Sinclair Q2 2026 Earnings Report

Sinclair EPS Results

• Actual EPS: -$1.06
• Consensus EPS: -$0.24
• Beat/Miss: Missed by -$0.82
• One Year Ago EPS: -$0.91

Sinclair Revenue Results

• Actual Revenue: $840.00 million
• Expected Revenue: $838.99 million
• Beat/Miss: Beat by +$1.01 million
• YoY Revenue Growth: +7.10%

Sinclair Announcement Details

• Quarter: Q2 2026
• Date: 8/5/2026
• Time: After Market Closes
• Conference Call Date: Wednesday, August 5, 2026
• Conference Call Time: 4:30PM ET

Sinclair (NASDAQ:SBGI) Broadcast Group, Inc. (NASDAQ: SBGI) is a media and entertainment company headquartered in Hunt Valley, Maryland. Founded in 1971 as a single UHF television station operator, Sinclair has grown through strategic acquisitions and organic expansion to become one of the largest owners of local television stations in the United States. Over its history, the company has pursued a diversified portfolio that includes both traditional broadcast assets and newer digital platforms.

At its core, Sinclair operates over 190 television stations affiliated with the major national broadcast networks, including ABC, CBS, NBC, Fox, The CW and MyNetworkTV. In addition to its local news and entertainment programming, Sinclair owns and operates a slate of sports networks—previously under the Bally Sports banner—and the Tennis Channel, offering regional and national sports coverage. The company also develops and distributes a suite of digital multicast networks such as Comet, Charge!, and TBD, providing genre-focused content that ranges from science fiction and action to lifestyle and local community programming.

Beyond station ownership, Sinclair has invested in national news production and podcasting. In 2021, the company launched “The National Desk,” a daily, morning and evening broadcast news program designed for distribution across its station group. Sinclair’s digital division supports streaming services, mobile apps, and local news websites, enabling viewers to access live and on-demand content. This blend of linear broadcasting and digital delivery positions Sinclair to serve audiences seeking both traditional television viewing and increasingly popular online platforms.

Sinclair’s leadership team is headed by Chief Executive Officer Christopher Ripley, who was appointed in 2017 after a long tenure with the company in various senior roles. Executive Chairman David D. Smith, Sinclair’s co-founder, remains involved in strategic oversight. Together, the management team emphasizes operational efficiency, localism in news and sports coverage, and continued growth via acquisitions and digital innovation. Sinclair’s footprint spans nearly every U.S. state, making it a significant presence in the American broadcast landscape.

Sinclair Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Political advertising revenue rose 9% year over year to $59 million, and Sinclair raised its full-year political guidance to at least $375 million, citing strong early demand across competitive Senate, gubernatorial and House races.
• Positive Sentiment: Sinclair increased full-year Adjusted EBITDA guidance to $730 million-$760 million despite lower core advertising expectations, supported by high-margin political revenue, year-to-date outperformance and continued expense discipline.
• Positive Sentiment: The company reduced debt by approximately $320 million during the quarter and an additional $25 million after quarter-end, lowering interest expense and leaving its nearest material maturity in December 2029.
• Negative Sentiment: Core advertising revenue declined 3% as political spending crowded out inventory and fuel, tariff and cost-inflation concerns pressured advertisers; Sinclair cut its full-year core advertising outlook by $40 million at the midpoint.
• Positive Sentiment: Management expects the anticipated removal of the FCC’s 39% national ownership cap to make large-scale broadcast M&A less risky, while record World Cup audiences and cross-platform sports offerings supported advertiser demand.

Presentation

[Operator]

Good day, everyone, welcome to the Sinclair second quarter 2026 earnings conference call. At this time, all participants are placed on a listen-only mode. If you have any questions or comments during the presentation, you may press star one on your phone to enter the question queue at any time, we will open the floor for your questions and comments after the presentation. It is now my pleasure to hand the floor over to your host, Chris King, Vice President of Investor Relations. Sir, the floor is yours.

