Audacy President and CEO David Field says he expects a full rebound in ad revenue in 2022 and the company’s third quarter 2021 report is proof of further progress in its recovery from the COVID-19 pandemic.
The audio company, formerly known as Entercom, reported net revenues for Q3 this year were $329.4 million, up 23% compared to the same quarter in 2020. And revenues were up 8% sequentially from the second quarter this year.
Spot radio advertising revenues for the broadcaster, which has more than 200 radio stations, were $220.6 million which is up 21% from third quarter 2020. Digital revenues climbed 30% YoY posting revenue of $61.4 million for the most recent quarter.
Field on a quarterly earnings call on Tuesday morning said the company continues to drive forward with “its strategic transformation as a scaled multiplatform audio content and entertainment company, including broadcast, podcasting, digital audio, network, live events, music news and sports.”
The sports betting ad revenue windfall continues for Audacy, according to its earnings report. Field said on the call the company is projecting sports betting ad revenue will grow 100% for the year 2021. “We expect sports betting to grow into a $100 million ad category for us in a few years as legalized mobile sports betting continues to spread across the country,” he said, “including California, Texas and Florida.”
The well publicized supply-chain issues affecting the United States impacted Audacy in Q3, Field said, especially in the automotive sector. Automotive, which is Audacy’s number one advertiser segment, was off about 40% in Q3 compared to 2020 levels. The company revealed today it doesn’t expect automotive ad revenue to recover until sometime in 2023.
“The decline in auto ad spending accounted for a third of our third quarter revenue decrease versus 2019. Another third was due to the combined cancellation of Audacy events and the decline in advertising from third-party concerts, theme parks and festivals,” Field said.
The radio broadcaster, which returned to hosting live Audacy events in the third quarter, has seen a significant difference in the rate of recovery between its larger and smaller markets, according to Field. “The sharp contrast in market recovery reflects how larger markets were slower to reopen and faced more disruption to their local economies. For Audacy this differential has a meaningful impact on our performance as our portfolio is by the far the most concentrated in the largest markets versus any of our peers,” Field said on the earnings call.
Audacy in October announced the $40 million acquisition of WideOrbit’s digital audio streaming and ad tech business and then relaunched it as AmperWave, which will “enhance future growth opportunities for Audacy,” according to Field.
“This acquisition gives us control of our product roadmap to deliver enhanced consumer-facing live and on demand streaming features to our 170 million monthly listeners using the cloud-based distribution and monetization platform,” Field said.
The company also this week announced Brian Benedik has joined the broadcaster as Chief Revenue Officer. Benedik is well known to many broadcasters for his previous role at Katz Media Group.
Audacy listed approximately $1.7 billion of debt in its most recent filing with the U.S. Securities and Exchange Commission.