EDGAR 10-K Filing

Company CIK: 912752
Filing Year: 2025
Filename: 912752_10-K_2025_0001971213-25-000012.json

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ITEM 1. BUSINESS
ITEM 1. BUSINESS
Sinclair, Inc. (“Sinclair”), a Maryland corporation formed in 2022, is the parent company of Sinclair Broadcast Group, LLC (“SBG”), a Maryland limited liability company, which formed from the conversion of Sinclair Broadcast Group, Inc. (“Old Sinclair”), a Maryland corporation founded in 1986, to a Maryland limited liability company in 2023. Refer to Company Reorganization in this Item 1. Sinclair is a diversified media company with national reach and a strong focus on providing high-quality content on our local television stations, digital platform, and, prior to the Deconsolidation (as defined below under Local Sports in this Item 1), regional sports networks (the “RSNs”). The content, distributed through our broadcast platform and third-party platforms, consists of programming provided by third-party networks and syndicators, local news, sports and other original programming produced by us and our owned networks. Additionally, Sinclair owns digital media companies that are complementary to our extensive portfolio of television station related digital properties and has interests in, owns, manages, and/or operates technical and software services companies, research and development companies for the advancement of broadcast technology, and other media and non-media related businesses and assets, including real estate, venture capital, private equity, and direct investments.
Sinclair and SBG’s principal executive offices are located at 10706 Beaver Dam Road, Hunt Valley, Maryland 21030, their telephone number is (410) 568-1500, and Sinclair’s website address is www.sbgi.net. The information contained on, or accessible through, Sinclair’s website is not part of this Annual Report on Form 10-K and is not incorporated herein by reference.
Company Reorganization
On April 3, 2023, Old Sinclair, entered into an Agreement of Share Exchange and Plan of Reorganization (the “Share Exchange Agreement”) with Sinclair, and Sinclair Holdings, LLC, a Maryland limited liability company (“Sinclair Holdings”). The purpose of the transactions contemplated by the Share Exchange Agreement was to effect a holding company reorganization in which Sinclair would become the publicly-traded parent company of Old Sinclair.
Effective at 12:00 am Eastern U.S. time on June 1, 2023 (the “Share Exchange Effective Time”), pursuant to the Share Exchange Agreement and Articles of Share Exchange filed with the Maryland State Department of Assessments and Taxation, the share exchange between Sinclair and Old Sinclair was completed (the “Share Exchange”). In the Share Exchange, (i) each share or fraction of a share of Old Sinclair’s Class A common stock, par value $0.01 per share (“Old Sinclair Class A Common Shares”), outstanding immediately prior to the Share Exchange Effective Time was exchanged on a one-for-one basis for an equivalent share of Sinclair’s Class A common stock, par value $0.01 per share (“Sinclair Class A Common Shares”), and (ii) each share or fraction of a share of Old Sinclair’s Class B common stock, par value $0.01 per share (“Old Sinclair Class B Common Shares”), outstanding immediately prior to the Share Exchange Effective Time was exchanged on a one-for-one basis for an equivalent share of Sinclair’s Class B common stock, par value $0.01 per share (“Sinclair Class B Common Shares”).
Immediately following the Share Exchange Effective Time, Old Sinclair converted from a Maryland corporation to SBG, a Maryland limited liability company. On the day following the Share Exchange Effective Time (June 2, 2023), Sinclair Holdings became the intermediate holding company between Sinclair and SBG, and SBG transferred certain of its assets (the “Transferred Assets”) to Sinclair Ventures, LLC, a new indirect wholly-owned subsidiary of Sinclair (“Ventures”). We refer to the Share Exchange and the related steps described above collectively as the “Reorganization.” The Transferred Assets included technical and software services companies, intellectual property for the advancement of broadcast technology, and other media and non-media related businesses and assets including real estate, venture capital, private equity, and direct investments, as well as Compulse, a marketing technology and managed services company, and Tennis Channel and related assets. As a result of the Reorganization, the local media segment assets are owned and operated by SBG and the assets of the tennis segment and the remaining Transferred Assets are owned and operated by Ventures.
