Earnings Call Transcript - VSNT Q4 2025

Operator, Operator

Greetings. Welcome to Versant Media's Full Year 2025 Operating and Financial Results Conference Call. Please note, this conference is being recorded. At this time, I'll turn the conference over to Wylie Collins, Executive Vice President, Investor Relations and Treasury. Thank you. You may now begin.

Wylie Collins, Executive Vice President, Investor Relations and Treasury

Thank you, and good morning, everyone. Welcome to Versant Media's Fourth Quarter and Full Year 2025 Operating and Financial Results Conference Call. Joining us today are Mark Lazarus, Chief Executive Officer; and Anand Kini, Chief Financial Officer and Chief Operating Officer. Also with us are Jordan Fasbender, General Counsel; and Natalie Candela, VP of Investor Relations. Before we begin, I'd like to remind you that certain statements made during this call may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect management's current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a discussion of these risks and uncertainties, please refer to Versant Media's filings with the SEC and today's earnings release. All forward-looking statements are made as of today, March 3, 2026, and we undertake no obligation to update them. During today's call, we may refer to certain non-GAAP financial measures. Reconciliations of these measures to the most directly comparable GAAP measures are included in today's earnings release and in the materials posted in the Investor Relations section of our website. With that, I'll turn the call over to Mark.

Mark Lazarus, Chief Executive Officer

Thank you, Wylie, and good morning. We are pleased to report Versant's 2025 operating and financial results as an independent, well-positioned media and entertainment company. 2025 was a pivotal year for Versant. We completed our transition to a stand-alone public company while advancing our clear and deliberate strategy, continuing to win with premium content, extending the reach of our iconic brands, and accelerating the growth of our digital platforms. We operate in four large and growing markets: business news and personal finance, political news and opinion, golf and athletics participation, and sports and genre entertainment. In each, our brands hold leadership positions with clear opportunities to extend beyond pay TV. Versant enters this next phase with meaningful scale, reaching an average of approximately 100 million people every month. Our live news, live sports, and premium entertainment programming continue to attract large engaged audiences and generate robust advertiser demand. Approximately 60% of our audience comes from news and sports, which are most valued by audiences and advertisers. In 2025, CNBC solidified its position as the #1 global business media brand, delivering exclusive breaking news and more than 6,000 hours of live on-air coverage. That leadership was on full display in Davos last month, where viewership surged across all three days of coverage as CNBC was at the center of the world's most consequential business conversations. We built on that position of strength in 2025 with a multiyear partnership with Kalshi, integrating real-time prediction market data directly into CNBC's editorial coverage. This important commercial relationship introduces new revenue streams and connects us with a younger, highly engaged, and data-driven investor audience. We're extending that strategy even further. CNBC will launch a next-generation direct-to-consumer subscription service tailored to retail investors, a fully integrated platform combining CNBC editorial insights, investment recommendations, portfolio tracking, advanced charting, AI-powered analysis, and powerful decision-making tools, all built on a brand and talent that investors trust. We believe this service addresses a significant market need with a product only CNBC can deliver. On election night in 2025, MS NOW was the most-watched network across all of cable, reinforcing the strength of the brand at the most consequential moments in politics. Since the rebrand to MS NOW in the fourth quarter, that momentum has not only held, it has accelerated with double-digit growth in total viewers since November. That