David , Look at the numbers! Even at 80million. You make it sound like I heart is loosing sleep. Radio in Houston will be down 60% compare to last year.
They are definitely losing sleep; all major radio companies are. And any company that is losing money is, whether radio or restaurant franchising or shopping centers.
Before the coronavirus and before 2008 I heart, Entercom, Cumulus were borrowing money like mad. I heart Radio used much of this debt to buy back their own shares of stock.
Not true. iHeart had to declare bankruptcy, and the equity investors lost nearly all of their positions while the lenders took over the equity in exchange for debt.
This raised the earnings of each remaining share creating a party for big investors and top executives! So don't give me the sad story about them loosing money. They lost and will continue to loose money because of greed and terrible management.
They lost because of three big factors:
The 1995 to 2005 purchase prices in the consolidation years were very high, based on future forecasts that everyone believed: investors, banks, advertisers. So they got huge debt during the consolidation period.
Then we had three major changes:
1. The PPM showed 30% less AQH listening. That meant agencies and transactional buyers paid less per point. 90% of iHeart revenue is in PPM markets.
2. The recession reduced everyone's revenue. But radio did not recover well.
3. The smart phone changed the way people listen to music and news and enetertainment.
Lower revenue. $20 billion in 2005, around $11 to $12 billion today, worth around $7 billion in 2005 dollars. So radio is off in revenue by 60% in real dollars. Nobody had 60% margins.
Most of these guys are bankers not radio people. They took all local jobs,content, engineering, promotion to corporate banking mindset in New York. Some Companies Deserve to Fail!
The investment bankers that own iHeart today are owners because it went bankrupt; it's essentially a foreclosure. Even with the reduced debt following the bankruptcy, they will still lose money. Remember, also, that the group that bought Clear Channel just before the recession tried to back out but could not find a legal way to do so; they knew they were forced into something they no longer wanted and could not find a way to make the business work.