At the Share Exchange Effective Time, Sinclair’s articles of incorporation and bylaws were amended and restated to be the same in all material respects as the existing articles of incorporation and bylaws of Old Sinclair immediately prior to the Share Exchange. As a result, the Sinclair Class A Common Shares confer upon the holders thereof the same rights with respect to Old Sinclair that the holders of the Old Sinclair Class A Common Shares had with respect to Old Sinclair, and the Sinclair Class B Common Shares confer upon the holders thereof the same rights with respect to Sinclair that the holders of the Old Sinclair Class B Common Shares had with respect to Old Sinclair. Sinclair’s Board of Directors (the “Board”), including its committees, and senior management team immediately after the Share Exchange were the same as Old Sinclair’s immediately before the Share Exchange.
SEGMENTS
As of December 31, 2024, Sinclair had two reportable segments, local media and tennis, and SBG had one reportable segment, local media. Sinclair and SBG’s local media segment is comprised of our television stations, which are owned and/or operated by SBG’s wholly-owned subsidiary, Sinclair Television Group, Inc. (“STG”) and its direct and indirect subsidiaries, original networks and content. Sinclair’s tennis segment primarily consists of Tennis Channel, a cable network which includes coverage of many of tennis’ top tournaments and original professional sports and tennis lifestyle shows. Prior to the Deconsolidation, Sinclair and SBG had one additional reportable segment, local sports, which consisted of RSNs, which owned the exclusive rights to air, among other sporting events, the games of professional sports teams in designated local viewing areas. Sinclair also earns revenues from digital and internet services, technical services, and non-media investments, included within “other”. Other is not a reportable segment for either Sinclair or SBG, but is included for reconciliation purposes.
Local Media
As of December 31, 2024, Sinclair’s and SBG’s local media segment primarily consisted of our broadcast television stations, original networks, and content. We own, provide programming and operating services pursuant to local marketing agreements (“LMA”), or provide sales services and other non-programming operating services pursuant to other outsourcing agreements (such as joint sales agreements (“JSA”) and shared services agreements (“SSA”) to 185 stations in 86 markets. These stations broadcast 641 channels, including 235 channels affiliated with primary networks or program service providers comprised of: FOX (55), ABC (40), CBS (30), NBC (24), CW (47), and MyNetworkTV (“MNT”) (39). Solely for the purpose of this report, these 185 stations and 641 channels are referred to as “our” stations and channels, and the use of such term shall not be construed that we control such stations or channels. Refer to our Television Markets and Stations table later in this Item 1. for more information.
Our local media segment provides free over-the-air programming to television viewing audiences for stations in markets located throughout the continental United States, as well as distributes the content of these stations to MVPDs for distribution to their customers in exchange for contractual fees. The programming that we provide on our primary channels consists of network provided programs, locally-produced news, local sporting events, programming from program service arrangements, syndicated entertainment programs, and internally originated programming. We provide live, local sporting events on many of our stations by acquiring the local television broadcast rights for these events or through our relationship with national networks.
We are one of the nation’s largest producers of local news. We produce more than 2,400 hours of news per week at 114 stations in 72 markets. For the year ended December 31, 2024, our stations were awarded 232 journalism awards, including 22 regional and two national RTDNA Edward R. Murrow awards and 37 regional and one national Emmy awards.
We also own and operate various networks carried on distribution platforms owned by us or others, including: The Nest, our free over-the-air national broadcast TV network, comprised of home-improvement, true-crime, factual reality series, and celebrity driven family shows; Comet, our science fiction network; CHARGE!, our adventure and action-based network; and TBD, the first multiscreen TV network in the U.S. market to bring premium internet-first content to TV homes across America.
Our internally developed content, in addition to our local news, includes our original news program, The National News Desk (“TNND”), and Full Measure with Sharyl Attkisson (“Full Measure”), our national Sunday morning investigative and political analysis program.
In 2024, we launched our new podcast division, including podcasts: Unfiltered Soccer, with Landon Donovan and Tim Howard, featuring hot takes, analysis, unique insights, and classic stories to bring fans closer to the game; The Triple Option, hosted by Urban Meyer, Mark Ingram II, and Rob Stone, providing analysis, opinions, and unique insights on the biggest topics in college football, the NFL, leadership, and more; and Throwbacks, with Matt Leinart and Jerry Ferrara, featuring insight into sports, television, and relatable family adventures.
