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Item 7. Management’s Discussion and Analysis

2026-03-02 compared with 2025-02-27 · 125 added, 134 removed, 379 unchanged (41% of the section changed)

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Format of Presentation

Management’s discussion and analysis of our financial condition and results of operations (“MD&A”) should be read in conjunction with the consolidated financial statements and related footnotes contained in Item 8 of this Annual Report on Form 10-K of iHeartMedia, Inc.

(the "Company," "iHeartMedia," "we," or "us").

Management’s discussion and analysis of our financial condition and results of operations (“MD&A”) should be read in conjunction with the consolidated financial statements and related footnotes contained in Part II, Item 8 of this Annual Report on Form 10-K of iHeartMedia, Inc.

(the "Company," "iHeartMedia," "we," "our," or "us").

We report based on three reportable segments:

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

We believe that our ability to generate cash flow from operations from our businesses and our current cash on hand will provide sufficient resources to fund and operate our business, fund capital expenditures and other obligations and make interest payments on our long-term debt for at least the next twelve months.

We believe that our ability to generate cash flow from operations from our businesses and our current liquidity will provide sufficient resources to fund and operate our business, fund capital expenditures and other obligations and make interest payments on our long-term debt for at least the next twelve months.

Certain prior period amounts have been reclassified to conform to the 2025 presentation.

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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 (“CPM”), 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 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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Our advertising revenue, cash flows, and cost of capital are impacted by changes in economic conditions.

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.

Higher interest rates and inflation have continued to contribute to a challenging macroeconomic environment.

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

We are monitoring ongoing developments surrounding international trade that may pressure the advertising budgets of our customers and could impact our financial results in future periods.

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 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.

Modernization Initiatives

We implemented operating expense savings initiatives during 2024 to streamline our organization and increase automation and the use of technology.

These modernization efforts included headcount reductions and other cost saving actions, which resulted in approximately $150 million of net savings for full year 2025.

We implemented additional initiatives in the fourth quarter of 2025, primarily headcount reductions, that are expected to generate approximately $50 million of additional annual savings beginning in 2026.

We are also implementing $50 million of new in-year cost savings initiatives that are expected to begin benefiting us in the second quarter of 2026, bringing total in-year 2026 savings to approximately $100 million.

We continue to explore opportunities for further efficiencies.

Impairment Charges

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

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 2024 or 2023 annual impairment testing .

We perform our annual impairment test on our goodwill and indefinite-lived Federal Communication Commission ("FCC") licenses as of July 1 of each year.

As discussed above, macroeconomic uncertainty, including persistent inflation and elevated interest rates, has contributed to slowing broadcast revenue growth and declines in margins.

These factors have negatively impacted the key assumptions used in the discounted cash flow models which are utilized to value our FCC licenses, particularly the industry profit margins used in estimating the market profitability.

Our FCC licenses are valued using a combination of direct and market valuation approaches.

Key assumptions in the direct valuation approach include 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, estimated start-up costs and capital expenditures.

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

We obtained the most recent broadcast radio industry revenue projections as well as various other sources of data in developing the assumptions used for purposes of performing impairment testing on our FCC licenses as of July 1, 2025.

FCC licenses valued using a market approach estimate the fair value by referencing recent transactions involving comparable spectrum assets.

This method considers observable market data, adjusted for differences in signal strength and market size.

Considerations in developing these assumptions included the expected impact on advertising revenues given the current market uncertainty, ranges of expected timing of recovery, discount rates and other factors.

Based on our testing, the estimated fair value of our FCC licenses was below their carrying values.

As a result, we recognized a non-cash impairment charge of $208.5 million on our FCC licenses as a result of our July 1, 2025 annual testing.

Additionally, we recognized non-cash impairment charges of $304.1 million to our FCC license balances as a result of our June 30, 2024 interim testing.

The goodwill impairment test requires us to measure the fair value of our reporting units and compare the estimated fair value to the carrying value, including goodwill.

