Newsmax Inc. (NMAX) Q1 2026 Earnings Call Transcript

Access earnings results, analyst expectations, report, slides, earnings call, and transcript.

Overview

The earnings call reveals mixed financial performance: a decline in overall revenue, advertising, and subscription revenue, but significant growth in affiliate and licensing revenue. The net loss improved substantially, but adjusted EBITDA worsened. The Q&A section indicates uncertainty in revenue drivers and advertising trends, with management providing vague responses. Despite some positive trends, the lack of clarity and concrete guidance tempers optimism, suggesting a neutral stock price movement.

Key Financial Performance

Total Revenue $51.7 million, representing a 14% increase year-over-year. The growth was driven by affiliate fee revenue growth and licensing growth.

Broadcast Revenue $43.7 million, up 20.8% year-over-year. This growth was attributed to affiliate fee revenue growth and licensing growth.

Digital Revenue $8 million, a decline of 12.7% year-over-year. The decrease was driven by declines in advertising, subscription revenue, and product sales.

Advertising Revenue $27.2 million, a 5.8% decline year-over-year. The decline was mainly due to lower digital advertising, reflecting a tougher comparison following the elevated demand environment associated with the 2024 election cycle. This was partially offset by higher linear cable and satellite advertising revenue due to expanded reach from new affiliate agreements.

Affiliate Revenue $13 million, an increase of 75.2% year-over-year. The growth was driven by new contractual relationships as well as rate increases that took effect in late 2025.

Subscription Revenue $6.4 million, a decline of 7.9% year-over-year. The decline was due to growth in Newsmax+ subscribers being more than offset by lower publication subscription revenue, primarily reflecting reduced new customer acquisition.

Product Sales Revenue $1.5 million, a decline of 3.5% year-over-year. The decline was primarily driven by decreased book and supplement sales.

Licensing Revenue $3.5 million, up from $437,000 in 2025. The increase was due to expanded licensing agreements.

Net Loss $2.2 million, an 87.3% improvement compared to a net loss of $17.2 million in the prior year quarter. The improvement was primarily driven by higher total revenue, lower legal expenses, and improved other income, partially offset by higher production headcount, programming and production costs, continued investment in Newsmax2, and higher stock-based compensation.

Adjusted EBITDA Negative $0.4 million, a decrease of $0.8 million from the amount reported in the same quarter last year. This reflects higher production, programming, and personnel costs associated with continued investment in content and OTT initiatives, partially offset by growth in affiliate fee and licensing revenue within the Broadcast segment.

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Operating Highlights

Newsmax2 streaming platform: Sequential news hours growth of more than 22% and improved viewership across every key daypart.

Newsmax Plus subscription platform: Major expansion of military history channels, with available titles increasing by more than 200%.

International licensing and brand expansion: Expanded licensing agreement with Telecom Serbia, launched Newsmax Poland, and continued growth in international partnerships.

Revenue growth: Total revenue of $51.7 million, up 14% year-over-year, with broadcasting revenue growing by 20.8%.

Affiliate revenues: Increased 75.2% year-over-year to $13 million, driven by new contractual relationships and rate increases.

Profitability improvement: Net loss reduced by 87.3% year-over-year to $2.2 million, driven by higher revenue and lower legal expenses.

Multi-platform integration: Integrated cable, FAST, subscription streaming, digital, and social platforms to expand engagement and strengthen monetization.

Focus on right-leaning market: Positioned as a primary alternative to legacy media, targeting the underserved center-right audience.

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Risk or Challenges

Digital Revenue Decline: Total digital revenues declined 12.7% year-over-year in Q1 2026, driven by declines in advertising, subscription revenue, and product sales. This reflects challenges in maintaining digital advertising demand and subscription growth.

Advertising Revenue Decline: Advertising revenues decreased by 5.8% year-over-year, primarily due to lower digital advertising demand following the elevated demand environment of the 2024 election cycle.

Subscription Revenue Decline: Subscription revenues decreased by 7.9% year-over-year, as growth in Newsmax+ subscribers was offset by lower publication subscription revenue, reflecting reduced new customer acquisition.

Product Sales Decline: Product sales revenues decreased by 3.5% year-over-year, driven by decreased book and supplement sales.

