Townsquare Media (NYSE:TSQ) reported second-quarter results that met its revenue and Adjusted EBITDA guidance, as the company pointed to accelerating digital advertising growth, record profitability at its subscription marketing unit and continued cash flow from broadcast operations.
Second-quarter net revenue was approximately flat year over year at $115.4 million, above the midpoint of the company’s $114 million to $116 million guidance range. Adjusted EBITDA was $24.8 million, also above the midpoint of guidance, though down 6.2% from a year earlier.
Digital Advertising Growth Accelerates
CEO Bill Wilson said Townsquare’s digital-first strategy continued to reshape the company’s business mix. Digital represented about 59% of total segment profit and 57% of total net revenue on a year-to-date basis, according to the company.
Digital advertising revenue at Townsquare Ignite increased 11% year over year during the second quarter, accelerating from 6.8% growth in the first quarter. Programmatic revenue, which accounted for about 70% of year-to-date digital advertising revenue, rose 27% year over year. Direct sales on the company’s owned websites and mobile apps increased at a high-single-digit rate, Wilson said.
Wilson said the company expects digital advertising growth in the third quarter to exceed the second quarter’s 11% rate. He attributed the outlook partly to stabilizing digital audiences and remnant revenue, which represented about 6% of year-to-date digital advertising revenue.
During the question-and-answer session, Wilson said Townsquare’s audience had grown from the fourth quarter of 2025 through the first half of 2026 as traffic from direct channels, including newsletters and mobile applications, and social channels increased. Search traffic has continued to decline amid changes associated with artificial-intelligence search, he said, but the company has adjusted its approach and is using AI tools to improve targeting, customer service and internal efficiency.
Media Partnership Business Expands
Townsquare’s media partnership business, which provides digital programmatic advertising services to other media companies, had 16 partners and operated in 41 incremental markets beyond Townsquare’s 74 owned-and-operated markets. The company said it now provides digital programmatic advertising in 115 U.S. markets.
Wilson said partnership revenue was approximately $6 million in 2025 and is expected to more than double in 2026. The company continues to target $50 million in revenue and a 20% profit margin from the business within four years.
The company also completed its first technology licensing agreement with media partner SummitMedia. SummitMedia licensed Townsquare’s internally developed customer relationship management software, Blueprint, for its sales team. Wilson said Townsquare sees opportunities to license additional internally developed tools to partners over the next several years.
Wilson said the main constraint on expansion of the partnership model is the pace at which Townsquare can add personnel, including sales representatives, media buyers, data specialists and reporting staff, to support partners. He described the model as capital-light because its principal investment is in personnel rather than physical assets.
Interactive Margins Reach Record Level
Townsquare Interactive, the company’s subscription-based digital marketing solutions business, reported an 8.5% year-over-year revenue decline to $17.2 million. However, revenue stabilized sequentially at roughly $5.7 million in each month of the quarter, CFO Stuart Rosenstein said.
The unit’s segment profit margin rose to a record 37.6%, supported by cost savings, organizational changes and AI-enabled efficiencies. Wilson said the company had restructured customer service and adjusted sales-force productivity expectations, resulting in a smaller but more efficient sales organization.
Townsquare expects Interactive revenue to remain roughly flat sequentially in the third quarter and expects to return to month-over-month revenue growth by year-end, potentially as early as the third quarter. Wilson said the company is rebuilding its sales organization after its sales force declined 40% from its peak level.
Broadcast Trends, Balance Sheet and Outlook
Broadcast revenue declined 5.5% year over year in the second quarter, or 7.2% excluding political advertising. Rosenstein said the company expects third-quarter broadcast revenue declines excluding political advertising to be in line with that result, compared with consistent 8% declines in each quarter of 2025.
Wilson said local direct broadcast advertising was down low single digits, while national network and agency business declined more sharply. He said Townsquare’s broadcast operations remain a source of cash flow and local advertiser relationships that support the broader digital business.
The company generated $7.8 million of cash flow from operations in the first six months of 2026 and ended the quarter with $462 million in debt outstanding. Net leverage stood at 5.44 times as of June 30. Rosenstein said Townsquare expects leverage to decline in the second half as EBITDA returns to year-over-year growth.
Townsquare declared a quarterly dividend of $0.20 per share, payable Nov. 2 to shareholders of record on Oct. 26. The annualized dividend is $0.80 per share.
For the third quarter, Townsquare forecast net revenue of $108 million to $110 million and Adjusted EBITDA of $22.5 million to $23.5 million. For the full year, it narrowed guidance to net revenue of $425 million to $431 million and Adjusted EBITDA of $87 million to $90 million. The outlook includes approximately $8 million in expected political revenue.
About Townsquare Media (NYSE:TSQ)
Townsquare Media, Inc (NYSE: TSQ) is a diversified media and entertainment company that operates primarily in small and mid-sized markets across the United States. The company owns and manages over 300 local radio stations that deliver music, news, sports and community programming to listeners. In addition to its core broadcasting business, Townsquare Media provides digital marketing solutions and advertising services through its proprietary platforms and specialized agencies, helping local businesses connect with consumers via targeted online campaigns.
Founded in 2010 and headquartered in Purchase, New York, Townsquare Media has grown its footprint through strategic acquisitions and the development of a broad digital portfolio.