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

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

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

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

The fair values of our reporting units were measured as of July 1, 2025 as part of our annual impairment assessment and no goodwill impairment was recorded as the estimated fair values of our reporting units exceeded the carrying values of the reporting units’ net assets, including goodwill.

No impairment was required as part of the 2024 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.

While we believe we have made reasonable estimates and utilized reasonable assumptions to calculate the fair values of our long-lived assets, indefinite-lived FCC licenses and reporting units, it is possible a material change could occur to the estimated fair value of these assets as a result of the uncertainty regarding current economic conditions.

Additionally, we recognized non-cash impairment charges of $616.1 million to our goodwill balance as a result of our June 30, 2024 interim testing.

While we believe we have made reasonable estimates and utilized reasonable assumptions to calculate the fair values of our indefinite-lived FCC licenses and reporting units, it is possible a material change could occur to the estimated fair value of these assets as a result of the uncertainty regarding the impact of current market conditions, as well as the timing of any recovery.

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.

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

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.

Consolidated revenues for the year ended December 31, 2025 increased primarily due to an increase in digital and podcast advertising revenue driven by a continued increase in demand for digital advertising and an increase in non-cash trade revenue resulting from strategic marketing initiatives, partially offset by a decrease in political revenues in our Multiplatform Group and Audio and Media Service Group as 2024 was a presidential election year, as well as 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, 2025 are summarized below:

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• Digital Audio Group Revenue increased $164.9 million, or 14.2%, and Segment Adjusted EBITDA increased $77.8 million, or 20.5%, compared to 2024.

• 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 $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.

• Audio & Media Services Group Revenue decreased $54.5 million, or 16.7%, and Segment Adjusted EBITDA decreased $47.2 million, or 33.6%, compared to 2024.

• Operating loss of $20.6 million improved $742.5 million from Operating loss of $763.1 million in 2024.

2025 included $213.9 million of non-cash impairment charges primarily related to our FCC licenses.

2024 included $922.7 million of non-cash impairment charges primarily related to our goodwill and FCC licenses balances.

• Net loss of $471.9 million improved $537.6 million compared to Net loss of $1,009.5 million in 2024.

• Cash flows provided by operating activities of $92.6 million increased $21.2 million from $71.4 million in 2024.

• Adjusted EBITDA (1) of $685.8 million decreased $19.9 million from $705.6 million in 2024.

• Free cash flow (2) of $10.9 million increased $37.1 million from $(26.2) million in 2024.

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

(In thousands) Year Ended December 31, %

2025 2024 Change

Revenue $ 3,864,991 $ 3,854,532 0.3 %

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Equity in loss of nonconsolidated affiliates (6,998) (2,646)

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

Other expense, net (926) (655)

Loss on extinguishment of debt and exchange costs (1,577) (97,305)

Other income (expense) 1,093 (926)

Loss before income taxes (473,682) (1,167,896)

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Consolidated revenue increased $10.5 million during the year ended December 31, 2025 compared to 2024.

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.

Multiplatform Group revenue decreased $99.4 million, primarily resulting from a decrease in broadcast advertising in connection with continued uncertain market conditions and lower political revenues, as 2024 was a presidential election year, partially offset by an increase in non-cash trade revenue resulting from strategic marketing initiatives.

Digital Audio Group revenue increased $164.9 million, driven primarily by continuing increases in demand for digital and podcast advertising as well as increased non-cash trade revenue resulting from strategic marketing initiatives.

Audio & Media Services revenue decreased $54.5 million 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 demand for digital advertising.

Direct operating expenses

Consolidated direct operating expenses increased $24.5 million during the year ended December 31, 2025 compared to 2024.

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.

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 (“SG&A”) expenses

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

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.

