OUTFRONT Media Q2 2025 Earnings Report

OUTFRONT Media EPS Results

• Actual EPS: $0.51
• Consensus EPS: $0.48
• Beat/Miss: Beat by +$0.03
• One Year Ago EPS: $0.50

OUTFRONT Media Revenue Results

• Actual Revenue: $460.20 million
• Expected Revenue: $463.16 million
• Beat/Miss: Missed by -$2.96 million
• YoY Revenue Growth: -3.60%

OUTFRONT Media Announcement Details

• Quarter: Q2 2025
• Date: 8/5/2025
• Time: After Market Closes
• Conference Call Date: Tuesday, August 5, 2025
• Conference Call Time: 4:30PM ET

OUTFRONT Media (NYSE:OUT), Inc. leases advertising space on out-of-home advertising structures and sites. Its inventory consists of billboard displays, which are primarily located on the most heavily traveled highways & roadways, and transit advertising displays operated under exclusive multi-year contracts with municipalities in large cities across the U.S. and Canada. It operates through the U.S. Media and other segments. The U.S. Media segment includes U.S. Billboard and Transit. The company was founded in 1938 and is headquartered in New York, NY.

OUTFRONT Media Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: The company completed a major organizational restructuring, rebranding sales teams into Commercial and Enterprise segments, centralizing operations, and appointing new CROs to drive growth and efficiency.
• Positive Sentiment: Digital revenue grew by 1.5% to represent over 34% of total organic revenues, with programmatic and direct automated sales up nearly 20%, highlighting progress in the digital out-of-home opportunity.
• Neutral Sentiment: Billboard revenues declined 2.5% due to the strategic exit of two low-margin contracts, but were essentially flat ex-exits, and yield per board rose ~0.5% driven by continued digital conversions.
• Negative Sentiment: The company recorded a $19.8 million Q2 restructuring charge for 120 employee reductions, though it expects to save $18 million–$20 million annually from these cost actions.
• Positive Sentiment: For Q3, Outfront anticipates low-single-digit consolidated revenue growth (double-digit transit growth and modest billboard decline) and maintains full-year AFFO guidance of mid-single-digit growth.

Presentation

[Operator]

Hello, everyone, and thank you for joining us for Outfront Media's Second Quarter twenty twenty five Earnings Call. My name is Lydia, and I'll be your operator today. After the prepared remarks, there will be an opportunity to ask questions.

[Operator]

I'll now hand you over to Stefan Beeson to begin. Please go ahead.

[Stephan Bisson, VP, IR at Outfront Media]

Good afternoon, and thank you for joining our twenty twenty five second quarter earnings call. With me on the call today are Nick Bryan and Matthew Siegel. After a discussion of our financial results, we'll open the lines for a question and answer session. Our comments today will refer to the earnings release and slide presentation that you can find on the Investor Relations section of our website, outfront.com. After today's call has concluded, an audio archived replay will be available there as well.

[Stephan Bisson, VP, IR at Outfront Media]

This conference call may include forward looking statements. Relevant factors that could cause actual results to differ materially from these forward looking statements are listed in our earnings materials and in our SEC filings, including our 2024 Form 10 ks as well as our Q2 twenty twenty five Form 10 Q, which we expect to file tomorrow. We will refer to certain non GAAP financial measures on this call. Any references to made today will be on an adjusted basis. Reconciliations of OIBDA and other non GAAP financial measures are in the appendix of the slide presentation, the earnings release and on our website, which also includes presentations with prior period reconciliations.

[Stephan Bisson, VP, IR at Outfront Media]

With that, let me hand the call over to Nick.

[Nick Brien, Interim CEO at Outfront Media]

Thanks, Stephane, and good afternoon, everyone. Before sharing our quarterly results, I'm excited to discuss some of the recent changes we have made within the organization, which have been undertaken to accelerate our revenue growth and reinforce Outfront's position as a leading in real life media company in today's rapidly changing marketing world. Looking at our structural changes first, we have undergone a large internal reorganization, rebranding our local sales teams as commercial and our national sales teams as enterprise. This important change reflects a more appropriate definition of US sales categories between enterprise, mid market, and SMB advertisers. Going forward, we will extend these definitions into our financial documents and earnings calls using the enterprise and commercial nomenclature rather than the traditional, national, and local.

