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    UONEK
    Earnings call· Jun 2026(Q2 FY26)

    URBAN ONE Q2 FY26 earnings call UONEK

    Aug 4, 2026 Source

    Executive summary

    Urban One Q2 FY26 — Adjusted Guidance Amidst Political Ad Anticipation

    Urban One reported sequential improvements in Q2 FY26 compared to Q1, but adjusted its full-year adjusted EBITDA guidance downwards due to a challenging first half. The company is anticipating a significant tailwind from political advertising in Q3 and Q4, particularly in key competitive states, and is actively pursuing debt reduction and strategic radio market consolidation while navigating subscriber churn in its linear cable segment.

    Highlights

    4

    • Reduced long-term debt by $60.2 million year-to-date, resulting in $4.6 million in annual interest savings.

    • National advertising sales for Radio were down 1.5% year-over-year, outperforming the market which was down 4.6%.

    • Dallas acquisition closed on July 17, 2026, expected to contribute significantly to the last 5.5 months of the year.

    • Q3 2026 TV One Prime delivery (25-54) is up 4% compared to Q2 2026, showing sequential improvement.

    Concerns

    5

    • Consolidated net revenues decreased by 6.4% year-over-year to $85.8 million.

    • Full-year adjusted EBITDA guidance adjusted down from $60 million to the mid-$50 million range due to weak first half performance.

    • Cable Television advertising sales were down 9.6% year-over-year, with Prime delivery down 21% year-over-year for 25-54.

    • Traditional linear cable TV subscribers for TV One decreased from 34.3 million in Q2 2025 to 27.3 million in Q2 2026.

    • Recognized a $13.9 million goodwill impairment charge and $0.3 million long-lived asset impairment charge related to Reach Media.

    Guidance & targets

    3
    CategoryTargetConfidence
    Full-year Adjusted EBITDA
    mid-50s
    high materiality
    Medium
    Radio Political Ad Revenue Budget
    $11.1 million
    medium materiality
    Medium
    Digital Political Ad Revenue Budget
    maybe a couple of $1 million or maybe $1 million
    low materiality
    Low

    Segment performance

    4
    SegmentRevenueYoYQoQMargin
    Radio Broadcasting
    Revenue decrease driven by local ad sales underperformance, partially offset by national ad sales outperformance. Government public and telecommunications categories showed growth.
    Local ad sales growth: -10.1% (vs market -7.8%)National ad sales growth: -1.5% (vs market -4.6%)Largest ad category (services) growth: -0.7%Government public category growth: +14.5%Telecommunications category growth: +16.9%
    		$35.3 million-3.9%——
    Reach Media
    Continued decline in network revenue available for participation, leading to a loss in adjusted EBITDA.
    		$4.8 million-10.6%—Adjusted EBITDA loss of $1 million
    Digital
    Decrease driven by reductions in DEI-focused spending and lower client spending due to macroeconomic concerns.
    		$9.4 million-8.4%——
    Cable Television
    Revenue decline due to advertising sales pressure from competition (NBA playoffs) and weak scatter market, and affiliate revenue decline from subscriber churn. Partially offset by increased subscriber rates. Q3 shows some sequential improvement in Prime delivery.
    Advertising sales growth: -9.6%Affiliate revenue growth: -4.5%TV One traditional linear subscribers (Q2 2026): 27.3 million (vs 34.3 million Q2 2025)TV One total subscribers (incl. virtual, Q2 2026): 30.5 million (vs 35.4 million Q2 2025)CLEO TV traditional linear subscribers (Q2 2026): 27.2 millionCLEO TV total subscribers (incl. virtual, Q2 2026): 31.1 millionTV One Prime delivery (25-54, Q2 2026 vs Q2 2025): -21%TV One Prime delivery (25-54, first 4 weeks Q3 2026 vs Q2 2026): +4%TV One Prime delivery (25-54, first 4 weeks Q3 2026 vs Q3 2025): -3%
    		$37.1 million-7.4%——

    Operational metrics

    24
    Operating Expenses (adjusted)
    $75 millionvs $78.1 million Q2 FY25
    Q2 FY26

    Decrease mainly driven by sales and marketing expense decreases across operating segments.

    Operating Expenses
    $0.5 million-1.6% YoY
    Q2 FY26

    Driven primarily by lower revenue and lower bad debt reserves.

    Operating Expenses
    $1.2 million-17% YoY
    Q2 FY26

    Primarily due to lower bad debt reserves.

    Consolidated Broadcast and Digital Operating Income
    $22.2 million-13.7% YoY
    Q2 FY26
    Interest Expense (P&L)
    $2.1 milliondown from $9.7 million Q2 FY25
    Q2 FY26

    Reflecting debt repurchase accounting and lower effective interest rates under Troubled Debt Restructuring laws.

