Townsquare Media TSQ Form 10-Q filing Q1 FY2026

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Item 1. Financial Statements

See Notes to Unaudited Consolidated Financial Statements

See Notes to Unaudited Consolidated Financial Statements

(1) Refer to Note 8, Stockholders' Deficit, in the accompanying Notes to Unaudited Consolidated Financial Statements for additional information related to shares issued.

(1) Refer to Note 8, Stockholders' Deficit, in the accompanying Notes to Unaudited Consolidated Financial Statements for additional information related to restricted stock issued.

See Notes to Unaudited Consolidated Financial Statements

See Notes to Unaudited Consolidated Financial Statements

(1) Represents total advertising services provided by the Company in exchange for property and equipment during each of the three months ended March 31, 2026 and 2025, respectively.

See Notes to Unaudited Consolidated Financial Statements

TOWNSQUARE MEDIA, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Organization and Basis of Presentation

Description of the Business

Townsquare is a community-focused digital and broadcast media and digital marketing solutions company principally focused outside the top 50 markets in the U.S. Townsquare Ignite, our robust digital advertising division, specializes in helping businesses of all sizes connect with their target audience through data-driven, results based strategies, by utilizing a) our proprietary digital programmatic advertising technology stack with an in-house demand and data management platform and b) our owned and operated portfolio of more than 400 local news and entertainment websites and mobile apps along with a network of leading national music and entertainment brands, collecting valuable first party data. Townsquare Interactive, our subscription digital marketing services business, partners with small and medium-sized businesses (“SMBs”) to help manage their digital presence by providing a SAAS business management platform, website design, creation and hosting, search engine optimization and other digital services. And through our portfolio of local radio stations strategically situated outside the Top 50 markets in the United States, we provide effective advertising solutions for our clients and relevant local content for our audiences.

Current economic challenges, including high and sustained inflation and interest rates, and enacted and proposed tariffs have caused and could continue to cause economic uncertainty and volatility. These factors could result in advertising and subscription digital marketing solutions cancellations, declines in the purchase of new advertising by our clients, declines in the addition of new digital marketing solutions subscribers, and increases to our operating expenses. We monitor economic conditions closely, and in response to observed or anticipated reductions in revenue, we may institute precautionary measures to address the potential impact to our consolidated financial position, consolidated results of operations, and liquidity, including wage reduction efforts and controlling non-essential capital expenditures.

The extent of the impact of current economic conditions will depend on future actions and outcomes, all of which remain fluid and cannot be predicted with confidence (including effects on advertising activity, consumer discretionary spending and our employees in the markets in which we operate).

Basis of Presentation

The accompanying Unaudited Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated Financial Statements and related notes thereto included in the Company's Annual Report on Form 10-K (the "2025 Annual Report on Form 10-K"). The accompanying unaudited interim Consolidated Financial Statements include the consolidated accounts of the Company and its wholly-owned subsidiaries, with all significant intercompany balances and transactions eliminated in consolidation. These financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. All adjustments (consisting only of normal, recurring adjustments) necessary for a fair presentation of results of operations and financial condition as of the end of the interim periods have been included. The results of operations for the three months ended March 31, 2026, cash flows for the three months ended March 31, 2026, and the Company’s financial condition as of such date are not necessarily indicative of the results of operations or cash flows that can be expected for, or the Company’s financial condition as of, any other interim period or for the fiscal year ending December 31, 2026. The Consolidated Balance Sheet as of December 31, 2025 is derived from the audited Consolidated Financial Statements at that date.

The presentation of $0.7 million of stock-based compensation expense previously reported in the Corporate category for the three months ended March 31, 2025 has been reclassified to conform with the current period's presentation. The reclassification resulted in a $0.3 million, $0.1 million, and $0.3 million increase in stock-based compensation for the Digital Advertising, Subscription Digital Marketing Solutions and Broadcast Advertising segments, respectively, for the three months ended March 31, 2025.

The presentation of $0.1 million of broadcast advertising revenue previously reported in the Other category for the three months ended March 31, 2025 has been reclassified to the Broadcast Advertising segment to conform with the current period's presentation.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. On an ongoing basis, the Company evaluates its significant estimates, including those related to assumptions used in determining the fair value of assets and liabilities acquired in a business combination, impairment testing of intangible assets, valuation and impairment testing of long-lived tangible assets and investments, the present value of leasing arrangements, share-based payment expense and the calculation of allowance for credit losses and income taxes. The Company bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the result of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual amounts and results may differ materially from these estimates under different assumptions or conditions.

Note 2. Summary of Significant Accounting Policies

There have been no significant changes in the Company’s accounting policies since December 31, 2025. For the Company's detailed accounting policies please refer to the Consolidated Financial Statements and related notes thereto included in the Company's 2025 Annual Report on Form 10-K.

Recently Issued Standards That Have Not Yet Been Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires the disclosure in the notes to financial statements, information about certain costs and expenses including, purchases of inventory, employee compensation, depreciation and intangible asset amortization. The guidance also requires a qualitative description of amounts remaining in certain expense captions that are not separately disaggregated on a quantitative basis, as well as the disclosure of the total amount of selling expenses. The guidance is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company continues to evaluate this new standard, but does not expect its adoption to have a significant impact on the Consolidated Financial Statements as its impact relates to additional disclosure.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The guidance moves away from phase-by-phase cost tracking to primarily focusing on how companies conclude when to count software development costs as an asset, particularly when there is uncertainty during development. Additionally, disclosure requirements outlined under ASC 360-10, Property, Plant, and Equipment — Overall, will apply to capitalized software costs. The guidance is effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years and may be applied using a prospective, retrospective or modified transition approach. The Company is assessing the impact on its Consolidated Financial Statements, if any.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, to clarify interim disclosure requirements, the form and content of interim financial statements, and when Topic 270 applies. The update primarily provides clarity about current interim reporting requirements. The amendments are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, and may be applied using a prospective or retrospective transition approach. The Company is evaluating the update, but does not expect its adoption to have a significant impact on the Consolidated Financial Statements.

