Good morning and welcome to Townsquare Media's Fourth Quarter 2024 Conference Call. Today's call is being recorded, and by participating, you consent to the recording. Currently, all participants are in a listen-only mode. A brief question-and-answer session will take place after the formal presentation. Now, I would like to introduce the first speaker for today's call, Claire Yenicay, Executive Vice President. Please proceed.

Thank you, operator, and good morning to everyone. Thank you for joining us today for Townsquare's fourth quarter and year-end financial update. With me on the call today are Bill Wilson, our CEO; and Stuart Rosenstein, our CFO and Executive Vice President. Please note that during this call we may make statements that provide information other than historical information, including statements relating to the company's future expectations, plans and prospects. These statements are considered forward-looking statements under the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties that could cause actual results to differ materially from these statements. These statements reflect the company's beliefs based on current conditions that are subject to certain risks and uncertainties, including those that are detailed in the company's annual report on Form 10-K filed with the SEC. During this call, we will discuss segment profit, which we previously referred to as adjusted operating income by segment. We may also discuss certain non-GAAP financial measures, including adjusted EBITDA. Such non-GAAP financial measures should be used in conjunction with all the information contained in the quarterly, year-end and current reports available on our website. I would also encourage all participants to go to our corporate website and download our Investor Presentation as Bill referenced some of those slides during our discussion this morning. In addition, our Annual Shareholder Letter is now available on our website. At this time, I would like to turn the call over to Bill Wilson.

