Greetings. Good day, ladies and gentlemen, and welcome to the Sinclair Third Quarter 2026 Earnings Conference Call. At this time, all participants are on a listen-only mode, and the question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. And please note, this conference is being recorded. I will now turn the conference over to your host, Chris King, Vice President of Investor Relations. Sir, the floor is yours.

Thank you. Good afternoon, everyone, and thank you for joining Sinclair's third 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, and Rob Weisbord, our Chief Operating Officer and President of Local Media. Before we begin, I want to remind everyone that 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. Such factors have been set forth in the company's most recent reports as filed with the SEC and included in our third quarter earnings release. The company undertakes no obligation to update these forward-looking statements. Included on the call will be a discussion of non-GAAP financial measures, specifically adjusted EBITDA. These measures are not formulated in accordance with GAAP, are not meant to replace GAAP measurements, and may differ from other companies' uses or formulations. Further discussions and reconciliations of the company's non-GAAP financial measures to comparable GAAP financial measures can be found in the company's third quarter earnings release. 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.

Thank you, Chris, and good afternoon, everyone. Let me begin on slide three. Sinclair delivered another strong quarter of results with political revenues of $136 million during the quarter, up 55% versus the third quarter of 2022, which was the last midterm election cycle. For the quarter, total revenue was $893 million, up 16% year-over-year, while adjusted EBITDA was $213 million, More than doubling last year's amount. Growth was led by political advertising and that continued strong pace of demand was seen through yesterday's election with our final political revenue figure expected to be approximately $455 million for the full year, well ahead of all our prior forecasts. Distribution revenue continued to grow, supported by partner station buy-ins completed over the past year. Tennis Channel continued to deliver strong growth with core revenue up 21% year-over-year while seeing continued growth in our D2C subscriber base. AMP Media also saw strong growth on increasing demand across all our social products, including our new podcasts and partnerships with key advertisers. Before turning the call over to Rob to cover our strong political results, I did want to provide an update on our strategic review process. which we originally outlined in August of last year. We continue to evaluate various broadcast transactions, and while pleased with some of the progress we have made so far, we believe opportunities still remain. We have also evaluated the separation of the venture's portfolio through a spinoff, split-off, or other transaction, and have determined at this time not to separate ventures on a standalone basis. However, Larger broadcast combinations that could include a spin merge are still an opportunity. We will continue to evaluate all options that provide value creation for the company shareholders. Narinder will provide some additional details a bit later, but for now, let me turn the call over to Rob to run through our political results.

Thank you, Chris, and good afternoon, everyone. Turning to slide four, the 2026 midterm election cycle, delivered strong results across the country for us. As we expect to book approximately $455 million in political revenue for the year following yesterday's midterm elections. This represents a 12% growth versus 2024 presidential election cycle and a 37% growth versus the last midterm cycle in 2022. Of note, this compares quite favorably to our initial guidance provided in February of at least $333 million, as well as our updated guidance in August of at least $375 million. To touch on two topics briefly, we believe that political crowd out was certainly evident in our numbers, but also managed given core trends. Also, we did not experience a meaningful impact from the lowest unit rate ruling by the various courts. including the Supreme Court which updated the FCC's authority to allow political parties to enjoy the same LUR protection that has been historically granted just to the candidates themselves. We believe that any pricing adjustments that were made as a result of the LUR threshold were offset by the increased demand coming from the parties. We believe this political environment bodes well for the upcoming 2028 election cycle, which will be here before we know it. Notably, 2028 will represent a dual open primary in both parties for the presidential nominations. So we expect early and aggressive spending as both parties will want to introduce a new name nationally. While our footprint is well positioned throughout many battleground states, we also believe that the entire broadcast sector did well during the election cycle. given recent management commentaries and industry forecasts. This provides evidence, once again, of local broadcast television being a key delivery platform for political advertising. Sinclair has a proven track record of strong local news operations that support the ability to deliver knowledgeable, independent voters, which can be seen in our political revenue results discussed today. I wanted to touch on the continued strong viewership levels being seen in the NFL broadcast. Through week seven, total NFL viewership is up 4% year over year, averaging 18.4 million viewers, the highest viewership level through the first seven weeks of a season in over a decade. In fact, NFL games rank as the top 40 shows on television since the start of the 2026 season. More than 203 Americans have watched the NFL so far this season, according to Nielsen Media Research. And the NFL isn't the only sport with record viewership, as total college football viewing is up 2% over last year's record high pace, according to Nielsen. Broadcast position as the prime outlet for appointment viewing windows, particularly with live sports, remains more dominant than ever, and we are delivering the results. Now let me turn the call over to Narinder to run through our financial results.

