, net of $0.4 million related to declines in the value of our investments.

During the six months ended June 30, 2024, we recogn ized a gain on in vestments, net of $91.6 million, related 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.

Income Tax Benefit (Expense)

The effective tax rates for the Company for the three months ended March 31, 2025 and 2024 were (93.0)% and 53.3%, respectively.

The effective tax rates for these three-month periods 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 Company for the three months ended June 30, 2025 and 2024 were (27.8)% and 2.4%, respectively.

The effective tax rates for the Company for the six months ended June 30, 2025 and 2024 were (72.7)% and 4.3%, 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 due to uncertainty regarding the Company’s ability to utilize those assets in future periods.

The 2024 effective tax rates were also impacted by impairment charges to non-deductible goodwill recorded during the second quarter of 2024.

Net Loss Attributable to the Company

Net loss attributable to the Company increased $262.7 million to $281.2 million during the three months ended March 31, 2025 compared to Net loss attributable to the Company of $18.5 million during the three months ended March 31, 2024.

The increase was primarily due to the increase in income tax expense as described above and the $101.4 million gain recognized on the sale of our investment in BMI in the first quarter of 2024.

Net loss attributable to the Company improved $898.2 million to $83.5 million during the three months ended June 30, 2025 compared to $981.7 million during the three months ended June 30, 2024, primarily due to the non-cash impairment charges of $920.2 million recognized in 2024.

Net loss attributable to the Company improved $635.5 million to $364.7 million during the six months ended June 30, 2025 compared to $1,000.2 million during the six months ended June 30, 2024.

The improvement was primarily due to the non-cash impairment charges of $921.7 million recognized in the second quarter of 2024, partially offset by the $101.4 million gain recognized on the sale of our investment in BMI in the first quarter of 2024.

Multiplatform Group Results

(In thousands) Three Months Ended

2025 2024 Change

June 30, % Six Months Ended

2025 2024 Change 2025 2024 Change

Revenue $ 544,598 $ 575,907 (5.4) % $ 1,017,576 $ 1,069,370 (4.8) %

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Broadcast revenue decreased $29.7 million, or 7.0%, year-over-year, driven by lower spot revenue.

Networks declined $2.6 million, or 2.5%, year-over-year.

Revenue from Sponsorship and Events increased $0.8 million, or 2.8%, year-over-year.

Operating expenses decreased $13.3 million, driven primarily by a decrease in employee compensation cost due to our modernization initiatives, partially offset by an increase in employee benefit expense related to the reestablishment of the 401(k) matching program during the first quarter of 2025.

Networks increased $1.2 million, or 1.1%, year-over-year.

Revenue from Sponsorship and Events decreased $2.6 million, or 6.7%, year-over-year.

Operating expenses decreased $23.4 million, driven primarily by a decrease in employee compensation cost due to our modernization initiatives, as well as lower sales commissions related to the decline in broadcast revenue, partially offset by an increase in non-cash trade and barter expense.

Revenue from our Multiplatform Group decreased $51.8 million compared to the prior year primarily due to a decrease in broadcast advertising in connection with continued uncertain market conditions, as well as lower political revenues as 2024 was a presidential election year.

Broadcast revenue decreased $48.3 million, or 6.2%, year-over-year, driven by lower spot revenue.

Networks decreased $1.4 million, or 0.7%, year-over-year.

Revenue from Sponsorship and Events decreased $1.8 million, or 2.8%, year-over-year.

Operating expenses decreased $36.7 million, driven primarily by a decrease in employee compensation cost due to our modernization initiatives, as well as lower sales commissions related to the decline in broadcast revenue, partially offset by an increase in non-cash trade and barter expense.

Digital Audio Group Results

(In thousands) Three Months Ended

2025 2024 Change

June 30, % Six Months Ended

2025 2024 Change 2025 2024 Change

Revenue $ 323,856 $ 285,614 13.4 % $ 601,143 $ 524,582 14.6 %

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Revenue from our Digital Audio Group increased $38.2 million compared to the prior year, driven by Podcast revenue which increased by $29.8 million, or 28.5% year-over-year, primarily due to a continued increase in demand for podcasting from advertisers, and Digital, excluding Podcast revenue, which increased $8.5 million, or 4.7% year-over-year, primarily due to an increase in demand for digital advertising.