Note 3. Revenue Recognition

The following tables present a disaggregation of our revenue by reporting segment and revenue from political sources and all other sources (in thousands) for the three months ended March 31, 2026 and 2025:

Revenue from contracts with customers is recognized as an obligation until the terms of a customer contract are satisfied; this occurs with the transfer of control as we satisfy contractual performance obligations. Our contractual performance obligations include the performance of digital marketing solutions, placement of internet-based advertising campaigns, broadcast of commercials on our owned and operated radio stations, and the operation of live events. Revenue is measured at contract inception as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Our contracts are at a fixed price at inception and do not include any variable consideration or financing components by normal course of business practice. Sales, value add, and other taxes that are collected concurrently with revenue producing activities are excluded from revenue.

The primary sources of net revenue are the sale of digital and broadcast advertising solutions on our owned and operated websites, radio stations’ online streams and mobile applications, radio stations, and on third-party websites through our in-house digital programmatic advertising platform. Through our digital programmatic advertising platform, we are able to hyper-target audiences for our local, regional and national advertisers by combining first and third-party audience and geographic location data, providing them the ability to reach a high percentage of their online audience. We deliver these solutions across desktop, mobile, connected TV, email, paid search and social media platforms utilizing display, video and native executions. We also offer subscription digital marketing solutions through Townsquare Interactive to small and medium-sized local and regional businesses in markets outside the top 50 across the United States, including, but not limited to the markets in which we operate radio stations. Our digital marketing solutions include offerings such as a SAAS business management platform, traditional and mobile-enabled website development and hosting services, e-commerce platforms, search engine and online directory optimization services, online reputation monitoring, and social media management.

Political net revenue includes the sale of advertising for political advertisers. Contracted performance obligations under political contracts consist of the broadcast and placement of digital advertisements. Management views political revenue separately based on the episodic nature of election cycles and local issues calendars.

Net revenue for digital advertisements is recognized as the contractual performance obligations for Townsquare services are satisfied over the duration of the campaigns based on impressions delivered or time elapsed. Net revenue for broadcast advertisements are recognized when the commercial is broadcast. Live events revenue and other non-broadcast advertising revenue is recognized as events are conducted. We measure progress towards the satisfaction of our contractual performance obligations in accordance with the contractual arrangement. We recognize the associated contractual revenue as delivery takes place and the right to invoice for services performed is met.

Net revenue from digital subscription-based contractual performance obligations is recognized ratably over time as our performance obligations are satisfied. Subscription-based service fees are typically billed in advance of the month of service at a fixed monthly fee that is contractually agreed upon at contract inception. The measure of progress in such arrangements is the number of days of successful delivery of the contracted service.

Our advertising contracts are short-term (less than one year) and payment terms are generally net 30-60 days for traditional customer contracts and net 60-90 days for national agency customer contracts. Our billing practice is to invoice customers on a monthly basis for services delivered to date (representing the right to invoice). Our contractual arrangements do not include rights of return and do not include any significant judgments by nature of the products and services.

For all customer contracts, we evaluate whether we are the principal (i.e., report revenue on a gross basis) or the agent (i.e., report revenue on a net basis). Generally, we report revenue for advertising placed on Townsquare properties on a gross basis (the amount billed to our customers is recorded as revenue, and the amount paid to our publishers is recorded as a cost of revenue). We are the principal because we control the advertising inventory before it is transferred to our customers. Our control is evidenced by our sole ability to monetize the advertising inventory, being primarily responsible to our customers, having discretion in establishing pricing, or a combination of these factors. We also generate revenue through agency relationships in which revenue is reported net of agency commissions. Agency commissions are calculated based on a stated percentage applied to gross billing revenue for advertisers that use agencies.

The following table provides information about receivables, contract assets and contract liabilities from contracts with customers (in thousands):

We receive payments from customers based upon contractual billing schedules; contract receivables are recognized in the period the Company provides services when the Company’s right to consideration is unconditional. Payment terms vary by the type and location of our customer and the products or services offered. Payment terms for amounts invoiced are typically net 30-60 days.

Our contract liabilities include cash payments received or due in advance of satisfying our performance obligations and digital subscriptions in which payment is received in advance of the service and month. These contract liabilities are recognized as revenue as the related performance obligations are satisfied. As of March 31, 2026, and December 31, 2025, the balance in the contract liabilities was $8.6 million and $8.7 million, respectively. The decrease in the contract liabilities balance at March 31, 2026 is primarily driven by $5.8 million of recognized revenue for the three months ended March 31, 2026, offset by cash payments received or due in advance of satisfying our performance obligations. For the three months ended March 31, 2025, we recognized $6.3 million of revenue that was previously included in our deferred revenue balance. No significant changes in the time frame of the satisfaction of contract liabilities have occurred during the three months ended March 31, 2026.

Our capitalized contract acquisition costs include amounts related to sales commissions paid for signed contracts with perceived durations exceeding one year. We defer the related sales commission costs and amortize such costs to expense in a manner that is consistent with how the related revenue is recognized over the duration of the related contracts. We have evaluated the average customer contract duration (initial term and any renewals) to determine the appropriate amortization period for these contractual arrangements. Capitalized contract acquisition costs are recognized in prepaid expenses and other current assets in the accompanying consolidated balance sheets. As of March 31, 2026 and December 31, 2025, we had a balance of $8.6 million and $8.5 million, respectively, in capitalized contract acquisition costs and recognized $1.4 million of amortization for the three months ended March 31, 2026. For the three months ended March 31, 2025, we recognized $1.1 million of amortization. No impairment losses have been recognized or changes made to the time frame for performance of the obligations related to deferred contract assets during the three months ended March 31, 2026 and 2025.