Our local media segment derives revenue primarily from the sale of advertising inventory on our television stations and fees received from Distributors, which includes distributors that distribute multiple television channels through the internet without supplying their own data transport infrastructure, as well as other over-the-top (“OTT”) distributors that deliver live and on-demand programming, for the right to distribute our channels on their distribution platforms. We also earn revenues by selling digital advertisements on third-party platforms, providing digital content to non-linear devices via websites, mobile, and social media advertisements, and providing digital marketing services. Our objective is to meet the needs of our advertising customers by delivering significant audiences in key demographics. Our strategy is to achieve this objective by providing quality local news programming, popular network, syndicated and live sports programs, and other original content to our audiences. We attract most of our national television advertisers through national marketing representation firms. Our local television advertisers are primarily attracted through the use of a local sales force at each of our television stations.
Our local media operating results are subject to cyclical fluctuations from political advertising. Political spending has been significantly higher in the even-number years due to the cyclicality of political elections. In addition, every four years, political spending is typically elevated further due to the advertising related to the presidential election. Because of the political election cyclicality, there has been a significant difference in our operating results when comparing even-numbered years’ performance to the odd numbered years’ performance. Additionally, our operating results are impacted by the number and importance of individual political races and issues discussed on a national level as well as those within the local communities we serve. We believe political advertising will continue to be an important advertising category in our industry. Political advertising levels may increase further as political-activism, around social, political, economic, and environmental causes continue to draw attention and Political Action Committees (“PACs”), including so-called Super PACs, continue to increase spending.
Television Markets and Stations. As of December 31, 2024, our local media segment owns and operates or provides programming and/or sales and other shared services to television stations in the following 86 markets:
Market Market Rank (a) Number of Channels Stations Network
Affiliation (b)
Washington, D.C. 8 6 WJLA, WDCO-CD, WIAV-CD ABC
Seattle / Tacoma, WA 13 6 KOMO, KUNS ABC, CW
Minneapolis / St. Paul, MN 16 6 WUCW CW
Raleigh / Durham, NC 22 6 WLFL, WRDC CW, MNT
Portland, OR 23 7 KATU, KUNP ABC, IND
St. Louis, MO 24 4 KDNL ABC
Nashville, TN 26 10 WZTV, WUXP, WNAB(d) FOX, MNT, CW
Pittsburgh, PA 27 7 WPGH, WPNT FOX, CW, MNT
Salt Lake City, UT 28 10 KUTV, KMYU, KJZZ, KENV(d) CBS, MNT
Baltimore, MD 29 8 WBFF, WNUV(c), WUTB(d) FOX, CW, MNT
San Antonio, TX 31 10 KABB, WOAI, KMYS(d) FOX, NBC, CW
Austin, TX 34 2 KEYE CBS
Columbus, OH 35 9 WSYX, WWHO(d), WTTE(c) ABC, CW, MNT, FOX
Asheville, NC / Greenville, SC 36 8 WLOS, WMYA(c) ABC, MNT