Thank you, Rob, and good afternoon, everyone. Turning to slide five, I will walk through our third quarter results. Total company revenue was $893 million, up 16% year over year, driven primarily by political advertising and continued modest distribution revenue growth. Adjusted EBITDA was $213 million, up 113%, reflecting strong political revenue and disciplined expense management. Political advertising revenue of $136 million was the largest contributor to growth, up 55% from the third quarter of 2022. Distribution revenue increased 1%, supported by continued moderation in subscriber churn and the benefit of partner station buy-in. Core advertising revenue declined 4%, reflecting political proud-out and continued caution in a handful of cost-pressured, consumer-facing categories where fuel volatility and broader inflation are squeezing advertisers' budgets. In local media, revenue was $789 million, up 18%, and adjusted EBITDA was $205 million, up 123%, driven by strong political revenue. Tennis revenue was $71 million, up 6%. Core advertising revenue increased 21%, and distribution revenue increased 2%, supported by continued direct-to-consumer subscriber growth. Tennis adjusted EBITDA was $15 million, down approximately $1 million, primarily reflecting higher programming and production costs and continued investment in our direct-to-consumer platform. Turning to slide six, we continued to make meaningful progress on deleveraging. During the third quarter, we repurchased and retired $25 million space amount of our B-7 term loan at a discount and repaid and terminated the remaining B-3 term loan balance further reducing our cash interest expense. At quarter end, total debt was approximately $4 billion, with no material maturity until December of 2029, excluding the accounts receivable facility. Sinclair Television Group, or STG, net leverage was 5.1 times, down from 5.2 times last quarter, and 6 times a year ago. We ended the quarter with $659 million of consolidated cash and cash equivalents, including $170 million at SDG and $489 million at Ventures. Including undrawn revolver and AR facility capacity, total liquidity was approximately $1.4 billion. Year-to-date, we have repaid or retired approximately $355 million of debt principal, We will continue to manage our maturity schedule carefully and reduce the total amount of debt outstanding. Deleveraging remains our top capital allocation priority while maintaining ample liquidity and investing selectively where returns are attractive. As Chris mentioned, we have determined at this time not to separate ventures on a standalone basis. Let me add a couple of points on what that means for capital allocation.

First,

Broadcast free cash flow remains dedicated to reducing debt at STG. And second, ventures will continue to monetize minority positions, redeploy capital into return-seeking investments, and continue to invest in the growth of tennis channel and digital remedy. Turning to slide seven, we are raising our full year 2026 guidance on the strength of political revenue and continued cost disciplines. Full-year political revenue is now expected to be approximately $455 million versus our prior guidance of at least $375 million. That is a record political year for Sinclair achieved in a midterm cycle. Higher political revenue brought somewhat more crowd out, so we have narrowed poor advertising guidance to $1.22 billion to $1.25 billion within our prior reign. We have also narrowed distribution revenue guidance to $1.735 billion to $1.775 billion, with the midpoint unchanged, reflecting more certainty as we approach year-end. Consolidated adjusted EBITDA guidance is now $825 million to $835 million, up $85 million at the midpoint. Political is the largest driver, but not the only one. The increase is larger than the step-up in our political outlook and reflects continued cost discipline across the business. Consolidated total revenue guidance is now $3.53 billion to $3.6 billion, up $95 million at the midpoint. Capital expenditures, net interest expense, and net cash tax guidance are unchanged. We will provide full-year 2027 guidance with our fourth quarter results in late February. In the meantime, let me offer a few early thoughts on the building blocks for 2027. On poor advertising, 2027 will not have the benefit of the Olympics or the World Cup. There is some uncertainty around the MLB season given the ongoing labor negotiations, and we remain mindful of the macro backdrop. At the same time, the inventory that Politico occupied this year frees up for poor, and our digital cross-platform and podcast businesses continue to grow. On distribution, subscriber churn continues to moderate, both in our numbers and in what the largest distributors are reporting. Our new ABC and CBS affiliation agreements are in place. Our Fox renewal is in December. and a significant portion of our MBPD subscribers come up for renewal next year. We will also have full year effects of the St. Louis affiliation change and the Charter Cox combination. And as an odd year, 2027 will of course reflect off-cycle political revenue. On cost, you can expect us to build on the discipline you have seen in 2026. and we expect capital expenditures to be broadly in line with 2026 levels. With that, let me turn the call back to Chris for closing comments before we open the call for questions.