    Cash Interest Payments
    $5 million
    Q2 FY26

    Semiannual payment for 2030 and 2031 notes made on April 1.

    Next Semiannual Cash Interest Payment
    $12.1 million
    Q3 FY26

    For the full 180 days of accrued interest.

    2031 Second Lien Notes Repurchased
    $23.5 million
    Q2 FY26

    Reduced outstanding long-term debt balance to $303.2 million.

    Long-term Debt Reduction
    $60.2 million
    YTD FY26

    Resulted in an annualized interest saving of $4.6 million.

    Asset-Backed Facility Draw
    $10 million
    Q2 FY26

    Resulted in total outstanding balance of $20 million.

    Asset-Backed Facility Draw (additional)
    $7 million
    Q2 FY26

    Made during the quarter.

    Asset-Backed Facility Repayment
    $5 million
    Q3 FY26

    Repaid in the third quarter.

    Asset-Backed Facility Outstanding Balance
    $22 million
    Current

    Current balance after recent repayment.

    Asset-Backed Facility Borrowing Capacity (Incremental)
    $24.1 million
    Current

    Available incremental borrowing capacity.

    Goodwill Impairment Charge
    $13.9 million
    Q2 FY26

    Related to Reach Media, non-cash.

    Long-Lived Asset Impairment Charges
    $0.3 million
    Q2 FY26

    Related to Reach Media, non-cash.

    Depreciation and Amortization Expense
    $6.2 million
    Q2 FY26
    Benefit from Income Taxes
    $1.7 million
    Q2 FY26
    Cash Taxes Paid (Net of Refunds)
    $0.5 million
    Q2 FY26
    Class D Common Stock Repurchased
    $0.6 million
    Q2 FY26
    Class B Common Stock Repurchased (Tax Vest)
    $0.7 million
    Q2 FY26

    Executed for stock vest tax repurchase.

    Contracted Outstanding Debt Balance
    $323.2 million
    As of June 30, FY26
    Net Debt
    $307.9 million
    As of June 30, FY26

    Calculated from $15.4 million ending unrestricted cash.

    Total Leverage Ratio
    6.66x
    As of June 30, FY26

    Industry KPIs

    9
    MetricValueDetails
    Total revenue$85.8 millionUSD
    Net income EPSNet loss of $7 millionUSD
    Adjusted EBITDA$11.7 millionUSD
    CAPEX capital program$1.7 millionUSD
    Operating income margin$22.2 millionUSD
    Total operating expenses$75 millionUSD
    Content title performanceTV One Prime delivery (25-54) down 21% YoY in Q2 FY26%
    Cash marketable securities$15.4 millionUSD
    M a integration cost synergies—

    Deals & partnerships

    3
    unrelated third partiesSale of radio broadcast licenses in Charlotte, North Carolina.$0.7 million (WMXG) and $4.2 million (WLNK)

    Sales completed on June 1, 2026.

    Service Broadcasting GroupAcquisition of radio stations KKDA and KRNB in Dallas, Texas.$22 million

    Agreement entered in April, acquisition completed on July 17, 2026.

    Fusion Dallas LLCSale of radio station KZMJ in Dallas.$6 million

    Agreement entered in April, sale completed on July 6, 2026.

    Risks & headwinds

    6
    Weak first half of the yearH1 FY26

    Contributed to full-year adjusted EBITDA guidance reduction from $60 million to mid-$50 million.

    Mitigation: Anticipated political ad spending in H2, Dallas acquisition contribution.

    Macroeconomic concernsQ2 FY26

    Drove lower client spending in Digital segment, resulting in 8.4% revenue decrease.

    Linear cable subscriber churnQ2 FY26

    TV One traditional linear subscribers decreased from 34.3 million (Q2 FY25) to 27.3 million (Q2 FY26), driving 4.5% affiliate revenue decline.

    Mitigation: Partially offset by increased subscriber rates; Q3 shows sequential improvement in Prime delivery.

    Weak scatter market and pricing pressure on ad ratesQ2 FY26

    Cable Television advertising sales down 9.6% YoY, Prime delivery down 21% YoY (25-54), leading to more commercial units allocated to direct response at lower average unit rates.

    Mitigation: Focus on upfronts, managing inventory in competitive CTV environment.

    Underperformance in local radio ad salesQ2 FY26

    Local ad sales down 10.1% YoY, compared to market down 7.8%.

    Mitigation: Focus on specific market improvements (e.g., Washington D.C., Atlanta) and strategic acquisitions like Dallas.

