Spanish Broadcasting System, Inc. (the “Company” or “SBS”) (OTC: SBSAA) recently reported financial results for the three months and six month ended June 30, 2025.
Discussion and Results
“We continued to execute our strategic plan during an economically sluggish second quarter, including investing in multiple growth initiatives, while simultaneously driving further reductions in our operating costs,” said Raúl Alarcón, SBS’s Chairman and CEO. “We are delivering consistently strong audience shares across our premier station portfolio, while leveraging our content across our digital, multiplatform ecosystem. These efforts are supporting increasing brand visibility and engagement across multiple consumer touchpoints, expanding our revenue growth potential and positioning SBS as a next-generation media leader for U.S. Hispanics.
Digital is, and will continue to be, a strategic focal point of our Company’s ongoing development, as evidenced by the growth in our user metrics at LaMusica, the digital aggregator platform that is home to all of the Company’s on-air talents and content creators.
LaMusica’s unique users grew by 18% in Q2, including the doubling of the digital audience of our new Houston station and the record streaming thresholds set by WSKQ-FM, the most streamed station in the nation; likewise, our session lengths set a new record with a staggering 55-minute average time spent listening and our social media offerings also attracting new users with YouTube views growing sequentially by 140% in Q2. In the Connected TV sector, the summer launch of our debut FAST channel, LaMusicaTV, has been a resounding success on Roku, the #1 TV streaming platform in the U.S., now presenting a 24/7 slate of digital video, radio and music, along with the latest artist, celebrity and entertainment news.
Our newest station in Houston, KROI-FM, continues to build on its dominant position among Hispanic listeners, displacing heritage competitors while on its way to becoming the most successful start-up (as measured by ratings and revenue) in the history of Spanish radio. We are also capitalizing on the momentum garnered by our new morning show on WSUN-FM in Tampa, which is delivering solid ratings growth.
Bolstered by our ability to attract and promote the best talent in the industry, we are committed to pursuing multiple growth initiatives across our digital streaming, network, syndication and live events businesses, all supported by a vastly more efficient infrastructure. We believe these initiatives, combined with our continued emphasis on constraining costs, will strengthen our ability to deliver revenue growth and improved cash flows for the benefit of all of our stakeholders,” added Alarcón.
Three Months Ended Results
For the three months ended June 30, 2025, our operating results were impacted by a decrease in overall broadcast advertising and an increase in non-cash impairment charges due to uncertain market conditions. These decreases in net revenue were partially offset by our continued decreases in broadcasting expenses throughout our markets and expense categories. Additionally, our radio segment operations include our newly acquired start-up station, in Houston, TX., purchased on December 20, 2024.
Our net revenue totaled $34.4 million compared to $40.0 million for the same prior year period, resulting in a decrease of approximately $5.6 million or 14%. The decrease was primarily the result of decreases in special events revenue, local, national and network sales which were partially offset by increases in barter sales.
Our operating expenses totaled $25.9 million compared to $28.9 million for the same prior year period, resulting in a decrease of $3.0 million or 10%. The decrease was primarily due to decreases in special event expenses, compensation & benefits costs, on-air programming costs, commissions, music license fees, affiliate station compensation, advertising & promotions, facilities, and professional services expenses, partially offset by increases in transmitter rents, ratings services, outside services and barter expenses.
Our station operating income, a non-GAAP measure, totaled $8.5 million compared to $11.1 million for the same prior year period representing a decrease of approximately $2.6 million or 23%. The decrease was primarily due to the decrease in net revenue which was partially offset by the decreases in operating expenses.
Corporate expenses, excluding stock-based compensation, increased $0.1 million or 4% primarily due to increases in compensation & benefits, travel & entertainment, and professional fees, partially offset by decreases in outside services.
Adjusted OIBDA, a non-GAAP measure, totaled $6.2 million compared to $8.9 million for the same prior year period representing a decrease of 30%. The decrease in Adjusted OIBDA was primarily due to a decrease in net revenue which was partially offset by the decreases in operating expenses.
Six Months Ended Results
For the six months ended June 30, 2025, our operating results were impacted by a decrease in overall broadcast advertising and an increase in non-cash impairment charges due to uncertain market conditions as well as the, January 2025, wildfires that affected the Los Angeles area. These decreases in net revenue were partially offset by our continued decreases in broadcasting and corporate expenses throughout our markets and expense categories. Additionally, our radio segment operations include our newly acquired start- up station, in Houston, TX., purchased on December 20, 2024.
