Local TV stations are continuing to struggle with the growth of cord cutting and a soft ad market. So far, three of the largest owners of local ABC, CBS, FOX, and NBC stations have all reported a drop in revenue.
So let us take a look at three of the largest owners of local TV stations and see how they are doing.
Sinclair’s total revenues decreased 27% to $1,541 million versus $2,125 million in during the same period the prior year. Media revenues for Sinclair dropped 27% to $1,527 million versus $2,106 million in the prior year period.
A lot of these losses come from Bally Sports and its parent company, the Diamond Sports Group. If you remove the Bally Sports losses, Sinclair’s total revenues decreased just 8% from $1,669 million in the prior year period and media revenues decreased just 7% from $1,650 million in the prior year period.
Tenga saw its revenues drop almost 7% year-over-year due to a tough ad market and the end of the political ad season, according to their report. Tenga’s total revenue hit $731 million.
Scripps saw revenue down just 1% year-over-year, with a revenue of $352 million.
There is still one more large TV station owner to report next week and that is Nexstar. They will report their earnings on August 8th, 2023. Nexstar is the largest owner and operator of local TV stations in the United States. Currently, they are in the middle of a fight with DIRECTV, but that started after the end of the 2nd quarter of 2023.
Typically owners of local TV stations could count on Fall TV giving them a nice boost, but that may not happen this year. With both the writers and actors being on strike right now, the typical ad revenue bump from the launch of the new season of popular shows may not be there. With this strike, many shows expected to come back in the fall have been delayed and replaced with new reality shows or in some cases, reruns of shows from streaming services.
There is one bright spot in 2024 for local TV stations and that is the next presidential election. Election years especially presidential elections often drive up ad revenue. Next year’s election is expected to be a record year for ad spending.
Some local owners representing 600 local TV stations are also asking the FCC to reclassify streaming services like Fubo and Hulu + Live TV as cable TV companies. This would force them to negotiate directly with local stations a move they hope will drive up revenue from streaming.
How people watch TV is changing, and slowly that is taking its toll on locals. Now the question is what will local TV stations look like in 5 years as streaming continues to grow and Americans move to more on-demand-only streaming options?