Cincinnati, OH 37 8 WKRC, WSTR(d) CBS, MNT, CW
Milwaukee, WI 38 5 WVTV CW, MNT
West Palm Beach / Ft Pierce, FL 39 15 WPEC, WTVX, WTCN-CD, WWHB-CD CBS, CW, MNT
Las Vegas, NV 40 9 KSNV, KVCW NBC, CW, MNT
Harrisburg / Lancaster / Lebanon / York, PA 42 4 WHP CBS, MNT, CW
Grand Rapids / Kalamazoo / Battle Creek, MI 43 4 WWMT CBS, IND
Norfolk, VA 44 4 WTVZ MNT
Birmingham / Tuscaloosa, AL 45 15 WBMA-LD, WTTO, WDBB(c), WABM ABC, CW, MNT
Greensboro / High Point / Winston-Salem, NC 46 7 WXLV, WMYV ABC, MNT
Oklahoma City, OK 47 7 KOKH, KOCB FOX, IND
Providence, RI / New Bedford, MA 52 4 WJAR NBC
Buffalo, NY 54 6 WUTV, WNYO FOX, MNT
Fresno / Visalia, CA 55 11 KMPH, KMPH-CD, KFRE FOX, CW
Richmond, VA 56 5 WRLH FOX, MNT
Mobile, AL / Pensacola, FL 57 12 WEAR, WPMI(d), WFGX, WJTC(d) ABC, NBC, MNT, IND
Little Rock / Pine Bluff, AR 58 5 KATV ABC
Wilkes-Barre / Scranton, PA 59 11 WOLF(c), WSWB(d), WQMY(c) FOX, CW, MNT
Tulsa, OK 61 5 KTUL ABC
Albany, NY 62 6 WRGB, WCWN CBS, CW
Dayton, OH 64 8 WKEF, WRGT(d) ABC, FOX, MNT
Spokane, WA 66 4 KLEW CBS
Des Moines, IA 67 4 KDSM FOX
Green Bay / Appleton, WI 68 8 WLUK, WCWF FOX, CW
Roanoke / Lynchburg, VA 70 4 WSET ABC
Wichita, KS 71 19 KSAS, KOCW, KAAS, KAAS-LD, KSAS-LD, KMTW(c) FOX, MNT
Flint / Saginaw / Bay City, MI 72 10 WSMH, WEYI(d), WBSF(d) FOX, NBC, CW
Omaha, NE 73 7 KPTM, KXVO(c) FOX , MNT, CW
Columbia, SC 76 4 WACH FOX
Madison, WI 77 4 WMSN FOX
Portland, ME 78 7 WPFO(d), WGME FOX, CBS
Rochester, NY 79 7 WHAM(d), WUHF ABC, FOX, CW
Toledo, OH 81 4 WNWO NBC
Charleston / Huntington, WV 82 8 WCHS, WVAH(d) ABC, FOX
Market Market Rank (a) Number of Channels Stations Network
Affiliation (b)
Savannah, GA 84 5 WTGS FOX
Charleston, SC 85 3 WCIV MNT, ABC
Chattanooga, TN 86 7 WTVC, WFLI(d) ABC, CW, FOX, MNT
Syracuse, NY 88 6 WTVH(d), WSTM CBS, NBC, CW
El Paso, TX 89 8 KFOX, KDBC FOX, CBS, MNT
Champaign / Springfield / Decatur, IL 92 18 WICS, WICD, WRSP(d), WCCU(d), WBUI(d) ABC, FOX, CW
Cedar Rapids, IA 94 8 KGAN, KFXA(d) CBS, FOX
Myrtle Beach / Florence, SC 97 8 WPDE, WWMB(c) ABC, CW
Boise, ID 98 8 KBOI, KYUU-LD CBS, CW
South Bend-Elkhart, IN 100 3 WSBT CBS, FOX
Tri-Cities, TN-VA 101 8 WEMT(d), WCYB FOX, NBC, CW
Greenville / New Bern / Washington, NC 102 8 WCTI, WYDO(d) ABC, FOX
Reno, NV 103 10 KRXI, KRNV(d), KNSN(c) FOX, NBC, MNT
Tallahassee, FL 105 8 WTWC, WTLF(d) NBC, CW, FOX
Lincoln and Hastings-Kearney, NE 107 9 KHGI, KWNB, KWNB-LD, KHGI-CD, KFXL ABC, FOX
Johnstown / Altoona, PA 112 4 WJAC NBC, CW
Yakima / Pasco / Richland / Kennewick, WA 114 18 KIMA, KEPR, KUNW-CD, KVVK-CD, KORX-CD CBS, CW
Traverse City / Cadillac, MI 116 12 WGTU(d), WGTQ(d), WPBN, WTOM ABC, NBC
Macon, GA 119 3 WGXA FOX, ABC
Eugene, OR 120 18 KVAL, KCBY, KPIC(e), KMTR(d), KMCB(d), KTCW(d) CBS, NBC, CW
Peoria / Bloomington, IL 122 4 WHOI TBD
Bakersfield, CA 125 8 KBFX-CD, KBAK FOX, CBS
Corpus Christi, TX 130 4 KSCC FOX, CW
Amarillo, TX 132 10 KVII, KVIH ABC, CW
Columbia / Jefferson City, MO 135 4 KRCG CBS
Chico-Redding, CA 136 18 KRCR, KCVU(d), KRVU-LD, KKTF-LD, KUCO-LD ABC, FOX, MNT
Medford / Klamath Falls, OR 139 5 KTVL CBS, CW
Beaumont / Port Arthur / Orange, TX 143 8 KFDM, KBTV(d) CBS, CW, FOX
Sioux City, IA 149 14 KPTH, KPTP-LD, KBVK-LP, KMEG(d) FOX, MNT, CBS
Albany, GA 152 4 WFXL FOX
Gainesville, FL 157 8 WGFL(c), WNBW(c), WYME-CD(c) CBS, NBC, MNT
Missoula, MT 161 8 KECI, KCFW NBC
