Even the perennial appeal of sports talk radio, a major presence in the country’s largest media markets, and strong ratings weren’t enough for radio and podcast company Audacy to avoid bankruptcy, yet another sign of the ongoing challenges for the media advertising market.
The Philadelphia-based Audacy has filed for Chapter 11 bankruptcy protection and reached a prepackaged agreement with most of its debt holders to turn about $1.6 billion of its $1.9 billion debt load into equity in the reorganized company. The moves marked a rapid fall for Audacy, which has roots going back to the 1960s as the former Entercom and which owns more than 200 radio stations—including WFAN-AM, the New York sports talk radio giant that essentially invented the genre in the 1980s with its 24-hour format and continues to dominate local ratings.
“The perfect storm of sustained macroeconomic challenges over the past four years facing the traditional advertising market has led to sharp reduction of several billion dollars in cumulative radio ad spending,” said David Field, Audacy’s chairman, president, and CEO. “These market factors have severely impacted our financial condition.”
In addition to the extensive radio station presence, Audacy owns the Cadence13 and Pineapple Street Media podcasting studios and distributes shows by the likes of Stephen A. Smith and Jim Rome. The bankruptcy filing also arrives about six months after Audacy paid more than $3 million in executive retention bonuses, including $1 million to Field alone.
No immediate operational impact to Audacy stations and podcasts is expected. The company’s issues, however, follow similar ones for top rival iHeartRadio Inc., which filed for Chapter 11 protection in 2018, and reemerged about a year later.