Arrangements with Multiple Performance Obligations

In contracts with multiple performance obligations, we identify each performance obligation and evaluate whether the performance obligations are distinct within the context of the contract at contract inception. When multiple performance obligations are identified, we identify how control transfers to the customer for each distinct contract obligation and determine the period when the obligations are satisfied. If obligations are satisfied in the same period, no allocation of revenue is deemed to be necessary. In the event performance obligations within a bundled contract do not run concurrently, we allocate revenue to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the prices charged to customers. Performance obligations that are not distinct at contract inception are combined.

Performance Obligations

We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Amounts related to performance obligations with expected durations of greater than one year are at a fixed price per unit and do not include any upfront or minimum payments requiring any estimation or allocation of revenue.

Allowance for Credit Losses

The Company maintains an allowance for credit losses, which represents the portion of accounts receivable that is not expected to be collected over the duration of its contractual life. Credit losses are recorded when the Company believes a customer, or group of customers, may not be able to meet their financial obligations. Account balances are charged off against the allowance when it is probable the receivable will not be recovered.

The change in the allowance for credit losses for the three months ended March 31, 2026 was as follows (in thousands):

Note 4. Property and Equipment, net

Property and equipment, net consisted of the following (in thousands):

Depreciation and amortization expense for property and equipment was $4.2 million and $3.9 million for the three months ended March 31, 2026 and 2025, respectively.

During the three months ended March 31, 2026, the Company recognized a $0.5 million net gain on the sale of property in Danbury, CT.

The Company had no material right of use assets related to its finance leases as of March 31, 2026 and December 31, 2025.

Note 5. Goodwill and Other Intangible Assets

Indefinite-lived intangible assets

Indefinite-lived assets consist of FCC broadcast licenses and goodwill.

FCC Broadcast Licenses

FCC licenses represent a substantial portion of the Company’s total assets. The FCC licenses are renewable in the ordinary course of business, generally for a maximum of eight years. The fair value of FCC licenses is primarily dependent on the future cash flows of the radio markets and other assumptions, including, but not limited to, forecasted revenue growth rates, profit margins and a risk-adjusted discount rate. The Company has selected December 31st as the annual testing date.

The Company evaluates its FCC licenses for impairment annually or more frequently if events or changes in circumstances indicate that the assets might be impaired. Due to an increase in the weighted average cost of capital, the Company quantitatively evaluated the fair value of its FCC licenses at March 31, 2026.

The key assumptions used in applying the direct valuation method are summarized as follows:

• Market share assumption used when reliable third-party data is available. Otherwise, Company results and forecasts are utilized.

Based on the results of the interim impairment assessments of our FCC licenses, the Company incurred $8.6 million of impairment charges for FCC licenses in 14 of our 74 local markets for the three months ended March 31, 2026, and incurred no impairment charges for FCC licenses for the three months ended March 31, 2025, respectively. The impairment charge realized during the three months ended March 31, 2026 was primarily driven by changes in the market data utilized in determining the discount rate applied in the valuation of our FCC licenses, which drove an increase in the weighted average cost of capital. The changes in data were primarily driven by an increase in industry bond yields.

The assumptions used to estimate the fair value of our FCC licenses are dependent upon the expected performance and growth of our traditional broadcast radio operations. In the event broadcast radio revenue experiences actual or anticipated declines in excess of these assumptions, such declines will have a negative impact on the estimated fair value of our FCC licenses, and the Company could recognize additional impairment charges, which could be material.

Unfavorable changes in key assumptions utilized in the impairment assessment of our FCC licenses may affect future testing results. For example, keeping all other assumptions constant, a 100-basis point increase in the weighted average cost of capital as of the date of our last quantitative assessment would cause the estimated fair values of our FCC licenses to decrease by $19.9 million which would have resulted in an incremental impairment charge of $10.3 million as of March 31, 2026. Further, a 100-basis point decline in the long-term revenue growth rate would cause the estimated fair values of our FCC licenses to further decrease by $11.3 million which would have resulted in an incremental impairment charge of $8.9 million as of March 31, 2026. Finally, a 100-basis point decline in operating profit margins would result in a decrease in the estimated fair values of our FCC licenses of $8.9 million which would result in an incremental impairment charge of $7.2 million.

Goodwill

For goodwill impairment testing, the Company has selected December 31st as the annual testing date. In addition to the annual impairment test, the Company regularly assesses whether a triggering event has occurred, which would require interim impairment testing. As of December 31, 2025, the fair values of our National Digital, Townsquare Ignite, and Townsquare Interactive reporting units were in excess of their respective carrying values by approximately 47%, 106%, and 152%, respectively. The Local Advertising, Amped, Analytical Services and Live Events reporting units had no goodwill as of December 31, 2025.

The Company considered whether any events have occurred or circumstances have changed from the last quantitative analysis performed as of December 31, 2025 that would indicate that the fair value of the Company's reporting units may be below their carrying amounts. Based on such analysis the Company determined that there have been no indicators that the fair value of its reporting units may be below their carrying amounts as of March 31, 2026.

Definite-lived intangible assets

The Company’s definite-lived intangible assets were acquired primarily in various acquisitions as well as in connection with the acquisition of software and music licenses.