Operating expenses increased $19.4 million, primarily driven by higher variable content costs, including higher podcast profit sharing and third-party digital costs related to the increase in revenues.

Operating expenses increased $22.5 million, primarily driven by higher variable content costs, including higher podcast profit share and third-party digital costs related to the increase in revenues.

Revenue from our Digital Audio Group increased $76.6 million compared to the prior year, driven by Podcast revenue which increased by $55.2 million, or 28.3% year-over-year, primarily due to a continued increase in demand for podcasting from advertisers, and Digital, excluding Podcast revenue, which increased $21.4 million, or 6.5% year-over-year, primarily due to an increase in demand for digital advertising.

Operating expenses increased $41.9 million, primarily driven by higher variable content costs, including higher podcast profit share and third-party digital costs related to the increase in revenues.

Audio & Media Services Group Results

(In thousands) Three Months Ended

2025 2024 Change

June 30, % Six Months Ended

2025 2024 Change 2025 2024 Change

Revenue $ 67,736 $ 70,082 (3.3) % $ 127,059 $ 139,250 (8.8) %

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(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 $9.8 million compared to the prior year period primarily due to contract termination fees earned by Katz Media in the first quarter of 2024 and a decrease in broadcast advertising in connection with uncertain market conditions, partially offset by increased demand for digital advertising.

Operating expenses decreased $1.9 million primarily as a result of our modernization initiatives, partially offset by higher sales commissions related to increased demand for digital advertising.

Reconciliation of Operating loss to Adjusted EBITDA

Revenue from our Audio & Media Services Group decreased $2.3 million compared to the prior year period primarily due to a decrease in broadcast advertising in connection with uncertain market conditions, as well as lower political revenues as 2024 was a presidential election year, partially offset by increased demand for digital advertising.

Operating expenses decreased $2.2 million primarily due to a decrease in employee compensation cost due to our modernization initiatives.

Revenue from our Audio & Media Services Group decreased $12.2 million compared to the prior year period primarily due to contract termination fees earned by Katz Media in the first quarter of 2024, a decrease in broadcast advertising in connection with uncertain market conditions, as well as lower political revenues as 2024 was a presidential election year, partially offset by increased demand for digital advertising.

Operating expenses decreased $4.2 million primarily due to a decrease in employee compensation cost due to our modernization initiatives.

Reconciliation of Operating income (loss) to EBITDA and Adjusted EBITDA

(In thousands) Three Months Ended

Operating loss $ (25,434) $ (34,708)

June 30, Six Months Ended

2025 2024 2025 2024

Operating income (loss) $ 35,370 $ (909,667) $ 9,936 $ (944,375)

Depreciation and amortization 90,369 104,356 182,270 209,518

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(In thousands) Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Net loss $ (83,988) $ (981,989) $ (364,871) $ (1,000,097)

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Other (income) expense, net (1,004) 231 (1,041) 727

Equity in (earnings) loss of nonconsolidated affiliates (50) 45

Equity in loss of nonconsolidated affiliates 51 61 1 106

Impairment charges 2,552 920,224 5,407 921,732

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$ 156,127 $ 150,207 $ 260,715 $ 254,824

(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:

(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:

Depreciation and amortization, Impairment charges and Other operating expense.

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

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

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.

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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 loss.

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 (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.

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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 loss or Net loss as an indicator of operating performance and may not be comparable to similarly titled measures employed by other companies.

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 needs.

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.

Reconciliation of Cash used for operating activities to Free Cash Flow

Reconciliation of Cash provided by (used for) operating activities to Free Cash Flow

(In thousands) Three Months Ended

Cash used for operating activities $ (60,944) $ (59,277)

June 30, Six Months Ended

2025 2024 2025 2024

Cash provided by (used for) operating activities $ 6,821 $ 26,729 $ (54,123) $ (32,548)

Purchases of property, plant and equipment (19,997) (21,172) (39,727) (42,754)

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$ (13,176) $ 5,557 $ (93,850) $ (75,302)

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

(1) We define Free cash flow ("Free Cash Flow") as Cash provided by (used for) 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.