Wheeling, WV / Steubenville, OH 163 3 WTOV NBC, FOX
Abilene / Sweetwater, TX 166 4 KTXS, KTES-LD ABC, CW
Quincy, IL / Hannibal, MO / Keokuk, IA 175 4 KHQA CBS, ABC
Butte-Bozeman, MT 185 8 KTVM, KDBZ-CD NBC
Eureka, CA 196 10 KAEF, KBVU(d), KECA-LD, KEUV-LP ABC, FOX, CW, MNT
San Angelo, TX 197 2 KTXE-LD ABC, CW
Ottumwa, IA / Kirksville, MO 200 3 KTVO ABC, CBS
Total Television Channels 641
(a)Rankings are based on the relative size of a station’s Designated Market Area (“DMA”) among the 210 generally recognized DMAs in the United States as estimated by Nielsen Media Research (“Nielsen”) as of September 2024.
(b)We broadcast programming from the following providers on our channels and the channels of our JSA/LMA partners:
Affiliation Number of
Channels Number of
Markets Expiration Dates
ABC 40 30 August 31, 2026
FOX 55 41 December 31, 2026
CBS 30 24 October 31, 2026
NBC 24 17 December 31, 2027
CW 47 38 August 31, 2026
MNT 39 30 August 31, 2025
Total Major Network Affiliates 235
Affiliation Number of
Channels Number of
Markets Expiration Dates
Antenna TV 23 21 December 31, 2028
CHARGE! 85 75 (1)
Comet 92 75 (1)
Dabl 30 29 July 31, 2025
The Nest 47 42 (1)
TBD 84 71 (1)
Univision 7 3 December 31, 2025
Other 38 Various
Total Other Affiliates 406
Total Television Channels 641
(1)An owned and operated network, which is carried on our multicast distribution platform or the platform of our JSA/LMA partners. Thus, there is no expiration date.
(c)The license assets for these stations are currently owned by third parties. We provide programming, sales, operational, and administrative services to these stations pursuant to certain service agreements, such as LMAs.
(d)The license and programming assets for these stations are currently owned by third parties. We provide certain non-programming related sales, operational, and administrative services to these stations pursuant to service agreements, such as JSAs and SSAs.
(e)We provide programming, sales, operational, and administrative services to this station, of which 50% is owned by a third party.
Tennis
As of December 31, 2024, Sinclair’s tennis segment consisted of Tennis Channel, a cable network which includes coverage of many of tennis’ top tournaments and original professional sports and tennis lifestyle shows; Tennis Channel International streaming service; Tennis Channel streaming service; T2 FAST, a 24-hours a day free ad-supported streaming television channel; Tennis.com; and FAST Channel Pickleballtv (PBTV), a partnership with the Carvana Professional Pickleball Association.
Sinclair’s tennis segment derives revenue primarily from fees received from Distributors, including virtual MVPDs, as well as other OTT distributors that deliver live and on-demand programming, for the right to distribute Tennis Channel on their distribution platforms, and advertising revenue generated by sales of commercial time within Tennis Channel programming.
Sinclair’s tennis segment operating results are usually subject to cyclical fluctuations due to the amount and significance of tournaments that take place in the respective quarters during the year. The first and fourth quarter operating results are usually higher than the second and third quarters’ because of the amount and significance of tournaments that are played during those periods.
