Nexstar Reports Ads No Longer Prime Revenue Source

In reporting its fourth-quarter and full-year 2018 results this morning, Nexstar Media, which is expected to become the industry’s largest station group when it closes on its merger with Tribune this fall, said that for the first time in its two-decade history, “non-TV revenue” from retransmission consent and digital will exceed that from TV advertising.

According to the company, combined digital and retrans revenue totaled $1.38 million in 2018, up 13.1% from the prior year. TV advertising clocked in at just $1.34 billion, up 18.2%.

And the non-TV revenue was able to surpass TV revenue even though Nexstar enjoyed a deluge of political advertising during the year, mostly in the fourth quarter. Political jumped from $12.5 million in 2017 to $140.2 million in 2018.

What’s driving the non-TV revenue, of course, is retrans, which grew 12.3.% to 284.5 million in the fourth quarter and 12.6% to 1.1 billion for the year.

Nexstar CEO Perry Sook expects retrans to continue to lead the way on top-line growth. “This is a revenue stream that we pioneered. We pay a lot of attention to it, we treat it with respect and we do a lot of planning and analysis before we begin the negotiation.”

CFO Tom Carter said to expect retrans to continue to grow in the low double digits.

By contrast, core advertising, which excludes political, remained in the doldrums. For the year, local was down 1% and national was down 3.5%.