Q3 2023 iHeartMedia Inc Earnings Call
Good morning, My name is Andre and I will be your conference operator today.
At this time I would like to welcome everyone to the I Heart Media Q3, 2023 earnings call.
Today's conference is being recorded.
Lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question. During this time simply press the star key followed by the number one on your telephone keypad if.
If you would like to withdraw your question Press Star one again.
At this time I would like to turn the conference over to Mike Mcginnis head of Investor Relations. Please go ahead.
Good morning, everyone and thank you for taking the time to join US for our third quarter 2023 earnings call. Joining me for today's discussion are Bob Pittman, our chairman and CEO and rich Bressler, President COO and CFO at the conclusion of our prepared remarks management will take your questions in <unk>.
And to our press release, we have an earnings presentation available on our website that you can use to follow along with our remarks.
Please note. This call may include forward looking statements regarding our financial performance and operating results. These statements are based on management's current expectations and actual results could differ from what is stated as a result of certain factors identified on today's call and in the company's SEC filings. Additionally, during this call we will refer to certain non-GAAP financial measures right.
Filiation between GAAP and non-GAAP financial measures are included in our earnings release earnings presentation, and our SEC filings, which are available in the Investor Relations section of our website and now I'll turn the call over to Bob Thanks, Mike and good morning, everyone. We're pleased to report that our third quarter 2023 results were at the high end of our previously.
Provided adjusted EBITDA and revenue guidance ranges throughout the year, we see gradual improvements in the advertising marketplace, which was reflected in the quarter by quarter sequential improvements in our advertising revenues and despite the recent global geopolitical events. We expect that to continue through Q4 now let me take you through some of the key financial results of the core.
Orders in the third quarter, we generated adjusted EBITDA of $204 million at the high end of the guidance range, we provided of $195 million to $205 million. Our consolidated revenues for the quarter were down three 6% compared to the prior year quarter, a little better than the guidance, we provided of down mid single digits and excluding the impact of political.
<unk>, our consolidated revenues were down 1% in the third quarter, we generated 68 million of free cash flow. In addition to our reported free cash flow. We also generated $45 million of cash from the sale of radio broadcast towers, which we'll use to pay down debt.
Turning now to our individual operating segments in the third quarter. The digital audio groups revenues were 267 million up five 2% versus prior year. Adjusted EBITDA was 94 million up 19, 6% versus prior year and the digital audio groups adjusted EBIT margins were 35% up from 31 person.
That in Q3, 2022 and in the third quarter. The digital audio group accounted for 28% of our consolidated revenues.
The digital audio groups adjusted EBIT performance for this quarter reflects the strategic fixed cost investments. We've made in the past few quarters. It also illustrates the strong flow through characteristics inherent in the business and this year's strong emphasis on having the most profitable mix of digital revenue product as our Q3 digital audio group margins expanded 400.
20 basis points year over year, and were 260 basis points better than the second quarter.
Turning to the revenue streams within the digital audio group, our podcast revenues continued to perform well growing 13% versus prior year illustrating the fact that podcast and continues to be a strong growth engine for the company. Additionally, our podcasting EBITDA margins continue to be accretive to our total company EBITDA margins.
Casting is the best performing segment of the advertising marketplace and we continue to have the largest podcast audience reach in the U S. In September I Heart was once again ranked the number one podcast publisher in the U S with more monthly downloads. The next two largest podcast publishers combined according the pod track.
As a reminder, the three segments of the pod casting ecosystem, our publishers distributors and sales reps publishers control the content and as a result enjoy the majority of the economics compared to the distributors, who have virtually no economic benefit and the sales reps who operate on razor thin gross margins and are often unprofitable.
From the beginning our strategy is focused on the publishing sector of the industry and the financial results of our business are evidence of the success of that strategy. Our leadership position in Pi gasoline is in part the result of the power of our broadcast radio assets, which we have used to build new lines of business for the company starting out with the IHOP radio App over 10 years ago.