    Significant non-cash goodwill and long-lived asset impairment chargesQ2 FY26

    $13.9 million goodwill impairment and $0.3 million long-lived asset impairment related to Reach Media.

    Mitigation: Goodwill for Reach Media now fully written down, Radio FCC licenses amortized, expecting fewer such charges going forward.

    What to watch in Q3 FY26

    5

    Political Ad Revenue Realization

    Next quarter (Q3 FY26) and Q4 FY26
    CurrentRadio budgeted at $11.1M, Digital at $1-2M for FY26.
    TargetActual political ad revenue in Q3/Q4 FY26, especially from competitive races.

    Why it matters

    Political ad spending is a key anticipated tailwind for H2 FY26, crucial for meeting revised full-year guidance.

    However, because of the weak first half of the year, we have decided to adjust our guidance down from 60 to the mid-50s, even though we still don't know exactly where political is going to come out.

    Q&A highlights

    7

    Can management quantify the expected political ad revenue for the upcoming period, especially with the Dallas acquisition?

    Management stated it's difficult to quantify precisely as it depends on spending and competitiveness of races. They budgeted Radio at $11.1 million for FY26, down from $13 million in 2022 due to no expected Georgia runoff. Digital might see $1-2 million. They highlighted competitive races in Ohio, Texas, Georgia, North Carolina, and Indiana as potential drivers.

    “I do know that we've got Radio budgeted at about $11.1 million. And in '22, we did 12 -- basically 13. And so not quite as -- we're not -- we're saying that we're not going to be quite as robust as '22, but...”

    asked by Ben Briggs · answered by Alfred Liggins

    2 min read6 chapters

    Detailed Narrative

    01

    Q2 Performance Overview and Political Outlook

    Urban One experienced sequential improvements in Q2 FY26 compared to Q1, but still faced a challenging first half with overall revenue decline. Management anticipates a significant pick-up in Q3 and Q4 driven by political advertising, citing competitive races in Ohio, Texas, Georgia, North Carolina, and Indiana as potential tailwinds. The company has adjusted its full-year adjusted EBITDA guidance downwards from $60 million to the mid-$50 million range due to the weak first half, despite the expected political boost and contributions from the recent Dallas acquisition.

    02

    Debt Reduction and Financial Restructuring

    The company continued its strategy of reducing leverage through market repurchases of its debt. During the quarter, Urban One spent $23.5 million to repurchase 2031 second lien notes at an average price of 42 cents on the dollar. This action resulted in a $60.2 million reduction in long-term debt year-to-date and an annual interest savings of $4.6 million. The company also utilized its asset-backed facility, drawing an additional $10 million in Q2, bringing the total outstanding balance to $20 million, with further draws and repayments occurring.

    03

    Radio and Digital Segment Dynamics

    The Radio Broadcasting segment saw a 3.9% year-over-year revenue decrease, with local ad sales underperforming the market (down 10.1% vs. market down 7.8%) but national ad sales outperforming (down 1.5% vs. market down 4.6%). Digital segment revenue declined 8.4% due to reductions in DEI-focused spending and general client spending. Management noted struggles in Indianapolis and momentum loss in Houston due to the World Cup impacting Q2.

    04

    Cable Television Challenges

    The Cable Television segment faced a 7.4% revenue decrease, primarily driven by a 9.6% decline in advertising sales due to strong competition from events like the NBA playoffs and a weak scatter market. Affiliate revenue was down 4.5% due to subscriber churn, with traditional linear subscribers for TV One falling from 34.3 million in Q2 2025 to 27.3 million in Q2 2026. Despite this, Q3 2026 showed early signs of improvement in TV One's Prime delivery.

    05

    Impairment Charges and Accounting

    Urban One recognized a $13.9 million goodwill impairment charge and a $0.3 million long-lived asset impairment charge, both related to Reach Media. Management clarified that these are non-cash charges and are added back in adjusted EBITDA calculations. They expressed optimism that such significant non-cash impairments might decrease in the future, as goodwill for Reach Media has been fully written down and Radio FCC licenses are now amortized rather than subject to large impairments.

    06

    Strategic Outlook and Consolidation

    Management indicated an openness to expanding beyond its core African-American demographic in radio, particularly in markets where it can build scale and drive local ad solutions. They foresee further consolidation in the radio business, emphasizing deliberate, accretive, and deleveraging acquisitions. The company's strategy involves smart acquisitions that address market pressures🌐 on advertising mediums, citing the beneficial acquisition of Cox stations in Houston and the recent Dallas acquisition as examples of successful scale-building.

    AI-generated summary of the company’s earnings call. Not investment advice.