[Nick Brien, Interim CEO at Outfront Media]

Second, as part of this effort, we've also redesigned our brand solutions group, which has been tasked to drive demand from enterprise marketeers within the largest industry verticals across The US. We will begin with six heads of inventory, colloquially referred to as FOIs, who will be responsible for the automotive, entertainment, finance, CPG, retail, and sports industry verticals. This group will assist advertisers through every phase of their campaign implementation from planning to ideation to activation to measurement. Third, we have centralized all of our operational and real estate functions. Our primary goal with this change is to ensure excellence in all functions while reducing the administrative burden on our in market sales leaders.

[Nick Brien, Interim CEO at Outfront Media]

This will allow them to focus on deepening existing client relationships while more aggressively prospecting non out of home advertisers. Our regional sale leader sales leaders will continue to be very involved in key business decisions regarding their markets, given the knowledge and expertise provided by their local proximity and deep market experience. Fourth, we are strengthening both our revenue operations and sales enablement functions. These are increasingly critical to fully optimize our assets to maximize both revenue yield and overall profitability. Fifth, we have moved from having four sales regions to three.

[Nick Brien, Interim CEO at Outfront Media]

We've done this to reduce overhead expenses, improve sales focus, and create speed and agility across the entire company. As part of this transformation process, we've also made several significant leadership changes to our sales organization, which we announced earlier today. Mark Bonani, previously EVP of our South Division, has been promoted to Chief Revenue Officer of Commercial Sales. Mark will focus on accelerating demand from important regional and local advertisers. In addition, Mark will be responsible for overseeing our focus on the independent agency sector, which today represents a growing number of important advertisers.

[Nick Brien, Interim CEO at Outfront Media]

He has more than twenty five years of experience in the digital transformation of media companies, including at Outfront, and will continue to play a key role in bridging the URL and the IOL as out of home advertising evolves as a dynamic digital channel. Jim Norton has been hired as our chief revenue officer of enterprise sales. In this role, he will focus on growth opportunities for the country's largest enterprise advertisers, which have traditionally underutilized out of home as part of their broader media strategies. Jim and the enterprise sales team will drive increased demand for our advertising solutions by implementing a full funnel sales strategy in conjunction with our brand solutions group, partnering with enterprise marketers throughout their entire advertising process. Jim comes to us with over twenty five years of sales experience across both media and advertising companies, where he has scaled teams of both SaaS startups and global media companies.

[Nick Brien, Interim CEO at Outfront Media]

Most recently, he was CRO at Brightcove, where he led the global go to market strategy and helped position the company for a successful sale. Speaking of our brand solutions group, Brad Alperin has joined to lead our efforts here. In this role, he will lead he will develop strategic solutions for the enterprise and mid market brands to accomplish their marketing goals by thoughtfully integrating out of homes power to influence in real life decisions into their broader media plans. Brad has more than twenty five years of agency experience, most recently as EVP integrated strategy at Dentsu. These new sales leaders will work with our experienced regional vice presidents, Bill Simpson, Art Martinez, and Dan Shearer, and our highly regarded enterprise sales leader, Mark Miller, who is directly responsible for all of our whole coagencies and out of home specialist relationships.

[Nick Brien, Interim CEO at Outfront Media]

This new sales organization will be enhanced and supported by our growing technology function led by Ramesh Puriel, our chief technology officer, who have weaved the past with delivering enhanced programmatic scale, a simplified out of home planning and buying process, and improved audience measurement capabilities. With our new organizational structure and talented people in place, we are applying to accelerate demand with increasing support from automation and digitization to deliver the advertising solutions that today's results focus marketeers demand. Now turning to our quarter two results. The headline numbers of which you can see on Slide four. Organic revenues were essentially flat, broadly in line with the guidance we provided in May, while OIBDA was $124,000,000 and AFFO was 85,000,000 Slide five shows our organic revenue results.

