Great. Well, good afternoon, everybody. Welcome to the Nexstar Fireside Chat at the Goldman Sachs Communacopia + Technology Conference. My name is Mike Ng, and I cover media cable telco here at the firm, and I have the privilege to introduce Nexstar Media Group's Founder, Chairman, and CEO, Perry Sook, and Nexstar's CFO, Lee Ann Gliha. Thank you so much for being here today. It's an absolute privilege to have you on stage here with us. Great. Thank you for having us. To start off, Nexstar recently marked its 30th anniversary. Congratulations. Growing from a single station in Scranton into the nation's largest local broadcaster, operating or servicing 265 full-power stations across 132 markets. To start things off, how would you characterize the operational performance and the overall health of the business today across local affiliates, the national networks, and NewsNation, and The CW, as well as some of your emerging spectrum ventures? Well, that's a lot. I'll see what I can do in the half hour that we have here. First of all, I think of our company as a local media company first and foremost, but with national scale and national scale aspirations in that what we do is the least sexy but most sticky and durable part of the media ecosystem, which is we provide a service, which is local content to local communities, and we help local businesses sell stuff. Everything else we do, we build on top of that. NewsNation was the outgrowth of the 5,500 journalists we have scattered around 44 states in the U.S. that provide content upstream to the news network. Acquiring The CW was done to make it a better network for the owned and operated stations, of which today we own about 60% of the national distribution of The CW through our owned and operated stations. Everything we do is to the ends of what can benefit our go-to-market option for viewers and advertisers locally. That's different than a lot of other companies that focus from the top down and what's good for the network. It's what's good for the stations will inform what we do with the network. It's through a local lens, and we have a 2,500-person local sales and national sales organization that we have business relationships with approximately 47,000 SMBs across 44 states in the U.S. That is an extremely durable long tail relationship, we think. Operationally, we're performing ahead of our plan, which is the plan we use to inform our EBITDA and free cash flow guidance to all of you. We feel good about that. Political is very stout right now, as you can imagine, post Labor Day, and has been all year, defying or at least overachieving our expectations, and we think that will continue. As you know, half of the money that's spent in all political advertising for the year will be spent between a week from Monday and Election Day, so that seven weeks will determine the tale of the tape. But we feel very good about our ability to deliver political, not only on the Nexstar platform, but then what TEGNA is doing on their platform. Obviously, we get the benefit of that revenue and free cash flow, and Lee Ann Gliha's been using all of that to pay down debt. We feel very good about the company. We want to clear this jurisprudence underbrush eventually. But we have the benefit of owning and operating or at least overseeing the operations of the TEGNA assets through their financial performance, which is basically our only lens into the business. But as time goes on, our worst-case scenario is we continue to pay down debt. It's not like we have escalating fees or things get worse as time goes on. From that perspective, we're in the best place possible given the cards we've been dealt, and we will do what we always do, which is keep our head down and do the work, and continue to find ways to make a more efficient operation, a more expansive operation, and continue to improve our balance sheet. Great. I would love to dive into the TEGNA integration and the hold separate order a little bit more. How is management running the business through this interim period while remaining compliant with the court order? What can you do from an integration readiness perspective so that you can hit the ground running once you get the clarity that you are able to do so? Obviously, a highly unusual situation, but would just love your thoughts on all that. Yeah, I will take that. We obviously cannot run the business right now pursuant to the court order. There is a team that is in place. Pat Paolini, who joined TEGNA as the CEO, who comes from Fox, is a phenomenal operator, is energizing that business and continuing to help that business generate the cash flows that it historically has. I think we feel very good about that. The business is also subject to limitations on what it can do with respect to the court order and with respect to the interim operating covenants that we had prior to the merger that are still in place. But I think everything is continuing to operate as we had seen and expected. I think from an integration perspective, there is also not a lot we can do there as a result of the court order currently. But as you might imagine, and as I think we talked about leading up to this, we did an incredible amount of diligence, very detailed diligence, really looking at under every rock and figuring out exactly what our integration plans were going to be, really down to the line item detail. So