Townsquare Media NYSE: TSQ said its first-quarter results met its prior guidance as the company continued to shift its revenue and profit mix toward digital advertising and marketing services.
On the company’s earnings call, Chief Executive Officer Bill Wilson said Townsquare is “reaffirming the full-year net revenue and adjusted EBITDA guidance” provided on its previous call, citing improving digital advertising trends in the second quarter and expectations for the second half of 2026.
Chief Financial Officer and Executive Vice President Stuart Rosenstein said first-quarter net revenue declined 1.9% year over year to $96.8 million, within the company’s guidance range of $96 million to $98 million. Adjusted EBITDA fell 9.7% to $16.4 million, also within the guided range of $16 million to $17 million.
The company reported first-quarter net income of $3 million, or $0.16 per diluted share, compared with a net loss of $0.12 per diluted share in the prior-year period.
Digital Revenue Reaches Record Share of Business
Wilson said Townsquare’s business mix has continued to move away from legacy broadcast revenue and toward digital products. In 2025, digital solutions accounted for about 55% of total net revenue and 56% of total segment profit. In the first quarter of 2026, digital revenue increased to 59% of total net revenue, while digital profit represented 63% of total profit, both all-time highs for the company.
Wilson said those figures demonstrate that Townsquare has “transformed from a legacy broadcast company into a digital-first local media company,” focused on local markets outside the top 50 in the U.S.
Townsquare Ignite, the company’s digital advertising segment, posted first-quarter net revenue growth of 7% year over year. Wilson said the increase represented a significant improvement from 2025, when digital advertising revenue grew about 2%.
The company attributed the improvement to growth in direct-to-client digital sales, including its programmatic advertising platform and sales of advertising on its owned-and-operated digital properties. Rosenstein said Townsquare Ignite revenue growth rebounded from a slight year-over-year decline in the fourth quarter of 2025 to 6.8% growth in the first quarter of 2026.
Programmatic Advertising and Media Partnerships Drive Growth
Wilson said the company’s programmatic digital advertising business, which represented about 65% of Townsquare Ignite’s 2025 revenue, grew 21% year over year in the first quarter. He said the company expects programmatic revenue to be up more than 20% year over year again in the second quarter.
Townsquare’s third-party media partnership model, a component of the programmatic business, also continued to expand. Wilson said media partnership revenue was approximately $6 million in 2025, and the company had six local media partners. In the first quarter, revenue from the initiative roughly doubled from the prior-year period, and Townsquare is on track to approximately double the $6 million generated in 2025 for the full year.
Wilson said the company has added two more media partners since its prior earnings call, bringing the total to 13. He reiterated a longer-term goal for the division to reach $50 million in revenue within four years at an approximately 20% profit margin.
During the question-and-answer portion of the call, Wilson said the media partnership pipeline includes “dozens and dozens” of local media companies, primarily radio operators, as well as some television, outdoor, print and other legacy media companies. He said some current partners operate in top 50 markets, where Townsquare’s digital advertising solutions have shown traction, though the company remains focused on markets outside the top 50 for potential acquisitions.
Owned-and-Operated Digital Sales Offset Remnant Declines
Direct sales of advertising on Townsquare’s owned-and-operated digital assets, including more than 400 local websites and mobile apps, increased 10% in the first quarter, Wilson said. He said those sales continued to show strong growth in the second quarter.
At the same time, the company continued to see pressure in remnant, or indirect, digital advertising revenue. Wilson said remnant revenue declined 40% in 2025 to about $12 million from about $20 million in 2024. For 2026, the company expects remnant revenue to decline to approximately $9 million, with most of the year-over-year decline occurring in the first seven months of the year.
In the first quarter, indirect remnant digital advertising revenue declined 37% year over year, but Wilson said it grew sequentially from the fourth quarter of 2025. He said remnant revenue now represents about 8% of total digital advertising revenue.
Wilson also said Townsquare’s digital audience showed signs of stabilization despite lower search engine referrals and headwinds related to AI search traffic. Average monthly unique visitors rose to 25 million in the first quarter from about 20 million in the fourth quarter of 2025, according to Wilson.
Townsquare Interactive Revenue Falls, Margins Improve
Townsquare Interactive, the company’s subscription digital marketing solutions business, reported an 8% year-over-year revenue decline in the first quarter, which Wilson said was in line with expectations and reflected slower sales velocity due to a smaller sales force.
Rosenstein said Townsquare Interactive’s first-quarter net revenue declined 7.9% year over year, while segment profit margins increased to 33.7%. Wilson said the margin improvement was driven by a restructured customer service model, changes to the sales organization and efficiencies from AI tools used in areas such as website creation and customer service.
The company expects Townsquare Interactive revenue to decline about 8% year over year again in the second quarter, though Wilson said the sequential decline is expected to be smaller, at about 2% quarter over quarter. He said the company may return to month-over-month revenue growth as early as the third quarter of 2026.
In response to a question from Barrington Research analyst Patrick Sholl, Wilson said churn has continued to improve and is returning to historically low levels. He said the company’s main hurdle is rebuilding the size of the Townsquare Interactive sales team, which was reduced during 2025. Wilson said the sales force had been down about 40% and is not expected to return to prior levels until 2027.
Broadcast Revenue Declines Moderate; Full-Year Guidance Reaffirmed
Townsquare’s broadcast business continued to decline, though at a slightly slower rate than in 2025. Rosenstein said total broadcast revenue declined 6.6% in the first quarter, while broadcast revenue excluding political advertising fell 6.9%. That compares with consistent 8% ex-political declines in each quarter of 2025.
Wilson said Townsquare gained local and national broadcast market share in the quarter, according to Miller Kaplan estimates, despite the revenue decline. He reiterated that radio remains a valuable cash-flow asset for the company, but not a growth driver.
For the second quarter, Townsquare expects net revenue of $114 million to $116 million and adjusted EBITDA of $24 million to $25 million. For the full year, the company reaffirmed guidance for net revenue of $420 million to $440 million and adjusted EBITDA of $87 million to $93 million. The guidance includes approximately $8 million of political revenue.
Rosenstein said Townsquare generated $4.2 million of cash flow from operations in the first quarter, more than in the first quarters of both 2025 and 2024. The company ended the quarter with $457 million of debt outstanding, $2 million of cash and net leverage of 5.27 times.
The company’s board approved a quarterly dividend of $0.20 per share, payable Aug. 3 to shareholders of record as of July 27. Rosenstein said the dividend equates to $0.80 per share annually and implies an annual payment of approximately $14 million based on the share count.
About Townsquare Media NYSE: TSQ
Townsquare Media, Inc NYSE: TSQ is a diversified media and entertainment company that operates primarily in small and mid-sized markets across the United States. The company owns and manages over 300 local radio stations that deliver music, news, sports and community programming to listeners. In addition to its core broadcasting business, Townsquare Media provides digital marketing solutions and advertising services through its proprietary platforms and specialized agencies, helping local businesses connect with consumers via targeted online campaigns.
Founded in 2010 and headquartered in Purchase, New York, Townsquare Media has grown its footprint through strategic acquisitions and the development of a broad digital portfolio.
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