Our marquee live events business and most recently with podcasts, our broadcast radio assets uniquely reach 90% of Americans every month, which for context is twice the consumer reach of the largest TV network and three times the consumer reach of the largest digital only streaming audio service, which is why broadcast radio is such a powerful tool.
For us in building new businesses the intersection of AI in podcast. It is also an area, which we had been focusing on as an important driver of future growth and I'll give you three examples of how we're taking advantage of this evolving technology first strategically we can use AI to finally cost effectively translate our unparallel.
<unk> English language podcast library, and other languages, which creates the potential for global expansion and is another vector of earnings growth for the company set.
Second on a more tactical level, we're giving our sellers, who make up the largest sales force in audio AI enhanced tools to help them prospect and communicate with clients about podcasting, along with radio and streaming products to and third we're utilizing AI to enhance our dynamic podcast AD insertion capabilities, helping us discern.
With the right message and the right voice, but the targeted demo time and territory and ways not previously possible with older technologies.
In addition to our industry, leading podcast business. We also have the number one streaming digital radio service, which is five times larger than our closest competitor we have the largest social footprint of any audio service by factor of seven and we operate 3000 national and local websites the reach almost 120 million people in the United States each month.
All of which represent additional opportunities for our advertising partners to interact with a highly engaged consumer base and provide additional revenue growth for the company.
Turning now to the Multiplatform group, which includes our broadcast radio networks and events business in the third quarter revenues were 626 million down 5.1% versus prior year and down 3.2%, excluding the impact of political adjusted EBITDA was 162 million down 21.6 per.
Sent versus prior year, the multiplatform group's third quarter adjusted EBITDA margins were 25.9% and rich will take you through the puts and takes of the multiplatform group's margins this quarter.
The multiplatform group does continue to be impacted by some of the advertising uncertainty you've been hearing about how are we seeing gradual improvement from quarter to quarter throughout the year and we remain confident that the multiplatform group will be an additional growth engine for the company in the advertising marketplace recovery.
We continue to see substantial upside in our broadcast radio assets in large part because of our unique and unparalleled reach and scale, including our participation in the migration to data and analytics infused planning buying and selling of media. Additionally, as AD supported TV has suffered from their loss of audience, our broadcast radio assets.
With 90% monthly consumer reach in America is the only platform along with Google and matter that can provide true mass market reach for advertisers. So what does that mean for the bottom line today over 30% of consumer media consumption in a day is audio yet it is only 9% of total advertising spend.
And we expect that gap to close and to directly benefit our multiplatform group.
As we talked about on previous calls we expected Q4 to be the strongest quarter of the year for the company. Although it is still on track for that it will be weaker than we originally anticipated due to some dampening of advertising demand, which coincided with the uncertainty caused by the recent geopolitical events, having said that in some years, we do see significant last minute advertising.
[noise] spend come in late November and December Indeed, it has in the last two years. However, since we can't predict it its not included in our guidance as we look ahead, we remain confident that both the advertising marketplace and our company will be back in growth mode. In 'twenty 'twenty, four and now I'll turn it over to rich thanks, Bob as I take you through our results.
As Bob mentioned, our third quarter 2023 results were at the high end of our previously provided adjusted EBITDA and revenue guidance ranges are.
Our Q3 2023 consolidated revenues were down 3.6% year over year, a little better than the guidance, we provided of down mid single digits.
Excluding the impact of political our consolidated revenues were down 1%.
Our consolidated direct operating expenses increased 2.2% for the quarter.
This increase was driven primarily by higher variable content cost, resulting from an increase in digital revenue, including third party digital cost and profit sharing costs as well as an adjustment from previous years relating to certain music licensing fees. This increase was partially offset by lower compensation expense as a.