[Nick Brien, Interim CEO at Outfront Media]

Billboard revenues were down 2.5%, primarily due to our previously announced exits of two large marginally profitable billboard contracts, one in New York and the other in LA. The revenues and expenses of these contracts are still included in our reported 2024 financial statements. Excluding the results of the New York and LA contracts, we have exited for both years, billboard revenues would have been essentially flat. Transit grew 5.6% with nice broad based growth across most of our franchises. Slide six shows our detailed billboard revenue, which as I mentioned earlier, was impacted by two large billboard contracts we have exited.

[Nick Brien, Interim CEO at Outfront Media]

Traffic and other billboard revenues were down 1.6% during the quarter and digital billboard revenues were down 4.5%. Slide seven shows our detailed transit revenue. The 5.6% top line growth was driven by 17 growth in our digital revenues, which were partially offset by a 2.9% decline in our organic revenues. Enterprise and commercial contributed relatively evenly to our transit growth and the New York MTA was up in mid single digits during the quarter despite a strong showing in 2024 when it grew 20%. On a consolidated basis, revenue basis, our strongest category during the quarter were legal, financial, service providers and insurance.

[Nick Brien, Interim CEO at Outfront Media]

The weaker categories during the quarter were entertainment, health and medical, restaurants and alcohol. Slide eight shows our combined digital revenue performance, which grew 1.5% in the quarter and represented over 34% of total organic revenues. However, digital revenues would have grown by about 5% excluding the aforementioned New York and LA contracts. Programmatic and digital direct automated sales were up nearly 20% during the period and represent represented 16 and a half percent of our total digital revenues, up from 14.8% in the same period last year. Automated digital and by extension digital generally is a paramount focus here at Outfront.

[Nick Brien, Interim CEO at Outfront Media]

There is a large growing universe of dedicated digital media buyers who have not yet embraced the digital out of home ecosystem at all. This underserved market represents a massive opportunity for us moving forward, and we are making concerted efforts to engage, educate, and inspire these important digital agencies as to the unique power of digital out of home. The breakdown of commercial and enterprise revenues can be seen on Slide nine. Commercial, previously called local, was up 1.4% year on year during the quarter with transit growing nicely and billboard up slightly. Enterprise, previously called national, declined 4% during the second quarter with mid single digit growth in transit being offset by weaker billboard results.

[Nick Brien, Interim CEO at Outfront Media]

Slide 10 shows our billboard yield growth, which was up about 05% year on year to nearly $3,000 per month, driven primarily by our continued digital conversions, which continues to see an approximate four times uplift versus the pre conversion revenue levels. Summing up, quarter two revenues ended broadly in line with our expectations as our enterprise billboard revenue results were offset by better performance within transit and continued organic acceleration across digital out of home. Encouragingly, we are seeing top line acceleration across both our lines of business in the second half. With that, let me now hand it over to Matt to review the rest of our financials.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Thanks, Nick, and good afternoon, everyone. Before taking a deeper dive into our financial statements, I would also like to briefly discuss the financial impact of the restructuring Nick described earlier. As noted in our earnings release, we incurred a $19,800,000 restructuring charge in the second quarter due to the reduction of approximately 120 people from the company during the quarter. This is in addition to the nearly $5,000,000 we expensed in the first quarter as a corporate expense entirely due to some of the recent senior management changes. As a result of the restructuring, we expect an annualized expense savings of approximately $18,000,000 to $20,000,000 of which about half should be realized over the balance of this year.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

We felt this action was necessary to reduce our cost base and increase our financial flexibility. We acknowledge change can be difficult, and I'd like to take a moment to thank all of our impacted colleagues for their years of dedicated work and wish them all the best in their future endeavors. Now please turn to Slide 11 for a more detailed look at our billboard expenses. In total, billboard expenses were down just over $7,000,000 or 3.3% year over year. Zooming in on billboard lease costs, these expenses were down just over $6,000,000 or 5.2% year over year.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