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In addition, we believe that Free Cash Flow helps improve investors' ability to compare our liquidity with other companies.

Since Free Cash Flow is not a measure calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, Cash used for operating activities and may not be comparable to similarly titled measures employed by other companies.

Since Free Cash Flow is not a measure calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, Cash provided by (used for) operating activities and may not be comparable to similarly titled measures employed by other companies.

Free Cash Flow is not necessarily a measure of our ability to fund our cash needs.

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

Share-based compensation expenses are recorded in SG&A expenses and were $9.0 million and $8.5 million for the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, there was $26.1 million of unrecognized compensation cost related to unvested share-based compensation arrangements.

Share-based compensation expenses are recorded in SG&A expenses and were $7.3 million and $7.2 million for the three months ended June 30, 2025 and 2024, respectively, and $16.3 million and $15.7 million for the six months ended June 30, 2025 and 2024, respectively.

As of June 30, 2025, there was $21.4 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 1.8 years and assumes Performance RSUs will be fully earned at target.

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The following discussion highlights cash flow activities during the periods presented:

(In thousands) Three Months Ended

(In thousands) Six Months Ended

Cash provided by (used for):

4 unchanged sentences

(93,850) (75,302)

(1) For a definition of Free Cash Flow and a reconciliation to Cash used for operating activities, the most closely comparable GAAP measure, please see “Reconciliation of Cash used for operating activities to Free Cash Flow” in this MD&A.

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

Operating Activities

Cash used for operating activities was $60.9 million during the three months ended March 31, 2025 compared to $59.3 million during the three months ended March 31, 2024.

The increase was primarily due to the timing of payable and accrual payments, partially offset by an improvement in the timing of receivable collections and timing of interest payments.

Accrued interest was paid in the fourth quarter of 2024 for the debt exchange transaction that would have been paid in the first quarter of 2025 under the old debt terms.

Cash used for operating activities was $54.1 million during the six months ended June 30, 2025 compared to $32.5 million during the six months ended June 30, 2024.

The increase was primarily due to the timing of receivable collections and the timing of the payment of payables, partially offset by the timing of interest payments as accrued interest was paid in the fourth quarter of 2024 upon closing of the debt exchange transaction that would have been paid in 2025 under the old debt terms.

Investing Activities

Cash used for investing activities of $20.1 million during the three months ended March 31, 2025 primarily reflects $19.7 million in cash used for capital expenditures.

Cash used for investing activities of $40.6 million during the six months ended June 30, 2025 primarily reflects $39.7 million in cash used for capital expenditures.

For capital expenditures, we spent $16.6 million in our Multiplatform Group segment primarily related to our IT infrastructure and real estate optimization initiatives, $10.3 million in our Digital Audio Group segment primarily related to IT infrastructure, $8.4 million in our Audio & Media Services Group segment, primarily related to software, and $4.4 million in Corporate primarily related to equipment and software purchases.

Cash provided by investing activities of $78.0 million during the three months ended March 31, 2024 primarily reflects $101.4 million of proceeds received from the sale of our investment in BMI, partially offset by $21.6 million in cash used for capital expenditures.

Cash provided by investing activities of $55.9 million during the six months ended June 30, 2024 primarily reflects $101.4 million of proceeds received from the sale of our investment in BMI, partially offset by $42.8 million in cash used for capital expenditures.

For capital expenditures, we spent $24.6 million in our Multiplatform Group segment primarily related to our IT infrastructure and real estate optimization initiatives, $11.1 million in our Digital Audio Group segment primarily related to IT infrastructure, $4.5 million in our Audio & Media Services Group segment, primarily related to software, and $2.6 million in Corporate primarily related to equipment and software purchases.

Financing Activities

Cash used for financing activities totaled $11.0 million during the three months ended March 31, 2025 primarily related to the quarterly amortization payment on the Term Loans due 2029 and payments reducing our debt premium recorded in connection with the debt exchange transaction completed in the fourth quarter of 2024.