Thanks, Narinder. We're very pleased with the strong political revenue results this year as the demand for political advertising time exceeded our expectations in almost every contested state. We believe this continues to demonstrate not only Sinclair's ability to attract significant political dollars due to our strong local news operations and our ability to deliver undecided viewers but also the industry's strong positioning as the ongoing leader in political advertising. We obviously must wait and see how other media players did over the coming days but it certainly appears that local broadcasters are likely to have at least maintained if not grown our overall market share of political advertising. I wanted to wrap up briefly by touching on our ongoing market optimization efforts. While we believe in transformational M&A for the broadcast industry, we have also been continuing our ongoing strategies to optimize our station portfolios. We have acquired stations in various markets from other broadcasters as well as our JSA station partners throughout this year and we believe the potential for larger station swaps with other broadcasters is significant. We remain encouraged by the broader regulatory environment for the industry and we anticipate additional station optimization transactions over the coming months and we look forward to keeping you updated on our progress. Thank you for joining us today and your interest in Sinclair. Operator, we will now open the call for questions.

Thank you. At this time we will have our question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you wish to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Thank you. Our first question today is coming from Dan Kornos with Stonex. Your line is live. Great, thanks. Good afternoon.

Chris, I'm going to frame it this way. I applaud you guys for making the decision, difficult decision to kind of, you know, not standalone spin ventures at this time. I think that's probably in line with what the market was looking for. And I guess just more color on the decision or the thinking as to how you arrived at that decision. And I know that Narinder in his own remarks gave some color around sort of the cash flow, but you do have a lot of cash sitting there. that could in theory be used for debt paydowns. So just any view on willingness to put that back into sort of the broadcast side of the equation, number one. And number two, Narinder, you talked about, you know, the renewals on the reverse side. We've been waiting to kind of get an update at the end of the year from you guys on how to think about longer tailed net retrends. So just any initial thoughts or color that you could give us post those renewals would be super helpful. Thank you. Sure. Thanks, Dan.

So, look, in terms of our evaluation, you know, certainly on paper, separating out ventures would create value, but it would also reduce strategic flexibility. And so we concluded that we wouldn't spin on a standalone basis, but a spin merge is still a priority. And as Narinder mentioned in his remarks, you know, the cash adventures are still going to be used to find return maximizing investments. In terms of renewals on networks, I think was your next question, right? We have just completed renewals with ABC and CBS, and we are actually in negotiations currently with Fox. And furthermore, Pretty much every one of our major NDPDs is up between the end of this year and the 12 months after that. There are a lot of moving pieces. All, we think, very positive for the company. First, I'll start with the networks. There is something I often talk about, but I'll repeat again, is that the payments that we give to the networks... need to be rebalanced vis-a-vis what the monetization is on streaming. And since our last renewal round, all of the networks now have streaming platforms, including Fox. And there needs to be a rebalance between how much is paid for this content by the streaming side of the house, so to speak, and the linear side. And so... That is the core sort of issue at hand, and I think we're having very good success bringing that to the networks in those negotiations. And in terms of our MVPDs, which are up in 2027, by and large, we have a very, I think, positive story there, but that's going to have to play out over the course of the next year.

Got it. Thanks, Chris, and congrats on the strong results.

Thank you.