A result of our ongoing cost savings initiatives, our consolidated SG&A expenses decreased 1.6% for the quarter, primarily driven by lower sales commissions as well as the continued impact of our ongoing cost savings initiatives, partially offset by higher bad debt expense and increase in trade and barter marketing expenses.
<unk> associated with our events business and higher variable compensation expense as a reminder, as you make the comparison to last year in 2022, we paid minimal bonuses to our employees, we generated third quarter GAAP operating income of $69 million compared to an operating loss of 211 million.
In the prior year quarter.
Our third quarter, adjusted EBITDA was $204 million compared to $252 million in the prior year quarter and at the high end of the guidance range, we provided of 195 million to $205 million.
Turning now to the performance of our operating segments and as a reminder, there are slides in the earnings presentation on our segment performances.
In the third quarter, the digital audio groups revenues were $267 million or five 2% year over year and they comprised approximately 28% of our third quarter consolidated revenues. The digital audio groups adjusted EBITDA was $94 million up 19.6% year over year and our.
Q3 margins were 35% a year over year increase of 420 basis points within the digital audio group or a podcast revenues, which grew 12.5% year over year and our non podcast in digital revenues, which grew 1.1% year over year as anticipated in the third quarter, we can.
To see improvements in the digital audio groups EBITDA flow through inhibitor margins in the long term. We continue to believe the digital audio group should be a 35% adjusted EBITDA margin business on an annualized basis.
The multi platform groups revenues were $626 million down five 1% year over year or down 3.2%, excluding the impact of political <unk>.
Adjusted EBITDA was $162 million down 21.6% year over year, the multiplatform group's adjusted EBITDA margins were 25.9%.
The multiplatform groups third quarter margins were impacted by a couple of items first we recognized higher than normal bad debt expense second in the third quarter. This year, our flagship IHOP Radio music festival for year over year increase in trade and event revenues, which drove increased promotion expense and which have lower.
Margins than our broadcast and networks revenues and third we have one more major event. This quarter that we had in the third quarter of 2022, which drove incremental expense.
The audio and media services groups revenues were $62 million down approximately 20% year over year, and adjusted EBITDA was $17 million down $30 million in the prior year, excluding the impact of political in the prior year quarter, the audio and media services group's revenues.
We're down 7.4%.
At quarter end, we had approximately $5 billion of net debt outstanding and our total liquidity was $625 million.
Which includes a cash balance of $213 million, our quarter ending net debt to adjusted EBITDA ratio was 6.2 times, we remain committed to our long term goal of a net debt to adjusted EBITDA ratio of approximately four times.
As highlighted on past calls, we have no material maintenance covenants and no debt maturities until mid 2026, we will continue to be opportunistic and responding to that market developments in Q3, we repurchased $89 million of the principal balance of our eight and three eighths senior.
Cured notes at a meaningful discount to their par value generating both earnings and free cash flow accretion. This brings our total repurchase of these notes of $519 million, reducing the outstanding amount from 1.45 billion to approximately $930 million and results in aggregate annualized interest savings of approximate.
The $43 million.
In the third quarter, we generated $68 million of free cash flow and we also generated an additional $45 million of cash from the sale of our remaining radio broadcast towers, which we will use to pay down debt.
Turning now to our outlook for Q4, as Bob mentioned before and some other companies have discussed on their earnings calls we are experiencing some additional uncertainty due to the recent geopolitical events and that is captured in our Q4 revenue outlook. So with that in mind, we expect our Q4 2023 revenues to be down.
High single digits as a reminder, Q4 of last year was the biggest quarter in the company's history and was the largest political quarter of the year with $66 million of political revenue, excluding the impact of political we expect our Q4 revenues to be at low single digits.
Revenue for the month of October was down approximately 8% turning to the individual segments. We expect a multi platform groups revenue to be down high single digits. Excluding the impact of political we expect multi platform group revenues to be down mid single digits. We expect the digital audio groups revenue.
