iHeart Says Revenues Are Up

[TheBigA]

iHeart posted its 1st Q 2025 revenues yesterday, and says revenues are up at its digital and podcast divisions:

iHeart Sees Broadcast Radio Momentum, While Digital Grows Double-Digits.

Digital has been the driver of growth at iHeartMedia for the past several quarters, and it is again true in the early months of 2025. CEO Bob Pittman also says

www.insideradio.com

Bob Pittman says radio has a problem monetizing its audience.

“We've got more listeners than we did 10 years ago. The audience side of broadcast radio just fine,” Pittman said. “This is a monetization issue that broadcast radio is facing. It's making the transformation from being a business that was sold as spots, and today it's moving to electronic and digital platforms, and I think we're making that transformation.”

More here:

iHeartMedia Releases Q1 2025 Earnings Report

iHeartMedia has issued its quarterly earnings report for Q1 2025 running from January through March. iHeart reports Q1 revenue up

radioinsight.com

 

[ted chittenden]

iHeart posted its 1st Q 2025 revenues yesterday, and says revenues are up at its digital and podcast divisions:

iHeart Sees Broadcast Radio Momentum, While Digital Grows Double-Digits.

Digital has been the driver of growth at iHeartMedia for the past several quarters, and it is again true in the early months of 2025. CEO Bob Pittman also says

www.insideradio.com

Bob Pittman says radio has a problem monetizing its audience.



More here:

iHeartMedia Releases Q1 2025 Earnings Report

iHeartMedia has issued its quarterly earnings report for Q1 2025 running from January through March. iHeart reports Q1 revenue up

radioinsight.com

While by no means a majority, several of the stations not owned by IHeart but available through its site are NPR-affiliated stations supported by CPB. These include some powerhouse NPR affiliates such as WNYC in New York; WBEZ in Chicago; WDET in Detroit; KQED in San Francisco; Minnesota Public Radio in Minnesota; and KCRW in Santa Monica, CA, among others. If these stations were to pull their participation on IHeart because of non-support by CPB at the request of the current President, how much revenue loss would occur in the short term

 

[TheBigA]

If these stations were to pull their participation on IHeart because of non-support by CPB at the request of the current President, how much revenue loss would occur in the short term

Don't know. Are you asking about revenue loss for iHeart or for the station? My understanding is commercial stations pay to be on iHeartRadio. Don't know if that's the case for non-coms. I haven't seen it show up as an expense on the station statements.

 

[ted chittenden]

Don't know. Are you asking about revenue loss for iHeart or for the station? My understanding is commercial stations pay to be on iHeartRadio. Don't know if that's the case for non-coms. I haven't seen it show up as an expense on the station statements.

I was thinking in terms of IHeart and its revenues.

 

[TheBigA]

I was thinking in terms of IHeart and its revenues.

Keep in mind that iHeart's streaming business is based on delivering a mass audience to advertisers. They're not selling those specific stations.

But my take is that those are the stations that won't be hurt very much by the loss of CPB money.

 

[PTBoardOp93]

The headline here is very much Pollyanna, because iHeart still lost $281 million, or about $3 million a day. It has been a while since iHeart has made a profit in any quarter but the 4th quarter, which isn't a sustainable business model.

iHeart is touting the digital numbers, because broadcast continued its slide. 1Q broadcast revenue fell 5.2% year over year. Network revenue (Premiere) fell 2.5%. I believe those numbers are essentially the same as Cumulus, which tells us it is broad based decline.

 

[TheBigA]

The headline here is very much Pollyanna

Yep. That's why I wrote it to say "iHeart says..."

iHeart is touting the digital numbers, because broadcast continued its slide. 1Q broadcast revenue fell 5.2% year over year. Network revenue (Premiere) fell 2.5%. I believe those numbers are essentially the same as Cumulus, which tells us it is broad based decline.

At some point, Pittman expects the digital numbers to exceed the broadcast. It may happen this year. The future isn't with broadcast. They know it, and we know it. So they have to keep cutting the broadcast expenses to adjust to the declining revenues. They'll never make a profit depending only on broadcast. At some point they'll have to shut off some AMs, just like Cumulus.