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

Hey, everyone. Thanks for having me on. Two questions, if I may. The first on core advertising with the election behind us. Can you talk a little bit more about what you're seeing now? from the environment the remainder of this year and into early 27. Maybe you can highlight some key verticals, including auto and how they're trending given the persistent high fuel prices, lingering macro uncertainties, et cetera.

Yeah, Aaron, this is Rob. With auto, it trended stable in third quarter. It's down slightly right now going into fourth quarter. with the auto prices and the cost of goods. So we're keeping an eye on that. As Narinder mentioned, we'll have a plethora of spots that are available going into next year that was absorbed by political and issue spots. And right now, we're finding our plans on how to absorb that through unique programs. So we expect to rebound, but traditionally, What we have to do is go back to the advertisers that were crowded out and encourage them now that the election's over to come back to broadcasting. There is some pressure sensitive, such as medical, legal, and food that we're seeing some declines in due to the pricing and the high prices in those categories. And again, so we're keeping our eye on that. But again, We know the dilemma that's in front of us, so there's some strategic plans to generate revenue with core advertisers, but not just solely relying on the spot business.

Thank you. That's helpful. And then one more question, if I could, maybe towards Narinder. You paid down over $200 million of debt in 2Q, a much smaller denomination this quarter. Political cash lands, what should we expect going forward in terms of opportunistic debt repayment? And sorry if I missed this, but did you say if there were any updated thoughts around the cash adventures and whether that could go towards debt repayment as well? And how do you think about prioritizing certain pieces of your debt?

Yeah, Aaron, thanks for the question. So as I mentioned in my remarks, so political cash has just come in. and the cash that comes in at STGE or the broadcast business, a significant majority of the cash is earmarked for reducing leverage and for reducing debt. Obviously, not at the expense of continuing to invest in the business and attractive return opportunities where they exist. So we will continue to do that. But a great majority of that cash at broadcast is going to go towards strengthening the balance sheet. As far as Ventures is concerned, I think we just mentioned to you, standalone separation is off the table. There is a significant amount of cash that's sitting there. And that cash helps us have some optionality around a large-scale broadcast transaction. And also, Ventures is going to continue to monetize its minority investment positions with more cash on the balance sheet. and then deploy that cash into the growth of Tennis Channel and Digital Remedy as a reminder of those businesses, you know, sit-in ventures and then also, you know, go out and seek return-seeking investments, you know, whatever they might be. So that's, you know, that's the current thought process that we have outlined and I hope, you know, that lends sufficient clarity on how we're thinking about capital allocation.

Very helpful. Thanks as always for the time.

Thank you.

Thank you. Our next question is coming from Stephen Cahal with Wells Fargo. Your line is live.

Thank you. Chris, it seems like the industry has gone kind of quiet on M&A discussions. And my guess is that's because everyone's been raking in political money and trying to get that on the balance sheet. You all have been probably the most proactive. is your expectation that as we get into 2027, conversations will restart with maybe the shot clock starting to tick down a little bit on the FCC? And what do you think needs to happen for the bid ask or the buyers and sellers to start to come together that hasn't happened so far? And then just a question on spectrum. It seems like if the FCC can move to sunset ATSC 1.0, then there could be a little more optimism about some of the potential to use excess broadcast spectrum. I was wondering if you've been involved in any efforts for that or if you see any other opportunities to generate value for the industry in the relative near term on spectrum and what seems like a pretty accommodative FCC. Thank you.

Great.

Thanks, Steve.

