VSNTV — Versant Media Group, Inc. Class A Common Stock When-Issued

Summary of Versant Media's Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Total Revenue: Approximately $6.7 billion, down 5% year-over-year, primarily due to secular pressures in pay TV and advertising normalization post-2024 presidential election.
• Adjusted EBITDA: About $2.2 billion, down 9% year-over-year, with margins above 30%.
• Free Cash Flow: Estimated at $1.5 billion for the year.
• Linear Distribution Revenue: $4.1 billion, down 5% year-over-year, affected by moderate cord-cutting.
• Advertising Revenue: Approximately $1.6 billion, down 9% year-over-year.
• Platforms Revenue: Increased 4% to approximately $826 million, driven by GolfNow and Fandango.
• Cash Position: Started the year with $850 million in cash and total liquidity of $1.6 billion.

2. Strategic Updates and Business Highlights

• Transition to Stand-Alone Company: Successfully completed the transition to an independent public company, focusing on premium content and digital platform growth.
• Audience Reach: Approximately 100 million people reached monthly, with 60% of the audience coming from news and sports.
• New Initiatives:
  • CNBC's upcoming direct-to-consumer subscription service targeting retail investors.
  • Launch of MS NOW direct-to-consumer platform to enhance audience engagement.
  • Fandango's new ad-supported streaming service to leverage existing content and audience.
• Acquisitions: Completed acquisition of INDY Cinema Group and Free TV Networks, expanding distribution and market presence.

3. Forward Guidance and Outlook

• 2026 Revenue Guidance: Expected between $6.15 billion and $6.4 billion, supported by midterm political advertising and new product initiatives.
• Adjusted EBITDA Guidance: Anticipated between $1.85 billion and $2 billion.
• Free Cash Flow: Expected between $1 billion and $1.2 billion in 2026.
• Revenue Mix Target: Aiming for 33% of revenue from non-pay TV platforms over the next 3 to 5 years.

4. Bad News, Challenges, or Points of Concern

• Declining Metrics: Revenue and adjusted EBITDA saw year-over-year declines due to ongoing pressures in the pay TV market and advertising normalization.
• Cord-Cutting: Continued moderate cord-cutting poses a risk to linear distribution revenue.
• Advertising Market Challenges: Advertising revenue decline reflects broader industry trends and ratings challenges.
• Competitive Pressures: The media landscape is evolving, with larger companies facing expensive renewals, potentially impacting Versant's negotiation leverage.

5. Notable Q&A Insights

• Platforms Growth Confidence: Management expressed confidence in achieving 33% revenue from non-pay TV platforms, citing strong growth potential in GolfNow and Fandango.
• Direct-to-Consumer Strategy: Discussions on potential partnerships with third-party streamers to enhance distribution and audience reach.
• Advertising Strategy: Emphasis on leveraging data and technology for targeted advertising across new platforms.
• Sports Strategy: Management sees opportunities to acquire secondary sports rights as larger companies focus on high-profile renewals, reinforcing Versant's strong position in sports media.

Overall, Versant Media's earnings call highlighted a year of transition and strategic positioning as an independent entity, with a focus on diversifying revenue streams and enhancing audience engagement through new initiatives, despite facing challenges in traditional revenue segments.