The CW Losses Decline By $50M In Q1, But Parent Nexstar Flags Concern About A National TV Ad Sector That Is “Not In A Positive Place”

The CW’s losses fell by $50 million in the first quarter and parent Nexstar Media Group still expects the network to turn a profit by next year, but CFO Lee Ann Gliha offered investors some reason for caution.

“We’re no longer going to externally disclose the CW numbers separately,” the exec said during the Nexstar first-quarter earnings call when asked about the network’s revenue trends. Since Nexstar took its 75% stake in 2022, she continued, “the quarter-over-quarter comparison is good. I would say just anecdotally it’s still driven by the national advertising market, which is not in a positive place even despite the green shoots.”

Excluding political spending, advertising declined 7% in the quarter ended March 31 compared with the same period in 2023, the company said. The negative effect of the high-interest-rate environment, among other challenges, took the blame for the dip. Total revenue inched up 2% to $1.28 billion, roughly in line with Wall Street forecasts, while earnings per share came in well ahead of expectations, at $5.16 compared with $2.97 in the year-ago quarter.

The $50 million reduction in losses at The CW represents about half of the projected $100 million in loss reduction for all of 2024, execs said, with the slowdown in the latter half of the year chalked up to various cyclical factors.

Asked about programming trends, Gliha noted that The CW has been in an active mode, especially in live sports. The network is not staging an upfront presentation alongside most broadcast peers, but a number of its executives will be in New York next week as the 2024-25 schedule is announced.

“We’ve tried to put on some programming that is not just focused on the 18-to-34 demographic but more focused on the broader demographic of The CW and that has benefited it,” Gliha said. In the first two quarters of the 2023-24 broadcast year, the network recorded sequential audience growth in prime time, though 2023 was impaired by the dual strikes. “We feel good about it and we think it will continue to do well for the rest of the year because some of the sports programming that we’ve announced but haven’t yet gotten on the air will be on the air later this year.”

CEO Perry Sook fielded another national TV question on the call, on the topic of NewsNation. The network was rebranded and completely revamped from its well-penetrated predecessor, WGN America, after Nexstar acquired Tribune Media in 2019. The network will fully transition to 24/7 news programming on June 1, Sook said, and has been “profitable since Day 1” because the company is shifting from a pricey diet of syndicated programming spending to a leaner all-news model.

Awareness of NewsNation, in Nexstar’s monthly viewer surveys, has risen to 35% from 11% when the rebrand first took effect, Sook said. “Reception is not the problem,” he observed. “Awareness is the opportunity.”