Saga Communications (NASDAQ:SGA) reported lower revenue in the fourth quarter and full year of 2025, citing a sharp decline in political advertising, while management emphasized continued growth in the company’s “interactive” and broader digital revenue initiatives. Results for the period were also heavily affected by a large non-cash impairment charge and higher expenses tied to an industry-wide music licensing rate settlement, executives said on the company’s fourth quarter and year-end conference call.
Quarterly and full-year revenue trends
Executive Vice President and CFO Sam Bush said net revenue for the quarter ended December 31, 2025 fell $2.7 million, or 9.3%, to $26.5 million, compared with $29.2 million in the prior-year quarter. He attributed “a large part of the decline” to reduced political revenue, with gross political revenue of $254,000 in the fourth quarter of 2025 versus $2.0 million in the fourth quarter of the prior year.
Expenses, impairment, and reported profitability
On expenses, Bush said station operating expense decreased 1.9% to $22.9 million in the fourth quarter. For the full year, station operating expense was flat year-over-year at $91.8 million, though management highlighted two unusual items that weighed on results: a non-cash impairment charge and a previously disclosed music licensing rate settlement.
Bush said the company recorded a non-cash impairment charge of $20.4 million in the fourth quarter, which also impacted the full year. The impairment included $19.2 million representing “all the remaining goodwill” previously carried on Saga’s balance sheet, plus $1.2 million representing a reduction in the value of FCC licenses in one market.
As a result, Bush said Saga reported an operating loss of $9.5 million for the fourth quarter, compared with operating income of $1.0 million in the year-ago quarter. Excluding the impairment charge, operating income would have been $10.9 million for the quarter, he said.
The company reported a net loss of $6.9 million for the fourth quarter, compared with net income of $1.3 million a year earlier. Without the impairment charge, Bush said the company would have reported net income of $8.2 million, or $1.27 per share, compared with $0.20 per share in the prior-year quarter.
For the full year, Bush said Saga recorded an operating loss of $11.0 million, compared with operating income of $2.4 million in 2024. Excluding the impairment charge, operating income would have been $9.4 million for 2025. The company posted a net loss of $7.9 million for the year, compared with net income of $3.5 million in 2024. Without the impairment charge, Bush said net income would have been $7.2 million, or $1.11 per share, compared with $0.55 per share the prior year.
Bush also said the music licensing settlement increased year-end 2025 station operating expense by $2.2 million. Without that impact, he said station operating expense for the year would have declined about 2% compared with 2024, rather than remaining flat.
Tower sale and capital returns
Bush said the company closed on the sale of telecommunications towers and related property on October 17, 2025, a transaction he described as having been in progress “for quite a few years.” The company recognized a gain of $11.6 million on the sale, with total proceeds of $15.1 million including both cash and non-cash consideration.
He explained that the non-cash proceeds reflect the recognized value of long-term nominal-cost leases entered as part of the transaction, allowing Saga to continue operating at the sites sold. Net cash proceeds after expenses were $9.8 million, excluding roughly $400,000 held in escrow pending landlord consent for the transfer of one final tower. Bush said the company anticipates that transfer will occur in the second quarter of 2026.
According to Bush, the transaction monetized 24 owned towers that were “not reaching the full potential” of leasing space to external users, and he said the towers were sold at a significantly higher valuation than what he characterized as being reflected in the company’s overall market valuation. He added that accounting treatment will result in a non-cash expense of about $50,000 per quarter in 2026, or $200,000 for the year, related to the favorable lease terms embedded in the transaction.
On shareholder returns, Bush said Saga paid a quarterly dividend of $0.25 per share on December 12, 2025, totaling about $1.6 million. The board declared another $0.25 per share quarterly dividend on February 12, 2026, with a record date of February 26, 2026 and a payable date of March 20, 2026. With the most recently declared dividend, Bush said Saga will have paid more than $143 million in dividends to shareholders since the first special dividend in 2012.
Bush also said the company repurchased 219,326 shares of Class A common stock for $2.5 million during 2025. He said the company intends to continue paying regular quarterly cash dividends and that the board will continue to consider special cash dividends, variable dividends, and stock buybacks, consistent with maintaining a strong balance sheet and returning value to shareholders.
Digital growth and 2026 outlook
Bush highlighted growth in “interactive” revenue, saying total interactive revenue was up 25.8% in the fourth quarter and up 19.1% for the full year. He said first-quarter pacing was down mid-single digits overall, with interactive revenue up 26.4%.
Looking ahead, Bush said the company still has “a ways to go” before increases in interactive revenue outweigh declines in traditional broadcast revenue. Including political revenue, he said the second quarter was pacing down and the company expected to end the quarter down mid-single digits. Bush said Saga expects a return to revenue growth, including political, in the second half of 2026, with revenue increasing in the mid-single-digit range.
To accelerate the transition, Bush said Saga is moving forward with a plan to add resources to build digital infrastructure to process interactive orders and to add sales managers and digital campaign managers in markets where those roles are not already in place. He said this would allow media advisors to spend more time with clients while also improving execution and monitoring of blended campaigns, which management believes can help retain more return clients.
Bush said the initiative will initially cost more than the revenue it brings in, but described it as necessary to compete with other digital companies and better serve clients. In total, he said the effort will increase marketing expenses by $1.5 million in 2026. He added that the company has already hired most of the digital infrastructure team and expects hiring for sales and campaign management in the second and third quarters, and that bringing infrastructure in-house should reduce digital fulfillment costs over time.
For 2026, Bush said Saga expects capital expenditures of about $3.5 million to $4.5 million. He said station operating expense is expected to be flat compared with 2025 when excluding the digital initiative, and up 3% to 4% when including estimated digital initiative expenses. Corporate, general, and administrative expenses are expected to be about $12.3 million and flat to 2025, he said.
CEO commentary on strategy and product mix
President and CEO Christopher Forgy described the company’s ongoing strategy as a “transformational change” centered on what he repeatedly called “the blend,” an advertiser-focused approach intended to integrate radio with digital services while protecting and growing the company’s radio core.
Forgy cited several digital-related metrics discussed on the call, including growth in the company’s e-commerce platform and hyperlocal online news sites, as well as increases in search, targeted display, and online streaming revenue. He also described past capital allocation actions, including regular quarterly dividends, prior special dividends and a variable dividend, and a stock buyback plan that he said was funded without depleting operational cash or adding debt. He also referenced efforts to reduce local market expenses and sell non-productive assets, including an owned home in Sarasota, Florida, which he said had been delayed by Gulf Coast hurricanes but was again being prepared for sale.
No questions were taken on the call, and management concluded by reiterating its focus on executing the company’s digital strategy and resource investments while maintaining financial strength.
About Saga Communications (NASDAQ:SGA)
Saga Communications, Inc (NASDAQ: SGA) is an independent radio broadcasting company that owns and operates a portfolio of local radio stations across the United States. Headquartered in Grosse Pointe Farms, Michigan, the company focuses on full‐service radio properties offering a variety of formats, including music, news‐talk and sports programming. In addition to traditional over‐the‐air broadcasts, Saga leverages web streaming and mobile platforms to broaden listener reach and provide advertisers with multimedia opportunities.
Founded in 1985 by Edward J.