This decline includes approximately $7,000,000 related to two large billboard contracts we recently exited, some of which was partially offset by contractual escalators on other leases. Excluding the impact of the portfolio exits, billboard property lease expense would have been up about 2%. Posting maintenance and other expenses were up about $1,000,000 or 3.1% due to higher production costs and compensation related expenses from regular annual merit increases. SG and A expenses declined just over 2,000,000 or 3.3% due primarily to lower credit card usage by customers, a result of newly implemented payment policies. This $7,000,000 improvement in total billboard expenses was offset by the modest decline in billboard revenues Nick described earlier and led to billboard adjusted OIBDA falling just over a million dollars or about 1%.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

We are pleased to see billboard adjusted OIBDA margin increase again, this time by 50 basis points year over year to 38.3%, helped by recent portfolio management decisions as well as the geographic mix of revenue generated in the second quarter. We continue to expect that billboard margins will improve on a year on year basis for the remainder of 2025. Now turning to transit on Slide 12. In total, transit expenses were up about $3,000,000 or 3% year over year. The transit franchise expense was up 5% due to the annual inflation adjustment to the MAG to the MTA contract and higher variable payments to other franchises as a result of improved revenue.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Posting maintenance and other expenses were up just under $1,000,000 or about 5% due primarily to the higher maintenance and utilities costs. SG and A expenses were down $1,000,000 or about 5% primarily due to lower compensation related expenses and lower professional fees. 3% in total transit expenses the 3% increase in total transit expenses, combined with a nearly 6% transit revenue growth described earlier with the transit adjusted OIBDA improving by almost $3,000,000 during the quarter. Slide 13 shows the company's combined billboard transit and corporate adjusted OIBDA in the second quarter. Corporate expense was about $2,000,000 nearly entirely due to the impact of market fluctuations on an unfunded equity linked retirement plan offered by the company to certain employees and higher professional fees, including fees related to a management consulting project, partially offset by lower compensation related expenses.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Combined with the billboard and transit OIBDA I covered earlier, consolidated adjusted OIBDA totaled about a $124,000,000, essentially flat versus the prior year. Turning to capital expenditures on Slide 14. Q2 CapEx spend was about $26,000,000 including about $7,000,000 of maintenance spend. The $7,000,000 increase in growth CapEx was primarily related to digital conversions as well as the timing of payments for new displays. We converted 22 new boards in this quarter.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

However, our digital count was lowered by a decline of 114 small format digital boards primarily found in lifestyle centers as a result of our exit of the LA billboard contract. In 2025, we still expect to spend approximately $85,000,000 of CapEx and also still expect $35,000,000 of this total for maintenance. Looking at AFFO on Slide 15, you can see the bridge to our Q2 AFFO of $85,000,000 The improvement is principally driven by higher billboard and transit OIBDA and lower interest expense, a result of lower debt balance following the sale of our Canadian business and lower interest rates. These benefits were partially offset by higher corporate expense. For the full year, we continue to expect reported twenty twenty five consolidated AFFO will grow in the mid single digit range, reflecting cost reduction from the recent RIF and our current revenue expectations.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Also included in this guidance is $35,000,000 of maintenance CapEx, interest expense of approximately $145,000,000 and a small amount of cash taxes. Please turn to Slide 16 for an update on our balance sheet. Committed liquidity is over $600,000,000 including about $30,000,000 of cash, around $500,000,000 available via our revolver and $80,000,000 available via our accounts receivable securitization facility. As of June 30, our total net leverage was 4.8 times within our four to five times target range. Our next maturity is a $400,000,000 term loan in late twenty twenty six, which we intend to refinance in the coming months.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Turning to our dividend, we announced today that our Board of Directors maintained a $0.30 cash dividend payable on September 30 to shareholders of record at the close of business on September 5. We spent approximately $3,000,000 on acquisitions during the quarter. And looking at our current acquisition pipeline, we continue to expect our 2025 deal activity to be focused on opportunistic tuck ins and remain at a similar aggregate level to those seen in last couple of years. With that, let me turn the call back over to Nick.