So look, on the M&A front, there is already a lot of activity at least over here at Sinclair around market optimization. In addition to our partner station buy-ins, we've acquired three different in-market station groups over the last 12 months. And we have many more in our pipeline across multiple counterparties within the industry. So I would say that side of the market is pretty constructive. and the types of synergy opportunities that we're seeing are very significant. And so, you know, that part of the market is already very vibrant and sort of the recent regulatory actions at the FCC have certainly facilitated that. And, you know, in terms of larger deals, we're certainly ready and willing and able to jump on larger deals. I think There will be a constructive environment for that once we see a resolution to the Nexstar Tegna situation. I do think that's out there as preventing some people from moving forward in a more constructive way. But otherwise, the regulatory environment right now is as good as it's ever been. and we're looking forward to not only market optimization opportunities like I mentioned, but the larger deal market freeing up here shortly. In terms of the spectrum side, look, I think the way I see our spectrum is there's three buckets of monetization for our spectrum. Number one is, of course, our core business of providing video. and, you know, ATSD 3.0 will allow us to provide better pictures, better sounds, modern experience, interactive features, more content, enhanced consumer experience and we're already rolling some, you know, that out in the three dollar markets that we have and the final completion of the transaction I think will be really great for our consumers and our core business. And by the way, on a monetization front, not only will our consumers be happier, but we will open up new areas of monetization through those interactive features and through dynamic ad search and capabilities. The second bucket of monetization is data casting. And that is what EdgeBeam was formed to work on. They're making great progress in areas like enhanced GPS, digital signage, automotive data. and, you know, that is going to be a market that will continue to develop over time. It's a new endeavor, so it does take a ramp and it will also be greatly facilitated by additional spectrum being made available and the transition to 3.0 finally be completed. And then the third bucket is something that, you know, there's been a lot more talk about recently is leasing the spectrum to Thank you for having me. The next big priority for that industry, for our industry, is completing the 3.0 transition. And there is an NPRM in front of the FCC, which seeks to do that. And we are looking forward to working constructively with Chairman Carr to figure out the final form of that and get 3.0 through the final transition and open up these three monetization streams.

Thanks.

Thank you.

Thank you. Our next question is coming from Benjamin Soft with Deutsche Bank. Your line is live.

Good afternoon, everyone. Thanks for the question. Obviously, really strong results on the political side. I was wondering if you could spend a bit digging into the different fundamental drivers there. where we saw that performance coming from. And what are your key takeaways from this election as we think about 2028? And then could you remind us what the growth initiatives are you're working for for Tennis Channel and how that business fits into your broader portfolio strategically? Thank you.

All right. Well, I'll speak a little bit about the first question around what drove our results. But I'm going to pass it off to Rob to speak more about political, because obviously political massively exceeded our expectations. It exceeded the midterms. But also, underneath, we had several other levers being pulled here at Sinclair. One was improved churn. are largely driven by Charter and DirecTV. And so those two very large MVPDs have improved their performance. And so that helped out this year. We also have completed several big projects here at Sinclair, like our cloud transition and other projects. and so there's been a quantum of expense that has, you know, extra expense that has been naturally eliminated. And then we have been, as Narinder has alluded to many times, been very focused and disciplined on the cost side. Thank you for joining us. different markets that we transacted on over the last 12 months. So I'll turn it over to Rob to speak a little bit more about political, which is, of course, the big story, and I think a really, really great read-through for what's going to happen in 2028. But Rob, do you want to say a word on that? And then I'll cycle back on your tennis question.

Yes, we were positioned nicely in a lot of contested races. Senatorial, gubernatorial, House, and we were able to be able to handle the tonnage and volume through our algorithm pricing system that we use. So we were in place to handle that volume. How it breaks out is between party and candidates, 38% of the political spend came from that category, while 62% came from The issue PAC side of things. And so, again, it's a lot of heavy work on the station and our national team dealing with the volume, but you have to be able to price it, you have to be able to run it. And so, as Chris indicated, it sets us up well for, you know, the open presidential seats. And coming out of these races, the Republicans are going to look to rebound. And Why we believe that money still flows to broadcast is the fact that we're able to give coverage of all the issues. We're able to give unbiased interviews with all the candidates running. And the officials getting elected is exactly where we're positioned in the marketplace to sort of people live where they work. And it shows the resiliency of the reach and status still of local broadcasters.