momentum extends well beyond traditional television as well. In 2025, MS NOW generated nearly 8 billion views across TikTok and YouTube, along with more than 140 million podcast downloads, demonstrating the depth and demand of a highly engaged audience. To build on that engagement, later this year, we will launch a new MS NOW direct-to-consumer platform centered on community, access, and exclusive content, extending the breadth and depth of MS NOW's audience reach. The Golf Channel is the #1 golf media outlet. And in 2025, we aired over 2,000 hours of live coverage across more than 200 events, accounting for 35% of all hours watched for golf. The inaugural Golf Channel games aired in December, and we also extended our USGA partnership through 2032 and our PGA of America partnership, including the Ryder Cup through 2033, securing long-term rights and reinforcing our leadership in golf for years to come. Beyond pay TV, our tee-time platform, GolfNow, delivered a record year with 40 million tee-times booked over 9,000 courses globally, demonstrating Versant's scale in the broader golf ecosystem. Across our broader sports portfolio, USA Sports added Pac-12 football and basketball and expanded our leadership in women's sports through long-term agreements with the WNBA and League One Volleyball. Last month, we also brought the Olympic Winter Games from Milan Cortina to audiences nationwide on USA Network and CNBC, and we'll provide more on that during our first quarter call. In entertainment, USA delivered the #1 scripted cable original premiere of 2025 with The Rainmaker, and it has already been renewed for a second season, reinforcing our ability to launch and develop premium franchises. We also broadcast the Critics Choice Awards, which delivered their strongest ratings since 2022, a reminder of the enduring appeal of live unscripted entertainment. At Fandango, we will launch a new ad-supported streaming service later this year, enabling audiences to watch films and television series for free, leveraging Fandango's broad distribution footprint, scaled customer base, and Versant's strong library of content. This is a natural extension for the Fandango platform, growing audience and deepening engagement while driving incremental monetization. In addition, we completed the acquisition of INDY Cinema Group, expanding our offering for cinema operators with a cloud-based operating system now deployed across theaters worldwide. We also added Free TV Networks to our portfolio with national over-the-air distribution, expanding our presence in the fast-growing free ad-supported market and extending our footprint beyond traditional pay television. These acquisitions reinforce our strategy of building on our leadership in our core markets by expanding distribution, deepening engagement, and developing new audience touchpoints through both existing and new platforms. We view revenue mix as a critical indicator of our strategic transformation. In 2024, 17% of our revenue came from non-pay TV platforms. In 2025, that increased to 19%, and that was achieved without the benefit of the new initiatives launching this year. Our target is 33% over the next 3 to 5 years and over time to get closer to 50%, positioning Versant as a platform for growth over time. We are committed to continue investing in the business and returning capital to shareholders. Our Board has declared the company's first dividend and has also approved a $1 billion share repurchase authorization. This program reflects our confidence in the business and our strong balance sheet, which provides us the flexibility to invest in growth while also delivering meaningful shareholder returns. As we move forward, we have a clear strategy and the infrastructure, operating discipline, and leadership required to win. We enter this next chapter from a position of strength; we are profitable, scaled, and disciplined. None of this would be possible without our team. Across every part of our company, our people executed a complex separation while continuing to deliver for audiences, partners, and shareholders. I am incredibly proud of what we have built and even more confident in what we will accomplish next. With that, let me turn it over to Anand.

