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Political-advertising revenue in big U.S. markets is coming in below expectations this year amid a lack of competitive races in the midterm elections, Richard Bressler, the CFO of radio giant iHeartMedia, formerly Clear Channel Radio parent CC Media unit, said Tuesday as the company reported mixed quarterly results.
Speaking on the company’s quarterly earnings conference call, he also said that in some smaller markets, such as in Kentucky, Colorado and Iowa, spending was strong. “The lack of competitive races in the bigger markets is the most significant factor in the political softness for us,” Bressler said.
Wells Fargo analyst Marci Ryvicker drew conclusions for bigger entertainment companies. “Not surprisingly, political is coming in softer than expected due to the absence of hotly contested races in the largest markets,” she said in a report.
The strength in select smaller markets “might be why we are hearing about really strong political from our broadcast station groups versus the diversified entertainment companies, [which] are projecting political to be flat to down versus the prior Congressional election cycle,” she said.
Bressler said iHeartMedia has more successfully sold music station ads to political campaigns, a trend that he said the company will look to capitalize on further in the future.
IHeartMedia reported a widened third-quarter loss on Tuesday. Revenue rose 2.7 percent to $1.63 billion. iHeartMedia reported a loss of $115 million, compared with a year-ago loss of $102 million.
But the company’s operating income before depreciation, amortization and noncash compensation expense, another profitability metric, rose 9 percent to $479 million.
“This quarter we became ‘iHeartMedia’ to better reflect who we are today — the leading media and entertainment company in the digital age,” said chairman and CEO Bob Pittman. “We are a one-of-a-kind multiplatform media company that delivers unparalleled reach, scale and impact while continuing to provide the most live entertainment – with more content and more events in more places on more devices — to the industry’s most engaged audiences, wherever they are.”
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