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Nexstar posted third-quarter results marred by a carriage dispute with DirecTV as well as a cyclical lack of political advertising.
Total revenue slipped 11% from the year-earlier quarter to $1.1 billion and earnings fell to 70 cents a share from $7.30. Both metrics undershot Wall Street analysts’ forecasts.
Even without political spending, core TV ad revenue fell 2% to $391 million, with the company blaming “continued softness in the advertising market, partially offset by the inclusion of The CW Network
Distribution revenue dropped nearly 7% to $598 million decreased 6.7% versus prior year. Nexstar blamed the DirecTV outage, which lasted 76 days during the quarter before the parties reached an agreement in September. A boost to distribution results came from renewals with operators representing more than half of Nexstar’s subscriber base, on what the company called “improved terms and annual rate escalators.”
The company took a 75% stake in The CW last year, promising to make it profitable by 2025. The quarterly numbers showed more progress in that effort, as losses at the broadcast network narrowed to $60 million.
Nexstar paid nothing up front for The CW, with previous 50-50 partners Paramount and Warner Bros. Discovery each retaining 12.5% positions in the network. Reducing debt and embarking on a lower-cost production strategy, with unscripted shows, news and sports replacing the network’s long-established slate of scripted dramas. In its quarterly report, Nexstar said The CW had $59 million in cash on its balance sheet as of the September 30 end of the quarter.