[Chris King, VP of Investor Relations at Sinclair]

Good afternoon, everyone, thank you for joining Sinclair's second quarter 2026 earnings conference call. Joining me on the call today are Chris Ripley, our President and Chief Executive Officer, Narinder Sahai, our Executive Vice President and Chief Financial Officer, Rob Weisbord, our Chief Operating Officer and President of Local Media. Before we begin, I want to remind everyone that the slides for today's earnings call are available on our website, sbgi.net, on the Events and Presentations page of the Investor Relations portion of the site. A webcast replay will remain available on our website until our next quarterly earnings release. Certain matters discussed on this call may include forward-looking statements regarding, among other things, future operating results. Such statements are subject to several risks and uncertainties. Actual results in the future could differ from those described in the forward-looking statements because of various important factors.

[Chris King, VP of Investor Relations at Sinclair]

Such factors have been set forth in the company's most recent reports as filed with the SEC and included in our second quarter earnings release. The company undertakes no obligation to update these forward-looking statements. Including on the call will be a discussion of non-GAAP financial measures, specifically Adjusted EBITDA. This measure is not formulated in accordance with GAAP and is not meant to replace GAAP measurements and may differ from other companies' uses or formulations. Further discussions or reconciliations of the company's non-GAAP financial measures to comparable GAAP financial measures can be found on our website. Please note that unless otherwise noted, all year-over-year comparisons throughout today's call are presented on an as reported basis. Let me now turn the call over to Chris Ripley.

[Chris Ripley, President and CEO at Sinclair]

Thank you, Chris, good afternoon, everyone. Let me begin on slide three. We delivered a strong second quarter with results that reflected the early strength of the 2026 political cycle, continued distribution revenue growth, disciplined execution across the business. For the quarter, total revenue was $840 million, up 7% year-over-year, while Adjusted EBITDA was $149 million, up 45%. Growth was led by political advertising the early pace of demand reinforces our confidence in the strength of the cycle the value of our broad station footprint in many of the country's most competitive races. Distribution revenue continued to grow, supported by the partner station buy-ins completed over the past year. The combination of broadcast, connected television, digital, podcast inventory continues to expand the solutions we offer advertisers positions us well as political demand builds through the remainder of the year.

[Chris Ripley, President and CEO at Sinclair]

Core advertising was softer as we expected, reflecting record political demand crowding out inventory in our most competitive markets and caution in a handful of cost-pressured advertiser categories. Narinder will take you through the details. Live sports once again demonstrated the reach of broadcast television led by record World Cup audiences on Fox. Rob will take you through that shortly. Tennis Channel also sustained its audience momentum with growth across its linear, direct-to-consumer, Tennis Channel 2, and Pickleball TV platforms. Within Ventures, the portfolio continued to generate cash distributions and ended the quarter with $489 million cash on hand. That liquidity continues to provide meaningful flexibility as we evaluate opportunities across the portfolio and advance our broader strategic priorities. We also made substantial progress on deleveraging as we repaid or retired approximately $320 million of debt in the quarter. Deleveraging our balance sheet remains our top priority for the company.

[Chris Ripley, President and CEO at Sinclair]

Based on our first half performance and current outlook, we are increasing our full year Adjusted EBITDA and political advertising guidance. Narinder will discuss the updated outlook in more detail later in the call. On slide four, we highlight what we expect to be a historic day for the broadcast industry tomorrow with the expectation of an FCC vote to remove the national ownership cap of 39%, a development that the industry has been supporting for many years. The removal of the national ownership cap would set the stage for broadcasters to be able to compete on a more level playing field as the industry finds itself competing against big tech and streamers that are not subjected to comparable regulatory constraints. It would strengthen broadcasters' ability to invest in local news across the country as we continue to serve our local communities.

[Chris Ripley, President and CEO at Sinclair]

As we continue our strategic review process, the increased clarity and support from an improved regulatory environment could help facilitate M&A activity across the industry. Sinclair is well prepared to participate in value-creating consolidation, and we will remain disciplined in how and when we do so. The slide also summarizes the other proceedings moving in the same constructive direction, the ATSC 3.0 transition, the network affiliation review, and modernized local ownership rules. With that, let me turn the call over to Rob to discuss our operating highlights in more detail.