Consolidated SG&A expenses decreased $6.1 million during the year ended December 31, 2025 compared to 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 related to strategic marketing initiatives, employee benefit expense related to the reestablishment of the 401(k) match program during the first quarter of 2025, bonus expense, and cash-settled share-based compensation expense driven by the increase in our stock price.

Depreciation and amortization

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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.

During the year ended December 31, 2025, we recorded non-cash impairment charges of $213.9 million to primarily reduce the carrying values of our indefinite-lived FCC licenses to their estimated fair values as a result of the annual impairment assessment.

No impairment related to our goodwill was recorded during the year ended December 31, 2025.

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 2024 or 2023 annual impairment testing.

During the year ended December 31, 2024, we recorded non-cash impairment charges of $922.7 million, to primarily 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.

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

Interest expense, net

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.

Interest expense, net increased $23.1 million during 2025 compared to 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 year ended December 31, 2025, we recognized a loss on investments, net of $43.0 million related to declines in the value of certain investments.

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 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.

Loss on extinguishment of debt and exchange costs

In connection with the debt exchange transaction that closed in the fourth quarter of 2024, we recognized costs of $1.6 million and $97.3 million during the years ended December 31, 2025 and 2024, respectively, primarily related to exchange fees incurred to facilitate the Debt Exchange Transaction.

Income tax benefit

Our effective tax rate for the year ended December 31, 2025 was 0.4%.

The effective tax rate was primarily impacted by the valuation allowance adjustments recorded during the year against certain federal and state deferred tax assets for disallowed interest expense carryforwards and state net operating losses due to the uncertainty regarding our ability to utilize those assets in future periods.

The valuation allowance build was partially reduced due to the enactment of the One Big Beautiful Bill Act ("OBBBA") tax provisions discussed in Note 8, Income Taxes .

Our effective tax rate for the year ended December 31, 2024 was 13.6%.

The valuation build for the year was offset fully by the tax impact of the debt transaction discussed in Note 6, Long-term Debt and Note 8, Income Taxes , that resulted in excluded cancellation of debt income and capital loss carryforward attribute reductions and the reduction of valuation allowances against those capital loss carryforwards.

In addition, we recorded a GAAP impairment charge to our non-deductible goodwill as discussed in Note 4, Property, Plant and Equipment, Intangible Assets and Goodwill .

Net loss attributable to the Company

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.

Net loss attributable to the Company of $472.9 million for the year ended December 31, 2025 improved $537.1 million compared to Net loss attributable to the Company of $1,009.9 million during the year ended December 31, 2024.

The improvement was due to the non-cash impairment charges of $922.7 million recognized in 2024 compared to the $213.9 million recognized in 2025, 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

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

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 our Multiplatform Group decreased $99.4 million compared to 2024, 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, partially offset by an increase in non-cash trade revenue resulting from strategic marketing initiatives.

Broadcast revenue decreased $93.5 million, or 5.4%, year-over-year driven by lower spot and political revenues.

Networks revenue increased $2.6 million or 0.6% year-over-year.

Revenue from Sponsorship and Events decreased $5.3 million, or 2.8%, 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.

Operating expenses decreased $52.3 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 higher trade and barter expenses, and an increase in bonus expense.

Digital Audio Group Results

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

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.

Revenue from our Digital Audio Group increased $164.9 million compared to the prior year, driven by Podcast revenue which increased by $114.9 million, or 25.6% year-over-year, primarily due to a continued increase in demand for podcasting from advertisers, and Digital, excluding Podcast revenue, which increased $50.0 million, or 7.0% year-over-year, primarily due to an increase in demand for digital advertising, as well as increased non-cash trade revenue resulting from strategic marketing initiatives.

Operating expenses increased $87.2 million primarily driven by higher variable content costs, including higher podcast profit share and third-party digital costs related to the increase in revenues, and higher non-cash trade expense.

Audio & Media Services Group Results

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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 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.

