Versant Media Group, Inc. Class A Common Stock 2026 Q2 Earnings Call

Thank you. Good morning, everyone. Welcome to Versant Media's second quarter 2026 operating and financial results conference call. Joining us today are Mark Lazarus, Chief Executive Officer, and Anand Kini, Chief Financial Officer and Chief Operating Officer. Also with us are Jordan Fasbender, General Counsel, and Natalie Candela, Vice President of Investor Relations. Before we begin, I'd like to remind you that certain statements made during this call may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect management's current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied. For a discussion of these risks and uncertainties, please refer to Versant Media's filings with the SEC in today's earnings release.

All forward-looking statements are made as of today, August 6th, 2026. We undertake no obligation to update them. In addition, we may refer to certain non-GAAP financial measures. Information and reconciliations to the most directly comparable GAAP measures are included in today's earnings release and in the materials posted in the investor relations section of our website. During today's call, all comparisons to the prior year are against standalone adjusted figures, which represent our estimated 2025 results as if Versant were already a separate independent company. With that, I'll turn the call over to Mark.

Thank you, Wylie. Good morning, everybody. Our second quarter results reinforce the strength of our portfolio and the strategy that we're executing to win with premium live content, extend the reach of our iconic brands, and accelerate growth across our platforms. Across news, sports, and entertainment, our brands continue to grow audiences and engagement while delivering value for viewers, advertisers, and our distribution partners. Our TV portfolio now reaches more than 120 million viewers each month with double-digit audience increases in aggregate across our networks. We also recently completed multi-year renewals with two large pay TV distribution partners, one in the U.S. and one in Canada, further highlighting the value of our portfolio. That strength gives us confidence to invest where we see the greatest opportunities, growing our digital platforms, advancing our direct-to-consumer offerings, and deepening our audience relationships.

Together, these investments extend our audience reach and build upon the foundation of our iconic, highly cash-generative brands. Our performance this quarter demonstrated our strong execution of this strategy across the portfolio. Let's walk through a few of the highlights. CNBC reinforced its position as the leading global business news brand. During market hours, the network ranked among the top 10 cable networks for the fourth consecutive month and delivered its highest-rated quarter in more than five years. Coverage of the SpaceX IPO drove CNBC's highest-rated day during that same period. CNBC continues to generate the most affluent and educated weekday daytime audience in all of television, a distinction it has maintained for 27 consecutive quarters. The network also featured exclusive interviews with business leaders and policymakers, including Jeff Bezos, whose appearance generated more than 100 million video views across all platforms.

MS NOW also built on its momentum, delivering its seventh consecutive month of audience growth in TV and expanding its reach on digital platforms. In June, viewers watched an average of nine hours each week, the second highest level of engagement across all of television. MS NOW saw a 14% increase in viewership in the second quarter versus last year. That momentum extended well beyond television. Year to date, the network generated nearly three billion combined YouTube and TikTok views and in June ranked as the number one news organization on YouTube. Podcast engagement was also healthy, with more than 11 million audio downloads during the month. In July, we celebrated MS NOW's 30th anniversary, an important milestone for one of the country's leading news brands. MS NOW continues to accelerate. Golf Channel also had an outstanding quarter.

PGA Tour coverage delivered the network's most-watched second quarter since 2020, with comprehensive coverage across all of golf, including the Masters, PGA Championship, U.S. Open, and PGA Tour and its signature events. In sports and entertainment, USA remained a top five entertainment network among key demographics, extending a track record of leadership spanning more than three decades. Live sports continue to drive large, highly engaged audiences. In the WNBA's first season on USA, the network aired the three most watched games across cable and streaming, while League One Volleyball increased viewership over its inaugural season. The WWE continued to deliver large audiences. We're investing in sports where we believe we can create long-term value. Last month, we announced a five-year agreement with the Bundesliga, one of Europe's most renowned soccer leagues, known for passionate fans, iconic clubs and athletes, and global appeal.

Beginning this season, we will broadcast more than 300 live matches annually, with at least 30 premium matches airing on USA Network and all remaining matches streaming for free on Fandango. This agreement builds on our year-round sports offerings, expands our reach with soccer fans, and creates more opportunities to engage audiences across platforms. In addition to Bundesliga, the start of our NASCAR Cup Series coverage on USA Network begins this Sunday. The return of the Premier League later this month provide a strong lineup of live sports as we enter the second half of the year. In entertainment, we're driving viewership with a balanced portfolio of original programming and proven franchises. Our strategy is to build brands that engage audiences across multiple platforms for years to come. That strategy is delivering results.