The following tables present details of our intangible assets as of March 31, 2026 and December 31, 2025, respectively (in thousands):

Amortization of definite-lived intangible assets was $0.9 million and $0.9 million for the three months ended March 31, 2026 and 2025, respectively.

Estimated future amortization expense for each of the five succeeding fiscal years and thereafter as of March 31, 2026 is as follows (in thousands):

Note 6. Long-Term Debt

Total debt outstanding is summarized as follows (in thousands):

On February 19, 2025, the Company entered into a $490 million Credit Agreement with Bank of America, N.A., as administrative agent and collateral agent and the lenders and financial institutions party thereto. The Credit Agreement provides for a five-year, $470 million senior secured Term Loan Facility (the "Term Loan") and a five-year, $20 million Revolving Credit Facility (the "Revolver"), together the Senior Secured Credit Facility.

The Term Loan Facility and revolving loans incurred under the Revolving Credit Facility mature on February 19, 2030. The per annum interest rate applicable to the Term Loan Facility is based on current SOFR levels with a 0.50% per annum SOFR floor and an applicable margin of 500 basis points (or an alternative base rate and an applicable margin of 400 basis points). The per annum interest rate applicable to the Revolving Credit Facility is based on current SOFR levels and an applicable margin of 375 basis points (or an alternative base rate and an applicable margin of 275 basis points). As of March 31, 2026, the interest rate on the Term Loan was 8.59%, based on current SOFR levels and the applicable margin of 500 basis points. As of March 31, 2026, borrowings under the Revolving Credit Facility had an interest rate of approximately 7.40%, based on current SOFR levels and the applicable margin of 375 basis points.

Subject to certain exceptions, the Senior Secured Credit Facility will be subject to mandatory pre-payments in amounts equal to (1) 100% of the net cash proceeds from issuances or incurrence of debt by the Company or any of the subsidiary guarantors (other than with respect to certain permitted indebtedness); (2) 100% of the net cash proceeds from certain sales or other dispositions of assets by the Company or any of the subsidiary guarantors in excess of a certain amount and subject to customary reinvestment provisions and certain other exceptions; and (3) 75% (with step-downs to 50%, 25% and 0% based upon achievement of specified first lien net leverage ratios) of annual excess cash flow of the Company and its subsidiaries subject to exceptions and limitations.

The obligations of the Company under the Senior Secured Credit Facility are guaranteed by each of its direct and indirect, existing and future, domestic subsidiaries, subject to customary exceptions and limitations, pursuant to a security agreement, dated as of February 19, 2025 (the “Security Agreement”), by and between the Company, the guarantors party thereto and Bank of America, N.A., as collateral agent.

The Senior Secured Credit Facility is secured on a first priority basis by a perfected security interest in substantially all of the Company’s and each guarantor’s tangible and intangible assets (subject to certain exceptions).

The Senior Secured Credit Facility contains a number of customary affirmative and negative covenants that, among other things, limit or restrict the ability of the Company and the guarantors to: (1) incur additional indebtedness (including guarantee obligations); (2) incur liens; (3) engage in mergers or other fundamental changes; (4) sell certain property or assets; (5) pay dividends or other distributions; (6) make acquisitions, investments, loans and advances; (7) prepay certain indebtedness; (8) change the nature of their business; (9) engage in certain transactions with affiliates; and (10) incur restrictions on contractual obligations limiting interactions between the Company and its subsidiaries or limit actions in relation to the Senior Secured Credit Facility.

The Senior Secured Credit Facility contains customary events of default, including with respect to nonpayment of principal, interest, fees or other amounts; material inaccuracy of a representation or warranty when made; failure to perform or observe covenants; cross-default to other indebtedness in an amount equal to the greater of $15 million or 15% of the

Company’s four quarter consolidated EBITDA; bankruptcy and insolvency events; inability to pay debts; monetary judgment defaults in an amount equal to the greater of $15 million or 15% of the Company’s four quarter consolidated EBITDA; actual or asserted invalidity or impairment of any definitive loan documentation; and change of control.

The Company was in compliance with its covenants under the Senior Secured Credit Facility as of March 31, 2026.

As of March 31, 2026, based on available market information, the estimated fair value of the Term Loan was $328.1 million. The Company used Level 2 measurements under the fair value measurement hierarchy established under Fair Value Measurement (Topic 820).

Annual maturities of the Company's long-term debt as of March 31, 2026 are as follows (in thousands):

Note 7. Income Taxes

The Company's effective tax rate for the three months ended March 31, 2026 and 2025 was approximately 123.3% and 66.8%, respectively.

The change in the effective tax rate for the three months ended March 31, 2026, is driven by the valuation allowance for interest expense carryforwards, non-deductible compensation and the effects of non-cash impairment charges recognized in the first quarter of 2026.

The effective tax rate may vary significantly from period to period, and can be influenced by many factors. These factors include, but are not limited to, changes to the statutory rates in the jurisdictions where the Company has operations and changes in the valuation of deferred tax assets and liabilities. The difference between the effective tax rate and the federal statutory rate of 21% primarily relates to certain non-deductible items, state and local income taxes and the valuation allowance for deferred tax assets.

Note 8. Stockholders' Deficit

Stock Options

During the three months ended March 31, 2026, eligible option holders tendered 19,500 options to purchase 19,500 shares of Townsquare common stock.

During the three months ended March 31, 2026, the Company did not grant any stock options.

The following table summarizes all option activity for the three months ended March 31, 2026:

The maximum contractual term of stock options is 10 years.

Restricted Stock Awards

During the three months ended March 31, 2026, the Company granted 140,911 restricted stock awards, including 120,150 shares to non-employee directors, with vesting periods of one to three years. The fair value of the restricted stock awards is equal to the closing share price on the date of grant.

