Radio One (NASDAQ:UONE), referred to on the call as Urban One, reported a sharply weaker first quarter as softness in traditional advertising weighed on its radio, digital and cable television businesses. Chief Executive Officer Alfred C. Liggins said the company had expected a down quarter, but that “the marketplace was softer than anticipated due to continued declines in the traditional ad marketplace.”
For the first quarter of 2026, consolidated net revenue was approximately $77.7 million, down 15.8% from the prior year. Consolidated adjusted EBITDA was $4.7 million, a decline of 63.8%. The company reported a net loss of approximately $3.1 million, or $0.69 per share, compared with a net loss of $11.7 million, or $2.64 per share, in the first quarter of 2025.
Advertising Weakness Hits Multiple Segments
Chief Financial Officer Peter D. Thompson said radio broadcasting segment revenue was $30.5 million, down 6.4% year over year. Excluding political revenue, radio revenue declined 8.7%. According to Miller Kaplan data cited by Thompson, local ad sales were down 5.5% versus a market decline of 7.1%, while national ad sales were down 8.2% compared with a market decline of 6.7%.
Thompson said services was the company’s largest advertising category and rose 14.5%, primarily due to legal services. Government and public advertising increased 23.6% because of political spending, while all other major categories declined.
Reach Media revenue fell 17% to $4.9 million, with adjusted EBITDA showing a loss of about $500,000. Thompson attributed the decrease to lower network marketplace revenue and key client attrition.
Digital revenue declined 33.5% to $6.8 million. Thompson said the drop was driven by lower national direct revenue tied to reduced DEI-focused spending, advertising budgets being pushed into the second quarter and second half of the year, and broader advertiser pullback due to macroeconomic concerns. Local digital revenue, however, rose 10.9% in the quarter.
The cable television segment generated approximately $36 million in revenue, down 18.5%. Cable advertising revenue fell 24.9%, while affiliate revenue declined 9.8% as subscriber losses from the continued decline in linear cable were partly offset by higher subscriber rates. TV One ended the quarter with 29.1 million Nielsen-measured subscribers, down from 30.2 million at the end of the fourth quarter, while CLEO TV had 28.6 million Nielsen subscribers.
Costs Fall, But EBITDA Declines
Operating expenses excluding depreciation and amortization, stock-based compensation, and impairment charges were approximately $73.5 million, down from $80.7 million a year earlier. Thompson said the decrease was mainly driven by lower sales and marketing expenses across operating segments.
Radio expenses declined 3.8%, Reach expenses fell 16.2%, digital expenses dropped 19.7%, and cable television expenses were down 9.8%. Corporate operating expenses declined approximately 6.1% due to lower professional service fees and payroll-related costs.
Interest expense fell to approximately $4.4 million from $10.9 million in the prior-year period. Thompson said the company made about $700,000 in cash interest payments during the quarter on its outstanding 2028 notes.
Debt Repurchases and M&A Drive Deleveraging Plan
During the first quarter, Urban One repurchased $4.3 million of its 2028 notes at an average price of 51% of par, recording a $2.1 million gain. It also repurchased approximately $32.4 million of its 2031 second lien notes at a weighted average price of about 40.7% of par. In the second quarter, the company repurchased an additional $23.5 million of 2031 notes at 42% of par.
Thompson said those actions reduced long-term debt by $60.2 million and are expected to generate annual interest savings of $4.6 million. As of March 31, the company had an ending unrestricted cash balance of $27.2 million and net debt of approximately $309.5 million, resulting in a net leverage ratio of 6.39 times based on last-12-month reported adjusted EBITDA of $48.5 million.
The company also updated its full-year 2026 outlook. Liggins said Urban One now expects approximately $60 million of EBITDA and year-end leverage below five times. Thompson said cash flow from operations is expected to be around $40 million for the year, and the company anticipates repaying its $20 million asset-based lending balance in the second half.
Dallas Acquisition and Charlotte Sales
Urban One previously announced agreements to sell WMXG and WLNK radio broadcast licenses in Charlotte, North Carolina, for approximately $0.7 million and $4.2 million, respectively. Thompson said those sales are expected to close by the end of the second quarter.
In April, the company agreed to acquire Service Broadcasting Group in Dallas, including radio stations KKDA and KRNB, for $22 million. It also agreed to sell Dallas station KZMJ for $6 million. Pending FCC approval, those Dallas transactions are expected to close in the third quarter.
Liggins said the Dallas acquisition is an in-market consolidation opportunity and part of the company’s effort to pursue accretive, deleveraging M&A. He said the company expects to invest about $11 million net of related dispositions and add approximately $5 million in pro forma EBITDA.
During the question-and-answer session, Liggins said the Dallas stations have similar formats and will expand the company’s reach in serving the African American community in Dallas. He said the combination should create a larger cluster with more revenue scale and stronger profitability.
Liggins also said the Charlotte station sales free up land associated with tower sites. He said the land is listed with JLL and that the company is pursuing a process to evaluate offers and eventually sell the parcels.
Management Points to Digital Opportunity but Lower Margins
Asked about the digital business, Thompson said the first quarter was “super soft,” but that some campaigns were pushed into the second quarter and the back half of the year. He said the digital team remains optimistic about meeting its numbers for the year.
Liggins cautioned that digital is not necessarily a higher-margin business, particularly at the local level, because campaigns often require custom content and third-party impressions that carry traffic acquisition costs. Still, he said local radio stations are pushing harder into local digital because “low margin is better than no margin.”
Liggins said the company’s broader strategy is to continue reducing debt, lowering its interest burden and seeking opportunities to create more cash flow amid continued pressure in media markets.
About Radio One (NASDAQ:UONE)
Urban One, Inc, formerly known as Radio One, Inc, is a media company primarily serving African-American and urban audiences across the United States. The company’s core business activities center on radio broadcasting, operating a portfolio of urban-format radio stations that deliver music, news, and community-focused programming. Urban One’s radio network spans key metropolitan markets including Washington, DC, Atlanta, Philadelphia, and Minneapolis, among others.
In addition to its terrestrial radio operations, Urban One has expanded into digital media to engage listeners online.