To address Tennis, we're very pleased with the trends that we're seeing at Tennis. As was mentioned, their core advertising in the quarter was up 21% year-over-year. Distribution revenue was up 2%, driven by D2C subscription growth. There's a lot of good trends going on at Tennis today. from an industry perspective, but also from a company perspective. So industry perspective, interest and participation in tennis continue to increase post-COVID. So COVID sort of reignited the industry as it did, or the sport, if you will, as it did several other sports, and that momentum continues through to today. And just to give you a flavor, All year, Tennis Channel has been setting new rating records on its cable. It's a linear cable channel. There are not too many cable channels that I'm aware of that are actually growing audience across all key metrics, and Tennis Channel is a standout in that regard. Q3 ratings increased across all key demographics. The Cincinnati Open, which was this summer, became Tennis Channel's most viewed tournament ever. and August was Tennis Channel's most watched month ever. So that's just kind of core linear channel strength. But then on top of that, you have Tennis Channel 2, which is a free ad supported channel that continues to grow in terms of audience and distribution. It's not fully distributed yet, but it's on many fast platforms. It's on and various cable platforms. It's on YouTube TV and it will continue to expand its distribution over time. But the types of increases you're seeing on that channel are double digits in terms of audience flow. So it's a whole new linear channel that is fueling growth. And then you've got social and digital outlets which are seeing tremendous growth in the double digits in terms of audience traffic and interesting engagement. So with our new leader over there, Jeff Blackburn, he's rebuilt the entire digital infrastructure at Tennis Channel from the website and culminating with new apps that we're going to be delivering in December. So we will be in-house on those apps free from third-party and controlling our destiny there with a vastly superior product, quicker iterations, A-B testing, the ability to iterate our product in a much faster way. So to really understand tennis from a high level, the biggest opportunity within tennis beyond just the core growth that I described is the ramp up of streaming. And We have the new app with the new apps coming and having all of our content now available direct to consumer. There's a tremendous opportunity to ramp up subscribers on the streaming side. So we're investing. You know, it's certainly the company is in investment mode. It's investing in content. It's investing in technology. It's investing in marketing for subscriber acquisition. So that's why you're seeing, you know, the profitability do what it's doing. But the top line is growing rapidly. very nicely and the trends are very positive there on tennis.

And I would add we're building on the culture of the sport where we bring the desk and talent to all the Master 1000s and some of the 500 events along with two majors, the US Open and Roland Garros. And having our talent doing live interviews where the fans are there watching in the background Allows them to touch and feel outside of the live play. And that's part of the strategy of building the culture both on our social platforms as well as live events.

That's helpful. Thank you.

Thank you. Our next question is coming from David Karanofsky with JP Morgan. Your line is live.

Hi, thank you. Maybe just a few more on sports. Maybe just first for Narinder. I don't know if you can frame the cyclical benefit from the Olympics and World Cup in 2026. And then to the extent there is no MLB season, which I guess is a possibility, is this mainly an advertising impact to Sinclair? Do your retrans agreements require any kind of game delivery minimum? And then separately, Chris, we saw in your quarter streamers form a lobbying group. to advocate for sports distribution on streaming. Just kind of curious where you think regulators' heads are on kind of items like the Sports Broadcasting Act. Thank you.

Okay. Why don't I – I'll answer part of the question first, then I'll throw it over to Narinder on your first question. But just in terms of no MLB season, does it impact distribution agreements? No. We don't have any – there's no – There's no impact to our MVPD agreements. There are no covenants that require us to have a certain number of MLB games, for instance. So no concerns there. And then in terms of the Sports Broadcasting Act and regulators, you did see earlier this year a hearing on that. I think it was quite clear that lawmakers I see the Broadcasting Act as being purposely drafted to grant antitrust carve-out to the leagues only as it relates to broadcast. And that was made clear in those hearings. And it also was made clear when college came around and tried to get the same items pushed through on legislation. They were going to have to live with the same carve out only as it relates to broadcast. And so we were very pleased with that outcome. Ultimately, that piece of legislation never went through, but that's the way it was drafted. And it just reinforces that from a rules of the road perspective, these major sports are supposed to be engaging with broadcast on a collective basis. And it's better for their business. It's better for the consumer. You know, there is a fundamental sort of access to content point when it comes to sports that I think is very much hits home with lawmakers. And that's why the law is drafted the way it is.

