As we learned from CBS yesterday, local TV is getting hammered by the ad slowdown. More evidence: Hearst-Argyle TV (HTV), one of the largest independent owners of network-affiliated stations, missed Q2 estimates for revenue and EPS. Total revenue for the quarter was down 5.6% to $182 million compared to $149 million on year ago. EPS came in at 15 cents a share. Analysts had been looking for $190 million revenue and 20 cents, but only three analysts bothered to do a forecast for the company.
The problem: Hearst-Argyle is near 100% dependent on local US ad revenue, the hardest-hit sector in TV. Non-political Q2 ad sales were down 10% from the year before, with weakness across multiple ad categories: automotive, retail, consumer packaged goods, telecommunications, furniture, movies, restaurants, and health services.
The company didn’t provide guidance for Q3, but it should benefit a somewhat from the ramp-up of political spending in battleground states. The company also owns 10 NBC affiliates, which should be getting some of the $150 million in local Olympics-related advertising. The bad news is that digital revenue for the company is slowing down, too. Digital revenue was up 13% in the quarter to to $5.7 million, a deceleration from the 22% growth in Q1.
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