Thank you, Claire, and thank you all for joining us this morning. It's great to reconnect with everyone. We're very pleased to share with you that Townsquare's fourth quarter results met our previously issued guidance and that our full year results met the guidance that we issued at the start of 2024. And as always, our differentiated strategy and business model generated meaningful cash flow consistently throughout the year. We ended 2024 with $33 million of cash on our balance sheet and generated $49 million of cash flow from operations in 2024. Importantly, we also completed a successful refinancing of our debt last month extending our maturities until 2030. I am extremely proud of the Townsquare team's performance over the past several years. In essence, we have continuously executed on our differentiated Digital First strategy and delivered on what we said we would do, while simultaneously building value for our shareholders through debt reduction and share repurchase, while also paying a high yielding dividend. We delivered solid and consistent results in 2024 as we built momentum throughout the year, driven in part due to the pickup in political advertising in our presidential election year, but also importantly due to the sequential improvement in both of our two Digital business divisions. By now, it should be very clear that Townsquare's Digital platform sets us apart from others in local media. As highlighted on slide 12, in 2024, Digital revenue contributed 52% of our total net revenue, more than two times the industry average, and Digital contributed 50% of our total segment profit. Digital is and Digital will continue to be Townsquare's growth engine and the area where we focus the bulk of our investment capital going forward consistent with our strategy of being a Digital First Local Media Company. Let's dive into our two Digital divisions results starting with the fastest growing business for Townsquare, which is Ignite, our Digital Advertising business. In 2024, Townsquare's Digital Advertising net revenue increased by 5.5% year-over-year to $159 million and grew to 35% of our total company's net revenue. Our Digital Advertising segment is composed of our owned and operated portfolio of local and national websites and mobile apps and our programmatic business, which contributes approximately 40% and 60% respectively of the segment's revenue. The success of our owned and operated Digital business is due to our focus on super-serving our communities with high quality hyper-local content, which has allowed us to build a large and engaged digital audience of over 70 million monthly unique visitors to our owned and operated websites and mobile apps. With the deep skillset of our digital product and engineering team, we have developed a multitude of Digital Advertising solutions for our clients, bringing national scale and sophistication to our size markets, including high impact solutions that are not available on programmatic exchanges such as site takeovers, first impression full-site coverage, mobile interstitials, sponsored social mentions and endorsements, etc. In addition, we have the unique ability to collect and analyze first-party data from our digital audience, allowing us to provide detailed and unique insights about consumer behaviors, audience interest and purchase intent that drive real results with strong ROI for our clients, giving us a true strategic advantage over our local competition. As a result of the strength of our local original content and brands combined with this powerful first-party data, we are confident that our owned and operated Digital Advertising business will continue to be a growth driver for our company moving forward. That being said, we are most excited about our Digital Programmatic business, which has been and will continue to be the largest growth driver for our company for the foreseeable future, particularly when factoring in the potential of the third-party media partnership model that we launched in 2024. Our Digital Advertising Programmatic platform provides our customers with precise targeted solutions, giving them the ability to reach a high percentage of their online audience across desktop, mobile, connected TV, email, paid search and social media platforms utilizing display, video and native executions. We essentially act as a full-service digital agency for our clients, from design and creative services to buying inventory, optimizing a campaign and providing real-time reporting and analytics and insights, therefore providing a level of service that is often not available in the markets that we operate in. In addition, we are simply able to offer a more cost-effective campaign to our clients than most of our competitors, given our scale across our 74 market footprint and our in-house proprietary demand-side trading desk that is integrated with more than 15 Digital Advertising buying platforms with access to all major advertising exchanges and therefore more than 250 billion impressions per day. Given our own momentum and success in the Digital Programmatic Advertising space, we elected to explore an additional avenue of growth which capitalizes on the knowledge, expertise and competitive advantages we hold, white labeling our Digital Programmatic Advertising solutions to others in local media. In 2024, we created the Media Partnership Division and we have since announced strategic partnerships with great companies like SummitMedia and Steel City Media, who operate local media properties across our 11 combined markets. While this is currently a modest-sized opportunity in the context of our overall Digital Advertising division for 2025, we are very excited about what these and other potential partnerships represent, which we believe is the opportunity to become the chosen provider of Digital Programmatic Advertising to broadcasters and digital agencies and others in local media in cities outside of the top 50. While early, we believe this Media Partnership initiative has the potential to be a significant difference maker and revenue and profit growth driver in 2026 and beyond as we are currently in discussions with numerous other partners in local media about potentially partnering with us to be their Programmatic Digital Advertising solution. S&P Global Market Intelligence's latest forecast project that Digital Advertising in the United States will increase at an 8.9% CAGR through 2029. We are confident that these favorable industry trends together with our in-house suite of marketing solutions, third-party Media Partnerships platform, investment in our original content strategy and our first-party data advantage will continue to drive strong Digital Advertising growth during the same period. Throughout 2024, our Digital Advertising business gained momentum as first half Digital Advertising revenue growth was 1% in 2024, which grew to 5% in Q3 2024 and accelerated in Q4 2024 to a very strong 15.5% revenue growth. Looking to Q1 of 2025, we expect strength in Digital Advertising revenue will continue with year-over-year growth rates in the high single-digits. This growth will be driven by very strong growth rates in Programmatic Digital Advertising revenue. Let's now turn to our second Digital business, which is our Subscription-based Digital Marketing Solutions SaaS business, Townsquare Interactive. One of the biggest accomplishments in 2024 was achieving a turnaround at Townsquare Interactive. Due to both internal and external factors which we have described at length on earlier calls and which have since been addressed, we lost more than 7,000 subscribers from 2023 through Q1 of 2024. At the start of 2024, we outlined our path to improvement. First, we returned to subscriber growth, then month-over-month revenue growth and eventually profit growth. I'm proud to say that we have hit these targets and then some. Within the first quarter of 2024, we had achieved subscriber and month-over-month revenue growth. And in Q4 of 2024, we proudly returned to year-over-year revenue growth. We are pleased to share that we expect Q1 2025 segment profit at Townsquare Interactive will increase on a year-over-year basis for the first time in two years, and we expect strong year-over-year full-year segment profit growth in 2025 for Townsquare Interactive of $2 million to $3 million. We also launched the Business Management Platform, a SaaS-based or Software-as-a-Service offering for Townsquare Interactive in early 2024. This platform provides a suite of digital solutions which assist SMBs in identifying, converting and communicating with their clients. Previously, Townsquare Interactive was positioned primarily as a web design and SEO company, which served us well for many years. And although these services are still part of our core offering today, we recognize that it was time to evolve. Today, there are many SMBs who already have a strong web presence but need help in other areas. Our new Business Management Platform can be sold to clients who already have an established website that they're happy with and/or those who already have dedicated resources to SEO. We believe that our new SaaS Business Management Platform is a very powerful tool and will be a difference maker as we grow and continue to scale the Townsquare Interactive business. We are not only helping SMBs with their digital presence, but we are also helping them operate their business more effectively. In 2024, Townsquare Interactive's net revenue declined 8% as compared to the prior year. Yet, what is important to highlight is that the interactive year-over-year growth rates improved each quarter in 2024 from negative 15% in Q1 to negative 13% in Q2 to negative 6% in Q3 and finally returning to revenue growth of 2% in Q4 2024. In addition, I am very proud of the fact that we managed expenses such that Townsquare Interactive's segment profit margin actually increased 10 basis points to 28.4%. The revenue growth will continue in Q1 2025. We anticipate TSI will double Q4's revenue growth rate from 2% in Q4 to approximately 4% in Q1. And as I said earlier, we expect very strong year-over-year segment profit growth in Q1 for Townsquare Interactive as well, with profit expected to increase approximately 20% and thus approximately $1 million in the first quarter of 2025. In the long term, we are confident that we have a long sustainable runway ahead of us. With an addressable market of nearly 9 million target customers as outlined on Slide 15, we are only scratching the surface. With our existing subscriber base, superior product offering, including our new Business Management Platform and a huge market opportunity, I am confident that Townsquare Interactive is on track and set up for long-term profitable growth and success. Thankfully, we strategically built a diverse product and service platform and the strength of digital advertising offset the recovery last year at Townsquare Interactive. In total, our Digital revenue grew 1% year-over-year to $234 million and importantly generated $62 million of segment profit, representing a 27% profit margin, a digital margin much higher than most in local media. We believe Townsquare's ability to drive profitable, sustainable digital growth is a key differentiator for our company. Thus, I am happy to report that in Q4 of 2024, our total Digital revenue grew approximately 11% year-over-year. We view local radio as an extremely valuable asset with significant cash flow properties, unparalleled consumer reach and an important local connection to our audience. However, radio is not a growth driver and in 2024 Broadcast Advertising net revenue declined 1% year-over-year and 6% year-over-year excluding political revenue. In fact, we take the view that broadcast is a mature, cash cow business that will continue to decline going forward as businesses continue to shift from traditional advertising to digital advertising. Thankfully, we are often the beneficiaries in that case as we often have the most comprehensive set of Digital Advertising solutions available in our markets. It is our view that as Broadcast revenue declines going forward, we will continue to generate solid profit as we carefully manage expenses to maintain a strong broadcast profit margin. In 2024, despite Broadcast revenue declines, our Broadcast segment profit margins increased to approximately 30% due to both cost reductions and high margin political revenue. But even excluding political revenue, we also experienced an increase in broadcast profit margin in 2024. Because of the powerful combination of Townsquare's digital plus radio plus local investment, I believe that our flywheel will continue to blaze forward and gain momentum. And now, Stu will go through our results in even more detail, including providing details on our successful refinancing last month of our debt, as well as provide 2025 guidance for revenue and profit.