Used to be up high single digits, and we expect the audio and media services groups revenues to be down approximately 30% or down low single digits, excluding the impact of political as.
As a reminder, the audio and media services group includes catch TB, which experiences a significant swing between its performance in political and non political years.
Turning to adjusted EBITDA for Q4, 2023, we expect to generate consolidated adjusted EBITDA in the range of $205 million to $215 million and as Bob mentioned any potential lastminute advertising spend in late November and December is not included in this guidance from an expense perspective.
In Q4, we expect to incur a bonus expense differential compared to prior year. We also expect to recognize additional marketing expenses associated with the expansion of our events business in the quarter, including our jingle ball holiday TV special moving KBC and the streaming of our IHOP Radio Music Festival.
To whom.
Want to comment on the following items affecting free cash flow, we continue to expect our cash taxes to be approximately $15 million in 2023.
Our estimate of full year 2000, Twenty's recap of expenditures is expected to be approximately $100 million Azure.
As a reminder, this is substantially below our 2022 capital expenditures of $161 million cash restructuring expenses remained down year over year, we continue to be impacted by the current interest rate environment as approximately 40% of our debt is floating but we are committed to opportunists.
Improving our capital structure and reducing our interest expense as the market allows we generated solid free cash flow in the third quarter and we expect that performance to improve in the fourth quarter, which is always our largest free cash flow generating quarter of the year.
And as we look forward to 2024, we expect to generate significantly better free cash flow driven in part by an improving macro environment as well as the impact of political dollars, which all collected upfront. In addition to our reported free cash flows. We also generated $45 million of cash from the sale of radio.
Towers, which we'll use to pay down debt.
As Bob mentioned, we expect 2020 for it to be back in growth mode. As a reminder, 2024 is a political year and during the last presidential political year in 2020, we generated $167 million of political revenues and finally on behalf of the entire senior management team, Bob and I will.
To thank our team members, who work to deliver for our communities and for IHOP everyday.
Now, we will turn it over to the operator to take your questions. Thank you.
Thank you at this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad.
We will take our first question from Steven Kay Hall at Wells Fargo.
Thanks, So first just on what Youre seeing in the AD market. So you know Bob you said you expect your confidence I think in a return to growth in 2024.
You know I'm I'm guessing that that comment is not just political that there some ex political confidence in there too and rich you said, you expect significantly better free cash flow next year.
Driven in part by an improving macro yes, we've seen a few media companies now kind of back off trying to call for an improving macro and watch that's something they're really seeing and their trends. So I was hoping you could just give us a little more on your thought process. Here are you starting to see some green shoots or inflections. It sounds like some of the geopolitical stuff, maybe it could be a little bit of a.
Near term headwind. So just help us think about what's driving that confidence in the improvement in 2024.
And then rich I don't think you all have any covenants and I know you're retiring debt at a hefty discount you did have a pretty big maturity wall in 2026 quite a few broadcast companies actually have a lot of debt coming due in 2020 six. So we're curious when you start those conversations what you think the town of of those will be.
And then finally, just a housekeeping one anything to read into the bad debt expense picking up thank you.
Great well, let me, let me start with the AD marketplace. I think there are two ways to look at it one is subjective once objective let me start with the objective I think in a recovery you generally see digital Republic first I think if you look at not only our digital but look at the marketplace you've seen the big guys go from.
You know negative.
Two positive and pretty steady growth. So I would sort of say digital is sort of already in recovered mode or recovering mode.
I think behind that historically, you see sort of TV recovers next in radio next I think with the TV and you asked the question about what others are saying I think with the rather dramatic decline in TV audience.
And.
You know sort of the accompanying advertising impact.
There is an opportunity perhaps for radio to move ahead of TV in terms of.
Q and and so from an objective standpoint, we're seeing the pieces falling in place so that gives us confidence on the subjective part you know we've talking to advertisers are looking at.