Cash used for financing activities totaled $3.5 million during the three months ended March 31, 2024 primarily due to distributions to noncontrolling interest holders.

Cash provided by financing activities totaled $70.7 million during the six months ended June 30, 2025 primarily due to the $100.0 million borrowed under the $450.0 million ABL Facility (defined below) , partially offset by the quarterly amortization payments on the Term Loans due 2029 and payments reducing our debt premium recorded in connection with the debt exchange transaction completed in the fourth quarter of 2024.

Cash used for financing activities totaled $4.8 million during the six months ended June 30, 2024 primarily due to distributions to noncontrolling interest holders.

Sources of Liquidity and Anticipated Cash Requirements

Our primary sources of liquidity are cash on hand, which consisted of cash and cash equivalents of $167.7 million as of March 31, 2025, 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 (as amended from time to time, the "ABL Facility").

As of March 31, 2025, iHeartCommunications had no amounts outstanding under the ABL Facility, a borrowing base of $415.1 million and $23.7 million in outstanding letters of credit, resulting in $391.4 million of borrowing base availability.

Our total available liquidity 1 as of March 31, 2025 was $559.1 million.

Our primary sources of liquidity are cash on hand, which consisted of cash and cash equivalents of $235.9 million as of June 30, 2025, and cash flows from operations.

During the three months ended June 30, 2025, iHeartCommunications, Inc.

(“iHeartCommunications”), our indirect wholly-owned subsidiary, borrowed $100.0 million under the $450.0 million senior secured asset-based revolving credit facility entered into on May 17, 2022 (the "ABL Facility").

This borrowing was executed as a short-term liquidity management strategy to provide financial flexibility in response to recent market uncertainty.

The funds remain available to support working capital requirements and general corporate purposes.

As of June 30, 2025, the ABL Facility had a borrowing base of $425.0 million, and $34.3 million of outstanding letters of credit, resulting in $290.8 million available for borrowing following the $100.0 million of outstanding borrowings.

Our total available liquidity 1 as of June 30, 2025 was $526.7 million.

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

A challenging macroeconomic environment has led to market uncertainty which has continued to negatively impact our revenues and cash flows.

For the three months ended March 31, 2025, our consolidated revenues increased compared to the three months ended March 31, 2024 primarily due to revenue growth in our Digital Audio Group, partially offset by lower revenue in our Multiplatform Group, among other factors discussed in the Results of Operations section of this MD&A.

For the six months ended June 30, 2025, our consolidated revenues increased compared to the six months ended June 30, 2024 primarily due to revenue growth in our Digital Audio Group, partially offset by lower revenue in our Multiplatform Group, among other factors discussed in the Results of Operations section of this 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.

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These obligations impact our short-term and long-term liquidity and capital resource needs.

Certain contractual obligations are reflected on the Consolidated Balance Sheet as of March 31, 2025, while others are considered future commitments.

Certain contractual obligations are reflected on the Consolidated Balance Sheet as of June 30, 2025, 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, 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 fluctuations in working capital, make interest and tax payments, fund capital expenditures, make voluntary debt repayments and pursue other strategic opportunities, and maintain operations.

Assuming the current level of borrowings and interest rates in effect at March 31, 2025, we anticipate cash payments to service our debt of approximately $333.7 million in the remainder of 2025.

Assuming the current level of borrowings and interest rates in effect at June 30, 2025, we anticipate cash payments to service our debt of approximately $238.4 million in the remainder of 2025.

These debt service cash payments include interest, quarterly term loan amortization payments and payments related to the debt premium.

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Summary Debt Capital Structure

As of March 31, 2025 and December 31, 2024, we had the following debt outstanding, net of cash and cash equivalents:

(In thousands) March 31, 2025 December 31, 2024

As of June 30, 2025 and December 31, 2024, we had the following debt outstanding, net of cash and cash equivalents:

(In thousands) June 30, 2025 December 31, 2024

Asset-based Revolving Credit Facility due 2027 (1)

$ 100,000 $ —

Term Loan Facility due 2026 5,095 5,095

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$ 4,635,284 $ 4,522,137

(1) Decrease is due to the quarterly amortization payment of $5.4 million equal to 0.25% of the original principal amount of the Term Loan Facility due 2029.