[Rob Weisbord, COO and President of Local Media at Sinclair]

Thank you, Chris, and good afternoon, everyone. Turning to slide five, the 2026 midterm election cycle is off to a strong start across our footprint. We operate in all of the top 10 states currently projected to receive the highest levels of political advertising spending. Importantly, these states include six competitive Senate, seven competitive gubernatorial, and 33 competitive House races, according to a recent stand and forest analysis. That combination of geographic reach, local audience scale, and competitive races positions us well as campaign spending expands through the second half of the year. Second quarter political revenue of $59 million was 9% above the second quarter of 2022. Demand has been broad-based across our markets, with candidates, parties, and issue advertisers beginning to reserve inventory earlier in the cycle. Recent changes to campaign finance rules are also enabling party committees to invest earlier and at greater scale.

[Rob Weisbord, COO and President of Local Media at Sinclair]

Given the strength we have seen to date and the current outlook for competitive races across our footprint, we are increasing full-year political advertising revenue guidance to at least $375 million. Narinder will take you through the updated outlook. Political spending is always back-end loaded towards the weeks immediately preceding election day, and timing can vary by race and market. However, the early activity we are seeing supports our expectation for a robust cycle and underscores the differentiated value of local broadcast television for reaching voters at scale. Turning to slide six, the FIFA World Cup provided another clear example of the power of broadcast-led live sports and the value of our Fox affiliate portfolio. The tournament delivered record soccer audiences on broadcast and generated strong advertising demand across our local markets.

[Rob Weisbord, COO and President of Local Media at Sinclair]

For some perspective, 128.4 million Americans watched some portion of the World Cup on Fox, FS1 and FS2, and the World Cup final drew an audience of 66.4 million viewers, which was the largest U.S. audience for any non-Super Bowl sports event in more than 30 years. Sinclair took this opportunity to expand well beyond the linear broadcast. Its media brands allowed advertisers to add targeted cross-platform reach, while our Unfiltered Soccer podcast featuring Landon Donovan and Tim Howard gave brands another way to engage highly interested soccer fans around the tournament. In addition, three live activations around the World Cup let consumers physically experience our advertisers' products, deepening engagement with their campaigns. This coordinated approach across broadcast, digital, and podcast platforms is increasingly important to advertisers.

[Rob Weisbord, COO and President of Local Media at Sinclair]

Broadcast provides mass reach and live engagement, while our digital capabilities, along with live activations, add audience targeting, frequency, and measurable extensions beyond the telecast. Premium live sports remain one of the most powerful drivers of appointment viewing, and broadcast delivers that content with unmatched reach. As we head into the third quarter, we look to build on the World Cup successes with the return of college football and the NFL. Our operational takeaways on slide seven highlight the strong early political demand across our markets during the quarter. With political revenue ahead of the comparable 2022 period, our broad station footprint, local sales relationships, and expanding digital capabilities position us well as campaign activity builds through the remainder of the cycle. Distribution also remains solid, supported by our partner station buy-ins.

[Rob Weisbord, COO and President of Local Media at Sinclair]

The value of broadcast remains clear, particularly around live news, premium sports, and other programming that consistently brings audience together at scale. Advertisers are increasingly looking for integrated campaigns that combine the broad reach and live engagement of broadcast with the targeting and measurement available through digital. Our portfolio allows us to deliver both, creating more value for the advertiser while deepening engagement with audiences across platforms. Client demand is consolidating total video with linear and streaming bought together. That is exactly what we have built towards. The World Cup was the template with broadcast reach, streaming, digital podcasts, and live activations sold as integrated campaigns. Across the business, we remain disciplined on expenses while continuing to support the content, technology, and sales capabilities that can drive long-term growth.

[Rob Weisbord, COO and President of Local Media at Sinclair]

In summary, strong early political demand, expanding cross-platform capabilities, and the audience strength of broadcast-led live sports position us well for the second half of the year. With that, let me turn the call over to Narinder to review the second quarter financial results and our updated outlook.