So are there plans for next year and having those discussions and the general sense. We get is for most of them is that they're looking at 'twenty four being back into growth mode for them and spending to support that so.
So I think we're again the beneficiary of that so both the objective subjective lineup for us in terms of giving us confidence for 24, okay.
Maybe just a couple of things the only thing I might add on to what Bob said I think there is further proof point you saw we were up about 5% in Q3 on digital revenue and just married to Bob's comment about that'd be one of the first one.
In terms of coming back and kind of weird.
The confidence in revenue if you look at our guidance for Q4 for digital and Thai Hot.
Single digits overall digital revenue so.
Again, I think that's not just words, but data and also if you look at what we did we did 13% growth in podcasting.
Approximately 13%.
Project in Q3, we don't give exact guidance after Q4, but clearly we think we're going to be above the growth rate.
We had in Q on Q3 will have higher growth rate in Q4, so just.
Just to put that in context in terms of your question, Jeff maybe I'll take them in reverse order for a second.
In terms of bad debt expense.
Bad debt expense nothing unusual there.
Yes, we just.
It's limited to just a couple of advertisers without going into names and categories, but no theres.
Theres nothing at all to worry about on that front and in terms of order that you just confirmed that we've got no significant covenants I think we've done a nice job were down too.
900, a little over 908 in three days.
Ed.
Say anything that I have said publicly already just said you know we continue to monitor.
Credit markets.
We obviously understand.
What our maturities are out there I think from our standpoint, we just need to continue to execute on the operating plan, we need to continue to generate free cash flow, we need to continue to look.
Potential opportunities to monetize things like we did with the towers.
This quarter, which which we're going to use to pay down debt also.
As part of that and I can't comment about other companies.
Again, if you look at the operating performance of this company.
We feel confident about.
About the refinancing of junior ways that continues to.
Maximize our capital structure.
Thank you.
Well go next to Jim Goss with Barrington Research.
Alright, Okay. Thanks couple of questions one.
Looking at pad casting still achieving growth, but I wonder if you could.
Position it and its business cycle, maybe discuss if you think that trajectory.
Is slowing a little bit that it might be a maturing somewhat or is it is this just a.
A function of.
Like current type events that might be putting a bit of a drag on that.
The very strong growth you, obviously get it in the earlier stages of the development.
The development.
Yeah, We don't think we're anywhere near maturity on podcasting.
And I think if you look at the audience growth in podcasting, it's not our audience growth in terms of more people coming into podcasting listening, but theyre spending more time with flight testing as well.
If you look at stats about.
How many.
Downloads, we have or how many shows get over 1 million downloads a month that continues to grow its sort of every metric you look at it as a very positive metric and what's also encouraging is that it's a relatively young audience for podcasting.
So you're not talking about you know the issues of talk radio which tend to be older. This is the young audience version of talk.
What's also great about podcasting for us in terms of our business is that about two thirds of the used supply casting is at home.
Whereas in radio about two thirds of our usage is out of home. So it's a it's a nice marriage of the two and you know that some people think about podcasting. It up you think Netflix the sort of TV on demand pod casting sort of radio on demand and.
And we think it continues to move and they're now more people using pod casting.
Use the biggest streaming music services and continues to grow so we're very optimistic about it I haven't seen it.
And the only thing in the marketplace as you've seen some people pull back on basically uneconomic deals that they were doing I think that's a positive for the marketplace.
Because it means the economics matter match real economics.
And I think that helps us in getting the deals done we need to to continue to lead as the number one by gas publisher and Jimmy and the only thing I might just build upon what Bob said and just.
To Steve's question.
Just a couple of mentioned you know were up approximately 13% a little less than that in revenue.
Testing and I think I've just mentioned.
Where we.
We plan to be our forecast will be higher than that.
For in terms of the percentage I remembered well you saw that increase in percentage. We're also told that we're getting to bigger numbers. So I'm not quite sure that there is any factual size at least from an IHOP standpoint.