(1) On May 22, 2025, iHeartCommunications borrowed $100.0 million under the ABL Facility, the proceeds of which were recorded as cash on the Balance Sheet as of June 30, 2025 .

(2) Quarterly amortization payments of $5.4 million (equal to 0.25% of the original principal amount) are required per the terms of the Term Loan Facility due 2029.

(3) The difference between the carrying value of the exchanged 5.25% Senior 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.

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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.

As of March 31, 2025, no triggering event had occurred and, as a result, we were not required to comply with any fixed charge coverage ratio as of or for the period ended March 31, 2025.

As of June 30, 2025, no triggering event had occurred and, as a result, we were not required to comply with any fixed charge coverage ratio as of or for the period ended June 30, 2025.

Other than our ABL Facility, none of our long-term debt includes maintenance covenants that could trigger early repayment.

As of March 31, 2025, we were in compliance with all covenants related to our debt agreements.

As of June 30, 2025, we were in compliance with all covenants related to our debt agreements.

For additional information regarding our debt, refer to Note 5, Long-Term Debt .

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Pursuant to iHeartCommunications' material debt agreements, iHeartMedia Capital I, LLC ("Capital I"), the parent guarantor and a subsidiary of iHeartMedia, is permitted to satisfy its reporting obligations under such agreements by furnishing iHeartMedia’s consolidated financial information and an explanation of the material differences between iHeartMedia’s consolidated financial information, on the one hand, and the financial information of Capital I and its consolidated restricted subsidiaries, on the other hand.

Because neither iHeartMedia nor iHeartMedia Capital II, LLC, a wholly-owned direct subsidiary of iHeartMedia and the parent of Capital I, have any operations or material assets or liabilities, there are no material differences between iHeartMedia’s consolidated financial information for the three months ended March 31, 2025, and Capital I’s and its consolidated restricted subsidiaries’ financial information for the same period.

Further, as of March 31, 2025, we were in compliance with all covenants related to our debt agreements.

Because neither iHeartMedia nor iHeartMedia Capital II, LLC, a wholly-owned direct subsidiary of iHeartMedia and the parent of Capital I, have any operations or material assets or liabilities, there are no material differences between iHeartMedia’s consolidated financial information for the three and six months ended June 30, 2025, and Capital I’s and its consolidated restricted subsidiaries’ financial information for the same period.

Further, as of June 30, 2025, we were in compliance with all covenants related to our debt agreements.

Commitments, Contingencies and Guarantees

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Accordingly, our earnings will be affected by changes in interest rates.

As of March 31, 2025, 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 three months ended March 31, 2025 would have changed by $5.4 million.

As of June 30, 2025, approximately 46% 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 six months ended June 30, 2025 would have changed by $11.3 million.

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

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The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by us or on our behalf.

This report contains various forward-looking statements which represent our expectations or beliefs concerning future events, including, without limitation, our future operating and financial performance, financial position and results of operations, macroeconomic trends including inflation, interest rates and potential recessionary indicators, our expected costs, savings and timing of our modernization initiatives and other capital and operating expense reduction initiatives, debt repurchases, our business plans, strategies and initiatives, benefits of acquisitions and dispositions, our expectations about certain markets and businesses, our expectations regarding the seasonality of our business, expected cash interest payments, future impairment charges and our anticipated financial performance and liquidity.

This report contains various forward-looking statements which represent our expectations or beliefs concerning future events, including, without limitation, our future operating and financial performance, financial position and results of operations, macroeconomic trends including inflation, interest rates and potential recessionary indicators, anticipated income tax benefits from the OBBBA, our expected costs, savings and timing of our modernization initiatives and other capital and operating expense reduction initiatives, debt repurchases, our business plans, strategies and initiatives, benefits of acquisitions and dispositions, our expectations about certain markets and businesses, our expectations regarding the seasonality of our business, expected cash interest payments, future impairment charges and our anticipated financial performance and liquidity.

Statements expressing expectations and projections with respect to future matters are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

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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 2. Management’s Discussion and Analysis