Company: IHETW
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001628280-25-051036
Chunk: 87

Company: iHeartMedia, Inc.
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 8
Chunk 87
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1, 2025.

FCC licenses valued using a market approach estimate the fair value by referencing recent transactions involving comparable spectrum assets. This method considers observable market data, adjusted for differences in signal strength and market size.

Considerations in developing these assumptions included the expected impact on advertising revenues given the current market uncertainty, ranges of expected timing of recovery, discount rates and other factors. Based on our testing, the estimated fair value of our FCC licenses was below their carrying values. As a result, we recognized a non-cash impairment charge of $208.5 million on our FCC licenses.

The goodwill impairment test requires us to measure the fair value of our reporting units and compare the estimated fair value to the carrying value, including goodwill. Each of our reporting units is valued using a discounted cash flow model which requires estimating future cash flows expected to be generated from the reporting unit, discounted to their present value using a risk-adjusted discount rate. Terminal values were also estimated and discounted to their present value. Assessing the recoverability of goodwill requires us to make estimates and assumptions about sales, operating margins, growth rates and discount rates based on our budgets, business plans, economic projections, anticipated future cash flows and marketplace data. There are inherent uncertainties related to these factors and in management’s judgment in applying these factors.

The fair values of our reporting units were reevaluated as of July 1, 2025 as part of our annual impairment assessment and no goodwill impairment was recorded as the estimated fair values of our reporting units exceeded the carrying values of the reporting units’ net assets, including goodwill.

While we believe we have made reasonable estimates and utilized reasonable assumptions to calculate the fair values of our indefinite-lived FCC licenses and reporting units, it is possible a material change could occur to the estimated fair value of these assets as a result of the uncertainty regarding the impact of current market conditions, as well as the timing of any recovery. If our actual results are not consistent with our estimates, we could be exposed to future impairment losses that could be material to our results of operations.

24

Executive Summary 

Consolidated revenues for the third quarter of 2025 decreased due to a decrease in political revenues as 2024 was a presidential election year and lower spending on radio advertising as a result of continued uncertain market conditions, partially offset by an increase in digital and podcast advertising revenue driven by a continued increase in demand for digital advertising. 

The key developments that impacted our business during the quarter are summarized below:

•Consolidated Revenue of $997.0 million decreased