Sinclair Broadcast Group reported lower net losses in the second quarter after the broadcaster decoupled the Diamond Sports regional sports network from financial results.
Sinclair recorded a net loss of $11 million, compared to a net loss of $332 million a year prior. In 2021 Q2 net loss from Diamond Sports was $385 million. Total revenues were down 48% year over to $837 million. Excluding Diamond Sports increased 5% in the period from $801 million in Q2 2021. Media revenues were also down 48% to $831 million, but up 5% without DSG.
Total advertising revenue was down 25% to $366 million, and up 11% when excluding DSG. Core advertising revenue, which doesn’t include political ad revenue, was down 36% in Q2 to $312 million. Core ad revenues dropped 3% without DSG.
As concerns over inflation and a challenging macro-economic environment have made their way into the advertising sphere (as seen in Roku’s Q2 results after advertisers pulled back TV spending in the period), Sinclair touted record second quarter political ad revenue. Sinclair CEO Chris Ripley said year-to-date political ad revenue “is also at all-time record levels.”
He said year-to-date levels doubled the amount reached in 2018 and were 20% higher than in 2020, which was a presidential election year.
“With even higher political ad revenues anticipated for our third and fourth quarters, which are typically the largest quarters for political spend, we believe 2022 political ad revenues could approach 2020’s levels,” Ripley said in a statement.
As Sinclair reported Q2 results, Comscore on Wednesday announced signing a groupwide multi-year agreement that will see Sinclair deploy Comscore Consumer Intelligence across its sales organization. Integrating the data will help Sinclair tee up cross-platform, consumer behavior impression-based selling – with a comparison of local TV and digital audience consumption. The tool combines Comscore’s local linear and digital search data with near-real time shopper information from Consumer Orbit.
“Comscore has supplemented its local television currency with a consumer-focused, rather than demographic focused offering that provides in-market consumer shopping behavior. This allows television to more effectively compete with digital giants that have siphoned media dollars from television,” said Carol Hinnant, chief revenue officer of Comscore, in a statement.
Sinclair prioritizes digital initiatives, marks ATSC 3.0 progress
With Diamond Sports separated out of results, Sinclair didn’t make mention of its Bally Sports direct-to-consumer RSN streaming service, which soft launched in June.
In prepared remarks, Ripley said Sinclair continues to prioritize initiatives in the digital space, including launching multiple new offerings within the next year.
“Our current average monthly unique users of 80 to 90 million position us well to develop incremental revenue streams in conjunction with digital content offerings, while providing more targeted and interactive opportunities to consumers,” the chief executive stated. “We expect to debut a number of new content offerings across our various platforms over the next 12 months that are unique to Sinclair."
As for progress on the NextGen TV via the ATSC 3.0 broadcast transmission standard, Sinclair said as of the end of July NextGen TV had launched in 32 markets and is available to 60% of households in the company’s licensed footprint.
Earlier this week it announced entering agreements with two top Korean Broadcast networks. Korean Broadcast System (KBS) and Munhwa Broadcasting Corporation (MBC) plan to work with Sinclair to develop and implement NextGen Broadcast business models and tech in both Korea and the U.S. That includes Data Distribution as a Service opportunities.
Scott Ehrlich, chief innovation officer at Sinclair, previously told Fierce that part of the excitement for broadcasters around NextGen TV is getting some benefits of streaming, such as one-to-one interaction with a viewer while holding on to the one-to-many viewers benefit of broadcast.
However, there’s also excitement for the potential of new business models for broadcasters beyond simpler TV applications, such as using data and spectrum for things like emergency alerts, enhanced GPS, sports betting and interactive TV.
In the announcement detailing the Korean broadcaster agreements, Sinclair also touted a demo of NextGen video and data services delivery with Hyundai Mobis and KBS. The partners tested an automobile deployed around Seoul, delivering targeted content using the NextGen standard. MBC provided an enhanced GPS signal that corrected accuracy from 3 meters to 3 centimeters.