[Nick Brien, Interim CEO at Outfront Media]

Thank you, Matt. We accomplished a lot this quarter. And while our work is far from finished, we have made meaningful progress on each of the four strategic pillars I outlined three months ago. First, we have begun optimizing our sales strategy to our board reorganization into distinct enterprise and commercial go to market teams. Second, we have started to modernize our workflow and processes by centralizing many of our functions, reducing the administrative burden on our key sales managers.

[Nick Brien, Interim CEO at Outfront Media]

Third, we are focused on generating new demand, particularly with our redesigned brand solutions group. And four, we are demanding operational excellence from all of our team members with a particular focus on eliminating unnecessary activities and streamlining processes across the entire organization. While we are still early in the process of transformation, we are encouraged by the energy and enthusiasm we have seen thus far. I'm pleased to say that business has picked up recently. From where we sit today, we expect third quarter revenue growth to accelerate meaningfully since quarter two level, with consolidated revenues up low single digits, driven by double digit growth in transit and a low single digit decline in billboard.

[Nick Brien, Interim CEO at Outfront Media]

Our expected decline in billboard revenues is a result of our strategic decision to exit the two large, marginally profitable billboard contracts in New York and Los Angeles. Excluding nearly $13,000,000 of billboard revenue generated by these two exited contracts in the 2024, we believe quarter three billboard revenues would be up low single digits and consolidated revenue would be up low to mid single digits. Looking at the longer term, I'm extremely excited about what lies ahead for Outfront and the industry. We recently participated in the Cannes Lion International Festival of Creativity, one of only two out of home companies to officially activate there. We hosted over 60 meetings with some of the world's biggest brands and agencies to discuss how and why out of home drives impactful outcomes in real life and should become a core part of their marketing strategy.

[Nick Brien, Interim CEO at Outfront Media]

We also illustrated incredible possibilities of out of home through a demonstration we entitled, a moment in can, a memory in times, whereby we snap photos of each of our guests at the festival and generative AI created a soulful, timeless portrait that was displayed seconds later in Times Square. You could see an example on the cover of our quarter two earnings presentation. Overall, it's clear to me that there is a general positivity about out of home, which is viewed as a trusted marketing channel in what has become an increasingly fragmented digital world that seemingly becomes less real by the day. There are still some hurdles that the industry must overcome to lessen complexity, strengthen measurement, and provide better attribution to deliver desired business outcomes. Outfront is determined to solve these challenges.

[Nick Brien, Interim CEO at Outfront Media]

And when we accomplish these goals, we will prove to be an indispensable part of the marketing mix and meaningfully grow our share of the advertising marketplace. To close, Outfront has a very exciting future, and we have spent much of 2025 improving our already strong foundations upon which we will create the industry's leading media company to build trusted brands in real life. And with that operator, let's now open up the lines for questions.

[Operator]

Thank you. Our first question today comes from Daniel Ossley with Wells Fargo. Please go ahead. Your line is open.

[Daniel Osley, VP - Equity Research(Media & Cable) at Wells Fargo]

Thank you. So the business has gone through an elevated period of change over the last year with new senior leadership, sales force restructuring and the exit of large billboard contracts. So my question is, are you through the heaviest period of these changes to the business? Or are there additional areas to address? Then I have a follow-up. Thank you.

[Nick Brien, Interim CEO at Outfront Media]

Well, hello, Daniel. And thank you for the question. I would we were very clear at our previous earnings call that this was going to be the year we would be focusing on the fundamental transformational issues. And those were around those four strategic imperatives I set. And if I look at each of them, when I think about the importance of resetting the sales strategy and ways of working, that was really about creating that new demand engine that was gonna engage the non out of home advertisers, which was significantly coming from the enterprise sector.

[Nick Brien, Interim CEO at Outfront Media]

Restructuring the way we have, and today's announcement of Jim Norton leading that operation in close collaboration with Brad Alpoen on the brand solutions group. We're very excited that that significant organizational structure restructuring has happened. Modernizing the workflow and processes is ongoing. We talked about AI and automation. We talked about modernizing the tech stack and making sure that our OMS and data was was as tight as it needed to be.