The following table summarizes restricted stock activity for the three months ended March 31, 2026:

Restricted Stock Units

The following table summarizes restricted stock unit activity for the three months ended March 31, 2026:

During the three months ended March 31, 2026, the Company granted 529,142 stock units with vesting periods ranging from vested at grant date to three years, and 506,244 bonus stock units that were vested at the grant date. The fair values of these restricted stock units were equal to the closing share price on the date of grant.

During the three months ended March 31, 2026, the Company granted 890,030 restricted stock units with a vesting period of three years and grant date fair values ranging from $2.06 - $3.63. The stock units contain market conditions

whereby the stock units will vest subject to the achievement of a specified VWAP, subject to continued employment or service through the end of the performance period as observed and summarized below:

The grant date fair value of the restricted stock units with market conditions is estimated using the Monte Carlo option pricing model. The below table summarizes the assumptions used to estimate the fair value of the restricted stock units granted:

The expected volatility was based on market conditions of the Company. The risk-free interest rate was based on the U.S. Treasury yield curve in effect on the date of grant which most closely corresponds to the vesting period of the restricted stock units.

Employee Stock Purchase Plan

During the three months ended March 31, 2026, a total of 37,671 shares of Class A common stock were issued under the 2021 Employee Stock Purchase Plan (the "ESPP").

For the three months ended March 31, 2026 and 2025, the Company recognized approximately $3.7 million and $4.2 million, respectively, of stock-based compensation expense with respect to options, restricted stock awards, restricted stock units and the ESPP.

As of March 31, 2026, total unrecognized stock-based compensation expense related to our stock options and restricted stock was $1.3 million and $6.9 million, respectively, and is expected to be recognized over a weighted average period of 1.2 years and 1.8 years, respectively.

Dividends Declared

On October 29, 2025, the board of directors approved a quarterly cash dividend of $0.20 per share. The dividend of $3.3 million was paid to holders of record as of January 26, 2026, on February 2, 2026.

On March 4, 2026, the board of directors approved a quarterly dividend of $0.20 per share. The dividend of $3.6 million was paid to holders of record as of April 27, 2026, on May 4, 2026.

On May 1, 2026, the board of directors approved a quarterly cash dividend of $0.20 per share. The dividend will be payable on August 3, 2026 to shareholders of record as of the close of business on July 27, 2026.

Stock Bonus Program

In 2024, the Company implemented a stock bonus program that offered certain employees the option to receive their annual incentive compensation in the form of the Company's Class A common stock. The incentive compensation to be paid to each employee is fixed at the time of election to participate in the program and the number of shares to be issued is determined based on the closing price of the Company's Class A common stock on the settlement date, primarily in the fourth quarter of the performance year or during the first quarter following each respective performance year. During the three months ended March 31, 2026 and 2025, a total of $1.0 million and $0.9 million of expense was recognized as a component of stock-based compensation in connection with the stock bonus program, respectively. A total of 506,244 and 566,359 shares were granted under the Stock Bonus Program for each of the performance years ended December 31, 2025 and 2024, respectively, during the three months ended March 31, 2026 and 2025, respectively.

Note 9. Net Income (Loss) Per Share

Basic earnings per common share (“EPS”) is generally calculated as income available to common shareholders divided by the weighted average number of common shares outstanding. Diluted EPS is generally calculated as income available to common shareholders divided by the weighted average number of common shares outstanding plus the dilutive effect of common share equivalents. Stock-based compensation awards that are out-of-the-money and stock options and restricted stock units in which the market-based performance criteria have not been met as of the end of the respective reporting period are omitted from the calculation of Diluted EPS.

The following table sets forth the computations of basic and diluted net income (loss) per share for the three months ended March 31, 2026 and 2025 (in thousands, except per share data):

The Company had the following dilutive securities that were not included in the computation of diluted net income (loss) income per share as they were considered anti-dilutive (in thousands):

Note 10. Commitments and Contingencies

The Company is involved in legal proceedings in which damages and claims have been asserted against us. The Company believes that we have valid defenses to such proceedings and claims and intends to vigorously defend the Company. Management does not believe that any such matters will have a material adverse effect on our financial position, results of operations, or liquidity. The Company records a loss contingency if the potential loss from a proceeding or claim is considered probable and the amount can be reasonably estimated or a range of loss can be determined. The Company provides disclosure when it is reasonably possible that a loss will be incurred in excess of any recorded provision. Significant judgment is required in these determinations. As additional information becomes available, the Company reassesses prior determinations and may change its estimates. Litigation is subject to many uncertainties, and the outcome of litigation is not predictable with assurance.

Note 11. Segment Reporting

Operating segments are organized internally by type of products and services provided. Based on the information reviewed by the Company's CEO in his capacity as Chief Operating Decision Maker ("CODM"), the Company has identified three segments: Digital Advertising, Subscription Digital Marketing Solutions, and Broadcast Advertising. The remainder of our business is reported in the Other category.

The Company operates in one geographic area. The Company's assets and liabilities are managed within markets outside the top 50 across the United States where the Company conducts its business and are reported internally in the same manner as the Consolidated Financial Statements; thus, no additional information regarding assets and liabilities of the Company’s reportable segments is produced for the Company's CEO or included in these Consolidated Financial Statements. Intangible assets consist principally of FCC broadcast licenses and other definite-lived intangible assets and primarily support the Company’s Broadcast Advertising segment. For further information see Note 5, Goodwill and Other Intangible Assets. The Company does not have any material inter-segment sales.