[Narinder Sahai, EVP and CFO at Sinclair]

Thank you, Rob, and good afternoon, everyone. Turning to slide eight, I will walk through the second quarter financial results in more detail. At the total company level, revenue was $840 million, up 7% year-over-year. The increase was driven primarily by political advertising and continued distribution revenue growth. Adjusted EBITDA was $149 million, up 45%, reflecting the favorable revenue mix and disciplined expense management. Political advertising revenue of $59 million was the largest contributor to growth, up 9% from the second quarter of 2022. Our strongest prior midterm cycle. Distribution revenue increased 2%, with subscriber churn continuing to moderate, consistent with trends the largest distributors have reported publicly, and the benefit of partner station buy-ins we have executed. Core advertising revenue declined 3%. Two things are worth keeping in mind.

[Narinder Sahai, EVP and CFO at Sinclair]

First, this was the first quarter with a full prior year comparison for Digital Remedy, which we acquired in March of 2025. That anniversary affects the year-over-year comparison. Second, on the demand backdrop, consumer spending held up in the quarter, but the fuel and tariff volatility clearly made advertisers more cautious. The pressure we saw was concentrated due to political crowd-out and in categories where cost inflation is squeezing advertiser budgets. In the Local Media segment, total revenue was $731 million, an increase of 8% year-over-year. Local Media Adjusted EBITDA was $149 million, up 51% year-over-year. The increase reflects strong political revenue and continued cost discipline across programming, production, and selling general and administrative expenses. Within the Tennis segment, total revenue was $70 million, up from $68 million in the prior year quarter. Advertising revenue increased 8%, supported by ratings growth and continued direct-to-consumer momentum, while distribution revenue increased 2%.

[Narinder Sahai, EVP and CFO at Sinclair]

Tennis segment Adjusted EBITDA was $8 million compared with $13 million in the prior year quarter. The decline primarily reflects higher programming and production costs as we continue to strengthen and monetize our rights portfolio and ongoing investment in our direct-to-consumer platform. On slide nine, we are updating our full year 2026 guidance. I will start with what is changing, which is political advertising revenue, core advertising revenue, and Adjusted EBITDA. Cover what is not changing, and close with the key free cash flow items. As Rob discussed, we are increasing political advertising revenue guidance to at least $375 million from at least $333 million previously. This 13% increase takes our guidance above the 2022 record and reflects strong first half demand and the current outlook for competitive Senate, gubernatorial, and House races across our footprint.

[Narinder Sahai, EVP and CFO at Sinclair]

We are resetting our core advertising revenue guidance, which is now expected to be between $1.22 billion and $1.28 billion for total company. While Local Media core advertising revenue is expected to be between $1.04 billion and $1.09 billion. This represents a reduction of $40 million at the midpoint of prior guidance ranges. On our last call, we said that if current conditions persisted, we would reassess our core advertising outlook. This revision now reflects the expected crowd out from an elevated political spending in the second half, and it resets second half core advertising to the demand levels we are currently seeing with no improvement assumed through year-end. Despite the change in core advertising expectations, we are increasing Adjusted EBITDA guidance by $25 million at the midpoint on the strength of our first half performance.

[Narinder Sahai, EVP and CFO at Sinclair]

Our updated guidance now includes the transition of our St. Louis ABC affiliation at the end of August in our guidance for the remainder of the year. Even after accounting for St. Louis, the new midpoint of our Adjusted EBITDA guidance is above the high end of our prior range, reflecting the improved political forecast and our continued expense discipline across the company. Total company Adjusted EBITDA is now expected to be between $730 million and $760 million. Local Media Adjusted EBITDA is now expected to be between $710 million and $740 million. Moving to what is not changing. We are maintaining total company revenue guidance of $3.4 billion-$3.54 billion and Local Media revenue guidance of $3 billion-$3.12 billion.

[Narinder Sahai, EVP and CFO at Sinclair]

Within that, distribution revenue guidance is also unchanged at $1.72 billion-$1.79 billion for the total company and $1.51 billion-$1.57 billion for Local Media segment. Finally, turning to key free cash flow components. Our capital expenditure forecast is unchanged at $75 million-$80 million. We are lowering our net interest expense guidance to be between $295 million and $290 million, reflecting the deleveraging activities we have completed to date. Our net cash tax guidance is now approximately $50 million, a function of higher expected pre-tax income in an expected record midterm political year. Taken together, our updated guidance reflects our current expectations for the full year. Turning to slide 10, we continue to make meaningful progress on our de-leveraging priorities during and immediately following the quarter. As Chris referenced, during the second quarter, we reduced our debt balance by approximately $320 million.