we feel like the minute that we are able to dust off those plans and get back in business, we will be in good shape to push the button on that. Nexstar is the largest local broadcaster, so you are in a unique and very well-positioned to talk about the FCC National Television Audience Reach Cap, which the FCC voted to repeal that 39% cap back in August. How does removing the cap change your longer-term M&A strategy? What is that regulatory modernization? I think everybody would agree that is a bit of an antiquated rule. What does it allow local broadcasters to do that they could not do before? Well, let me say first that the removal of the national ownership cap restrictions against broadcasting, then dealing with the quadrennial review process, which is open proceeding in front of the FCC, which we think will lead to modernization of both the local ownership rules that govern in-market conduct of both radio and television. We think if Chairman Carr accomplishes that, which we think he will, likely by the end of the year, I think that we will look at Chairman Carr as the most consequential FCC chairman in modern times to actually do what he's been talking about doing since he was a commissioner under Ajit Pai and then under Jessica Rosenworcel, of eliminating these ridiculously outdated rules to allow the industry the ability to compete on a more level playing field, at least in the domestic U.S. with big media and big tech, and just take the politics out of it. Those accomplishments would be seminal and really, I think, consequential. So what it does for us is if those impediments are taken away, then we can continue to grow our footprint, we can continue to grow and add in markets that would be of significant importance for distribution and advertising to The CW, to our owned and operated station portfolio that would benefit the network. And I think will allow for more rationalization and consolidation of the industry. If you look at most industries, the arc of how they grow, there becomes usually a dominant player in the industry, a secondary player that is maybe not as large but has similar characteristics, and then a lot of smaller players that are less strategically important to the industry that ultimately get consolidated up either by private equity or the two strategic players. To some extent, that started to play out in broadcasting. It certainly, I think, plays out in streaming. I think it's playing out in cable in front of us. This is typically what happens as industries mature. So we see that definitely playing out here, and these removing the restrictions from allowing the industry to react more to market forces, I think is extremely important, and I think it's extremely important for the health of this industry. I think the contra to that is having done nothing, local television would look a lot like local newspaper, which is there's not much left there to deregulate. So you can't wait too long. It comes not a moment too soon, and I think will be strategically important to the health of retaining local journalism, and I would argue we're the last bastion of that, given the diminution of newspaper in the vast majority of the country, and in allowing this local industry to continue to survive. Great. It is a great segue. Maybe we can talk a little bit about local journalism, local broadcasting, as a trusted service for the public. Talk about the importance of local news. How do you differentiate the brand? What are some of the practical benefits of being able to operate a national footprint of local newsrooms, as well as national properties like NewsNation and The CW? Well, as we said, our local newsrooms around the country and our local journalists were the seed corn that allowed us to create a new alternative national news network in the cable news space, which is NewsNation, which is seen as the most unbiased and neutral reporter and unbiased coverage and high-end enterprise reporting. We serve the center of opinion and the center of America, unlike other news networks. If you look at just the sheer growth of NewsNation from where it was to where it is in its five years, the growth has been phenomenal, which I think says there is a thirst for and an increasing acceptance of that product, which since it was all organically grown and self-funded, that organic growth is purely an earthly benefit because there is no real additional cost of building out the network. It is there. We are 24/7, so we will continue to promote it and continue to look for unique opportunities to differentiate ourselves from the echo chambers that are on the left and the right. Again, I think that we are very gratified with the growth, but no, we are satisfied with the destination that we are at today. We employ more local journalists in the United States than any other news organization on the face of the Earth. We take that responsibility very seriously. We produce, including TEGNA, in excess of 400,000 hours of local content every year, and that is far more than anybody else does in television or any form of video media in the United States. It is, again, our local news are seen as unbiased and centrist of opinion and centrist of coverage. What we are doing at national really is an extension of what we have been doing locally all the time. Give me the news, I will make my own decisions. That is the real cornerstone of our