Anand Kini, Chief Financial Officer and Chief Operating Officer

Thanks, Mark, and good morning, everyone. As Mark noted, we are focused on disciplined execution and positioning the company for long-term value creation. I'll review our full year 2025 results, discuss key performance drivers, and provide our outlook for 2026. Unless otherwise noted, all comments reflect stand-alone results, meaning a view of 2025 and 2024, as if we were already operating as an independent company, aligned with how we presented at Investor Day and how we will report going forward. 2025 performance is consistent with the forecast we shared in December with strong profitability, healthy margins, and significant free cash flow generation. Total revenue was approximately $6.7 billion, down 5% year-over-year. The decline primarily reflects ongoing secular pressure in pay TV and advertising normalization following the prior year's presidential election cycle, partially offset by growth in our platform's businesses. Stand-alone adjusted EBITDA, which excludes transaction and separation-related costs, was about $2.2 billion, down 9% year-over-year. Stand-alone adjusted EBITDA margins remained above 30%, consistent with the framework outlined at Investor Day. An estimated stand-alone free cash flow totaled a healthy $1.5 billion for the year. Turning now to revenue details. Linear distribution revenue was $4.1 billion, down 5% year-over-year, driven by continued moderate cord-cutting, partially offset by contractual rate increases. Importantly, more than half of our pay-TV subscribers are under agreements not subject to renewal until 2028 and beyond, providing meaningful revenue visibility. Advertising revenue was approximately $1.6 billion, down 9% year-over-year, reflecting ratings declines and post-election normalization in use. Quarterly growth trends were affected by sports timing differences and certain assumptions related to the impact of the 2024 Paris Olympics on our stand-alone results. Platforms revenue, primarily GolfNow and Fandango, increased 4% to approximately $826 million. GolfNow delivered another strong year with growth in bookings, payment volumes, and subscriptions. Fandango's performance reflected a softer-than-expected theatrical slate, particularly in the second half. We expect platforms to return to high single-digit revenue growth organically in 2026, supported by a stronger box office slate and continued growth at GolfNow. Additionally, we anticipate favorable contributions from our recent INDY Cinema acquisition. Content licensing and other revenue was approximately $193 million, down 9% year-over-year, primarily due to the timing of entertainment licensing agreements. On expenses, the cost of revenues declined by about $130 million in 2025 driven by programming cost savings, including from a new long-term NASCAR agreement. SG&A, excluding transaction and separation-related costs, was slightly lower year-over-year and reflects the resources required to operate as a stand-alone public company. Turning now to the fourth quarter. Results were broadly consistent with the full year trends. Revenue was $1.6 billion, down 7% year-over-year. Stand-alone adjusted EBITDA was $521 million, down 19%, impacted by production tax benefits in the prior year quarter. Full year results better reflect the underlying financial profile. We began the year with approximately $850 million of cash and total liquidity of approximately $1.6 billion, including availability under our $750 million revolving credit facility. Gross debt totaled approximately $3 billion, resulting in net leverage of 1 times trailing 12-month stand-alone adjusted EBITDA, providing substantial financial flexibility. With respect to capital allocation, returning capital to shareholders remains a top priority for us, alongside disciplined investing to support long-term growth. As Mark noted, the Board has authorized a share repurchase program of up to $1 billion and has declared a $0.375 per share quarterly cash dividend, representing an expected annualized dividend of $1.50 per share. Our 2026 outlook remains consistent with the framework provided at Investor Day. We expect revenue between $6.15 billion and $6.4 billion supported by midterm political advertising and new product initiatives. We expect adjusted EBITDA between $1.85 billion and $2 billion as we continue to invest in growth with some quarterly volatility caused by sports rights timing, particularly in the second half. Depreciation and amortization will remain elevated in 2026 largely due to amortization of intangibles related to the 2011 Comcast acquisition of NBCUniversal. This amortization will be substantially complete by year-end 2026. We anticipate our cash tax rate for 2026 to be approximately 26%, excluding the impact of intangibles on the balance sheet. From a capital expenditure standpoint, we expect 2026 CapEx to be modestly above stand-alone 2025 levels. The increase primarily reflects the build-out of our new Manhattan headquarters and targeted investments in our platforms and other growth businesses. Over the medium term, we expect capital intensity to normalize following completion of these projects. We continue to expect free cash flow between $1 billion and $1.2 billion in 2026. Free cash flow conversion will be modestly lowered in 2025, reflecting working capital timing, onetime cash tax benefits in 2025, and the incremental capital expenditures I just outlined. On working capital, we anticipate quarterly variability, particularly in the fourth quarter. This is principally caused by separation-related timing effects, including NBCUniversal's prefunding of certain receivables at separation, which increased our opening cash balance with a corresponding Q1 working capital impact. With that, I'll hand it back to the operator to open the line for Q&A.

Operator, Operator

And the first question comes from Michael Ng with Goldman Sachs.

Michael Ng, Analyst

Congratulations on your first quarter as a stand-alone public company. I just have two questions, if I could. First, platforms is obviously a critical part of getting to your revenue diversification goals. Can you talk a little bit about your confidence in achieving that one-third of revenue from non-pay TV over the next 3 to 5 years, key new product launches and features that you expect to be the most meaningful in the next couple of years here?

Mark Lazarus, Chief Executive Officer

Yes, we're very confident in our platforms business. As mentioned earlier, the results for 2025 were somewhat affected by a softer film slate in the industry. As Anand noted, we anticipate high single-digit revenue growth for 2026, which aligns with our historical performance in these businesses. We are optimistic about strong growth in both revenue and profit over the long term. When considering our core businesses, GolfNow and Fandango are leading brands in their markets, and there is significant potential for organic growth and increased market penetration. For instance, GolfNow currently accounts for less than 10% of total rounds booked, and we are just starting our international expansion. We can easily extend these businesses into adjacent markets. We're introducing a free AVOD service as part of Fandango, which will complement our movie ticketing and home rental services. Additionally, we acquired INDY Cinema, which allows us to provide the best operating software to cinema operators already using our ticketing partners. There are numerous expansion opportunities for both Fandango and GolfNow. We will also launch new platforms related to our brands. CNBC's direct-to-consumer service will target retail investors, while MS NOW D2C will provide community insights relevant to that brand. These are strong brands with large existing audiences, positioning us well for successful adoption at scale in direct-to-consumer markets where we have not previously invested.

