Q2 adjusted EBITDA landed at $113 million, below the $122 million consensus. Sinclair kept its $575-600 million full-year view, a second-half-heavy target.
Sinclair (SBGI) missed Wall Street's revenue and profit estimates for the second quarter. The broadcaster reported $755 million in revenue, below the $769 million analysts expected, and adjusted EBITDA of $113 million, short of the $122 million consensus.
Shares fell 3.2% in after-hours trading Wednesday. The company blamed the soft advertising market and the absence of political spending. Earnings-season coverage across sectors is on the stock market analysis page.
Core ad revenue, excluding political, fell 8.4% from a year earlier. The decline was heaviest among auto dealers and services advertisers, Chief Financial Officer Narinder Sahai said. He tied a second-half rebound to national marketers returning to the market.
Digital revenue rose 12%, helped by its programmatic platform and local sales tools.
Distribution revenue, which includes retransmission fees, increased 3% to $440 million, roughly 58% of the quarter's revenue. Sinclair has renewed 60% of its cable and satellite affiliate contracts for the current cycle at mid-single-digit rate increases, consistent with earlier guidance.
Local sports and news revenue fell 5%. Sinclair attributed the drop to lower subscriber counts at the regional sports networks it operates. The company has been moving those networks toward direct-to-consumer distribution, and executives offered no timeline for subscriber stabilization.
Sinclair carried $4.2 billion in total debt and $187 million in cash at the end of June. The company did not announce any change to its capital allocation plans.
Full-year adjusted EBITDA guidance of $575 million to $600 million was reaffirmed on the call. Sahai said distribution renewals and a pickup in local advertising would carry the second half.
Chief Operating Officer Rob Weisbord said early bookings for fall political advertising are building ahead of the midterms.
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