Revenue from our Audio & Media Services Group decreased $54.5 million compared to the prior year, primarily due to lower political revenues as 2024 was a presidential election year, a decrease in broadcast advertising in connection with uncertain market conditions, and contract termination fees earned by Katz Media in 2024, partially offset by increased demand for digital advertising.

Operating expenses decreased $7.3 million primarily due to a decrease in employee compensation cost due to our modernization initiatives and lower commissions as revenue declined.

Non-GAAP Financial Measures

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(Gain) loss on investments, net 43,025 (75,523)

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

Other expense, net 926 655

Loss on extinguishment of debt and exchange costs 1,577 97,305

Other (income) expense, net (1,093) 926

Equity in loss of nonconsolidated affiliates 6,998 2,646

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

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.

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, Loss on extinguishment of debt and exchange costs, Other (income) 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.

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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.

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

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At our 2023 Annual Meeting of Stockholders, the amendment was approved.

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

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 the statement of comprehensive loss as Selling, general and administrative expenses and were $44.1 million and $32.3 million for the years ended December 31, 2025 and 2024, respectively.

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Cash provided by operating activities was $92.6 million in 2025 compared to $71.4 million of cash provided by operating activities in 2024.

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.

The increase was primarily due to 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, and an increase in deferred revenues based on the timing of payments received, partially offset by the decrease in political revenues.

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 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 of $66.2 million during the year ended December 31, 2025 primarily reflects $81.7 million in cash used for capital expenditures and $21.5 million of proceeds received from the sale of certain land assets.

For capital expenditures, we spent $39.1 million in our Multiplatform Group segment primarily related to our IT infrastructure and real estate optimization initiatives, $19.9 million in our Digital Audio Group segment primarily related to IT infrastructure, $14.6 million in our Audio & Media Services Group segment, primarily related to software, and $8.1 million in Corporate primarily related to equipment and software purchases.

Cash provided by investing activities of $0.5 million during the year ended December 31, 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, we spent $52.2 million in our Multiplatform Group segment primarily related to our IT infrastructure and real estate optimization initiatives, $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.

Financing Activities

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 .

Cash used for financing activities totaled $15.3 million during the year ended December 31, 2025 primarily due to the quarterly amortization payments on the Term Loan Facility due 2029 and payments reducing our debt premium recorded in connection with the debt exchange transaction completed in the fourth quarter of 2024 and the $50.0 million repayment towards the outstanding balance on the $450.0 million ABL Facility (as defined below), largely offset by the $100.0 million borrowed under the $450.0 million ABL Facility.

Cash used for financing activities totaled $158.3 million during the year ended December 31, 2024 primarily relates to $150.5 million of cash paid as partial principal repayment in connection with the Debt Exchange Transaction.

Sources of Liquidity and Anticipated Cash Requirements

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 $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.

Our primary sources of liquidity are cash on hand, which consisted of cash and cash equivalents of $270.9 million as of December 31, 2025, and cash flows from operations.

During the year ended December 31, 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 (as amended, the "ABL Facility").

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

During the fourth quarter of 2025, we repaid $50.0 million of the outstanding balance.

The remaining funds outstanding are available to support working capital requirements and general corporate purposes.

As of December 31, 2025, the ABL Facility had a facility size of $450.0 million, and $31.1 million in outstanding letters of credit, resulting in $368.9 million available for borrowing following the $50.0 million of outstanding borrowings.

Our total available liquidity 1 as of December 31, 2025 was $639.8 million.

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, 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.

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

For the year ended December 31, 2025, our consolidated revenues increased slightly compared to the year ended December 31, 2024 primarily due to revenue growth in our Digital Audio Group, partially offset by lower political revenue as 2024 was a presidential election year, which primarily impacted our Multiplatform Group and Audio and Media Service Group, as well as lower broadcast 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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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.

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.

In addition to our contractual obligations, we expect that our primary anticipated uses of liquidity in 2026 will be to fund working capital, make 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 December 31, 2025, we anticipate cash payments to service our debt of approximately $508.5 million in 2026.

