0001628280-25-051036
SEC filingQ3 2025 revenue fell 1.1% YoY as political tailwinds reversed, but Digital Audio growth and cost savings held Adjusted EBITDA flat.
For the three months ended September 30, 2025, iHeartMedia reported consolidated revenue of $997.0 million, a decrease of $11.1 million (1.1%) compared to $1,008.1 million in the prior-year quarter. The decline was primarily driven by the absence of political advertising revenue that benefited Q3 2024 (a presidential election year) and continued softness in broadcast radio advertising amid uncertain market conditions. This was partially offset by strong growth in the Digital Audio Group, where revenue rose 13.5% to $341.7 million.
Operating income swung to a loss of $116.3 million from income of $76.7 million in Q3 2024, largely due to a non-cash impairment charge of $208.5 million on FCC licenses. Excluding impairment and other adjustments, Adjusted EBITDA was essentially flat at $204.8 million versus $204.6 million, as cost savings from modernization initiatives offset revenue pressure. Net loss widened to $65.8 million from $41.3 million, impacted by the impairment and higher interest expense ($101.8 million vs. $95.7 million). Free cash flow turned negative to $(32.8) million from $73.3 million, reflecting lower operating cash flow and capital expenditures of $23.3 million.
Multiplatform Group revenue fell 4.6% to $591.2 million, driven by a 4.9% decline in Broadcast Radio and a 9.6% drop in Sponsorship and Events. Segment Adjusted EBITDA decreased 8.3% to $119.2 million, with margin contracting 80 bps to 20.2%. Operating expenses declined 3.6% due to lower employee compensation and sales commissions from modernization efforts.
Digital Audio Group was the standout, with revenue up 13.5% to $341.7 million. Podcast revenue surged 22.5% to $139.7 million, and Digital (ex-Podcast) grew 8.0% to $202.0 million. Segment Adjusted EBITDA jumped 30.3% to $130.3 million, and margin expanded 490 bps to 38.1%, as revenue growth outpaced a 5.1% increase in operating expenses (higher variable content costs and bonus expense).
Audio & Media Services Group revenue plunged 26.0% to $66.6 million, primarily due to lower political revenue at Katz Media. Segment Adjusted EBITDA fell 49.1% to $22.6 million, with margin contracting to 33.9% from 49.3%. Operating expenses decreased only 3.6%, reflecting the fixed-cost nature of the business.
Management highlighted ongoing macroeconomic uncertainty, including inflation and elevated interest rates, which continue to pressure broadcast advertising. The company is executing modernization initiatives expected to deliver $150 million in net savings for full-year 2025, with an additional $50 million in annual savings beginning in 2026 from headcount reductions implemented in Q4 2025. No formal revenue or earnings guidance was provided, but management expressed confidence in sufficient liquidity to fund operations for at least the next twelve months, supported by $192.2 million in cash and $317.5 million available under the ABL facility. The company also noted potential risks from international trade developments and the possibility of further impairment charges if key assumptions (revenue growth, profit margins, discount rates) deteriorate.
As of September 30, 2025, the company held $192.2 million in cash and cash equivalents. Total available liquidity was $509.8 million, including $317.5 million in undrawn capacity on the ABL Facility after a $100.0 million borrowing. Total debt stood at $5,120.3 million, with a weighted average interest rate of 9.2%. The aggregate market value of debt was approximately $4.1 billion. The company was in compliance with all debt covenants.
Note 6 discusses legal proceedings but does not disclose specific purchase commitments. The notes also do not provide a schedule of contractual obligations. Deferred revenue from contracts with customers was $169.6 million, with $219.2 million of remaining performance obligations expected to be recognized over the next five years.
During the nine months ended September 30, 2025, capital expenditures totaled $62.5 million, with $23.3 million in Q3 alone. The company borrowed $100.0 million under the ABL Facility and repaid $43.6 million of long-term debt. No share repurchases or common dividends were reported. Share-based compensation expense was $27.9 million for the nine months.
The company reports three segments: Multiplatform Group, Digital Audio Group, and Audio & Media Services Group. In Q3 2025, Multiplatform Group revenue was $591.2 million (59.3% of total), Digital Audio Group $341.7 million (34.3%), and Audio & Media Services $66.6 million (6.7%). Segment Adjusted EBITDA was $119.2 million, $130.3 million, and $22.6 million, respectively. The Digital Audio Group saw strong growth, particularly in Podcast revenue ($139.7 million vs. $114.0 million in Q3 2024), while Multiplatform Group declined due to Broadcast Radio weakness. All revenue is domestic; no geographic mix is disclosed.
For the nine months ended September 30, 2025, iHeartMedia reported a net loss of $430.6 million, yet operating cash flow was negative $63.7 million, a significant deterioration from positive $70.2 million in the prior year. The primary driver was a large increase in prepaid and other current assets ($158.4 million outflow) and a decrease in accrued expenses ($123.8 million outflow), which more than offset the $130.0 million decrease in accounts receivable. These working capital swings suggest timing mismatches and potential liquidity pressure.
Capital expenditures totaled $62.9 million, representing a capex intensity of roughly 99% of operating cash flow (on a negative base). Free cash flow (operating cash flow minus capex) was negative $126.7 million, compared to negative $2.0 million in the prior year. No share repurchases or dividends were paid, indicating capital allocation is focused on debt reduction and liquidity preservation.
Financing activities provided $53.9 million, primarily from $100.0 million in borrowings under the ABL facility, partially offset by $43.6 million in debt repayments. The company ended the period with $192.2 million in cash and equivalents, down from $259.6 million at the start of the period. Overall, cash flow quality is weak, with negative CFO, elevated capex, and reliance on debt to fund operations.