Versant Media Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Total Revenue: $1.64 billion, a decline of 4% year-over-year (3% decline excluding SportsEngine divestiture).

Linear Distribution Revenue: $954 million, down 6% year-over-year.

Advertising Revenue: $423 million, a slight decline of 0.6% year-over-year, an improvement compared to a 13% decline in the prior year.

Platforms Revenue: $225 million, up 9% year-over-year, driven by growth in Fandango and GolfNow.

Adjusted EBITDA: $624 million, an increase of 3%, with margins above 30%.

Free Cash Flow: $350 million for the quarter; maintaining annual guidance of $1 billion to $1.2 billion.

Cash Position: Approximately $1.5 billion at the end of the quarter.

2Strategic Updates and Business Highlights

Audience Growth: The TV portfolio reaches over 120 million viewers monthly, with double-digit audience increases.

Content Performance: CNBC had its highest-rated quarter in over five years, and MS NOW saw a 14% increase in viewership.

Sports Initiatives: Announced a 5-year agreement with Bundesliga for over 300 live matches, enhancing sports offerings.

Digital Expansion: Launched an AVOD service under Fandango, integrating ticketing, home entertainment, and free streaming.

Acquisition of Full Swing: Aimed at enhancing the golf ecosystem and providing immersive off-course experiences.

Direct-to-Consumer Strategies: MS NOW and CNBC are developing independent D2C offerings to deepen audience engagement.

3Forward Guidance and Outlook

Revenue Guidance: Increased from $6.15 billion to a range of $6.2 billion to $6.45 billion.

Adjusted EBITDA Guidance: Raised from $1.85 billion to a range of $1.9 billion to $2.05 billion.

Expectations for Second Half: Anticipated increases in programming costs due to sports rights, leading to potential EBITDA declines in Q3 and Q4.

4Bad News, Challenges, or Points of Concern

Revenue Decline: Overall revenue decreased by 4%, with linear distribution revenue continuing to face headwinds from subscriber declines.

Programming Costs: Expected to rise significantly in the second half due to increased sports rights costs, which may pressure EBITDA growth.

Market Conditions: Ongoing secular changes in the pay TV landscape pose challenges to revenue stability.

5Notable Q&A Insights

Affiliate Renewals: Negotiations for distribution deals were similar to past experiences, emphasizing the strength of Versant's brands.

Direct-to-Consumer Demand: Management highlighted strong engagement metrics for MS NOW and CNBC, indicating latent demand outside traditional pay TV.

Full Swing Contribution: Guidance increase was not attributed to Full Swing, but rather overall portfolio strength.

M&A Strategy: Management remains disciplined regarding leverage and capital allocation, indicating a balanced approach to growth and shareholder returns.

Advertising Trends: Broad-based strength in advertising revenue, primarily driven by sports and live events, with no single network dominating the improvement. Overall, Versant Media's Q2 2026 results reflect a mix of strong audience engagement and strategic growth initiatives, tempered by ongoing challenges in the pay TV sector and rising costs associated with content rights.