company, and as I said, local is our North Star, so everything we do starts from that local journalism base. The ability to get bigger, the ability to operate two separate news products under the same roof allows us to not have to spend duplicate administrative costs on maintaining a separate building. It is in our interest to have our news products reach as many different and cumulative audiences as possible. So the idea that we would somehow eliminate news or put the same product on both stations as a business practice across the country is contra to the way that we generate our revenue. We make half of our money in advertising from our local news broadcasts across the entire Nexstar portfolio. So why would we do anything to harm this? What we're trying to do is consolidate operations to maintain jobs, increase the amount of local content. We've committed to the regulatory agencies we'd increase the amount of local content that the TEGNA stations do, or we do in these TEGNA markets on an all-in basis. It's in our business interest to do that. We're not doing that altruistically. We're doing it because it makes good business sense, because that's the only IP that we own. That's the only product that we manufacture ourselves. Everything else, we're a middleman and a vendee of people that sell us other programming. So it's vitally important. It's the only thing that makes us unique from any other video distributor out there. There's a moat around what we do in the local markets because it would be prohibitively expensive to duplicate the equipment, the facilities, and the people on a startup basis and hope that it works out. I think Patch proved that pretty well several years ago, that just because you want to put a bunch of people in a room and have them generate local content doesn't necessarily mean it's going to resonate with the local community. Great. News is one of the genres that are still very relevant. It still has to be consumed live, it can't really be disrupted by on-demand in a meaningful way. The other genre would be sports, so maybe we can talk a little bit about sports. The CW has transformed very quickly under Nexstar's ownership. I've been an observer of the asset for a long time, so certainly acknowledge that you guys have done an amazing thing with it. The sports slate has grown with Mountain West, Pac-12, ACC, WWE NXT, just as an example, along with a bunch of streaming partnerships that you have with ESPN, Roku, just to name a few. How are sports and digital initiatives driving ad monetization and reach beyond some of the just traditional broadcast? How complete is the sports rights portfolio for you guys, and are you still selectively pruning and adding? Well, you left out NASCAR in your description of our product. We air the NASCAR, it used to be the Xfinity Series, it is now the O'Reilly Series, which are the Saturday races. It was our belief, and it has been proven out, that broadcast television is still special and different from the other distribution alternatives that are out there. If you make it easy for the viewer to find the product, they will find it and they will watch it. Every race that NASCAR runs on Saturday is on The CW. Pretty easy to figure out. It was there last week, it will be there this week. We are generating increases in NASCAR viewership. The race we just ran this past weekend was the best that race has done since sometime in the 20-teens. That is before there were streaming services and a lot of other ways to slice and dice the product. I was just with NASCAR at their foundation banquet in New York earlier this week, and they said, "This is the best thing we have going and you are the best partner we have." As my wife would say, what would you expect them to say when they are talking to you? In any event, we have been the growth engine for NASCAR, and that has been a growth engine for CW Sports. It played out because it is on broadcast television, it is on the same place every week, kind of like Sunday night football or other things like that. You make it easy for the viewer to find it, they will find it. Conversely, if you make it too hard for the viewer to find the product, and it moves around every week to another service, not just NASCAR, but anything. If they cannot find it quickly, they will probably give up and go watch something else. We see that play out as well. We still think of broadcast television as having a special place in the media ecosystem, and that has been proven out. We get calls from all sports leagues now wanting to know if there is an opportunity to do business. Again, we looked at The CW App where our sports used to reside, and it had an interesting but not very meaningful audience in terms of size. We said we could build, buy, or partner. We are probably not going to spend the amount of money that it costs to create something like Peacock. We are probably not going to buy something at a non-accretive multiple to achieve the same end. We had the opportunity with ESPN to put all of our CW Sports on ESPN and instantly partner to have a distribution platform that would cost us a lot of time and money to get to the same place. ESPN likes it because we are not beholden to any other streaming service, and they have the exclusive streaming rights for all of the current CW Sports properties. It was a win for both. I mean, there was an exchange of value