Everything on the Menu saw double-digit ratings growth in its second season, and we're excited to build on that momentum with our next generation of originals, including Anna Pigeon and The Golden Life, set to premiere this month and fall, respectively. Platforms continue to be an important part of our long-term strategy, and both Fandango and GolfNow delivered strong results. We are evolving Fandango from a leading movie ticketing business into a comprehensive entertainment platform. A few weeks ago, we launched our new AVOD service, bringing ticketing, home entertainment, and free streaming together under the Fandango name. AVOD is one of the fastest-growing areas in media, and we enjoy clear advantages from the well-known Fandango brand, broad Connected TV distribution, rich first-party data, and unique and exclusive content, most recently with the addition of the upcoming live Bundesliga matches.

The Fandango platform we're creating is anchored by a differentiated core business, as demonstrated by healthy ticketing volume growth. In any given month, 50 million consumers visit either Fandango or Rotten Tomatoes to decide what to watch. Together, these platforms enjoy loyal customer relationships and support our long-term growth strategy. GolfNow realized broad-based growth, including domestic rounds booked, global course relationships, payments volume, and GolfPass subscribers. We are further strengthening our leadership in golf and platforms with the acquisition of Full Swing. Full Swing is a leading sports technology company serving one of the fastest-growing segments in the golf industry through immersive off-course golf experiences. The acquisition expands our portfolio with an interactive offering spanning immersive simulation, launch monitors, virtual greens, integrated software, and performance data. As a trusted partner to many of the game's top players, Full Swing is growing rapidly, is profitable, and generates healthy recurring revenue.

We believe Versant's leadership in golf uniquely positions us to accelerate adoption of Full Swing's technology across both consumer and commercial markets. We believe there is meaningful upside in this market. Today, there are 38 million U.S. off-course golfers, exceeding the number who play on traditional courses. Since 2019, the number of off-course golfers grew more than 60%, and simulator golfers grew by more than 150%. More importantly, Full Swing will expand our golf ecosystem by broadening our relationship with the golf community. Together with Golf Channel, GolfNow, and GolfPass, we are uniquely positioned to connect premium content, commerce, technology, and participation, creating more ways to engage golfers throughout their journey. There are also additional opportunities beyond golf, including baseball, where Full Swing's technology is already used by both college and professional teams.

We are also advancing our direct-to-consumer strategies around MS NOW, which will launch its direct-to-consumer experience ahead of the midterm elections, giving audiences new ways to engage with its hosts, programming, and community while deepening engagement, strengthening the brand's relationships with viewers and fans. At CNBC, we're developing a next-generation digital platform that will combine CNBC's trusted journalism, exclusive access to leading voices in business, and AI-powered investing tools to become a premier destination for investors. Taking a step back, our accomplishments this quarter reinforce what we've believed since becoming an independent company just over seven months ago. We continue to deliver premium content that expands our audiences, drove compelling results across pay TV and platforms, renewed distribution agreements with valued partners, and advanced a strategic initiative that will further strengthen our leadership in golf.

Looking ahead, we'll continue to invest where we see competitive advantages and clear returns, extending the reach of our brands while creating long-term value through scalable platforms. Today's announcement of an additional $100 million accelerated share repurchase program alongside our quarterly dividend reflects our commitment to returning capital to shareholders, the enduring strength of our business, and the confidence in the opportunities ahead. With that, let me turn it over to Amit.

Thanks, Mark, good morning, everyone. Our second quarter results reflect another quarter of disciplined execution of our strategy and progress toward our financial objectives. We delivered EBITDA growth, strong margins, and meaningful Free Cash Flow while continuing to invest in the business to drive growth. Based on the strength of our first half performance and our expectations for the balance of the year, we are raising our full-year outlook for revenue from $6.15 billion-$6.4 billion to $6.2 billion-$6.45 billion. For adjusted EBITDA from $1.85 billion-$2 billion to $1.9 billion-$2.05 billion. On Free Cash Flow, we are maintaining our prior expectation of $1 billion-$1.2 billion to account for natural quarterly fluctuations in working capital timing. Turning to our results, total revenue for the quarter was $1.64 billion, a decline of 4% compared to the prior year.