Anand Kini, Chief Financial Officer and Chief Operating Officer

Yes. The only thing I would just add is, I think as Mark mentioned, Michael, it's a good question. And for us, it's a combination, as you saw, of organic investment where we're making quite a bit as we just talked about the different brands. And then also M&A, our bar is high. I think INDY Cinema is a good example of an M&A opportunity that we found very compelling, a very good use of capital, significant value creation, fits with our brands, and fits with Fandango. It's kind of an opportunity to add incremental value right away because we already have a sales channel to the exhibitors who buy our Fandango ticketing products. So I think that between the organic investment and then selective inorganic just kind of reinforces how confident and how bullish we are about our platforms business.

Michael Ng, Analyst

Wonderful. And just as a follow-up, could you just provide an update on the SportsEngine strategic review process and the M&A point to support platforms? Just some clarity on kind of tuck-ins versus maybe something more midsized?

Anand Kini, Chief Financial Officer and Chief Operating Officer

Sure. I'll start with SportsEngine. As we discussed, we're assessing various options to maximize the value of that business. To be clear, we see significant consolidation happening in the youth sports market, so we believe this is the right time to conduct this review, though we haven't made a final decision yet. We genuinely like SportsEngine; it has been a strong business for us and continues to be valuable. We are committed to pursuing only those opportunities that truly enhance long-term value. Regarding mergers and acquisitions, we will consider all opportunities that contribute value. INDY Cinema serves as a good example of a tuck-in, and we anticipate there may be more similar opportunities. For instance, GolfNow was developed over time and involved the integration of various independent operators, which could also be seen as a tuck-in. We are open to the possibility of larger transactions, but it's important to note that our standards are very high. In our capital allocation strategy, mergers and acquisitions play a role, but we must ensure that any potential deal aligns with our brand, can deliver immediate value, and presents synergies that we evaluate carefully. Therefore, any opportunity must meet these criteria to guarantee strong returns, and we will maintain a disciplined approach in our pursuit of these opportunities.

Operator, Operator

Our next questions are from the line of Brent Penter with Raymond James.

Brent Penter, Analyst

First one for me. Good to see the shareholder return plans in the buyback authorization. What's your philosophy going to be on buybacks? Do you plan on being pretty opportunistic? Or should we expect them to be pretty regular? And is there a 10b5-1 program in place already?

Mark Lazarus, Chief Executive Officer

Yes. At this point, we're going to be opportunistic. We're going to be thinking through the total capital allocation program sort of holistically, and we'll handle it that way.

Brent Penter, Analyst

Okay. And then realize it's very early into your journey as a stand-alone company and majority of your renewals are beyond 2026 and 2027, but can you just update us on your confidence on the affiliate fee trajectory and what you might be hearing from distribution partners at this point?

Mark Lazarus, Chief Executive Officer

Well, we were able to execute a bunch of deals last year when we were long announced as a stand-alone company, and we were able to do that on terms that work for us and work for the distribution partners. We have a few deals up later on in this year, and we anticipate being able to have very productive and similar discussions with them at that time. Our live portfolio of news and sports we think plays into what people are still looking to watch on linear television, and that's a big part of our asset play.

Brent Penter, Analyst

Okay. Got it. And then the final question for me. The Warner Bros. Discovery process, obviously kind of moving into the next phase now. Watching from the sidelines, what have you all learned from this process in terms of the industry, in terms of some of your competitors, in terms of valuations? What does all this mean for Versant?

Mark Lazarus, Chief Executive Officer

Well, we have our plan to go as an independent company. We have a strong set of assets. We're very focused on our vertical markets. And the wider view was it was interesting because the assets from Warner Bros. were interesting to a couple of people in a couple of different ways, and we look at that as being reinforcing of the value of our company.

Anand Kini, Chief Financial Officer and Chief Operating Officer

I think the only other thing I'd add is I think maybe what we learned is as you kind of went through that process, the assets that had a tremendous amount of value often were around news and sports. And I think you've heard us say before that about 60% of our audience is news and sports. So we think in many ways, that process validates, a, the quality of our brands and our portfolio and the strategy that we're pursuing to kind of continue to drive those businesses, which are supremely positioned within the pay TV ecosystem, and it also gives us the opportunity then to extend them outside of it. So we think, in many ways, that has validated the approach that we have.

Operator, Operator

Our next question is from the line of Peter Supino with Wolfe Research.

Peter Supino, Analyst

I have a couple of questions about how your brands go to market. First, could you discuss the size of the audience you are reaching in linear pay TV? While we can see ratings data on individual shows, I'm curious how many households engage with your news and sports content each month and with enough frequency to be significant in your negotiations with pay TV distributors. The context for this question is that we often hear from clients a strong concern about the possibility that you might lose a distributor in the future. Additionally, I'd like to ask about your brand's direct-to-consumer opportunity. Can you comment on the economics of streaming CNBC and MS NOW direct-to-consumer, and whether a partnership with a third-party streamer that has a large audience could be an interesting option in the future?