Thank you, Bill, and good morning, everyone. It's great to speak to you today. We're pleased to report that our fourth quarter results met our revenue and adjusted EBITDA guidance and that our full year results met the guidance we set out at the beginning of the year. Fourth quarter net revenue increased 2.6% year-over-year to $117.8 million, above the midpoint of our guidance range of $114.8 million to $118.8 million. Full year net revenue declined 0.7% year-over-year to $451 million within our guidance set at the beginning of the year. In Q4, total political revenue was $7.2 million and for the full year, political revenue came in at $13.4 million. Adjusted EBITDA returned to growth in the fourth quarter with and without the impact of political. Fourth quarter adjusted EBITDA increased 25.8% year-over-year to $31.2 million, which was within our guidance range of $30.8 million to $31.8 million. Full year adjusted EBITDA was approximately flat, increasing 0.4% or just under $400,000 year-over-year to $100.4 million. This was also within our guidance range set at the beginning of the year. Townsquare Ignite, our Digital Advertising segment, built momentum throughout the year and had a very strong end to 2024, as strength in Programmatic Advertising led to fourth quarter Digital Advertising net revenue growth of 15.5% year-over-year. In total, full year Digital Advertising net revenue increased 5.5% year-over-year. As Bill also noted, we expect strong Digital Advertising revenue growth rates to continue in 2025, with Q1 Digital Advertising growth in the high-single-digits. In 2024, our Digital Advertising profit margin was approximately 26%, and we expect full year margins to remain in the mid-20s for this business going forward, although there may be some variations from quarter to quarter depending on the timing of investments, particularly the timing of new hires as well as the ramping of new Media Partnership agreements. Townsquare Interactive, our Digital Subscription Marketing Solutions segment, continued to demonstrate growth and recovery in the fourth quarter, just like it had all year. In fourth quarter, as expected, Townsquare Interactive returned to year-over-year revenue growth, with net revenue increasing 1.9% as compared to the prior year. In the fourth quarter, Townsquare Interactive segment profit was close to flat year-over-year, as profit declined by less than 1% or less than $50,000. And as Bill mentioned, we are thrilled to share that we expect to return to very strong year-over-year segment profit growth in the first quarter of 2025, and for revenue growth rates to double from Q4's 2% to approximately 4% in Q1 of 2025. For the full year, Townsquare Interactive net revenue decreased 8.4% as compared to the prior year, and profit decreased 7.9% year-over-year. Segment profit margins were strong at approximately 28% in 2024, despite our continued investment in the business. 2025, we're very confident in our expectation that we will deliver both revenue and profit growth for our Townsquare Interactive business. Fourth quarter Broadcast Advertising net revenue decreased 4.1% as compared to the prior year. In the fourth quarter, Broadcast segment profit increased 26.4% year-over-year due to the impact of high margin political revenue. For the full year, Broadcast revenue declined 1.3% year-over-year, but Broadcast segment profit increased 11.1% year-over-year, with margins at approximately 30%. In 2025, we anticipate margins will be slightly lower due to the loss of high margin political revenue, closer to the mid-20s. Our fourth quarter net income was $25 million or $1.42 per diluted share, as compared to a net loss per diluted share of $0.14 in the prior period. We'd like to remind you that any benefit or provision for income taxes included in the face of the income statement is for GAAP financial statement purposes only. We maintain significant tax attributes, including approximately $96 million of federal NOL carryforwards and other substantial tax shields related to the tax amortization of our intangible assets. We continue to believe that we will not be a material cash taxpayer until approximately 2028. As Bill highlighted and I would again like to emphasize, we consistently have strong cash flow generation. We generated $28.2 million of cash flow from operations in the fourth quarter and $48.8 million in 2024, ending the year with $33 million of cash. In 2024, we repurchased approximately $24 million worth of shares or 2.3 million shares through our share buyback program, including the repurchase of 1.5 million of MSG shares at an accretive price on April 1st. Since 2021, we have repurchased 16.6 million shares at an average price of $7.30 per share while simultaneously reducing leverage over that period. In 2024, we also bought back and retired $36 million of our bonds, including $12 million of bonds at or close to par in Q4. At the end of the year, our net leverage was 4.33 times, our lowest leverage level since March of 2023. Last month, we completed the successful refinancing of our debt by entering into a $490 million credit agreement, including a $470 million Term Loan B and a $20 million revolving credit facility, both due in 2030. This offering replaced our existing bonds that were due in February of 2026. At closing, we had approximately $480 million of debt, including the $470 million Term Loan, which has an interest rate of SOFR plus 500 basis points and $10 million drawn on our revolver, which has an interest rate of SOFR plus 375 basis points. Assuming current SOFR rates, this implies an annual interest expense of approximately $45 million. This represents an increase in our annual interest expense of approximately $9 million per year from 2024. However, this delta will decline as we pay down our debt and if and when there are interest rate reductions over the next several years, we will benefit from that as well. In addition, should market conditions permit, we always have the opportunity to replace our Term Loan in the future. Overall, we are very pleased that our distinguished business model and successful digital strategy allowed us to successfully navigate a Term Loan market that was very wary of lenders with forecast assets given their experience over the past decade. As always, our number one priority is to invest in our local business through organic, internal investments that support our revenue and profit growth, particularly our digital growth engine. We plan to continue to invest in our digital product technology, sales, content, and support teams, specifically in our Townsquare Interactive and Townsquare Ignite businesses, to maintain our strong competitive advantage in markets outside the top 50 cities. In addition, we plan to use our excess cash flow to reduce our debt to both mandatory and voluntary debt repayments, and of course, support a high-yielding dividend. I'm pleased to share that due to the confidence in our strategy and our consistent and strong cash generation, our Board has approved an increase to our dividend. The raised dividend of $0.20 per share equates to $0.80 per share on an annualized basis, which is an increase of 1.3% year-over-year and implies an annual payment of approximately $13 million based on our current share count and a dividend yield of approximately 10% based on our current share price. The higher dividend will be payable on May 1st to shareholders of record as of April 17th. We believe our strong cash flow characteristics will allow us to continue to invest in our business, support our newly increased dividend, and allow us to delever going forward. Turning now to our first quarter and full year 2025 outlook. We expect first quarter net revenue to be between $98 million and $100 million which at the midpoint is approximately flat year-over-year excluding political. As previously detailed on this call, we expect Townsquare Ignite, our Digital Advertising business, to be up in high-single-digits. Townsquare Interactive to be up 4% and Broadcast ex-political to decline more moderately than we experienced in Q4. We expect first quarter adjusted EBITDA to be between $17 million and $18 million. As a reminder, in the first quarter, we typically have the lowest revenue of the year due to advertising cyclicality. So our margins are typically lower in our advertising segments in the first quarter as a result. For the full year, we currently expect that our revenue will be between $435 million and $455 million. Embedded in this guidance is the loss of political revenue of $10 million to $11 million as we typically get between $2 million and $3 million of political revenue in non-election years. As Bill outlined, we anticipate offsetting the loss of political revenue with growth in our Digital business, including the return of year-over-year growth at Townsquare Interactive. We expect that our 2025 adjusted EBITDA will be between $90 million and $98 million.