[Nick Brien, Interim CEO at Outfront Media]

And we knew that our ad tech stack, the programmatic side of the business, you know, needed to be strengthened. That work is well underway. Increasing it improving external demand. I mean, that is ongoing, and that was largely, as I said earlier, ensuring that we engaged, and educated and excited the independent agencies and the digital agencies, and we involved that channel strategy ongoing effort. Our transit focus, we're very excited that we feel our transit task force and the transit leadership as part of the restructuring has seen tremendous improvement, and we'll share that with you soon.

[Nick Brien, Interim CEO at Outfront Media]

And last but not least, the the ongoing operational excellence involves the sales KPIs, the pipeline strength, the RevOps improvements, sales enablement, as well as optimizing and centralizing all of our real estate that is ongoing for the balance of the year. So long winded way of saying, yes. We believe we've cracked the back of the transformation changes we we committed to, but the work goes on for the That's helpful. And and then as a

[Daniel Osley, VP - Equity Research(Media & Cable) at Wells Fargo]

follow-up, can you help us unpack the weakness you called out in the entertainment vertical? We were assuming you start to see some benefit from the strong box office year to date. Thank you.

[Nick Brien, Interim CEO at Outfront Media]

Well, we it entertainment play is is certainly very experienced and is being very involved in in making sure that the work that we have in quarter two involves securing big deals on Universal, HBO, Disney, Warner Brothers. You know, I look at the logos and the money they spent, they were up year on year. It was the absence of some of the other entertainment companies and the and the studios who just weren't supporting the slate that they had. I think we're feeling bullish about more bullish about the entertainment sector in the quarter three when I look at the deals that have been committed. But that really does explain not just that it was a lower spend, that was an absence of a number of the key studios that we're supporting. Thank you.

[Operator]

Our next question comes from David Konofsky with JPMorgan. Please go ahead.

[David Karnovsky, Senior Research Analyst at JP Morgan]

Hi. Thank you. Maybe just two on the q three outlook. Just with the acceleration in transit, I don't know if you can walk through some of the drivers there, like ridership, which looks like it's up nicely year to date or or initiatives in your control. And then, back with billboard in q three, can you just maybe give the anticipated impact from MTA and LA contract exit as we're just trying to get to what the underlying growth was like in the quarter? Thank you.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Sure. David, on transit, a bunch of things. As you point out, the key performance is really in New York, which is our biggest transit franchise, doing very well. Ridership is up a a little bit, which really but I would say more the the focus of the team. We have a transit task force focused, you know, a a lot on New York.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

We have management focus, extra incentives. I think the team is doing a great job, you know, reinvigorating the New York franchise, and we're seeing improvement in in some of the other smaller ones as as well. As far as the the billboard franchises, each of them, both in New York and LA, we're about 2% of our billboard revenues in 2024 and translate to about 1.5% each of our overall revenues. So I think you'll see it's a biggest headwind is gonna be third quarter when we're good meet without both. By the fourth quarter, we start to lap the the New York franchise that we lost. And then later in 2026, we lap both.

[David Karnovsky, Senior Research Analyst at JP Morgan]

Okay. Thanks.

[Operator]

Our next question comes from Cameron McVeigh with Morgan Stanley. Please go ahead. Your line is open.

[Cameron McVeigh, Vice President - Equity Research at Morgan Stanley]

Hi. Thanks. I just wanted to one, just to follow-up on the on the transit. What with the decline in static transit revenue this quarter, is that a function of ridership? Or do you think there has been more of a structural shift away from static transit boards?

[Cameron McVeigh, Vice President - Equity Research at Morgan Stanley]

And then secondly, just wanted to ask about the some of the cost related actions that you recently noted. I was curious if you could help size the opportunity for potential margin expansion in the back half of this year and next year. Thanks.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Sure. Thanks, Kim. On Transit, when we first went into the MTA contract, I think back in 2017, the original plan was really digitize everything, take down all the all the static. We decided mid midway through to keep the static up because it was doing okay, but recognizing that it was a tired or tiring product. So we're not surprised by the decline of static because everyone wants shiny new objects here here in New York, and you can see it in in Boston and DC.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Yeah. Very similar. Plus, overall, the the bus product across the country, not just ours but others, I think pales in comparison to some of the digital that we have that others have in all the big cities. So I think the decline of static transit is is not a surprise in your terminology. I'd probably declare it structural and likely to continue.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

That being said, I think there's a small test just starting in DC on some digital bus that's I'm sure the the ultimate decision or solution will be years away, but, know, there there's hope yet for, you know, digitizing some buses. We'll we'll see about that.