We see anything pipe casting slowing down whatsoever.
In terms of the growth the second thing I would say is that if you look at all the people that your projections in terms of revenue pies.
North American advertising.
If you go out three four years and everybody has got kind of a little different years and slightly different numbers, but you know and you can all go read them yourself, whether it's E market or the other people out there, but everybody's got podcasting right.
Four of $5 billion pie of advertising dollars over whatever period of time from between shovel for.
Even if those are not exactly right just looking down directionally.
Finally, I would just say just remember the podcasting industry in terms of big advertisers, what consumers listening habits big advertisers coming to podcast, which is so important because that's where the big dollars coming from the advertising that is really only a couple of years quite frankly in the making.
Bob talks about the early days that we saw.
Seeing no signs of slowing down look tuition and what's out there want to consumers I think it's something like 85% or some number close to that of people that start a podcast listening to all the way through so I don't think any of us stepping running media companies for long period of time have seen engagement.
At that level and Thats critical because that engagement is what's driving this dramatic growth in ad revenue.
Okay very helpful.
Couple of other things political.
I know you talked about.
Rich, but video seems to Trump reach in terms of.
Attracting political ads so local broadcast always gets the lion's share of that business.
Excuse me I wonder if.
You feel there's any risk to ditch.
Digital or other farms, taking any of the political momentum you have tended to have because it's it's not the biggest category, but it's an important category and very profitable category for them.
Yeah, no to the contrary I think video has always been there and anybody wants to see their faces always bought video.
So now the only variable now has reached at.
At a certain point they got to save nobody nobody is seeing it.
They got to worry about getting the message out and I think finally people really be getting to appreciate and I think with the.
Success of streaming audio and the success of podcasting the impact of the conversation and indeed, I think probably the most products and by the way most candidates probably it's not seeing their face is hearing the conversation about the candidate and nothing does that better than broadcast radio so.
Again, I think if you look at the history of the sort of growth we've had in political advertising in the 'twenty 'twenty cycle in 2022 cycle I think we're encouraged that that we're in good shape on political.
And just one thing you mentioned I think when you.
Ask your question you talked about video and digital and just Bob just to hold back on that.
From a broadcast standpoint remember going into.
This election cycle as well as we've gotten past election cycles.
Our capabilities from a data standpoint.
Ted capabilities that we've talked about with our ability just at a very high level.
The plan to plan out advertising campaigns to monitor advertising campaigns and report out on them.
That goes obviously not just from a digital standpoint, but we now have capabilities on broadcast.
Broadcast look like digital.
Again, not one to one which as we all know the world has gone away from but one children for many and we've got capabilities going into this political season to get $8 that we didn't have in the last election cycle. So I wouldn't.
That's not a small detail to overlook.
Okay. Thank you one last one.
I know you can't exactly create a concert.
Movie like Taylor Swift Era's tour that you do have the things that you've put on ABC and Hulu as you mentioned the jingle ball, but are there events you are creating that could that be monetized with.
Streaming relationships, where it might be something that is accessible on the ongoing basis with that flex, there's nothing of that nature that could add to that.
The amount of cessation of those types of events.
The answer is yes, and indeed this year, we've moved the IHOP Radio music Festival to Hulu.
And I think Thats a perfect example of this success.
The success of that and again, we do you know a lot of other major tentpole events and we are wide open to that and really looking at where is the consumer and how do we reach them and we always feel to get the audience monetization follows.
Alright, thanks, Thanks very much.
Thank you.
Well move to our next question from Dan <unk> B Riley Securities.
Yes. Good morning, guys. Thanks for taking the questions. So I just wanted to push on the EBITDA guidance, a little bit more I think.
The presumption coming into this year was that.
The cost savings efforts that real estate reductions you guys have talked about what at least stabilize the margin profile. Even if we saw continued softness in the advertising market.
