Nexstar, the largest owner of local television channels in the United States, posted record results in the fourth quarter, with political ad spending pushing revenue up 25% to nearly $ 1.4 billion.
Political ad spending was $ 298 million in the quarter ended Dec. 31, out of a total of $ 772 million in TV ad sales. Atlanta’s runoffs in the state’s two seats in the US Senate adding to already massive transportation, and Nexstar stations also added debates and studio shows designed to amplify coverage of political news. .
Net income was $ 7.97 on a diluted basis, more than triple the $ 2.36 recorded in the last year’s quarter.
The numbers far exceeded Wall Street analysts’ consensus estimate of $ 1.34 billion in revenue and $ 7.11 per share. Investors applauded the quarterly report, pushing the stock up nearly 5% by midday to an all-time high of $ 134.41.
Discovery Succeeds 11 Million Stream Subscribers, Top Estimates, But Fourth Quarter Revenue Dips On Pay TV
Political engines will soon restart for the races of 2022, although CEO Perry Sook has warned the company does not anticipate a return to spending in 2020, which he called an “extraordinary event.” Distribution costs also bolstered quarterly results, as distribution revenue increased 18% year-over-year to $ 528 million. In a conference call with analysts, Sook noted that 85% of the company’s distribution deals have been on lockdown until 2022.
Tim Busch, president of broadcasting for Nexstar, said that out of 435 elections for US House seats, Nexstar stations reach around 370. In the Senate, he said the company would be able to broadcast announcements for 31 of 34 races and about 85% of all governor races nationwide.
“It’s a strong imprint,” he says. “It will start a little earlier in ’21 and continue until the last part of ’22.”
Sook said WGN America’s name change to NewsNation will take effect on Monday and he said the cable network “has far exceeded budget expectations” in 2020.
The rebranding is based on an intermediate approach to prime time news, an effort to distance itself from the partisan fare of Fox News, CNN and MSNBC.
Asked about audience trends for linear TV, which has been on a more fragile footing as streaming began to sweep the media landscape, Sook noted that Covid-19 has lifted all broadcast boats in 2020. ” Our job is to try to hold onto as much of that vision as we can, ”he says.
The snow and energy crisis experienced last week in Texas – the state in which Nexstar is headquartered – offered a demonstration of the desirability of linear and local television.
“People haven’t gone to Apple TV” for news about the storm and the power outages, Sook said. “People don’t go to streaming services to find out when water is safe to drink.”