[Cameron McVeigh, Vice President - Equity Research at Morgan Stanley]

Great. Thanks. And then just to to ask on the potential margin expansion.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Oh, I'm sorry. Yeah. So you said about, you know, $1,820,000,000 dollars of full year savings. We really think, you know, probably almost half felt in in 2025. Full year impact in 2026 will get a pickup half year in each each, say, you know, $910,000,000 in in improvement in in both years. Tim, does that answer your question?

[Cameron McVeigh, Vice President - Equity Research at Morgan Stanley]

It does. Yeah. Thanks.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Thank

[Operator]

you. Our next question comes from Jonathan Navarreta with TD Cowen. Please go ahead.

[Jonnathan Navarrete, VP - Equity Research at TD Securities]

Thank you. First one is on Billboard. I think the margin held up relatively well, I guess, despite the revenue pressure. Any cost levers left to pull if revenue remains soft in the back half?

[Matthew Siegel, Executive VP & CFO at Outfront Media]

There's always cost levers left to pull. Right now, we're continuing to look at our billboard portfolio. We don't have any other large, low margin portfolios to look at. Over time, we certainly expect to manage the portfolio to optimize margin, billboard margin and overall margin. So I wouldn't be surprised if we can continue to cull the herd, if you will, pardon the expression.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Some of our expensive static. I'm not sure the impact in 2025, but I think overall, it's a positive creative nature. And as far as other costs, we're always looking to be efficient and nimble. As Dan asked earlier, we've had a lot of change in 2025 and probably more focused on seeing the impact of that change through 2025 and pulling more cost levers at this time.

[Jonnathan Navarrete, VP - Equity Research at TD Securities]

Got it. Thanks. And related, it's just an AFFO. Can we should we continue to expect growth in the second half, just given the stability of interest expense as well as CapEx and presumably some growth in OIBDA? Thank you.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Yes. As we said, we're keeping our AFFO guided at mid single digit growth. And as you probably noticed, it implies some acceleration in revenue in the second half, which we feel pretty confident about. As Nick pointed out, we're seeing some improvement. Interest expense benefit mostly from the sale of our Canadian business last year with lower debt.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

We have a little bit of floating rate debt, so there could be some improvement as rates do trend down in the second half of the year.

[Jonnathan Navarrete, VP - Equity Research at TD Securities]

Understood. Thank you.

[Matthew Siegel, Executive VP & CFO at Outfront Media]

Thanks.

[Operator]

Our next question comes from Patrick Shaw with Barrington Research. Please go ahead.

[Patrick Sholl, Vice President at Barrington Research Associates]

Hi. Thank you. Just a question on the guidance expectations. Could you could you maybe talk about some of the regional variations and what you're you're seeing for the acceleration in the in the second half or if it's mostly format driven?

[Nick Brien, Interim CEO at Outfront Media]

Patrick. Hi, Patrick. It's Nick here. I I didn't quite could you do me a a favor and repeat that question? I didn't quite hear the beginning bit clearly.

[Patrick Sholl, Vice President at Barrington Research Associates]

Hi. Sorry. Is this better? I was just wondering if you could talk about any of the regional variations in the expectation for the revenue growth improvement in the second half.

[Nick Brien, Interim CEO at Outfront Media]

Yes. I think the no, thank you for that question, Patrick. We track in our sort of daily Monday morning when we look at our growth when we have our growth meeting, we're looking at every region and the key states in each of our sales regions. As one of the reasons we said earlier that we had consolidated from four regions to three and reorganized some of the states accordingly was to ensure that we could get that greater consistency of focus where the pressures were. And I think we could see that it varies a lot.