Segment profit is the primary measure the CODM utilizes in assessing segment performance and determining the allocation of resources. Segment Profit is defined as revenue less direct operating expenses, excluding depreciation, amortization, and stock-based compensation. The CODM is the primary individual in control of resource allocation, and the allocation determinations are made in consultation with each respective segment manager who is directly accountable to and maintains regular contact with the CODM to discuss operating activities, financial results, forecasts, or plans for the segment. The most significant allocation determinations made by the CODM pertain to sales accounts and support, capital spending and employee resource allocation. Segment profit is used to monitor budgeted versus actual results and is used in assessing performance of the segment and in establishing compensation. These determinations are made through regular reviews throughout the year, and on a weekly basis, the CODM considers actual results, as compared to budget and the prior period, when evaluating the allocation of resources.

Direct operating expenses represents our significant expense category and aligns with the segment level information that is regularly provided to the CODM. Segment profit excludes unallocated corporate expenses and the impact of certain items that are not directly attributable to the reportable segments' underlying operating performance, and primarily includes expenses related to corporate stewardship and administration activities, transaction related costs and non-cash impairment charges.

The following tables present the Company's reportable segment results for the three months ended March 31, 2026 (in thousands):

The following table presents the Company's reportable segment results for the three months ended March 31, 2025 (in thousands):

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following management’s discussion and analysis is intended to provide the reader with an overall understanding of our financial condition, results of operations, cash flows and sources and uses of cash. This section also includes general information about our business and a discussion of our management’s analysis of certain trends, and risks and opportunities in our industry. In addition, we also provide a discussion of accounting policies that require critical judgments and estimates. This discussion should be read in conjunction with our Unaudited Consolidated Financial Statements and related notes appearing elsewhere in this quarterly report.

OVERVIEW OF OUR PERFORMANCE

Highlights of Our Financial Performance

Certain key financial developments in our business for the three months ended March 31, 2026 as compared to the same period in 2025 are summarized below:

• Net revenue decreased $1.9 million, or 1.9%, primarily driven by a $2.7 million decrease in our Broadcast Advertising net revenue and a $1.5 million decrease in Subscription Digital Marketing Solutions net revenue, partially offset by a $2.5 million increase in our Digital Advertising net revenue.
• Excluding political revenue of $0.6 million for each of the three months ended March 31, 2026 and 2025, respectively, net revenue decreased $2.0 million, or 2.0%, to $96.1 million, Broadcast Advertising net revenue decreased $2.8 million, or 6.9%, to $38.0 million, and Digital Advertising net revenue increased $2.5 million, or 6.9%, to $39.2 million.
• Operating income decreased $8.4 million for the three months ended March 31, 2026. The decrease was primarily due to an $8.6 million non-cash impairment charge and the $1.9 million decrease in net revenue, partially offset by a $1.3 million decrease in transaction and business realignment costs.
• Broadcast Advertising reported an operating loss of $4.1 million for the three months ended March 31, 2026, which represents a decrease of $9.4 million, as compared to operating income of $5.3 million for the same period in 2025. The decrease is primarily due to an $8.6 million non-cash impairment charge and a $1.0 million decrease in segment profit, partially offset by a $0.5 million increase in net gain on sales and retirements of assets. Digital Advertising reported operating income of $6.8 million for the three months ended March 31, 2026, a decrease of $0.5 million, as compared to operating income of $7.2 million for the same period in 2025 due to a $0.4 million decrease in segment profit. Subscription Digital Marketing Solutions reported operating income of $5.0 million, a decrease of $0.5 million from the three months ended March 31, 2025, primarily due to a $0.3 million decrease in segment profit and higher depreciation and amortization.

Consolidated Results of Operations

Three months ended March 31, 2026 compared to three months ended March 31, 2025

The following table summarizes our historical consolidated results of operations:

** not meaningful

Segment Results

The following table presents the Company's reportable segment net revenue, direct operating expenses and segment profit for the three months ended March 31, 2026 and 2025 (in thousands):

Net Revenue

Net revenue for the three months ended March 31, 2026 decreased $1.9 million, or 1.9%, as compared to the same period in 2025. Broadcast Advertising net revenue decreased $2.7 million, or 6.6%, due to decreases in the purchases of advertising by our clients and Subscription Digital Marketing Solutions net revenue decreased $1.5 million, or 7.9%, due to reduced sales velocity as a result of lower sales headcount. These decreases were partially offset by an increase in Digital Advertising net revenue of $2.5 million, or 6.8%, due to increases in the purchases of advertising by our clients.

Direct Operating Expenses

Direct operating expenses for the three months ended March 31, 2026 decreased by $0.2 million, or 0.3%, as compared to the same period in 2025. Broadcast Advertising direct operating expenses decreased by $1.8 million, or 5.4%, primarily due to lower compensation and bad debt expense as compared to the same period in 2025. Subscription Digital Marketing Solutions direct operating expenses decreased by $1.2 million, or 9.6%, due to lower compensation as compared to the same period a year ago. These decreases were partially offset by a $2.9 million, or 10.1%, increase in Digital Advertising direct operating expenses due to higher inventory and compensation costs as compared to the same period in 2025.

Segment Profit

Segment profit for the three months ended March 31, 2026 decreased by $1.7 million, or 7.2%, when compared with the same period in 2025. Broadcast Advertising segment profit decreased $1.0 million, or 11.4%, primarily due to the decrease in net revenue. Digital Advertising segment profit decreased $0.4 million, or 5.0%, as compared to the same period in 2025, primarily due to the increase in inventory and compensation costs. Subscription Digital Marketing Solutions segment profit decreased $0.3 million, or 4.5% as compared to the same period in 2025, primarily due to lower revenue.

Transaction and Business Realignment Costs

Transaction and business realignment costs for the three months ended March 31, 2026 decreased $1.3 million, or 53.2%, as compared to the same period in 2025, primarily due to local market operational cost reduction efforts and costs related to the February 2025 debt refinancing incurred in 2025, which did not recur in 2026, partially offset by higher severance related expenses in the first quarter of 2026.