It seems like you're implying a pretty big step down in margins here <unk> kind of low twenty's versus higher 'twenty is in almost every <unk> you reported.
Just one of the things I hear from investors is that it seems like theres been a number of quarters.
Items have mostly offset any fixed cost savings. So just any thoughts there when those might start to become more evident in any pushback you might get to that.
Well look at.
I think they are in all honesty.
Becoming evident and one thing I want to.
Just highlight and then ill.
Spend 30 seconds or a little more detail.
<unk> com.
<unk>.
Based companies to different degrees.
The ability to talk about guidance for Q4, whether you go into 2024.
<unk>.
It's challenging and I think Bob highlighted this is based on what we know today, but if you look at just historical what's happened we've seen.
There is a time, where we have had a lot of business placed at the end of Q3 I'm sorry at the end of November.
In December when you look at this year kind of in particular, just kind of contrast to last year remember, we're comping against last year. If you look at margins both in the <unk> level.
Highlighting this in our discussion.
The audio and media services level, a dramatic difference from what we had in political revenue year over year I think last year, we had $66 million in political revenue at MTGE, we had.
<unk> 'twenty about mid twenties, I'm, sorry that $60 million and should make it at Patriot mid twenties.
Audio and media services and that comes from extremely high margin quite frankly that political whether it's our highest margin business.
Really you know quite frankly, the biggest piece and then the.
Our balance going the other way is obviously the increase in Dag.
We do have some nice cost savings in Q4, and as a reminder, we announced a $75 million program at the beginning of this year that we started layering in.
During Q2.
We've got a nice benefit in Q4.
Lapping year over year, but I think we continue to look at cost. There is just a way of life and I think also as we highlighted two other things.
One is.
We have bonuses.
Last year, we didn't pay bonuses to any significant amount across our employee base and finally, the trade marketing expenses that we touched upon with both the who deals now streaming.
The IHOP Music Festival.
And our deal with ABC and so those are.
Excuse me not comparable year over year, even though the music festivals in Q3 those hit in Q4.
That's really the items that are affecting comparability.
Okay, great. Thanks rich.
One more for me.
Level question on podcasting it feels like we've hit a tipping point.
We're within podcasts like a majority of them most popular ones seem to have some sort of video component to them.
Like hosted on Youtube or some other platform. In addition to that like more traditional audio only format. So.
Just wondering how you've played in that.
Whether that's impacting discussions with talent.
And your thoughts on that sort of hybrid audio video approached the podcast it seems to be moving towards.
Yeah.
Actually disagree I don't think it is moving to that I think you have some shows that are hybrids, but I don't think that is an overall trend at all in the podcasting business as a matter of fact I think most people have been surprised by how little interest there is and seeing what they're hearing.
I think people who've come out of the video business. Thank everybody wants to see it and the reality is no. They dealt their cooking there driving they're doing something else and it doesn't fit in well there and I think look everybody who's in the video business with love to capture by guessing that are all trying desperately to do it and we have some shows that are on <unk>.
And if it's the best way to do it we certainly can do it. The video today is not much more expense to add to it. We're just looking for the best way to make money.
Yeah.
If I may just add that if you look at what all.
Revenue growth is.
Through the nine months and then what I just talked about the Q4 also nationwide yeah. As we've said podcasting is accretive to the overall.
Company's EBITDA margin out there.
So if you look at what Bob just articulated that as an overall part of our podcasting strategy.
I think it's hard to argue that we've that we're not on the right strategy that we've enjoyed pretty good success.
In the podcast and both on revenue and also most importantly, driving it to the bottom line for the benefit of our shareholders and our profitability.
So with that as well.
Thank you everybody for listening to the IHOP story, Bob myself into Western management team.
We are available for questions and follow up that I appreciate everybody's time and support.
Thank you.
And this concludes today's conference call. Thank you for your participation you may now disconnect.
Please wait the conference will begin shortly.
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