Thank you, Stu, and thanks to everyone for taking the time to be updated on Townsquare's Q4 and full year results this morning. Greatly appreciate it. I want to conclude today's call by again highlighting some of the more relevant accomplishments we achieved with the Townsquare team's hard work in 2024. Number one, 2024 net revenue and adjusted EBITDA both met the guidance that we initiated at the start of the year. Number two, we executed the successful turnaround of Townsquare Interactive, which is now supported by a more efficient and scalable business model. Number three, we expanded Townsquare Interactive's addressable target customer base through the introduction of a new SaaS offering and we've also launched our Media Partnership division of Townsquare Ignite, our Digital Advertising business, opening the door to grow third-party revenue streams outside of our market footprint. Number four, approximately 52% of our company's total net revenue and 50% of our total segment profit now come from our Digital businesses. Number five, we generated $49 million of operating cash flow in 2024 and efficiently repurchased both debt and equity while maintaining a high-yielding dividend, therefore delivering attractive current returns to our shareholders. And finally, number six, we refinanced our outstanding debt, successfully navigating a Term Loan lender market that has experienced bad outcomes in the radio industry over the past decade, thus extending our maturities until 2030. In the words of Peter Drucker, the best way to predict the future is to create it. As always, we are going to create our own opportunities, not wait for them to show up or present themselves. We create opportunities and overcome challenges. It's the Townsquare way. Given 2024, we are confident in our ability to continue to deliver attractive current returns to our shareholders in the form of a high-yielding dividend while also focusing on the financial health of the company by reducing our net debt levels through strong cash generation and debt reduction. And again, I'd like to take this opportunity to thank the entire Townsquare team for their passionate hard work each day in partnering and helping their clients and communities. With that, operator, at this time, please open the line for any and all questions.