[Nick Brien, Interim CEO at Outfront Media]

Now we're starting to analyze our revenues between new logos as a new win to the medium and those who have lost as well as increases and decreases. And it's hard to yet see a pattern where there has been a consistent regional consequence of either the market in general or anything that we're doing. Because where we've had enterprise clients suddenly very active, whether they're launching a car or launching a credit card, whatever it is in a particular part of the country, then we have the commercial side of the business strengthening it or vice versa. So I wouldn't say that there's been any regional variations being so significant other than the strengths of the regions that we have in terms of the biggest markets being California and New York. There's not been and so far in my time in the seat and when we look at the first half actuals and what we're looking at now for quarter three and certainly the early signs in the final quarter, we're not seeing significant regional variation over the norms.

[Nick Brien, Interim CEO at Outfront Media]

So I don't know if that helps answer your question, Patrick.

[Patrick Sholl, Vice President at Barrington Research Associates]

Yeah. Yeah. And I guess maybe sort of like following up on that just with your LA footprint and and the loss of that contract. I guess, can you maybe just talk about your your go to market there and just your, I guess, ability to reach the the a portion of the market to I guess, you seeing any sort of effect on, like, the loss of that contract on, like, the broader footprint?

[Nick Brien, Interim CEO at Outfront Media]

No. We're not. I I I we feel very strongly that was a very heavy entertainment oriented, contract. That sector, that industry vertical has been suffering for all the reasons we starting back in the right to strike in 2024 all the way through 2023. And then where we are with all things, the strength of streaming and the creative economy.

[Nick Brien, Interim CEO at Outfront Media]

I think what we're recognizing is that we need to you know, be more more consistent in our relationship building with a very strong independent agencies in, the LA area, whether it be seventy two and Sunny, whether it be Horizon, whether it be Dentsu, three sixty I. There's so many strong independent players as well as the independent multicultural agencies, as well as a very strong increase across California of the digital agencies. So those are an opportunity to generate revenues at the enterprise level as well as the commercial level. The second thing we're doing is being much more proactive with the focus of this restructuring on growth, organic growth. So when we're talking about account leaders and focusing on a customer success growth function, it's about making sure that we can get more out of what we've got with the resources we have.

[Nick Brien, Interim CEO at Outfront Media]

We've been clear. We were very clear at the last earnings call that we were gonna be very deliberate and judicial around the contracts and at what level we will continue to bid when our models and our math, even at the most optimistic levels would see us basically taking on loss making leases. And we balance that knowing that it particularly when you cite Los Angeles, that the enterprise sector had been the category that significantly popped up certain of these contracts that we've we've basically chosen to walk away from. And we didn't do it lightly because obviously then as you're surmising, we have to focus on where we're generating the new revenues both from existing clients as well as the new non out of home advertisers. And that work is is well underway, especially in New York and LA.

[Patrick Sholl, Vice President at Barrington Research Associates]

Okay. Thank you so much.

[Nick Brien, Interim CEO at Outfront Media]

Thanks, Patrick.

[Operator]

Thank you. We have no further questions in the queue. So I'll pass the call back over to Nick Bryan for any closing comments.

[Nick Brien, Interim CEO at Outfront Media]

Well, thank you for joining us today. We hope to see and meet with many of you at our various conferences and events throughout the autumn. But for those who we don't, we look forward to presenting our quarter three results to you in early November. Thank you so much for your time today.

[Operator]

This concludes today's call. Thank you very much for joining. You may now disconnect your line.

Participants

Analysts

• Stephan Bisson, VP, IR at Outfront Media
• Nick Brien, Interim CEO at Outfront Media
• Matthew Siegel, Executive VP & CFO at Outfront Media
• Daniel Osley, VP - Equity Research(Media & Cable) at Wells Fargo
• David Karnovsky, Senior Research Analyst at JP Morgan
• Cameron McVeigh, Vice President - Equity Research at Morgan Stanley
• Jonnathan Navarrete, VP - Equity Research at TD Securities
• Patrick Sholl, Vice President at Barrington Research Associates