Nexstar Media Group saw lower net revenue in 2023 amid ongoing weakness in the core and political advertising markets coupled with sizable operating expenses associated with its broadcast televison stations and CW Network.
On Wednesday, the largest independent owner of television stations in the country said its net revenue for 2023 fell to $4.933 billion, down 5.3 percent from the $5.211 billion the company earned one year prior.
Total advertising from its television and digital operations fell to $1.726 billion in 2023, weighed down by an erosion in its political advertising business despite an increase in overall spending heading into the 2024 presidential election. The total advertising figure was down 22.4 percent compared to the prior year, and included an 87 percent decrease in political advertising, which came in at $66 million during 2023.
The sluggish advertising business was only partially offset by higher carriage fees charged to cable, satellite and some streaming television companies, with Nexstar reporting $2.727 billion from distribution fees, an increase of 6.1 percent. Those fees likely include higher payments made from some companies like DirecTV, which opted to drop Nexstar-owned broadcast stations and its cable network NewsNation for several weeks last year.
Digital revenue rose by 8.2 percent to $395 million during the year, though the company’s fourth quarter (Q4) digital revenue was down 5.4 percent compared the same time frame in 2022. Nexstar said certain “other revenue” — a term that was left undefined in its earnings release — generated $85 million in cash during 2023.
Net income for the year came in at $270 million, down 71.4 percent compared to the $943 million Nexstar earned in 2022.
In a statement, Nexstar CEO Perry Sook said the company’s Q4 earnings “outperformed consensus expectations,” and affirmed its year-end report “extend Nexstar’s long record of consistently generating substantial free cash flow, and we expect that trend to continue.”
“The power of the broadcast model and its ability to reach the largest audience of any medium with important news, sports and entertainment content is as strong as ever, reflected by the record audience delivery for NFL and Super Bowl, Grammys and other live sports and event programming,” Sook affirmed on Wednesday. “Validating the enduring strength, reach and appeal of broadcast, during the fourth quarter we successfully completed all of our remaining distribution negotiations without interruption, as our distribution partners, their customers and our audience value the highest-rated broadcast and fastest-growing cable news network programming we provide.”
That cable news network is NewsNation, which trails its closest three competitors in the Nielsen ratings. Last year, the Fox News Channel was the leading cable news network, according to Nielsen ratings, followed by MSNBC in second place and CNN in third.
While NewsNation was a distant fourth, it’s also difficult to compare the network to the other three: It is the newest of the four cable networks, and doesn’t have around-the-clock news and commentary programming. The channel recently affirmed its commitment to expand its weekend programming schedule, though it still shows off-network re-runs of the CBS crime drama “Blue Bloods” on Saturdays and Sundays.
The CW Network continues to prove to be a challenge for Nexstar, too: Despite moving the network to some of its own stations in markets like San Francisco and securing affiliation agreements with third party broadcasters in places like Seattle and Detroit, the network is costing Nexstar more money than it is bringing in.
During Q4, the CW Network brought in just $55 million, resulting in an overall loss of $52 million. The CW Network’s total loss in 2023 was $273 million on revenue of $250 million, Nexstar’s earning reports showed.
Some of that loss was attributed to higher programming-related investments: During 2023, Nexstar forged new agreements with the World Wrestling Entertainment (WWE), the Atlantic Coast Conference (ACC), LIV Golf and NASCAR to bring more live sports to the CW Network.
Editor’s note: An earlier version of this article erroneously reported losses at the CW Network as $94 million on $66 million in revenue during Q4 2023. The story was updated with the correct data shortly after it was published.