Thank you. We will now begin the question-and-answer session. Our first question comes from Michael Kupinski with Noble Capital Markets. Please go ahead.

Thank you. Thanks for taking the question. Good morning. Congratulations, first of all, on your solid Q4. I have a couple of questions here. I was wondering if you could add a little bit more color on Townsquare Interactive. I may have missed this, but I was wondering if you provided the number of subscribers you ended Q4 with and where you see subscriptions headed in Q1 2025?

Good morning, Michael. Great to hear from you and thank you for dialing in. So in terms of Interactive, as you just said, and we just noted in the conclusion of our prepared remarks, couldn't be more proud of the turnaround at Townsquare Interactive. As we said exactly a year ago, that there'd be three signs of a turnaround. One, subscriber growth returning then month-over-month revenue growth and then year-over-year revenue growth and then profit growth. I’m really proud of the team ending the year with year-over-year revenue growth. We started subscriber growth back in Q1 and then we started month-over-month sequential revenue growth again back in Q1 and then ending in Q4 with that year-over-year revenue growth. We stopped disclosing subscribers, I believe, back in Q2. But what I would share with you is as we started looking at Q1, we shared this morning that we expect our revenue growth rate year-over-year to at least double Q4's growth rate. So obviously, if we were at 2% in Q4, we expect a minimum of 4% growth in revenue in Q1. Probably most importantly is we expect really strong profit growth in Q1. I think we've managed this business incredibly well for over a decade. We noted that profit growth in Q1 we expect to be up 20%, which would imply about $1 million of incremental profit year-over-year in Q1 2025 versus Q1 '24. On a full year basis, as you know, Michael, we traditionally generated $2.5 million to $3 million in profit year in and year out. And we expect this year to get back into that level on a full-year profit basis of $2.5 million to $3 million. So things are, I'd say, close to firing on all cylinders. I think we shared that we brought in a new Head of Customer Service from OpenTable back last summer leading into the fall. That individual has had an impact right away, but is still continuing to fine-tune our offering on the service side and continues to make improvements. So really proud of the turnaround. I think most importantly, we've talked at great length what transpired, so I won't repeat all that. But we lost a number of subscribers in 2023 and then ending in Q1 of 2024 and just feel very, very well positioned not only for this year, but more importantly over the next five to ten years. We believe we've built a more scalable and efficient model and we also have the SaaS-based offering, which is really broadening our target audience. So just extremely bullish when we're thinking about the next three to five years at Townsquare Interactive. So I’ll toss it back to you, Michael.

