Cumulus Media, Inc. Q3 FY2024 earnings call

Digital Businesses - Digital revenue accounts for 20% of total revenue, growing 8% y-o-y. - Digital marketing services grew close to 40% y-o-y, with customer count up 22%, retention up 6%, average order size up 17%, and legacy radio clients buying DMS up 32%. - DMS has unique selling proposition including feet-on-the-street sales force, integrated solutions, out-execution of competitors, and ongoing investment. - Streaming had slight increase, podcasting had modest revenue decrease due to Daily Wire, but non-Daily Wire podcasting segments performed well. ### Broadcast Business - National advertising had positive indicators with sports driving network growth, but overall advertising sentiment weak. - Political revenue impacted by presidential candidate change, with Q3 political revenue lower, but Q4 pacing up. ### Expenses - Disciplined in expense structure, with $8 million year-to-date cost reductions on top of $120 million from 2019 - 2023. - Aggressively pursuing AI-enabled efficiencies across business. ### Capital Allocation - Prioritize investment in growth businesses and debt reduction, with debt maturities extended to 2029 giving financial flexibility.

During the third quarter, Cumulus Media delivered $203.6 million of revenue and EBITDA of $24.1 million. Digital revenue, accounting for 20% of total revenue, grew 8% year-over-year. Digital marketing services (DMS) grew close to 40% year-over-year, with customer count up 22%, customer retention improved by 6%, average digital order size per customer increased by 17%, and legacy radio clients purchasing DMS up by 32%. In broadcast business, national advertising had positive indicators with sports driving growth in network, but overall advertising sentiment remained weak. Political revenue was impacted by presidential candidate change, with Q3 political revenue $4.4 million vs $5.8 million in 2020 and $4.5 million in 2022.

Fourth Quarter - Total company revenue is currently pacing down slightly. ### Full Year - CapEx expected to be below the $25 million revised guidance provided on last earnings call.

- Advertising environment uncertainty with overall rate environment and presidential election concerns impeding spending. ### - Economic and interest rate concerns leading to lower spending in key categories. ### - Political candidate change impacting political revenue.

Q: In terms of the marketing services, what are the upsells?

A: We've added a full suite of integrated presence products ranging from listings to reputation management, website development, SEO, etc.

Q: Thoughts on political $9.7 million booked, any upside?

A: Fourth quarter tracking close to expectations, with potential to add more from political ads and possible individual runoffs.

Q: Advertisers paused due to elections, expectations after election?

A: Sentiment is either waiting to see economy settle or due to political ad clutter.

Q: Sense of interest rates needed to alleviate uncertainty?

A: Rates coming down, lower inflation, and growing economy ideal for alleviating uncertainty across categories.

Q: Podcasting down, cause?

A: Daily Wire no longer representing some podcasters, and flagship shows pressured by iOS 17 and other issues, but non-Daily Wire podcasting segments performed well and Q4 pacing up.