Mark Lazarus, Chief Executive Officer

We have established strong audience engagement, reaching around 100 million people each month with our well-known brands. Individually, MS NOW has significantly increased its prime-time audience over the last decade, currently averaging about 1.2 million viewers daily in that time slot. This level of viewership reflects substantial engagement, with audiences watching approximately 8 to 9 hours per week, placing us among the top in the media landscape. Similarly, CNBC maintains a dedicated following in the financial sector, particularly among retail investors, which we plan to leverage as we prepare for our direct-to-consumer launch. In our sports programming, we've seen substantial viewership on USA Network for events like the Premier League, WWE, NASCAR, WNBA, and the Olympics, reaching millions at a time. We have considerable scale by combining the viewership of our individual networks and our overall audience across the portfolio. Regarding our direct-to-consumer programs, we are confident in our existing infrastructure, making development less capital intensive. We are designing product offerings tailored to both CNBC's retail investors and MS NOW's engaged audience.

Anand Kini, Chief Financial Officer and Chief Operating Officer

Yes, that's right, Mark. I think, Peter, part of that also kind of may be implicit or embedded in your question is would we go to market in different ways. And I think that answer is yes. So sure, we're going to offer it direct to consumers. But clearly, we're open to different opportunities to distribute through other partners, whether that's bundling or packaging or other distributors. And we will, in fact, be active in striking that. I mean it's all about driving value and driving scale. And there's actually a lot of folks that are interested, frankly, in working with us on that. And those conversations, we'll discuss them at the right time, but they're ongoing.

Operator, Operator

Our next question is from the line of Jessica Reif Ehrlich with Bank of America.

Jessica Reif Ehrlich, Analyst

Two questions. First one is on advertising. So in addition to your existing business, which obviously has a big advertising component, your new businesses, whether direct-to-consumer or free TV, are dependent, at least in part, on advertising. So could you give us a little bit of color on the current market and talk through some of the levers that you can control to maybe improve the advertising trajectory in the current year, whether pricing or sell-through, cross-platform packaging, measurement, etc., data, so that would be great if you can give some real color. And then secondly, second completely different topic, but on sports, with the larger media companies facing what's likely a very expensive NFL renewal, does this open the door for you to buy what would be considered secondary or tertiary sports, but growing sports, whether like women's sports or upcoming sports, and maybe bigger picture, I mean, sports is obviously a focus. How do you think that your sports strategy will evolve?

Mark Lazarus, Chief Executive Officer

I’ll address the second question first. As the NFL engages with the market and we explore new partnerships with other media companies, we anticipate a rebalancing of sports portfolios. This will create opportunities for us, given our strong heritage and established properties in sports, coupled with our extensive reach. USA Network, in particular, serves as a robust platform comparable to any cable or pay television asset. We foresee chances to engage with properties that we hadn't previously considered and remain open to discussions; we are actively pursuing them. We've developed our own production unit and are ready to navigate the shifting sports landscape. While we will be strategic in our approach, we will remain engaged in the evolving situation. Regarding advertising, I'll start by saying that for the next two years, NBCUniversal will continue to represent us. This partnership has proven effective for both parties, allowing us to leverage our combined assets under a single strategy for the past 15 years. We plan to maintain this arrangement for at least the next two years, after which we will assess the optimal approach for our advertising sales together. Additionally, we are expanding some of our advertising efforts beyond pay TV, including DTC and free TV networks. This strategy enables us to connect with different marketers and become more involved in programmatic advertising and technology-driven sales through platforms like Fandango. With GolfNow, we have access to valuable customer data that will enhance our advertising targeting in the free TV and digital arenas.

Operator, Operator

Our next question is from the line of Kutgun Maral with Evercore ISI.

Kutgun Maral, Analyst

I just had a follow-up on linear distribution. I think we're all aware of the secular challenge across the industry, along with more skinny and genre-based packages coming to market. But as you go into your future negotiations, do you see any offsets to some of these industry-wide headwinds when it comes to pricing, for example at networks like MS NOW, which seems quite underpriced in terms of affiliate fees per subscribers compared to its cable network peers or cable news network peers? And is there anything more specifically you can share on expectations for linear distribution revenue growth in 2026 specifically?