Yes. And as a follow-up, Bill, I know that in the past, Townsquare Interactive subscriptions roughly were $300 a month. And I was wondering if you could kind of give us a sense of what subscriptions are now that you have enhanced your product offerings in Interactive?

Yes. So you are correct. Our ARPU is roughly $300 per subscriber. That is continuing today. We have some offerings that go well over $400, but with the SaaS-based offering, we are broadening the target market that we're so excited about. There are great businesses that have a great website and don't need a new website, but we're helping them with our SaaS-based tools to operate their business more effectively and efficiently as well as helping them convert web traffic to customers, which is obviously an incredibly strong attribute for this offering. Sometimes that would be under $300. So on average, the ARPU continues to be $300, and that's what we expect over the coming years. At some point, could that raise? Definitely. But when I think about the next two years, I would assume a $300 ARPU going forward.

Thank you for that, Bill. And one quick another question here. In the past, you provided some revenue goals for Interactive and also for Ignite. And you largely achieved that for Ignite. I was just wondering if you plan to update your three to five year outlook for terms of revenues for Interactive and Ignite much like you did in the past?

For sure. I mean, we couldn't be more proud of it, but I appreciate your comments at the beginning of your question. Q4 was just a great quarter and great momentum going into 2025. Having our Digital Advertising accelerate to almost 16%, it was 15.5% Digital Advertising growth was incredibly strong. We benefited from strong programmatic and our owned and operated properties. We talked at great length on prior earnings calls about the news deserts and the service that we're providing and filling the void as newspapers go away. So again, with Digital Advertising, we're not only benefiting from the strength of programmatic, but importantly the strength of our owned and operated. So we expect our Digital Advertising to continue to operate in the high-single-digits in terms of revenue growth when you're looking at a three to five year model. Townsquare Interactive, as I said on the profit side, I expect $2.5 million to $3 million this year. I expect not to be at the full $10 million that historical level of top line revenue this year. I think that will be more modest, as we're, as I said earlier, one of the great benefits of rebuilding the whole business over the last, I'd say, twelve months, is the efficiency we're creating. So although we'll be back at normal profit levels for Townsquare Interactive, I believe our revenue will be definitely muted from that $10 million normal number. But when you think about 2026 and onward, I would think about our top line revenue growth at Townsquare Interactive at $10 million and profit growth returning to that $3 million that we historically did year in and year out for almost a decade. So and then as you know and we spoke about on the call, we may be different than others in the space because we obviously have a very differentiated business model being a Digital First Local Media Company, particularly operating outside of the top 50 cities, which we continue to hammer as really a completely different business overall even in radio, but having a differentiated digital strategy is a core attribute for us. So we view broadcast as a mature cash cow business. We talked about them on our prepared remarks. With the great attributes of radio, it's obviously the number one reach medium, tremendous cash flow. The fact that we generated $49 million of cash flow from operations, we're incredibly proud of for 2024. But we do expect Broadcast to continue to decline, and that is in our five-year model. We've been saying this for many years and we've been able to moderate the expense base to have a very strong profit margin in the Broadcast side. The great news for us, as we continue to try to highlight, is when people do stop advertising on radio for whatever reason, they're switching to Digital Advertising. And when they're switching to Digital Advertising, they're switching to us. That's one reason you saw the explosive growth of Digital Advertising in Q4 at 15.5%. Also for us, which I think is unlike others, given that fact that we have so many of our digital solutions built in-house with our tremendous product and engineering and technology team. I couldn't be more proud of that our margins on the Digital Advertising side are actually slightly higher than our Broadcast ex-political margins. So when somebody does decide to stop advertising on Broadcast, if they do decide that and switch to our Digital Advertising solutions, we actually make more profit as an outcome. I think if you look at the last three to five years, we've managed the Broadcast decline quite well from an expense base. Then we're obviously our futures in Digital, Digital Advertising, Digital Marketing solutions and we continue to ramp that. We're really proud as you just said in Q4, Digital overall, Digital revenue increased 11%. So we go into 2025 with a lot of momentum and we're quite excited about the next three to five years. But I'll toss it back to you in case you have questions outside of Interactive.