Impairment of Intangible Assets

The Company incurred $8.6 million of non-cash impairment charges related to FCC licenses during the three months ended March 31, 2026, as compared to no impairment for the same period in 2025. The impairment charges were primarily driven by increases in the discount rate applied in the valuation of our FCC licenses due to an increase in the weighted average cost of capital, caused by an increase in industry bond yields. For further discussion, see Note 5, Goodwill and Other Intangible Assets, in the Notes to Unaudited Consolidated Financial Statements.

Unfavorable changes in key assumptions utilized in the impairment assessment of our FCC licenses may affect future testing results. For example, keeping all other assumptions constant, a 100-basis point increase in the weighted average cost of capital as of the date of our last quantitative assessment would cause the estimated fair values of our FCC licenses to decrease by $19.9 million which would have resulted in an incremental impairment charge of $10.3 million as of March 31, 2026. Further, a 100-basis point decline in the long-term revenue growth rate would cause the estimated fair values of our FCC licenses to further decrease by $11.3 million which would have resulted in an incremental impairment charge of $8.9 million as of March 31, 2026. Finally, a 100-basis point decline in operating profit margins would result in a decrease in the estimated fair values of our FCC licenses of $8.9 million which would result in an incremental impairment charge of $7.2 million. Assumptions used to estimate the fair value of our FCC licenses are also dependent upon the expected performance and growth of our traditional broadcast radio operations. In the event broadcast radio revenue experiences actual or anticipated declines in excess of these assumptions, such declines will have a negative impact on the estimated fair value of our FCC licenses, and the Company could recognize additional impairment charges, which could be material.

Interest Expense, net

The following table illustrates the components of our interest expense, net for the periods indicated (in thousands):

Interest expense increased primarily due to the cost of borrowings under the February 2025 credit agreement, including the term loan and revolving credit facilities, partially offset by scheduled principal repayments. For further discussion related to the terms of the credit agreement and effective interest rates, see Note 6, Long-Term Debt, in the Notes to Unaudited Consolidated Financial Statements.

Benefit for income taxes

We recognized a benefit for income taxes of $15.7 million for the three months ended March 31, 2026, as compared to $3.0 million for the same period in 2025. Our effective tax rate for the three months ended March 31, 2026 and 2025 was approximately 123.3% and 66.8%, respectively. The increase in the effective tax rate and tax benefit for the three months ended March 31, 2026 is driven by the valuation allowance for interest expense carryforwards, non-deductible compensation and the effects of non-cash impairment charges recognized in the first quarter of 2026.

Our effective tax rate may vary significantly from period to period and can be influenced by many factors. These factors include, but are not limited to, changes to statutory rates in the jurisdictions where we have operations and changes in the valuation of deferred tax assets and liabilities. The difference between the effective tax rate and the federal statutory rate of 21%, primarily relates to certain non-deductible items, state and local income taxes and the valuation allowance for deferred tax assets.

Liquidity and Capital Resources

The following table summarizes our change in cash and cash equivalents (in thousands):

Operating Activities

Net cash provided by operating activities was approximately $4.2 million for the three months ended March 31, 2026, as compared to net cash used in operating activities of $0.1 million for the same period in 2025. The increase was primarily related to lower cash interest payments in 2026 and net changes in working capital balances, particularly accrued expenses and accounts receivable.

Investing Activities

Net cash used in investing activities was $2.9 million for the three months ended March 31, 2026, as compared to $4.3 million for the same period in 2025. The decrease in net cash used in investing activities was primarily due to a $0.8 million decrease in purchases of property and equipment and a $0.6 million increase in net proceeds from sales of assets.

Financing Activities

Net cash used in financing activities was $3.6 million for the three months ended March 31, 2026, as compared to $22.7 million for the same period in 2025. The primary differences in net cash used in financing activities include:

• $25.7 million of net cash utilized in the February 2025 debt refinancing transactions, including fees and expenses;
• $3.0 million in net borrowings under the Revolver during the three months ended March 31, 2026, as compared to $7.0 million during the same period in 2025;
• Fixed term loan repayments of $2.9 million in 2026;
• $1.4 million of shares repurchased to cover employee tax withholdings on restricted stock that vested during the three months ended March 31, 2025, which did not recur in 2026; and
• $3.7 million of dividend payments in 2026, as compared to $3.1 million of dividend payments in 2025.

Sources of Liquidity and Anticipated Cash Requirements

We fund our working capital requirements through a combination of cash flows from our operating, investing, and financing activities. Based on current and anticipated levels of operations and conditions in our markets and industry, we believe that our cash on hand and cash flows from our operating, investing, and financing activities will enable us to meet our working capital, capital expenditures, debt service, and other funding requirements for at least one year from the date of this report. Future capital requirements may be materially different than those currently planned in our budgeting and forecasting activities and depend on many factors, some of which are beyond our control. We have focused on and will continue to monitor our liquidity in response to current and future economic challenges and uncertainty.

As of March 31, 2026, we had $434.2 million of outstanding indebtedness, net of unamortized discount and deferred financing costs of $23.3 million.

Based on the terms of our Senior Secured Credit Facility, as of March 31, 2026, we expect our mandatory debt service requirements to be approximately $50.7 million over the next twelve months. See Note 6, Long-Term Debt, in our Notes to Consolidated Financial Statements for additional information related to our Senior Secured Credit Facility.