Yeah. On the first part of your question, I'll answer it a little bit more broadly on how we think about core advertising. As you know, 27 is going to be a tougher, you know, comp year, not just because, you know, political rolls off and that's obviously impacts core to the extent there is crowd out and then the core kind of bounces back. But then tougher comp because you don't have the benefit of Olympics or the World Cup, as I mentioned. and there's some uncertainty around the MLB season. And that's mostly the impact is on advertising side of the house. It's quite possible that the MLB negotiations get pushed out to 2028. So we'll just have to kind of wait and see what happens there, David. So I think net-net there are some things to keep in mind as you're thinking about 27, on app core advertising. There are several puts and takes here. On the plus side, though, our digital business continues to grow. We continue to make good progress on cross-platform and podcast businesses. So those are some of the puts and takes you kind of have to keep in mind. But as far as MLB goes, the main impact is going to be on the core advertising.

Thank you. Thank you. As a reminder, ladies and gentlemen, if you do have a question, please press star 1 on your telephone keypad. Our next question is coming from David Hamburger with Morgan Stanley. Your line is live.

Thank you. So could you elaborate on subscriber churn? I think you had alluded to some improvement and we've seen some of the video numbers from Charter. Just curious, historically it said mid single digit churn had been kind of the norm. I'm wondering if that's improved and if you can kind of paint that against the backdrop of distribution revenue was up 1% year over year. How do you think about The trajectory and what, you know, as you have all the renewals next year, we've seen a lot of blackouts as well. Just kind of elaborate maybe a little bit on how you're approaching those discussions. Sure.

So, look, overall churn is in the mid single digits. It has improved on the traditional side, mainly, as I said, related to the improvements at charter. but also DirecTV has been doing better, especially when you look at DirecTV combined with DirecTV Stream. And we're seeing the rest of the MVPDs start to take notice as to what Charter is doing and start to pursue similar strategies. So we're very heartened by that. We think... The Charter strategy is the right strategy. It gives the consumer a ton more value. When you net out all the streaming platforms that are put into the base offering or the expanded cable offering from Charter, it makes the cost of legacy cable, which is the broadcast networks and some cable channels, about $30 a month. It's a huge change from $100 a month, which is where it was a couple of years ago. We hope everyone will follow Charter's lead. By the way, they just bought Cox. They'll be rolling out the same packaging on Cox's subscriber base very shortly here. It's a strategy that works. It's helping us. It's helping the industry. It is having an impact on churn. And as it relates to our gross line, we were up 1%. I think what's notable there is that we did not have any major renewals this year. And the only thing that really helped us along was the JSA partner buy-ins. and we were pleased with the outcome there, not having any renewal step-ups. As we go into next year, we will have quite a few negotiations, pretty much all the major traditional MVPDs we'll be negotiating with over the span of next year. And so that, you know, that should bode well for us. You know, that generally means bigger increases in the initial renewal. And, you know, we have been able to navigate our last set of renewals, I think, in 2024, where we had another, you know, big session of renewals and even 2021. You know, we haven't had a single blackout through that period. So I think our last slide, though, you'd have to go even back further beyond 2021. So, yeah, I hear there has been blackouts for other broadcasters, and we kind of always get this question, but we have a very constructive process with the MVPDs. They are our partners, our most important partners, and we have very valuable content that they need to operate their systems. and we are not concerned about blackout risk.

If I could just ask, could you talk about the MVPDs? I mean, I think we've noticed a little bit of a deceleration for them. Is that impacting some of your numbers as well?

So, look, I think it's fair that the virtual MVPDs are not growing quite as fast as they were, but they're still growing. And then on top of that, we also get paid for Things like Peacock and Paramount Plus and Fox One. And so there are other sources of growth on the sort of virtual side, if you will, if you want to lump those other platforms in there. And also for us, the most important trend are the traditional side. That's where we get paid the most.

Thank you very much.

Thank you. Ladies and gentlemen, this will conclude our question and answer session. I would now like to turn the call back over to Mr. Ripley for any closing remarks.

Thank you all for joining us on our Q3 earnings call. If you have any questions or comments, please don't hesitate to reach out to us. Thank you.

Thank you. Ladies and gentlemen, this does conclude today's call. You may disconnect your lines at this time and we thank you for your participation.