One last question and I promise. Obviously, we have a new administration and an FCC now looking at deregulations and lifting ownership caps and so forth. And I was just wondering if you have some thoughts in terms of that prospect in radio and then whether or not, given that prospect, whether you would be a buyer of radio. I know that you said that it's a mature business, but it sounds like you get benefits in other ways. I was wondering if you would be interested in looking at M&A in that light?

Yes. No, great question, Michael. Appreciate all the insights and perspective. So you are correct. If you go back for the last number of years, you've heard us talk about our perspective that deregulation is going to happen. It needs to happen. It's a must. The laws and regulations are antiquated and make no sense in today's media landscape, is our view. So we've always taken the position it's going to happen. It's just a matter of when. With the new FCC Chairperson, we are extremely excited about the comments he's been making as recently as last week about deregulating, I believe, television as well as radio assets, which are long overdue, as I just said. So we believe that will happen. We believe that we are the best positioned acquirer of radio assets, particularly for markets outside the top 50. That's we've been consistent. We stick to our knitting. We've had many, many opportunities over the last fifteen years to acquire assets, broadcast assets in the top 50 markets and we've always passed on that. It served us well. I think it's one of the reasons we have had the success we have in diversifying our company into a Digital First Company with over 50% of our revenue and profit being in Digital. So I do believe the landscape will change. I do believe we're the natural acquirer of broadcast assets. When we talk about our last asset, I think on our last earning call, we talked about Cherry Creek. In June of this year, that'll be coming up on three years. We bought Cherry Creek and we've doubled the cash flow in under three years. That's because the Broadcast business declined modestly, and we grew the Digital business so aggressively, which is our Townsquare model, and that proved true again with Cherry Creek just like it did with prior acquisitions. That said, I would like to highlight the success we're having with Ignite's Media Partnership. We have three partners. One, we have not disclosed because they've asked us not to, and then two we have disclosed, which is SummitMedia and Steel City. We couldn't be more excited about the progress we're making. In Q1 of 2025, we believe that will be just under about $1 million in top line revenue. We've said on the year, we believe the Media Partnership division could be $7 million, $8 million of top line at a 20% profit margin. But more importantly, when you think about 2027 and 2028, we believe this is a $50 million division top line and $10 million profit to us. And there's a lot of conversations and partners that we're talking to. So we have two avenues. It's great to have choices. We could acquire assets, and we've demonstrated every time we've acquired assets, the ability to manage the cash flow of the broadcast business, yet grow profit through our Digital advertising and Digital Marketing solutions. So we could take that path, and particularly with deregulation, there's a lot, I believe there'll be a lot of opportunities for acquisitions or swaps and other strategic moves, which are exciting. But if we chose not to go that route, as we detailed on a couple of our earnings calls in 2024, we can keep our capital, utilize it to continue to deleverage, which is a main priority for us over the next couple of years, and sign up more Media Partnerships and still generate a 20% margin in our Digital Advertising partnerships with those companies. So it's great to have choices. It's great to have multiple paths for digital growth, and that's what we have here at Townsquare. So thank you, Michael, for the questions. Appreciate it as always.

Thank you, Bill. That's all I have. Thanks.

You got it.

Your next question comes from the line of Patrick Sholl with Barrington Research. Please go ahead.

Hi. Good morning. I was curious within your guidance, I guess, both for the first quarter maybe to clarify and also for the full year, are you expecting kind of an improvement in the trends on ex-political growth for radio?

