Local TV giant Nexstar reported a blockbuster fourth quarter, driven mostly by explosive growth in political advertising. That is especially clear when looking at the company’s core advertising revenue (which does not include political), which was down slightly year-over-year, consistent with the rest of the industry.
Nexstar reported revenue of $1.49 billion in the quarter, net income of $178 million, and adjusted EBITDA of $662 million. Core advertising revenue was $478 million (down 3.3 percent year over year), while political advertising revenue was $266 million (up 1,307 percent).
Nexstar also closed its acquisition of The CW last quarter, bringing the national broadcast network under its fold. The company has installed new leadership at The CW, and has inked deals for content like the LIV Golf tour.
As The Hollywood Reporter first noted last year, The CW is a money-loser, with Nexstar reporting a $54 million “bargain” gain on the purchase. The company’s restructuring is meant to turn the network toward profitability.
Still, if the latest quarter is any indication, The CW is still firmly in its money-losing phase. The CW had approximately $66.4 million in revenue in the quarter, but it also reported a $94 million loss.
On the company’s earnings call, Nexstar CEO Perry Sook said that The CW would become “instrumental to unlock the national advertising opportunity” the company sees. He added that the company has “already taken action to improve and diversify our content” with the addition of LIV Golf, and that it would be reworking The CW’s programming over time.
The company also gave guidance for 2023, projecting free cash flow of $1.25 billion.
“Looking ahead, 2023 will benefit from the 2022 renegotiation of our distribution contracts representing more than half of our subscribers, and 2024 will benefit from presidential election year political advertising and additional distribution contract renewals,” Sook said in a statement.