[Narinder Sahai, EVP and CFO at Sinclair]

That included the $165 million of term loans we repurchased through the reverse Dutch auction discussed on our last call, $150 million of repayment on our accounts receivable facility, and roughly $5 million of scheduled amortization and finance lease payments. In July, after quarter end, we repurchased and retired an additional $25 million face amount of our B7 term loan at a discount and repaid and terminated the remaining B3 term loan balance. These actions have improved our maturity profile and reduced our interest expense, directly benefiting our cash flow. At quarter end, total debt was approximately $4.1 billion. Our nearest material maturity, excluding the accounts receivable facility, remains in December of 2029, providing us with a manageable runway to continue executing our de-leveraging plan.

[Narinder Sahai, EVP and CFO at Sinclair]

Sinclair Television Group, or STG, net leverage ended the quarter at 5.2x. With the heaviest political quarters still ahead of us, we expect continued progress through the balance of the year. We ended the quarter with $604 million of consolidated cash and cash equivalents, including $115 million at STG and $489 million at Ventures. Ventures generated $19 million of cash distributions from its portfolio during the quarter. Including undrawn revolver and AR facility capacity, total liquidity was approximately $1.4 billion. We remain focused on reducing debt and improving leverage over time while maintaining sufficient liquidity to operate the business and invest selectively in high return opportunities. With that, let me turn the call back to Chris for a community update and closing comments.

[Chris Ripley, President and CEO at Sinclair]

Thank you, Narinder. Before wrapping up, I want to recognize our employees and the impact they made through the 2026 Sinclair Day of Service, highlighted on slide 11. More than 1,200 employees contributed a combined 3,070 hours of service across our markets and cities. Their work supported a wide range of local needs, including food security, hygiene assistance, accessibility resources, and animal welfare. Enriching local lives is central to who we are as a company. Our stations and employees live in the communities they serve. I'm proud of the time, energy, and care they contributed through this year's Day of Service. As we wrap up on slide 12, let me briefly summarize our second quarter and outlook. First, the 2026 political cycle is off to a strong start.

[Chris Ripley, President and CEO at Sinclair]

Second quarter political revenue highlights the value of our broad local footprint. The demand we are seeing across competitive races supports our increased full-year political guidance. We also enter what we expect to be a more constructive regulatory era for local broadcast. We are preparing for it. Broadcast-led live sports continue to deliver premium audiences at scale. The FIFA World Cup on Fox generated record audiences and strong advertiser demand across our platforms. Tennis Channel also maintained strong momentum across linear, direct consumer, Tennis Channel 2, and Pickleball TV. Our cross-platform portfolio is expanding our reach beyond linear television, helping advertisers connect with audiences when and where they interact with our brands. Based on our first half results and current outlook, we increased full-year Adjusted EBITDA guidance despite a more cautious view of the core advertising environment.

[Chris Ripley, President and CEO at Sinclair]

Lastly, de-leveraging remains a top priority, as illustrated through our actions during and immediately following the quarter. These actions are reducing interest expense and strengthening our financial position. We enter the second half of the year with strong political momentum, a valuable live sports programming schedule, expanded cross-platform capabilities, meaningful strategic optionality, and a continued focus on cost discipline and debt reduction. With that, operator, we are ready to open the line for questions.

[Operator]

Certainly. Everyone at this time will be conducting a question-and-answer session. If you have any questions or comments, please press star one on your phone at this time. We do ask that while posing your question, please pick up your handset if you're listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone. Your first question's coming from Dan Kurnos from StoneX. Your line is live.

[Dan Kurnos, Analyst at StoneX]

Great, thanks. Good afternoon. Chris, you get the first crack at upcoming FCC cap repeal and any comments you want to make. It seems likely tomorrow. A little premature, but we've obviously been talking M&A in the space for a long time. Do you think that changes the conversation, number one? Number two, your guidance is just shy now, I think $25 million or $30 million of your 2024 political numbers. What are you seeing? How much conservatism? It's still early. Just maybe unpack some of the pieces would be great. Thank you.