Good morning, Patrick. It's always a pleasure to hear from you. Looking at the big picture, I want to reiterate that our Broadcast business is a well-established cash-generating segment. We appreciate its cash flow attributes and the fact that it reaches about 50% of the adult population across our 74 markets. Additionally, it significantly drives audience traffic to our owned and operated local websites and mobile apps. While I won't go into all the benefits of our Broadcast business, we do anticipate, as we've stated for several years, that Broadcast excluding political content will decline. For our guidance in 2025, we expect this decline to mirror that of 2024, where Broadcast excluding political dropped approximately 6%. We forecast a similar decline for 2025 and also for the first quarter. Our primary growth engine remains our Digital Advertising and Digital Marketing Solutions. We expect our Digital Advertising to grow in the high-single digits this year. For Townsquare Interactive, I mentioned projected profits of $2.5 million to $3 million and revenues around $5.5 million to $6 million. In the first quarter, our guidance indicates that non-political revenue will be relatively flat at the midpoint, while we anticipate digital revenue could approach 55% of our total revenue. Taking a long-term perspective, we've successfully transformed the company. We continue to manage the declining Broadcast segment while investing in our Digital Ignite Advertising and Townsquare Interactive businesses. Looking two to four years ahead, we believe digital revenue and profits could represent 75% to 80% of our total. To address your original question, Patrick, our guidance suggests that Broadcast will decline similarly to last year at around 6%. There is potential for moderation in future years to a more low-single-digit decline. Historically, we've consistently provided accurate year-end guidance, and we take pride in that. We prefer to be realistic and conservative with our forecasts. While there's a chance that Broadcast could perform better this year, our strategic plans indicate that we are well-positioned despite the decline in the Broadcast sector, thanks to the strength of our digital assets and our teams in markets outside the top 50 cities. I'll now turn it back to you, Patrick, for any additional questions.

Yes. Going back to Interactive, I was just kind of curious on how you manage that business now with like increased uncertainty on the economic environment and like the, I guess maybe like the risk there, like businesses kind of pulling back on some of their spending in response to like economic uncertainty, and how you kind of manage that within both Interactive and Ignite?

Totally get it. Great question. And listen, when you're reading the headlines and you're following the media and you're hearing about one thing from the administration in the morning and maybe something slightly different in the afternoon, it definitely creates a volatile environment. But that said, the advertising market overall is quite healthy. As we just said, we're expecting high-single-digit growth rate in our Digital Advertising business, and we're expecting to double the growth rate in Interactive in Q1 versus Q4. So even with that economic uncertainty, we are performing extremely well, and I couldn't be more proud of the Townsquare team for doing so. So from going back to your original question, we're not seeing a negative impact from that economic uncertainty. I think the challenges that we faced and overcame in Townsquare Interactive were mostly self-inflicted. We noted that in great detail in 2023 and the beginning of '24. Were there greater pressures because inflation was at 7%, 8%, 9%, interest rates were much higher? Yes, it was definitely a more challenging time, particularly for the businesses for Townsquare Interactive because as we've gone to great lengths to explain, the target market is a 9 million, $32 billion TAM, but they're smaller companies that we target. So in those more tough times with that high inflation and interest rates, it was tougher. But that said, we truly believe those setbacks that we faced over that 18 months were really self-inflicted that if we would have performed at the level we're capable of, we would have overcome those economic conditions. And that's what we're doing now, and we're quite proud of that. Having expected growth of roughly $1 million in profit in Q1 is phenomenal. We couldn't be more proud of that Townsquare Interactive team. So we are navigating the economic uncertainty, but the market's healthy. I mean high-single-digit digital advertising as we're sitting here, almost the end of Q1 is very robust. As we look at Q2, we're seeing increased pacing from we see March better than February and we see April better than March. So we don't give monthly pacing or this now that's why we're trying to just give you a full year picture. But we're feeling quite good about the year. We're feeling incredibly confident about our differentiated digital strategy and the fact that we're a large-scale publisher having owned and operated at 70 million having first-party data and then utilizing that leverage and assets for our Programmatic business is quite unique. I think that's why you see people like Summit and Steel City and many others turning to us and talking to us about powering their Digital Advertising. And then the Interactive business again, we're set up for a great 2025, call it $2.5 million to $3 million of profit growth. So even in this time of economic uncertainty, we're performing quite well and the advertising business is quite healthy on the digital side. I’ll turn it back to you, Patrick.

Okay. Thank you.

You got it.

Thank you. And that concludes our question-and-answer session. I would like to turn it back to Bill Wilson for closing remarks.

Thank you, operator, and thank you all for joining us this morning. We're really excited about the upcoming year. We appreciate you taking the time. As Claire said at the top of the call, I would highly encourage you to read our Annual Shareholder Letter that is available on our corporate website and was published this morning. I would also encourage you to download the new investor presentation. We look forward to talking to you soon. We'll be talking to you in the beginning of May to update you not only on Q1, but our progress through the year. So thank you and have a great day. Happy St. Patty's Day.

Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.