from ESPN to us to give them those rights. But now we have the ability to cume that audience, or we can do dynamic ad insertion just on that stream if we so choose. The early days are that the audience is additive and it is, with very little notice, has started to develop into something that we think will be significant over time. Very interesting. We haven't talked about NewsNation yet, and NewsNation is the fastest-growing cable news network. That's across total day and prime time. What programming choices are allowing NewsNation to take market share from some of the incumbent cable news networks? What's your view on what the next leg of investments, either in programming or talent, that you expect to make to continue to drive that ratings momentum? Yeah, I'll take that one. I think what differentiates NewsNation is a number of things. I think first and foremost is that we leverage our on-the-ground reporters, our 6,000 on-the-ground reporters in these local markets to help provide direct, timely news that is interesting to the local communities. The second thing we do is we are very focused on making sure that that news that we're providing and programming is going to be unbiased and fact-based. If we do have opinion, we cite that as opinion. We do think that the majority of Americans are not polar right or polar left. They're actually somewhere in the middle. What we have seen anecdotally is that we have people telling us that they will maybe watch Fox or MSNBC, but then they'll come to NewsNation to fact-check and to make sure that they're getting the right information. The other thing that we do is we don't really spend too much time on the same type of content that the other news networks are providing. We're not spending all of our time on political content. We actually provide true crime and other types of news that's important from a local perspective. I think we have done really well in terms of the ratings. The first quarter, actually, we peaked at the 35th-ranked network of all the networks. We're excited about that because you see, typically, you see Fox and MSNBC in the top 10 in terms of networks, and there's a real benefit. I know that Warner Bros. Discovery made some comments about CNN being almost $2 billion of revenue. So there's real opportunity for us to continue to grow. I think what can help us grow that, I think it's really sticking to our knitting, making sure that we're providing that safe source, that fact-based journalism. I think every once in a while, you catch a really good news cycle, and people start to tune in like they did in the first quarter. It was a very good news cycle for overall and really kind of start to gravitate toward it and enjoy it and tune in again and again and again. Great. If we could pivot and maybe just talk about the portfolio's carriage renewals. Retrans affiliate fees and sub-trends. I think late last year, Nexstar completed several multi-year renewals covering 60% of its subscriber base, and you're seeing the benefit of some of those contractual rate step-ups into 2026. How much do those escalators help sustain distribution revenue growth, particularly given the continued headwinds from cord-cutting? How important is packaging in your next round of negotiations with pay TV operators, just given all this talk around skinny bundles? I would imagine you guys are relatively well-positioned there. Oh, yeah. Just taking that one first. In most of the skinny bundles, if not all of them, we are the key component of it. If you think about the percentage of viewership that these cable companies are seeing, about north of 40% is coming from the broadcast channels. If you look at, I was mentioning the rankings in terms of broadcast and cable networks, the top four are always the broadcast networks, which is our content. So we're going to be very important to those packages. We still believe we are under-monetized with generating north of 40% of the viewership, but in the mid-20%s of the dollars that get spent by these operators in terms of content. So we still think there's an opportunity from that perspective. We did renew about 60% of our subs last year. This is at Nexstar on a standalone basis. That's what I'm referring to when I'm speaking right now. We did guide that our top line, this is for Nexstar only, distribution revenue would be up low single digits, and our net retransmission revenue would be up mid-single digits. You can get a sense for when we get these renewals done and the step-ups, it is enough to overcome the rate of decline. We are seeing the MVPDs declining at a much, obviously, faster rate with the virtual MVPD growth sopping up some of that. You can see those numbers in the public financials that get reported. It's really kind of those step-ups that are helpful in terms of sustaining that growth. Now, going forward, it's really going to be, for us, in terms of escalators and continued growth, we're going to have to continue to focus on the fact that we're undervalued in these negotiations. I think the other piece of it is we're seeing some really positive results coming out of some of the cable companies like Charter, who's done an unbelievable job in repositioning their video package and really tightening up that subscriber base. Hopefully others will follow suit because we've really seen some positive trends. If we continue to see that should