The good news is they have a diversified revenue stream. The bad news is they still have a money pit in some places with broadcasting. Maybe the way to handle it is spin off the smaller markets into their own thing.

 

[Theater of My Mind]

Bob Pittman says radio has a problem monetizing its audience.

He's been saying that for years, complaining radio is undervalued. It's hard to disagree but it's the same old refrain at this point. Advertisers see radio as a bargain basement form of media and it's been that way for so long it's never going to change.

 

[TheBigA]

He's been saying that for years, complaining radio is undervalued. It's hard to disagree but it's the same old refrain at this point. Advertisers see radio as a bargain basement form of media and it's been that way for so long it's never going to change.

The multiple for broadcast has always been higher than digital. So it's hard to call it a bargain.

My response to Pittman is that radio has to find another way to monetize that doesn't involve spots. I think he knows that.

 

[boombox4]

I noticed two things in the article, as well as another article on IHeart posted elsewhere.

One, they save money by using reductions in staff, and they're increasingly using AI to replace the staff.

Second, podcasting is apparently bringing in a lot of money. Not being an IHeart stream listener, I believe the podcasts aren't necessarily IHeart productions, correct? I think a lot of them come from outside the company. If that's so, I suppose the fact that the podcasts are independent productions also saves them money -- money they don't have to spend producing their own content.

 

[MarkW]

Overall, iHeartMedia’s total revenue increased 1% year-to-year to $807 million. The company posted a loss of $281.2 million, but CFO/COO/President Rich Bressler noted first quarter is typically a seasonal low point, and they expect to generate a profit in the remaining quarters of the year. The company expects earnings of $140 million to $160 million during Q2.

Unless Q2 is expected to include significant non-recurring income of some kind, I'll gladly take the other side of the above bet. I'll be surprised if iHM hits the above guidance in Q2.

“We've got more listeners than we did 10 years ago. The audience side of broadcast radio just fine,”

Is the above a truthful statement? I am highly skeptical. Before the rules were changed in terms of cume measurement earlier this year, many PPM stations' cume levels were 20% or more lower than a decade ago.

 

[davideduardo]

Is the above a truthful statement? I am highly skeptical. Before the rules were changed in terms of cume measurement earlier this year, many PPM stations' cume levels were 20% or more lower than a decade ago.

The change in Nielsen qualifications for quarter hour credit did not involve cume directly. They involve how many detections in discreet minutes within a given quarter hour a panelist's meter detects, reducing them from 5 to 3.

If a person only listened to a particular station during one quarter hour during an entire week, only then did the change in qualifications affect that station.

The greatest beneficiaries from the 5 to 3 detections were stations or show that had fewer opportunities for a PPM code to be inserted. Examples would be talk-intensive morning shows where there are just not that many chances for the code to "match" one of the precise audio frequencies used by the PPM system. Or talk, news and sports stations that do not have the same degree of audio intensity that give the PPM generator a chance to insert the code. Or even music with an absence of content in the places where the PPM code can be inserted. Or commercial breaks and newscasts where the content may not give as many opportunities for encoding.

Even though the "code" is approximately 5" long, meaning that there are 180 opportunites for insertion per quarter hour, much of the content of every station just does not give enough chances for a mask on the selected frequencies to be "offered" to the PPM encoder.

And what stations and advertisers principally look at in ratings is AQH audience, expressed as share, rating or AQH persons (all the same thing but expressed differently like 2/4 is the same as 1/2 is the same as 50%).

 

[TheBigA]

One, they save money by using reductions in staff, and they're increasingly using AI to replace the staff.

They're reducing staff in areas where there are reductions in revenue.

I believe the podcasts aren't necessarily IHeart productions, correct? I think a lot of them come from outside the company. If that's so, I suppose the fact that the podcasts are independent productions also saves them money -- money they don't have to spend producing their own content.

It depends. Most of their local talk shows are also available as podcasts, so they own them and the content. But they also own a lot of non-radio podcasts such as "Stuff You Should Know" or "On Purpose With Jay Shetty." Are they "iHeart productions?" That depends on how the deal was done. A lot of broadcast radio shows are independent productions, done with outside staff. Is it cheaper? In a way yes, because the company isn't responsible for a salary plus benefits. iHeart is also a platform, just like Apple, and it's possible that iHeart podcasts are also available on Apple podcasts. But when iHeart owns the podcast, it makes them money regardless of the platform. So it's complicated.