These debt service cash payments include principal amounts maturing in 2026, interest, quarterly term loan amortization payments and payments related to the debt premium.

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

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.

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 and other contractual commitments, see Note 7, Commitments and Contingencies .

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 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.

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

If these sources of liquidity need to be augmented, additional cash requirements would likely be financed through the issuance of debt or equity securities;

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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:

As of December 31, 2025 and 2024, we had the following debt outstanding:

(In thousands) December 31,

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Term Loan Facility due 2026 5,095 5,095

5,095 1,864,032

Incremental Term Loan Facility due 2026 1,500 1,500

1,500 401,220

Term Loan Facility due 2029 (2)

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

2,124,267 2,145,724

6.375% Senior Notes due 2026 44,644 44,644

6,983 750,000

5.25% Senior Notes due 2027 6,983 6,983

8.375% Senior Unsecured Notes due 2027 72,388 72,388

72,388 916,357

4.75% Senior Secured Notes due 2028 276,868 276,868

276,868 500,000

9.125% First Lien Notes due 2029 717,588 717,588

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Other subsidiary debt 3,934 5,008

Original issue discount (4,247) (7,558)

Long-term debt fees (7,220) (8,974)

Debt Premium (3)

242,151 289,752

Total Debt $ 5,053,091 $ 5,071,469

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$ 4,540,019 $ 4,522,137

(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.

(1) During the quarter ended December 31, 2025, iHeartCommunications repaid $50.0 million of the outstanding $100.0 million previously borrowed under the ABL Facility during 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.

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

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

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.

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These transactions could also require or result in amendments to the agreements governing outstanding debt obligations or changes in our leverage or other financial ratios, which could have a material positive or negative impact on our ability to comply with the covenants contained in iHeartCommunications’ debt agreements.

These transactions, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

These transactions, if any, will depend on

prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

The amounts involved may be material.

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Capital expenditures for the years ended December 31, 2025 and 2024 are discussed in the Cash Flows section above.

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

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As of December 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 would change by $21.7 million.

Assuming the current level of borrowings and assuming a 100 bps change in floating interest rates, it is estimated that the interest expense for the twelve months ended December 31, 2025 would change by $22.1 million.

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

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Indefinite-lived Intangible Assets

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.

Indefinite-lived intangible assets, such as our FCC licenses, are reviewed for impairment using a combination of the direct and market valuation methods.

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.

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

On June 30, 2024, we performed an interim impairment test in accordance with ASC 350-30-35 and we concluded that a $304.1 million impairment of the indefinite-lived intangible assets was required.

We performed our annual impairment test as of July 1, 2025 in accordance with ASC 350-30-35 and we concluded that a $208.5 million impairment of the indefinite-lived intangible assets was required.

In determining the fair value of our FCC licenses, the following key assumptions were used:

• Revenue forecasts published by BIA Financial Network, Inc.

(“BIA”), varying by market, and revenue growth projections made by industry analysts were used for the initial five-year period;

(“BIA”), varying by market;

• 2.0% over-the-air revenue growth and 3.0% digital revenue growth was assumed beyond the initial five-year period and 1.0% revenue growth was assumed in the terminal period;

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

FCC licenses were valued using a market approach to estimate the fair value by referencing recent transactions involving comparable spectrum assets.

This method considers observable market data, adjusted for differences in signal strength and market size.

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.

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To the extent that the carrying amount of net assets would exceed the fair value, an impairment charge may be required to be recorded.

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 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.

Based on the impairment testing performed as of July 1, 2025, no impairment was identified for any of our reporting units.

Fair values increased or remained flat across the reporting units, primarily driven by stronger debt and equity market performance .

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 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.

We performed our annual impairment test as of July 1, 2025 in accordance with ASC 350-30-35, resulting in no 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.

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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-K

Item 7. Management’s Discussion and Analysis