be really great for our top line. Great. I wanted to ask about digital and Connected TV advertising. Nexstar expects that digital revenue should surpass national advertising— Yeah. —revenue in 2026. Could you just spend a minute talking about the core drivers behind this inflection? Furthermore, following the acquisition of TEGNA, how does eventually integrating the Premion Connected TV platform enhance your digital scale and help your presence with advertisers? Yeah. What we have seen over time is that our national component, this is really more talking about our local stations, the national component of our advertising has become more under pressure just because there's been an increasing amount of new inventory from CTV that's out there. While that is somewhat impactful to our linear side, it's actually also a positive for us because we can sell that. That's not something that we can't get our hands on. Part of our strategy has really been to talk to our advertisers about audience extension strategies where we can not only provide our core television and linear product, but then add onto it. "Hey, you want more sports? You want more targeted demographic? We can get that for you with respect to CTV." As a result, we've seen that digital, both our O&O and our, on a combined basis, third-party CTV inventory that we've been selling growing at a low double-digit type of a multiple. We're also looking to expand our own digital inventory. We've launched CTV apps in all of our markets that provide our local news product on them, and so we're looking to create unique programming that's available there and to monetize that. Great. At the onset, you guys talked about political advertising and the strength there. I think some of the market research forecasts are that total political ad spending should be $10.8 billion for the 2025/2026 cycle. Nexstar, on a standalone basis, expects to capture low double-digit share of broadcast political dollars, just given its presence in more than 80% of contested markets. Could you talk a little bit about how you're positioning the sales organization to maximize that market share across both broadcast and local CTV? What are you seeing in terms of the split of political dollars between local broadcast and CTV? Yeah. Well, I think what we have really seen is that broadcast political advertising has been durable and sustainable. If you talk to any agency that is placing dollars on behalf of their candidates, or their issues, or whatever else they are on the ballot that they are trying to get approved, they realize that broadcast is number one with a bullet in terms of the media that you want to be involved in. We have not really seen a degradation in the spend or the rate of spend within our broadcast television properties. I think what you have seen is an increase in the fundraising and the overall potential dollars that can be spent, and really that incremental dollars have been really accruing to the benefit of CTV. So what you see is our core business, but then on top of that is added the incremental CTV. As I mentioned, one of the things that we are doing to try to be part of that CTV spend is we have launched these local apps that we think we can potentially have some sales of some political advertising inside that component. Great. If we could just talk about core advertising. I think that embedded in your guidance for mid-single digit declines in non-political advertising in the third quarter is a result of some of the crowd out— Yeah. —from the record political ad spend. How would you characterize the underlying core advertiser sentiment today? How are local markets faring against national networks? What specific advertising categories do you think are showing the most resilience? Yeah. Our advertising is not doing anything that we haven't expected it to do. We did guide that we would be down mid-single digits in the third quarter, similar to what we were in the second quarter, which is good given the increased amount of crowd out in the third quarter, I believe. We still see, as I mentioned, some continued pressure from increased competition from digital sources, but that's also a source of growth for us as we're able to sell that inventory. I think we keep getting bubbled up a little, some information from our local advertisers commenting that the economy is not the best. You've got increasing interest rates, you've got increasing gas prices, all of which goes to a little bit of a weaker economy, which is causing some of the more consumer-focused categories to pull back a little bit. Nothing is out of the ordinary, nothing is out of line in particular. Look, like I said, we're doing things to try to combat this impact. One of which is obviously focused on as much political revenue as we can this year. Number two is focused on the digital revenue growth and digital revenue selling. The third is really working on a new model to make our advertising more accessible to advertisers by trying to effectively make our advertising look like CTV so that it can be a more frictionless buy for advertisers, which we think will bring people back into the medium because we're still driving audience. Great. There's been a lot of focus on spectrum this week at our conference. Can you talk a little bit about EdgeBeam Wireless, right? The joint venture that you have with other major broadcast