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UO

URBAN ONE, INC. (UONE)·Q3 2025 Earnings Summary

Executive Summary

  • Net revenue declined 16.0% year-over-year to $92.7M; Adjusted EBITDA fell 44.1% to $14.2M, driven by weakness in national audio, Digital and Reach Media, and cable affiliate fee churn .
  • Management cut FY 2025 Adjusted EBITDA guidance from $60.0M to $56.0–$58.0M, citing softer conditions; Q4 radio pacings are down 30.2% all-in and 6.4% ex-political, a key near-term headwind .
  • Cable TV advertising fell 5.4% and affiliate fees declined 9.1% YoY; Digital revenue was down ~30% with audio streaming down $1.3M; Reach Media revenue fell 40% on weaker national renewals/DEI pullback .
  • Balance sheet actions continue: $4.5M of 2028 notes repurchased at ~52% of par and announced exchange/tender offers (post-quarter) with a backstopped note subscription to extend maturities and optimize capital structure .

What Went Well and What Went Wrong

  • What Went Well

    • Cost discipline: Q3 operating expenses (ex D&A, SBC, impairments) decreased to ~$83.7M (-4.2% YoY); corporate professional fees and payroll were down .
    • Local radio outperformance: Local ad sales down 6.5% vs market down 10.1%, partially offsetting national underperformance .
    • Debt management: Repurchased $4.5M of 2028 notes at ~52% of par, lowering interest expense YoY and recorded ~$2.1M gain on retirement of debt .

  • What Went Wrong

    • Broad revenue softness: Net revenue down 16.0%; Digital (-26.8%), Reach (-40.0%), Radio (-15.3%), cable affiliate fees (-9.1%) all declined YoY .
    • Royalty catch-up expense: ~$3.1M retroactive music licensing royalties (RMLC settlement) raised radio programming/technical costs in Q3 (added back in Adjusted EBITDA) .
    • Guidance cut and Q4 pacing: FY Adjusted EBITDA lowered to $56–$58M, with radio pacings down 30.2% all-in for Q4; national radio advertising demand remains weak .

Financial Results

MetricQ4 2024Q1 2025Q2 2025Q3 2025
Revenue ($USD Millions)$117.1 $92.2 $91.6 $92.7
Net Income ($USD Millions)$(35.7) $(11.7) $(77.9) $(2.8)
Diluted EPS ($)$(0.78) $(0.26) $(1.74) $(0.06)
Adjusted EBITDA ($USD Millions)$26.9 $12.9 $14.0 $14.2
EBIT Margin %*19.06*9.26*10.25*6.03*
Net Income Margin %*(30.44%)*(12.73%)*(85.02%)*(3.05%)*

Values retrieved from S&P Global for asterisked items.

Sequential comparison (Q2 2025 → Q3 2025):

  • Revenue: $91.6M → $92.7M (+1.1%)
  • Adjusted EBITDA: $14.0M → $14.2M (+1.7%)
  • Diluted EPS: $(1.74) → $(0.06) (improved on lower interest expense and no impairments) .

Year-over-year (Q3 2024 → Q3 2025):

MetricQ3 2024Q3 2025
Revenue ($USD Millions)$110.4 $92.7
Diluted EPS ($)$(0.68) $(0.06)
Adjusted EBITDA ($USD Millions)$25.4 $14.2

Segment breakdown (Q3 2025 vs Q3 2024):

SegmentNet Revenue Q3’24 ($M)Net Revenue Q3’25 ($M)Adj. EBITDA Q3’24 ($M)Adj. EBITDA Q3’25 ($M)
Radio Broadcasting$39.7 $34.7 $7.4 $7.1
Reach Media$10.2 $6.1 $3.5 $(0.2)
Digital$18.3 $12.7 $5.3 $0.8
Cable Television$42.8 $39.8 $16.9 $14.5
Corporate/Elims/Other$(0.7) $(0.7) $(7.7) $(8.0)

KPIs (Q3 2025 revenue sources vs Q3 2024):

CategoryQ3 2024 ($M)Q3 2025 ($M)YoY Change ($M)YoY %
Radio advertising$45.0 $38.1 $(6.9) (15.3%)
Political advertising$3.5 $0.2 $(3.3) (94.3%)
Digital advertising$17.3 $12.7 $(4.6) (26.8%)
Cable TV advertising$24.0 $22.7 $(1.3) (5.4%)
Cable TV affiliate fees$18.8 $17.1 $(1.7) (9.1%)
Events & other$1.7 $1.9 $0.2 9.2%

Balance sheet highlights (end of Q3):

  • Cash and restricted cash: $79.8M; Total debt: $484.3M; Stockholders’ equity: $78.8M .
  • Net leverage: 6.02x LTM Adjusted EBITDA (Net debt ~$408.5M / $67.9M LTM Adj. EBITDA), per CFO .