[Chris Ripley, President and CEO at Sinclair]

Okay. I'll let Rob speak to what he's seeing on the political ad front, in terms of the cap elimination, which is expected tomorrow, we couldn't be happier. We certainly applaud the FCC for taking this very meaningful step to remove an outdated regulation that really just has no place in this modern media marketplace. It is very significant to change this rule. As we look at large-scale M&A, which is a major objective for us, this really de-risks those opportunities, and we expect that some of the counterparties that we are interested in will be more likely to want to transact with this certainty put on the books.

[Rob Weisbord, COO and President of Local Media at Sinclair]

In regards to the political, we've taken it up significantly. The last guide was $333 million. The guide now is to $375 million. As we get closer into election day, we'll have a better indication of what races will remain hot and where that funding's going. In 2024, we saw some funding in Pennsylvania move to the bigger cities of Philly and Pittsburgh, where earlier on in the pre-race, it was spread out throughout the state. Today, we're comfortable at that $375 guidance, and we'll have more clarity within the next four weeks. We feel very comfortable that we can handle this demand.

[Chris Ripley, President and CEO at Sinclair]

Yeah. Dan, I'd just add to that, the intensity of the political ad spend, it almost doubles every quarter. In the fourth quarter, you'll only have a half a quarter, essentially, of political ad spending, and it's usually about double Q3 in terms of volume. It really is hard to predict how you will ultimately end up with everything being as back-end loaded as it is. With what we're seeing so far, we were comfortable meaningfully increasing our guidance.

[Dan Kurnos, Analyst at StoneX]

Super helpful. Thanks, guys, and congrats on print.

[Chris Ripley, President and CEO at Sinclair]

Thank you.

[Rob Weisbord, COO and President of Local Media at Sinclair]

Thank you.

[Operator]

Thank you. Your next question's coming from Benjamin Soff from Deutsche Bank. Your line is live.

[Benjamin Soff, Analyst at Deutsche Bank]

Good afternoon. Thanks for the question. I'm wondering how you expect the recent ruling from the Supreme Court on lowest unit pricing for political party spending could impact your business either this year or in the future. On tuck-in M&A, you've recently closed your buy-in transactions, and I'm wondering how you think about the opportunity set for more tuck-in M&A. Are there any types of assets or markets that are attractive right now? How do you think about balancing doing smaller deals versus your focus on larger consolidation? Thank you.

[Rob Weisbord, COO and President of Local Media at Sinclair]

I'll handle the political question. Our outlook for this year already takes into account the ruling. Something to note is this ruling only affects 60 days out from the election. In 2024, it was mid-single digits that came from the party spending. If we see an increase in that spending, our yield team will adjust rates on the fly based on the demand, and our capacity still will be able to handle the volume of dollars being spent this year and historically as that spending has increased, we will be able to handle it.

[Chris Ripley, President and CEO at Sinclair]

Look, on the M&A front, overall, we see the environment and of course, led by regulatory being increasingly constructive for all sorts of M&A. As I mentioned in my prepared remarks, there is additional local ownership easing, which is in the pipeline tied to the Quadrennial Review. That's another key rule change that we're tracking closely here and will be very helpful in terms of local market consolidation. In terms of the opportunity set, I do think the elimination of the cap will make large-scale M&A much easier and less risky. We're going to be redoubling our efforts in that area.

[Chris Ripley, President and CEO at Sinclair]

In the meantime, we've done some smaller market-by-market optimization deals recently, such as in Tulsa, and we have a very full pipeline of additional opportunities on the smaller side where we're going market-by-market, looking at swaps and looking at ways to double up and sometimes triple up. Those are very accretive transactions. We're pursuing those quite extensively. The cap obviously does not implicate those opportunities, but we are still prioritizing them as well as redoubling our efforts on the large-scale front.

[Benjamin Soff, Analyst at Deutsche Bank]

Got it. Thank you.

[Operator]

Thank you. Your next question's coming from Steven Cahall from Wells Fargo. Your line is live.

[Steven Cahall, Analyst at Wells Fargo]

Thank you. Three, if you don't mind. First, just on the political guide, I think you're now at least 13% over 2022. How do we think about that in terms of what's being driven by some of the idiosyncrasies of this election cycle or some of the consolidation that you've just done versus just the size of the cycle? I'm kind of getting to whether or not 2028 could be 13% over 2024 or if there's something more special in 2026 that's driving that upside.