Our net revenue totaled $62.0 million compared to $73.7 million for the same prior year period, resulting in a decrease of approximately $11.7 million or 16%. The decrease was primarily the result of decreases in special events, local, national and network sales which were partially offset by increases in digital and barter sales.
Our operating expenses totaled $50.3 million compared to $56.3 million for the same prior year period, resulting in a decrease of 11%. The decrease was primarily due to decreases in special event expenses, compensation & benefits costs, on-air programming costs, commissions, music license fees, affiliate station compensation, advertising & promotions, banking & payroll fees, facilities, and professional services expenses, partially offset by increases in transmitter rents, ratings services, outside services and barter expenses.
Our station operating income, a non-GAAP measure, totaled $11.7 million compared to $17.4 million for the same prior year period representing a decrease of approximately $5.7 million or 33%. The decrease was primarily due to the decrease in net revenue which was partially offset by the decreases in operating expenses.
Corporate expenses, excluding stock-based compensation, decreased $0.1 million or 2% primarily due to decreases in outside services and professional fees, partially offset by increases in compensation & benefits, and travel & entertainment expenses.
Adjusted OIBDA, a non-GAAP measure, totaled $7.1 million compared to $12.7 million for the same prior year period representing a decrease of $5.6 million or 44%. The decrease in Adjusted OIBDA was primarily due to a decrease in net revenue which was partially offset by the decreases in operating and corporate expenses.
Sale of Television Assets (Assets Held for Sale & Discontinued Operations)
On February 9, 2023, the Company entered into various asset and real property purchase agreements (together the “Voz Agreements”) to sell substantially all its television and certain real estate assets (together the “Purchased Assets”) which comprised the Company’s television operations known as MegaTV, serving the United States of America and Puerto Rico, to Voz Media, Inc. (“Voz Media”) for $64.0 million. Pursuant to the Voz Agreements, the Purchased Assets included: licenses, permits and authorizations issued by the FCC; programming content, equipment, leases and contracts used in or related to the operation of MegaTV; and certain real properties located in Miami, Florida and Puerto Rico as part of the transaction.
On September 20, 2023, the Company terminated the Voz Agreements because Voz Media did not cure its material breach to timely close on the transaction when notified by the Company. On October 10, 2023, the Company filed a lawsuit related to the contemplated sale of its MegaTV television network and other related assets to Voz Media, Inc. On March 13, 2024, the Company settled with Voz Media, Inc. and agreed to the recovery of monetary damages against the plaintiffs.
Although the Company continues to pursue the sale of these television and real estate assets and expects the assets to be sold within one year, in accordance with FASB ASC Topic 360-10-45-9, Long-Lived Assets Classified as Held for Sale, management determined that with the exception of the Puerto Rico television licenses, permits and authorizations issued by the FCC and certain related transmission equipment, and the real properties located in Miami, Florida, the ongoing plans to sell its MegaTV and certain real estate assets in Puerto Rico no longer meet the criteria to classify the assets as held for sale as of December 31, 2024 and as of the balance sheet date of these unaudited condensed consolidated financial statements. The assets which no longer met the held for sale criteria as of December 31, 2024 were reclassified to their respective held and used classifications as of January 1, 2023.
During the six months ended June 30, 2025 and the year ended December 31, 2024, the Company made capital expenditures of less than $0.1 million which are included in assets held for sale for the six months ended June 30, 2025 and the year ended December 31, 2024, listed above.
Once assets are classified as held for sale, management is required to evaluate if under ASC Topic 205-20-45, Discontinued Operations, the disposal of a component of an entity shall be reported in discontinued operations. Management determined that the disposal of the Puerto Rico television operations does not represent a strategic shift that will have a major effect on operations and financial results, at the balance sheet date, and that the results of the Puerto Rico television operations shall not be reported as discontinued operations.
On August 15, 2025, subsequent to the balance sheet date, the Company received $5.7 million of immediately available funds and closed on the sale of its Puerto Rico television broadcast stations WVEO(DT), WTCV(DT), WVOZ-TV and certain related transmission equipment.