Non-GAAP adjustments impact:

  • Q3 Adjusted EBITDA adds back: $3.1M litigation settlement (royalty rate increase), $1.6M severance, corporate costs and other items .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EBITDA ($USD Millions)FY 2025$60.0M $56.0–$58.0M Lowered
Radio revenue pacings (All-in)Q4 2025N/ADown 30.2% New pacing disclosure
Radio revenue pacings (Ex-political)Q4 2025N/ADown 6.4% New pacing disclosure
Annualized cost savingsRun-rate$5M earlier in year +$3M added in Q3 (total ~$8M) Raised savings target

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q3 2025)Trend
DEI/national audio weaknessQ2: Reach loss-making; DEI and national renewals weaker; timing of Fantastic Voyage shifted to Q4 . Q1: Digital down (16.1%); reaffirmed $75M then later reduced guidance .Reach revenue down 40% YoY; DEI drying up noted; Adjusted EBITDA loss at Reach (~$0.2M) .Worsening vs prior year; still weak.
Radio demand/mixQ2 core radio ex-digital down 11.8%; Q3 pacing mid-single-digit ex-political . Q1 core radio down 12.4% .Local underperformed less than market; national underperformed more; Q4 pacings down 30.2% all-in, 6.4% ex-political .Sequential improvement ex-political but headline pacings weak.
Cable TV subs/ratingsQ2 affiliate down 11.7% due to churn . Q1 cable ad down 6.3%; ratings stabilized .Cable ad down 5.4%; affiliate down 9.1%; TV One Nielsen subs 34.1M; CLEO TV 33.5M .Continuing churn; rating stabilization earlier, subscriber declines continue.
Cost actionsQ1/Q2: cost controls; impairments; reduced expenses .Additional $3M annualized saves; severance $1.6M in Q3 .Intensifying cost reduction.
Capital structure/deleveragingQ1/Q2: ~$88.6M and $64.0M notes repurchases at ~54%/52% of par .Q3: $4.5M notes repurchased at ~52% of par; post-Q3 exchange/tender launched; leverage 6.02x .Ongoing repurchases; pursuing liability management transactions.
Regulatory/dereg M&A optionalityN/AManagement monitoring FCC potential deregulation; no transformative M&A planned; focus on delevering .Watching policy catalysts; optionality maintained.

Management Commentary

  • “Third quarter results came in slightly softer than expected across the board… we are reducing our full year guidance from $60.0 million of Adjusted EBITDA to $56.0 to $58.0 million.” – Alfred C. Liggins, III (CEO) .
  • “Local ad sales were down 6.5% against a market down 10.1%… national ad sales were down 29.1% vs market down 21.5%.” – Peter Thompson (CFO) .
  • “We recorded approximately $3.1 million of retroactive royalties in Q3… we did add that back to Adjusted EBITDA.” – Peter Thompson (CFO) .
  • “We repurchased $4.5 million of our 2028 Notes at an average price of approximately 52% of par.” – Company disclosure .
  • “We decided to sit pat and build a little liquidity… keep our powder dry… focused on delevering.” – Alfred C. Liggins, III (CEO) .

Q&A Highlights

  • 2026 outlook: Management expects a rebound aided by political year tailwinds, operational changes at Reach Media, diversification in radio formats (e.g., Hispanic format in DC), and stable TV One performance .
  • M&A/deregulatory backdrop: Monitoring FCC ownership cap waivers and potential deregulation; no transformative deal active; any transaction must be deleveraging and mindful of secular top-line pressures .
  • Debt buybacks/liquidity: While open to discounted buybacks, near-term preference is liquidity conservation given potential deregulation-driven opportunities; overall focus remains deleveraging .
  • Guidance clarity: Reinforced FY Adjusted EBITDA range and Q4 radio pacing dynamics; emphasized cost actions and segment demand drivers .

Estimates Context

  • S&P Global consensus estimates for Q3 2025 EPS and revenue were unavailable; no estimate counts were returned. Comparisons to Wall Street consensus could not be made this quarter. Values retrieved from S&P Global.
  • Actual revenue: $92.7M . EPS: $(0.06) diluted . Adjusted EBITDA: $14.2M .

Key Takeaways for Investors

  • Guidance cut and weak Q4 pacing are near-term negatives; watch for potential estimate revisions and sentiment around FY 2025 EBITDA trajectory .
  • Segment pressure remains broad (Reach, Digital, cable affiliate fees), with DEI pullback and national audio weakness driving the misses; local radio outperformance is a relative bright spot .
  • Cost actions are tangible (additional $3M annualized saves; severance), supporting margin defense into 2026 despite soft top-line .
  • Liability management continues: discounted repurchases and announced exchange/tender offers can improve maturity profile and reduce interest burden, a potential medium-term catalyst .
  • Regulatory developments (FCC ownership rules) could create M&A optionality; management remains disciplined on leverage and returns .
  • Cable subscriber churn persists; monitor TV One/CLEO ratings, CTV migration and affiliate dynamics as key drivers of cable segment profitability .
  • Execution priorities: diversify advertiser mix at Reach, stabilize Digital monetization, maintain local radio share gains, and preserve liquidity to capitalize on opportunities .

Notes:

  • All asterisked metrics were retrieved from S&P Global and presented where company disclosures did not provide the exact margins.
  • Non-GAAP Adjusted EBITDA reconciliations are provided by the company; adjustments include litigation-related royalties and severance .