Net Loss: The company reported a net loss of $2.2 million in Q1 2026, though this was an improvement from the prior year. The loss was driven by higher production headcount, programming and production costs, and continued investment in Newsmax2.

Adjusted EBITDA Decline: Adjusted EBITDA was negative $0.4 million, a decrease of $0.8 million from the prior year, reflecting higher production, programming, and personnel costs.

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Guidance & Outlook

Revenue Guidance: The company reiterated its full-year 2026 revenue guidance of $212 million to $216 million, representing 13% growth at the midpoint.

Growth Drivers: Growth is expected to be structural, driven by higher-margin affiliate fee expansion, licensing growth, ongoing investment in premium content, and digital monetization.

Operating Profile: An improved operating profile is anticipated as the year progresses.

International Expansion: The company sees international licensing and brand expansion as a meaningful opportunity to extend reach and diversify revenue cost-efficiently, with more announcements expected in the coming quarters.

Streaming and Subscription Platforms: Continued investment in Newsmax2 (free streaming platform) and Newsmax Plus (paid subscription platform) is expected to support long-term growth.

Market Position: The company aims to capitalize on the demand for independent, values-driven journalism, particularly in the right-leaning marketplace, to expand reach and strengthen monetization.

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Shareholder Return Plan

The selected topic was not discussed during the call.

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Key Q&A

Q:How much of the ratings improvement might be tied to expanded distribution, investments in content, or news flow and geopolitical events?

A:Christopher Ruddy stated that it is difficult to ascertain the exact benefits, but it is likely a combination of all factors. He mentioned the Iran conflict starting in Q1, marketing promotions, social media engagement (25 million aggregate followers), changes in programming lineup, and upcoming political events like primaries and congressional elections as contributing factors. Darryle Burnham added that live news consumption and cyclical cycles in ratings also play a role, with expectations of increased engagement during midterms and presidential elections.

Q:Are there ancillary benefits from affiliate fee negotiations, such as improved channel placement or broader packaging?

A:Christopher Ruddy explained that their packages are strong and usually in basic distribution. They have resisted efforts to move news channels into tiers. He mentioned a renewal with Cablevision (Optimum Altice) adding about 0.25 million subscribers. He also highlighted the positive impact of OTT distribution, including Newsmax's improved positioning on Pluto TV's news guide.

Q:Are advertisers more willing to shift larger national brand budgets towards Newsmax given the improved ratings trends?

A:Christopher Ruddy noted an increasing number of brands buying ads last year and expressed hope for continued improvement. However, he emphasized that there is no guarantee and that marketing spends are not linear. He highlighted the long-term impact of increased engagement and Newsmax's unique position in the center-right market for pay TV and OTT.

Q:What were the drivers of strong ratings results in Q1 and April, and what gives confidence in sustainable growth?

A:Christopher Ruddy attributed the strong ratings to factors such as the Iran conflict, political interest in primaries and elections, marketing and social media efforts, and programming changes. He acknowledged it is hard to pinpoint exact causes but noted positive general trends.

Q:What drives impressive social media growth on platforms like Truth Social, Instagram, and TikTok, and is the growth sustainable?

A:Christopher Ruddy credited a robust social media team of about 15 people and effective content strategies. He mentioned high engagement levels reported by Amplify and noted that younger demographics are more likely to consume news on platforms like TikTok. He also highlighted younger people's interest in politics as a contributing factor.

Q:Review of Unclear Management Responses

A:Management avoided giving a direct answer to the question about the exact drivers of ratings improvement, stating it is difficult to ascertain and attributing it to a combination of factors without providing specific data or clarity. Similarly, the response to advertisers shifting budgets lacked concrete evidence or guarantees, relying on general trends and long-term expectations.

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Earnings Word Cloud

The most frequently occurring keywords in this quarter's earning call

NMAX Transcript

Newsmax Inc. (NMAX) Q1 2026 Earnings Call Transcript

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Newsmax Inc. (NMAX) Q4 2025 Earnings Call Transcript

Positive4-2

The earnings call highlights strong financial performance with significant year-over-year growth in revenue, net income, operating margin, and free cash flow. Despite the absence of strategic or operational updates, the financial metrics suggest a positive outlook. The lack of risk discussion and unclear Q&A responses do not significantly detract from the financial strength demonstrated. The increase in advertising revenue and subscription rates further supports a positive sentiment, likely leading to a stock price increase in the short term.

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