[Chris Ripley, President and CEO at Sinclair]

Sure. Look, I think our platform is pretty much the same as it was four years prior. There's very little movement in terms of station portfolio. I believe that the main driver of the increase here that we're expecting this year versus four years prior is being driven by money raised. If you pay attention to external research tracking these numbers, there is a significant step up in money raised this year versus 2022. It's approaching, the total money raised this may equal 2024, which is a presidential year, of course. The basic formula for political ad spending is money raised equals money spent. As I like to point out, politicians don't return money to the donors when the elections are over. It's really the most important factor, is money raised, and we're seeing that being done in record levels.

[Chris Ripley, President and CEO at Sinclair]

Certainly, for a midterm, it might even be an all-time record. We'll have to see how the final numbers come in. I think the read-through to 2028 is very positive.

[Rob Weisbord, COO and President of Local Media at Sinclair]

Yeah. I'll add, by the time 2028 comes around, some of our investments will be content on the digital side as well, full platform. We'll be able to capture that money both on the linear and digital side, capturing some of that now, and it'll be even more significant in 2028.

[Steven Cahall, Analyst at Wells Fargo]

Great. Narinder, I just want to make sure I understand the guidance changes. Is it that political revenue is a little higher margin than core revenue? Is it that you've done better on cost than you thought for the year or a combination of those two things with the EBITDA guide going higher?

[Narinder Sahai, EVP and CFO at Sinclair]

Sure. Steve, thank you for the question. Yes, you're absolutely right. There are a few moving pieces here. If you just compare midpoint of the prior guide to the midpoint of this revised guide on Adjusted EBITDA, plus $25 million. We took up the political by about $42 million. Very, very high margin. When you look at the reset we have on the core, there's certainly some offset there, right? When you look at the impact of our St. Louis affiliation transition, that's also factored into the guide. If you take these three together, that does not take you all the way to $25 million. The delta there is the outperformance and the expense management that we have achieved so far year-to-date. We expect that to continue to flow through for the remainder of the year. We are not giving that back.

[Steven Cahall, Analyst at Wells Fargo]

Great. Last one. I know you and your peers are pursuing some spectrum-related business opportunities through EdgeBeam. Historically, in spectrum, there were three telcos that might have competed to buy that from you at some point. Now there's another player in this market with more than a trillion-market cap. Some days it's $2 trillion. You and your peers, it just seems like are sitting on a resource that has a different scarcity factor than it has historically. How do you think about the opportunities to monetize that low-band spectrum? Does it have to be done through an auction, or are there ways that you can use the EdgeBeam consortium and do something more quickly with some of the unused spectrum? Thanks.

[Chris Ripley, President and CEO at Sinclair]

Thank you for that question. It's a great question, Steve. It's very encouraging to hear from you and other market participants talking about the underlying value of our spectrum, which we've been big believers in for a long time. If you dial back the clock to the last auction, which was 2017, it was really a disappointment for the industry because AT&T and Verizon, for reasons I won't expand upon here because it would take too long, decided not to participate in that auction in any meaningful way. You essentially had two major bidders, which was T-Mobile and Dish. If you remember, Dish also had some shenanigans working through some entities to get a discount. It really was not a great outcome for the broadcasters.

[Chris Ripley, President and CEO at Sinclair]

It ended up having an average price of about $1.00/MHz-POP, which we think vastly undervalues low-band spectrum given its scarcity value and its beachfront location. Really, that was just driven by a lack of competition. Fast-forward to today, I think the competitive set on the telecom side has changed. If you did have another auction, it wouldn't just be T-Mobile showing up or a new entrant like Dish. I think you'd see competition from the AT&T's and the Verizon's of the world as well. Now, as you alluded to, anyone who has or is planning on launching a LEO constellation is very interested in acquiring low-band spectrum. Either acquiring it or acquiring access to it, which I think goes to your second statement, which is how would you go about activating this spectrum for use on those constellations.

