Nexstar Media Group Q4 Earnings Call Highlights

27 Feb 2026, 00:06 by Amy Steele · The Cerbat Gem

Nexstar Media Group (NASDAQ:NXST) executives said the company ended 2025 with “strong execution and bold strategic action,” while laying out priorities for 2026 that include closing its proposed acquisition of TEGNA, capitalizing on the return of midterm-cycle political advertising, expanding digital revenue, and continuing cost rationalization efforts.

TEGNA deal timeline and regulatory process

Founder, Chairman, and CEO Perry Sook said the company remains “on track” toward closing the TEGNA transaction, with Hart-Scott-Rodino filings and FCC license transfer applications submitted and responses provided to inquiries from the DOJ, FCC, and state attorneys general. Sook reiterated Nexstar’s expectation to close by the end of the second quarter of 2026, noting the company would “hopeful[ly]” close sooner but that timing ultimately rests with regulators.

In response to analyst questions, management said it has not had conversations with regulators about divestitures at this stage. Sook reiterated Nexstar’s longstanding view that if divestitures are required, they would be “de minimis” and not meaningful to overall deal value. He added that the company has provided extensive information and economic studies to the DOJ focused on how the relevant competitive market should be defined.

Fourth-quarter results: political swing drives year-over-year declines

Chief Operating Officer Michael Biard said fourth-quarter net revenue was $1.29 billion, down 13.4% year over year, “primarily reflecting” the reduction in political advertising, partly offset by stronger-than-expected non-political ad performance.

Key revenue items discussed on the call included:

Distribution revenue: $720 million, up $6 million (0.8%) year over year, reflecting rate increases, vMVPD subscriber growth, and the addition of CW affiliations on certain stations, partly offset by MVPD subscriber attrition.
Advertising revenue: $549 million, down $209 million (27.6%), driven by a $233 million year-over-year decline in political advertising to $21 million.
Non-political advertising: up 4.5% in the quarter, outperforming the company’s prior expectation of a low single-digit decline, with Biard citing later-than-anticipated spending that drove broad-based improvement across local, national, network, and digital.

Biard said top advertising categories in the quarter were gaming, banking, attorneys, and sports betting, aided by the legalization of online sports betting in Missouri. Auto was cited as the largest declining category, though the company said growth in digital products for auto dealers partially offset those declines.

Profitability progress at The CW and growth at NewsNation

Sook and Biard highlighted improvements at The CW and continued ratings gains at NewsNation as validation of Nexstar’s strategy to emphasize “high-impact news and sports programming.” Sook said The CW finished 2025 as the 10th most-watched ad-supported network and the second fastest-growing network overall, posting a 19% year-over-year increase in viewership. He added that the network improved cash flow by 32% in 2025 and is expected to reach profitability in the fourth quarter of 2026.

Biard provided additional programming and audience metrics, including that the NASCAR O’Reilly Auto Parts Series (formerly Xfinity Series) on The CW delivered its most-watched season in four years, up 10% year over year, averaging over one million viewers across 33 races. He also cited double-digit gains in college football viewership and early-season increases in ACC basketball audiences.

On NewsNation, Sook said the network had its “strongest year ever” in total day, primetime, and daytime viewership and was the fastest-growing cable news network in the adult 25-54 demographic in 2025. Management also said consumer awareness of NewsNation increased to over 40%.

Expenses, EBITDA, and cash flow

Chief Financial Officer Lee Ann Gliha said fourth-quarter direct operating and SG&A expenses (excluding depreciation and amortization and corporate expenses) decreased $7 million (0.9%), driven by items including reduced commissions tied to lower political ad revenue versus the prior year, reduced news and production costs, lower promotions from restructuring initiatives, and lower administrative and one-time expenses.