groups. You guys have together assembled a nationwide spectrum footprint for high-speed data services. What progress are you making in commercializing EdgeBeam and signing enterprise or government customers? Talk a little bit about what you see as the long-term revenue and margin potential for this business. The EdgeBeam consortia, as you said, has a near nationwide footprint, and we see that as kind of the management agent, the leasing agent for our spectrum assets. The opportunities are as we clear more and more of our spectrum for non-video uses, which would include the sunset of the ATSC 1.0 simulcast requirement, the sunset of a ATSC 1.0 service, which we have proposed to the FCC happen in phases, basically 2030 through 2032. That would enable us to have conversations with any number of use cases on material, whether it is Sony that is interested in in-car entertainment to the headrests that face the rear seats, or whether it is precision navigation, fleet management, lower-cost 5G replacement networks, anteing spectrum into a phone company's need for more 5G-like spectrum to facilitate their needs, to potentially being the terrestrial component to a satellite-delivered startup phone service that either Mr. Bezos or Mr. Musk might. All of those conversations and business development activities are going on, and we see the opportunity there, potentially to create a substantial revenue stream in addition to our current core business. I tell people I think it is the single largest value creation opportunity in our business as we know it today. I liken it to shale gas and shale oil in the ground in Texas, that it took 20 years to figure out how to hydraulically frack and horizontally drill to monetize that asset. This won't take 20 years to get there, but it will take between five and 10. The money will be made in B2B opportunities, but we have to obviously recognize and accommodate the B2C component, which is to make sure no one loses television access. When we transitioned from analog to digital, that was done via dongles. There was a government program. I think if the FCC is not giving a mandate, but gives a deadline to the sunset of ATSC 1.0 service, set manufacturers will begin to design to that standard, so the unserved portion of the population will decrease as time goes on. But right now, Sony is the only set manufacturer that puts a ATSC 3.0 chip in every set. So go buy Sony if you are looking for a television set. But we think that again, if we had to underwrite a dongle for the unserved, I think that not only have the cost of those come down from analog to digital days, but that a Samsung, a Vizio, some other manufacturer would say, "I will gladly provide that dongle free of charge if I have access to some of the data stream coming out of it." So I think there are commercial solutions to all of these problems. There won't be a nationwide one day where you turn off ATSC 1.0 and all you have is ATSC 3.0. It will have to be done kind of regionally and on a rolling basis. All of which makes it harder, but certainly not impossible. If you look at what I think the opportunity is 5- 10 years from now, data use of our spectrum revenue from that will rival what distribution revenue is today. To this company, that is $3 billion. So at a high margin, that certainly will support and underwrite local journalism for a long time to come. I think that is another reason why it is in the national interest that we move in that direction. Great. In the last minute that we have, just to close it out, over the next one to two years, what are your top strategic priorities for Nexstar? What milestones or industry catalysts are you most excited about as you position the company for long-term growth? Well, I think to be unshackled from our current legal entanglements as it relates to TEGNA is job one. Paying down debt while we are doing that is certainly virtuous and worthy. I think then, being unshackled from these additional regulatory burdens with the local ownership rules and the national cap will allow us to consider acquisitions that historically we have been prohibited regulatorily from doing so. I think we will continue to look at that. We still believe that accretive M&A, the TEGNA transaction was 20% accretive. Its stock buyback is 40% accretive. Its stock buyback is 20% accretive. I feel like we were being appropriately compensated as shareholders for the additional risk of execution approval and all of that. The company has built the vast majority of its value through demonstrated commitment and achievement and performance on accretive M&A. That still remains our top priority. Absent that, return of capital to shareholders would be our secondary priorities. Listen, there are all kinds of opportunities out there. We get calls all the time. There are all kinds of hypothetical, "What if this happens? Would you be interested in this?" We will take all of those meetings and again, put them through the same filters of every transaction we have done in our 30-year history is it accretive for shareholders? Is there industrial logic? Is the price right? Can we execute and add value? If it clears those screens, then that is what you will see Lee Ann and I spend our time on. Perry, Lee Ann, thank you so much for participating— Thanks, Mike. —in our conference. It was great having you on stage here. Thank you very much for having us.