Mark Lazarus, Chief Executive Officer

We all believe that our networks are undervalued, and we appreciate your acknowledgment of that. News and sports have been our main focus in the new packaging, and we're fortunate to have both news and sports assets, including two news networks and two sports networks: Golf Channel and USA Network. Being included in all these packages has been instrumental for us in maintaining our distribution and revenue. I expect these types of packages will persist. As Anand mentioned earlier about the direct-to-consumer side, we are now a stand-alone company with fewer competing interests than before. This enables us to be more flexible and innovative while ensuring we maintain the value we know our networks and audiences deserve.

Anand Kini, Chief Financial Officer and Chief Operating Officer

Regarding the 2026 question, we have quite a bit of clarity on this. In fact, we have very good clarity. We previously mentioned that around 16% of our subscribers are up for renewal, which indicates that 84% are secure. As for the trajectory, we believe the rate of cord-cutting has not worsened; we expect it to remain about the same as what we've experienced for some time, at a high single-digit rate, which is countered by some contractual rate increases. This likely outlines what we anticipate as we look ahead to 2026.

Operator, Operator

Next question is from the line of David Joyce with Seaport Research.

David Joyce, Analyst

A couple of clarifications and other questions. On the affiliate fees, are you starting to negotiate your carriage on your own as they expire? Or was there a complete separation already versus the Comcast and NBCUniversal deals? And then secondly, on your various other platform companies, do you anticipate providing trends on the data of the users or subscription numbers? Just wondering what we could look for in terms of some more data points and trends there.

Mark Lazarus, Chief Executive Officer

Regarding the distribution question, we have our own negotiation team handling all future deals. We have a strong established group, including individuals from Comcast, NBCU, and others, who possess solid industry relationships. We are actively engaging in the marketplace to strengthen those connections.

Anand Kini, Chief Financial Officer and Chief Operating Officer

Yes. Regarding the platforms revenue, we will continue to report good visibility in this area, which we believe serves as a solid indicator of how the business is growing. To clarify, the major contributors include GolfNow, Fandango, SportsEngine, and some new direct-to-consumer initiatives we just discussed. Over time, we will share more insights as we launch these services, as Mark mentioned earlier, with a few expected to launch in 2026. We anticipate providing additional details on these efforts. Currently, we are focusing on the overall platforms revenue and also examining our revenue mix. As previously noted, the proportion of our revenues generated from outside pay TV has increased from 17% to 19%. Our goal is to raise that to about 33% within the next 3 to 5 years. We will continue to offer insights on this as well.

David Joyce, Analyst

Okay. I appreciate that. And one final question, actually. On the Fandango AVOD service that you're going to be launching, what's the anticipated library availability there? Is there anything that you have exclusive? Or what are the kind of windowing availabilities that are going to be on there?

Mark Lazarus, Chief Executive Officer

Yes, it will include a mix of content we own and content we license. Through our linear deals, we have licensed content from various studios, especially Universal, allowing us to utilize parts of our windows that were designated for linear networks on the new AVOD service. This will be a combination of those and additional third-party agreements.

Anand Kini, Chief Financial Officer and Chief Operating Officer

Yes, that's correct. Some content will be exclusive to Versant, meaning it may be available on our television networks and Fandango AVOD, but not elsewhere. Other programming might also be accessible on different platforms. From what we've observed, exclusivity isn't necessary for most AVOD success. The market doesn't demand it, as it's often more about brand strength. Fandango is a strong brand, and we are continually enhancing the user experience to help viewers discover available programming. Additionally, we have important customer insights. A key advantage of Fandango AVOD is that we know our customers well, as these services see users logging into their connected TVs. This allows us to offer tailored recommendations, and our advertising can be targeted. We believe we have significant advantages in both content and additional features.

Mark Lazarus, Chief Executive Officer

I think to enhance one of Anand's points, Fandango is already a big broad brand. It's already on people's phones and connected TVs because of buying movie tickets, and also it's a top 5 home video service for buying and renting movies and TV series. So we already have a large installed base. It's now a matter of converting them and showing them that we have a strong free AVOD service, something that we have seen the trends across the industry as a growth vehicle. And we believe that the combination of our brand, our content, and our large installed base will help us grow quickly.

Operator, Operator

Our final question today comes from the line of Doug Creutz with TD Cowen. Thank you. Ladies and gentlemen, this will conclude today's conference. We thank you for your participation. You may disconnect your lines at this time, and have a wonderful day.