 

[vw86]

Are podcasts for local radio shows that are tied to a specific station PPM coded? For example, would a morning show that puts their daily show on a podcast get any Nielsen credit for listeners to the podcast?

 

[TheBigA]

Are podcasts for local radio shows that are tied to a specific station PPM coded? For example, would a morning show that puts their daily show on a podcast get any Nielsen credit for listeners to the podcast?

No. There's real time and on demand. The real time broadcast content is PPM encoded. On demand is not. However, if you record off the air, and play it back later, that playback is likely encoded. Podcasts have their own measuring system that is IP based.

 

[TheBigA]

Unless Q2 is expected to include significant non-recurring income of some kind, I'll gladly take the other side of the above bet. I'll be surprised if iHM hits the above guidance in Q2.

Full disclosure: I'm not an accountant. However, one observation I have is that there are many things iHeart does where the expenses take place during the first quarter, and the actual event occurs in the second. Some of the iHeart music events are examples. One can also expect that severance for former employees laid off in Q4 2024 will likely end before Q2 2025. Those are just a couple things that come to mind. But also he is correct that Q1 is usually lower than the rest of the year. iHeart doesn't own rights to the Super Bowl or other events that might benefit Cumulus or Audacy. By the same token, radio hasn't benefited from the Q4 retail bounce it once did.

The main thing is that iHeart is much further along than most other radio companies in transitioning from broadcast to digital. Users of radio can't really see the process as it happens. To them, all it means is the public cost-cutting they may hear. They don't see the bigger picture that revenues aren't keeping up with increased costs because those costs aren't passed on to radio users.

 

[NJnerd19]

I was listening to a major market iheart station in morning drive on Monday. Every other spot was an iheart spot explaining the benefits of advertising with them. Not all the same ones but different copy. I’m not even counting the normal house spots they run.

They are definetly hurting.

 

[davideduardo]

No. There's real time and on demand. The real time broadcast content is PPM encoded. On demand is not. However, if you record off the air, and play it back later, that playback is likely encoded. Podcasts have their own measuring system that is IP based.

You bring up an interesting point: do any stations record for later use audio from an over-the-air monitor as opposed to a pre-band specific processing chain?

If audio is recorded off the air, it is the product of the leveling and peak limiting devices at a station transmitter. I would think that recording for rebroadcast would be taken either at the board output or right after any studio-based AGC activity.

 

[TheBigA]

I was listening to a major market iheart station in morning drive on Monday. Every other spot was an iheart spot explaining the benefits of advertising with them. Not all the same ones but different copy. I’m not even counting the normal house spots they run.

They are definetly hurting.

The broadcast side is hurting, which is why the layoffs are in the broadcast sector. When most businesses are faced with a situation where revenues aren't keeping up with increased costs, they either raise prices or increase inventory. Broadcast radio can do neither. They can't raise prices to advertisers, and they can't add more spots. If radio was a subscription service, it could raise prices to users. But it's not. So the question that Pittman is asking in the OP is how to use the reach and the audience to attract the money necessary to continue the service. That's what you're hearing in those spots.

 

[TheBigA]

You bring up an interesting point: do any stations record for later use audio from an over-the-air monitor as opposed to a pre-band specific processing chain?

If audio is recorded off the air, it is the product of the leveling and peak limiting devices at a station transmitter. I would think that recording for rebroadcast would be taken either at the board output or right after any studio-based AGC activity.

It's probably happening in the control room, not "off the air." What I was talking about is when listeners record off air, as they might do with TV shows. When they do that, it captures the PPM, and that factor is included in the delayed ratings Nielsen does. But when the station records its shows and repackages them as a podcast, my guess is there's some editing done. The podcast might not just be a rebroadcast, but a highlights package. In that case, the PPM isn't the best way to assess usage for advertising purposes. You're not going to bundle that audience in with the broadcast audience, just as you can't bundle a simulcast if it's not identical. Then the podcast will have its own commercials, as pre-roll and within content.