[Chris Ripley, President and CEO at Sinclair]

That could obviously be achieved through a conventional auction like we did in 2017. It could also be achieved through a negotiated sale, which is another possibility that would be organized with the FCC. The third option would be to enter in some sort of a lease arrangement to make capacity available. I think the macro point is that this spectrum is very valuable. I think it's easily at market, at auction, at a negotiated sale over $2.50/MHz-POP. I think it would be a floor valuation that I would see in any sort of transaction, which, by the way, implies $4.1 billion for Sinclair's portfolio in totality.

[Chris Ripley, President and CEO at Sinclair]

It also underscores the necessity to fully roll out ATSC 3.0 and sunset ATSC 1.0 because by sunsetting ATSC 1.0, we're able to free up a lot of spectrum, which could be used for additional programming and data casting, which we're working on at EdgeBeam. There is sort of a cost-benefit analysis that I think will go on once we sunset ATSC 1.0 and these commercial applications are available that EdgeBeam is working on. The industry will have to assess, is it better to run those use cases over that spectrum and earn an annuity stream of income from it? Or is it better to transact and sell or lease to someone like Starlink?

[Chris Ripley, President and CEO at Sinclair]

I think all of those are possibilities, and it's really just an economic equation, and it reinforces to me and the rest of the industry that we need to get the FCC to act and approve the NPRM in front of them on ATSC 3.0 and sunset ATSC 1.0 in order to open up these types of opportunities.

[Steven Cahall, Analyst at Wells Fargo]

Great. Thank you.

[Operator]

Thank you. Your next question is coming from Aaron Watts from Deutsche Bank. Your line is live.

[Aaron Watts, Analyst at Deutsche Bank]

Hi. Thanks for having me on. Covered a lot of ground already. Chris, I had a follow-up around the FCC and the national ownership cap change. Curious how you think about the practical timing of the industry being able to act on the changes that we may see come tomorrow and in the near future, especially in light of how other media consolidation processes are playing out and the expected or potential challenges that may be raised in the courts.

[Chris Ripley, President and CEO at Sinclair]

Once the vote happens, it does take some amount of time to go into the registry, where it becomes officially a rule. I think it's something around 30 days or so, but don't quote me on that. After that's the law of the land, so to speak. We fully expect people to challenge this order, and we think the FCC is on solid legal ground here in terms of their authority to change this rule and the rationale behind changing it. In terms of the FCC's mandate is to deregulate over time. That was the mandate from Congress as conditions change, and that's what's happening here. We'll be able to transact under this new rule shortly after the vote happens, as soon as it gets into the federal registry.

[Aaron Watts, Analyst at Deutsche Bank]

Okay. That's really helpful. Thanks. Maybe one for Rob, potentially, but I know you touched on some weakness in some of your core categories. Can you highlight a little bit more about your top categories and how they're trending plus or minus right now? Are the ones that are a little softer at the moment just really a reflection of the macro uncertainties?

[Rob Weisbord, COO and President of Local Media at Sinclair]

Yeah. I'll start with automotive. Automotive is flat year-over-year, that trend continues, which means it's a great sign through these macroeconomics that automotive spending remains equal to last year. Sports betting and legal were categories that helped drive the quarter, while services and medical were the downtrending top categories.

[Aaron Watts, Analyst at Deutsche Bank]

All right. Perfect. Thanks again, guys.

[Operator]

Thank you. That concludes our Q&A session. I'll now hand the conference back to Chris Ripley, President and Chief Executive Officer, for closing remarks. Please go ahead.

[Chris Ripley, President and CEO at Sinclair]

Thank you once again for joining us for our Q2 earnings call. If you have any follow-ups or questions, please don't hesitate to reach out to us.

[Operator]

Thank you. Everyone, this concludes today's event. You may disconnect at this time and have a wonderful day. Thank you for your participation.

Participants

Executives

• Chris King, VP of Investor Relations
• Chris Ripley, President and CEO
• Rob Weisbord, COO and President of Local Media
• Narinder Sahai, EVP and CFO

Analysts

• Dan Kurnos, Analyst at StoneX
• Benjamin Soff, Analyst at Deutsche Bank
• Steven Cahall, Analyst at Wells Fargo
• Aaron Watts, Analyst at Deutsche Bank