Nexstar, Tegna: Political Ad Revenues Soar, Core Ad Revenue Recedes

Nexstar Media Group and Tegna Inc. continue the parade of big TV station groups registering large political advertising gains in the third quarter -- all as their respective core-advertising revenues fell.

Nexstar’s political revenue climbed $70.1 million from $7.2 million versus the third quarter of 2017. Tegna registered $60 million, up from $3.8 million.

Tegna now expects what it says will be record-breaking political advertising results -- $238 million for the full year, up 50% from the last midterms. All this is up from prior company estimates of $180 million to $200 million. It also expects $144 million in the fourth quarter, up 56% from the previous midterms.

The downside for both TV station groups is with lower core non-political advertising -- which generally gets pushed out of media schedules in favor of virtually all-must-run political advertising.

Nexstar reported that local ad revenue sank 4.1% to $189.4 million, while national ad revenue sank 5.8% to $71.6 million.  Tegna says its advertising and marketing services revenue -- which includes traditional, digital ad business -- was down 5% in the quarter due to this.

Earlier this week, Sinclair Broadcast Group also reported higher political advertising and lower core advertising -- also due to displacement by political media schedules.

Overall revenue grew for Nexstart and Tegna, due to political ad gains as well as retransmission fees. Nexstar had a 10.4% gain in retransmission revenue to $284.3 million, while Tegna’s subscription revenue grew 17% to $207.5 million.

Company-wide quarterly revenues saw Nexstar rising 13.3% to $693.0 million, while Tegna was up 16% to $539 million. Nexstar's net income was up 137% to $99.8 million. Tegna's rising net income from continuing operations was 77% higher to $87.4 million.

Nexstar says its total digital revenue in the period climbed 25% to $69.3 million.

Tegna’s OTT advertising service, Premion, is on pace to achieve full-year revenue guidance of $75 million, excluding political revenue.

Mid-day stock market trading of Nexstar was down 1.4% to $82.03, while Tegna dipped 1.6% to $12.30.

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