Gliha reported fourth-quarter total corporate expense was $65 million, including $20 million of non-cash compensation expense, compared with $48 million a year earlier (also including $20 million of non-cash compensation). She attributed the increase primarily to one-time costs tied to the proposed TEGNA acquisition and the impact of a larger bonus reserve reduction in Q4 2024 than in Q4 2025.

On profitability and cash flow, Gliha said:

Adjusted EBITDA: $433 million (33.6% margin) in Q4, down from $628 million in Q4 2024.
Adjusted free cash flow: $214 million in Q4, down from $411 million a year earlier.
CapEx: $54 million in Q4, up from $35 million, primarily due to real estate investment at one property.

Gliha also said Nexstar’s debt at year-end 2025 was $6.3 billion and cash was $280 million, including $13 million at The CW. She reported total net leverage of 3.09x at quarter end and a first lien covenant ratio of 1.71x, below the company’s 4.25x covenant threshold.

2026 outlook: midterms, digital, distribution renewals, and cost actions

Management issued standalone 2026 Adjusted EBITDA guidance of $1.95 billion to $2.05 billion (pre-TEGNA). Biard said Nexstar expects 2026 distribution revenue growth to be low single digits on a gross basis and mid single digits on a net basis, based on contract terms and an anticipated improvement in subscriber attrition. He noted that Nexstar renewed distribution agreements covering more than 60% of subscribers in 2025 and has about 30% of subscribers up for renewal in 2026.

On advertising, Biard said non-political advertising in the first quarter of 2026 is forecast to be roughly flat year over year, citing a negative comparison from the Super Bowl airing on NBC this year versus Fox last year, partially offset by incremental advertising from the Winter Olympics on NBC. He added that Nexstar has seen “strong viewership and advertiser demand” for marquee sports content, citing more than a 20% increase in advertising for the 2026 Super Bowl and the Milano Cortina Olympics compared with the comparable 2022 events.

On political advertising, management cited AdImpact’s projection of about $10.8 billion in total political advertising for the 2025-2026 cycle, with broadcasting expected to capture nearly 50%, or about $5.28 billion. Nexstar said it expects to capture a low double-digit share of total broadcast political advertising and reminded investors that it reports advertising net of agency commissions. Biard also said the company expects roughly 20% of full-year political revenue in the first half of 2026 and 80% in the second half, with political expected to displace non-political advertising in the back half.

Sook said two major 2026 priorities, beyond political execution and the TEGNA close, are digital optimization and expense rationalization. He said local CTV apps are live in 108 markets and that despite “AI search headwinds,” digital revenue grew high single digits in 2025 and double digits in the local business. Management also said it expects digital revenue to surpass national advertising revenue in 2026.

In Q&A, executives discussed AI tools being deployed in local newsrooms to improve workflow and optimize stories for multiple platforms, and said the company is deploying AI tools for sales prospecting and sales operations. Management also discussed programmatic advertising, noting that the TEGNA deal would include Premion, a programmatic CTV platform, and said Nexstar is working with partners on developing a more programmatic approach to linear advertising transactions.

On capital allocation, Gliha said Nexstar returned $56 million to shareholders in the quarter via dividends and is conserving cash to fund the TEGNA acquisition. For the full year, Nexstar returned $351 million (42% of adjusted free cash flow) through $226 million of dividends and $125 million of share repurchases. She said 2026 cash flow priorities include mandatory debt repayments of about $111 million, pension and defined benefit plan contributions of $36 million, an anticipated $228 million dividend, and building cash balances for the TEGNA transaction.

About Nexstar Media Group (NASDAQ:NXST)

Nexstar Media Group, Inc is a diversified American media company engaged primarily in the ownership, operation and strategic affiliation of local television stations, digital platforms and cable networks. The company provides a range of broadcast content, including local news, sports coverage, entertainment programming and syndicated shows, reaching audiences in more than 100 television markets across the United States.

Founded in 1996 by entrepreneur Perry Sook and headquartered in Irving, Texas, Nexstar has built its presence through organic growth and a series of high-profile acquisitions.