As of March 31, 2026 we had $2.2 million of cash and cash equivalents, and $49.1 million of receivables from customers, which historically have had an average collection cycle of approximately 50 days. As of March 31, 2026, the Company had $15.0 million available under its revolving credit facility. Amounts borrowed under the revolving credit facility above an aggregate $6.0 million as of the end of each fiscal quarter requires compliance with a net leverage ratio covenant, which could limit the Company’s ability to access the full amount of the facility.

On October 29, 2025, the board of directors approved a quarterly cash dividend of $0.20 per share. The dividend of $3.3 million was paid to holders of record as of January 26, 2026, on February 2, 2026.

On March 4, 2026, the board of directors approved a quarterly dividend of $0.20 per share. The dividend of $3.6 million was paid to holders of record as of April 27, 2026 on May 4, 2026.

On May 1, 2026, the board of directors approved a quarterly cash dividend of $0.20 per share. The dividend will be payable on August 3, 2026 to shareholders of record as of the close of business on July 27, 2026.

Our anticipated uses of cash in the near term include working capital needs, interest payments, debt amortization payments, dividend payments, excess cashflow payments that may be required under the terms of the Credit Agreement, other obligations, and capital expenditures. The Company believes that the cash generated by its operations should be sufficient to meet its liquidity needs for at least the next 12 months. However, our ability to fund our working capital needs, interest payments, debt payments, dividend payments, other obligations, capital expenditures, and to comply with financial covenants under our debt agreements, depends on our future operating performance and cash flow, which are in turn subject to prevailing economic conditions, increases or decreases in advertising spending, changes in the highly competitive industry in which we operate, which may be rapid, and other factors, many of which are beyond our control. To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and requirements, we may be required to seek additional equity or debt financing. The sale of additional equity would result in additional dilution to our stockholders, while the incurrence of debt financing would result in debt service obligations. Such debt instruments could introduce covenants that might restrict our operations. We cannot assure you that we could obtain additional financing on favorable terms or at all.

Additionally, on a continuing basis, we evaluate and consider strategic acquisitions and divestitures to enhance our strategic and competitive position as well as our financial performance. Any future acquisitions, joint ventures or other similar transactions may require additional capital, which may not be available to us on acceptable terms, if at all.

We closely monitor the impact of capital and credit market conditions on our liquidity and our ability to refinance in the future. We also routinely monitor the changes in the financial condition of our customers and the potential impact on our results of operations.

Off-Balance Sheet Arrangements

We have no material off-balance sheet arrangements or transactions.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. On an ongoing basis, we evaluate our significant estimates, including those related to determining the fair value of assets and liabilities acquired in a business combination, impairment testing of intangible assets, valuation and impairment testing of long-lived tangible assets, the present value of leasing arrangements, share-based payment expense and the calculation of allowance for doubtful accounts and income taxes. We base our estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the result of which forms the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Our estimates may change, however, as new events occur and additional information is obtained, and any such changes will be

recognized in the Consolidated Financial Statements. Actual results could differ from such estimates, and any such differences may be material to our financial statements.

We believe the accounting policies and estimates discussed within “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2025 Annual Report on Form 10-K reflects our more significant judgments and estimates used in the preparation of the Consolidated Financial Statements. There have been no material changes to the critical accounting policies and estimates as filed in such report.

Recent Accounting Standards

For a discussion of accounting standards updates that have been adopted or will be adopted in the future, please refer to Note 2, Summary of Significant Accounting Policies of the Notes to Unaudited Consolidated Financial Statements included under Item 1.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), with the assistance of other members of management, have reviewed the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Our disclosure controls and procedures are intended to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is (1) recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms and (2) accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure. Based on this review, our CEO and CFO have concluded that the disclosure controls and procedures were effective as of March 31, 2026.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect every misstatement. An evaluation of effectiveness is subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may decrease over time.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal controls over financial reporting that occurred during the three months ended March 31, 2026 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

There are inherent limitations in the effectiveness of any control system, including the potential for human error and the possible circumvention or overriding of controls and procedures. Additionally, judgments in decision-making can be faulty and breakdowns can occur because of a simple error or mistake. An effective control system can provide only reasonable, not absolute, assurance that the control objectives of the system are adequately met. Accordingly, the management of the Company, including its Chief Executive Officer and Chief Financial Officer, does not expect that the control system can prevent or detect all error or fraud. Finally, projections of any evaluation or assessment of effectiveness of a control system to future periods are subject to the risks that, over time, controls may become inadequate because of changes in an entity’s operating environment or deterioration in the degree of compliance with policies or procedures.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

There is no current material pending litigation to which we are a party and no material legal proceedings were terminated, settled or otherwise resolved during the three months ended March 31, 2026. In the normal course of business, the Company is subject to various regulatory proceedings, lawsuits, claims and other matters related to intellectual property, personal injury, employee, or other matters. These matters are subject to many uncertainties and outcomes are not predictable with assurance. However, we do not believe that the ultimate resolution of these matters will have a material adverse effect on our financial position or results of operations.

Item 1A. Risk Factors

Please refer to Part I, Item 1A, “Risk Factors,” in our 2025 Annual Report on Form 10-K for information regarding known material risks that could affect our results of operations, financial condition and liquidity. In addition to these risks, other risks that we presently do not consider material, or other unknown risks, could materially adversely impact our business, financial condition and results of operations in a future period.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None of our directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the quarter ended March 31, 2026.

Item 6. Exhibits

See Exhibit Index.

EXHIBIT INDEX

Exhibit Description

31.1* Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended 31.2* Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended 32.1** Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350 32.2** Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350 101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document 101.SCH XBRL Taxonomy Extension Schema Document 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF XBRL Taxonomy Extension Definition Linkbase Document 101.LAB XBRL Taxonomy Extension Label Linkbase Document 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document (104) Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

• Filed herewith

** Furnished herewith