Local Sports
Deconsolidation of Diamond Sports Intermediate Holdings LLC. On March 1, 2022, SBG’s subsidiary Diamond Sports Intermediate Holdings, LLC, and certain of its subsidiaries (collectively “DSIH”) completed a series of transactions (the “DSIH Transaction”). As part of the DSIH Transaction, the governance structure of DSIH was modified including changes to the composition of its Board of Managers, resulting in the Company's loss of voting control. As a result, DSIH, whose operations represented the entirety of our local sports segment, was deconsolidated from our consolidated financial statements effective as of March 1, 2022 (the “Deconsolidation”). The consolidated statement of operations for the year ended December 31, 2022 therefore includes two months of activity related to DSIH prior to the Deconsolidation. Subsequent to February 28, 2022, the assets and liabilities of DSIH were no longer included within our consolidated balance sheets. Prior to the Deconsolidation, the local sports segment consisted of RSNs, which owned the exclusive rights to air, among other sporting events, the games of professional sports teams in designated local viewing areas. Any discussions related to results, operations, and accounting policies associated with DSIH refer to the periods prior to the Deconsolidation.
OTHER
Digital and Internet
Sinclair owns Compulse, a marketing technology and managed services company, which earns revenues by licensing the platform to other local media companies and agencies, as well as executing their digital media initiatives across search, social, programmatic, email, and more.
Technical Services
Sinclair owns subsidiaries which are dedicated to providing technical services to the broadcast industry, including: Dielectric, a designer and manufacturer of broadcast systems including all components from transmitter output to antenna, and ONE Media 3.0, whose purpose is to develop business opportunities, products, and services associated with the NextGen TV (also known as ASTC 3.0) broadcast transmission standard and TV platform, and to develop wireless, cloud infrastructure, and artificial intelligence technologies. Sinclair has also partnered with several other companies in the design and deployment of NextGen TV services including: Tejas Networks, to develop NextGen TV technologies to be used in consumer devices, and EdgeBeam Wireless, a joint venture with three other broadcast companies to provide services to third parties utilizing NextGen TV including, wireless data services to a wide range of businesses and industries across the country. NextGen TV is further discussed under Operating Strategy - Development of Next Generation Wireless Platform below.
Non-Media Investments
Primarily through Ventures, Sinclair owns various non-media related investments across multiple asset classes including real estate, venture capital, private equity, and direct investments in technology driven companies, including wireless communication and semiconductor solutions, next-gen communication solutions, advertising intelligence and data security. Sinclair’s investments in real estate primarily consist of apartment complexes and development projects. Sinclair’s investments in venture capital and private equity funds include capital for companies involved in a variety of businesses, including advertising, marketing, media technology, sports betting, e-sports, sports technology, pickleball, beverages and community services.
CUSTOMERS
In 2024, Sinclair’s local media and tennis segments had two customers that individually accounted for 10% of Sinclair’s consolidated revenue. Any disruption in our relationship with these customers could have a material adverse effect on Sinclair’s local media and tennis segments and Sinclair’s results of operations.
In 2024, SBG’s local media segment had one customer that individually accounted for 10% of SBG’s consolidated revenue. Any disruption in SBG’s relationship with this customer could have a material adverse effect on SBG’s local media segment and SBG’s results of operations.
OPERATING STRATEGY
Programming to Attract Viewership. We seek to target our programming offerings to attract viewership, to meet the needs of the communities in which we serve, and to meet the needs of our advertising customers by entering into network affiliation agreements that provide us the right to broadcast general entertainment network programming, national news, and sports programming.
Our stations seek to broadcast live, local, and national sporting events that would appeal to a large segment of the local community. Moreover, our stations produce local news at 114 stations in 72 markets. Our stations also seek to develop original programming or obtain, at attractive prices, popular syndicated programming that is complementary to each station’s network programming.
Television advertising prices are based on ratings information measured and distributed by Nielsen and Comscore. Ratings methodologies have been changing rapidly due to advancements in technology and changes in the manners in which viewers consume news, sports, and entertainment. Certain new methodologies are currently not accredited by the Media Rating Council, an independent organization that monitors rating services, and may not reflect actual viewership levels.
News. Through local news, our mission is to serve our communities by sharing relevant information to alert, protect, and empower our audiences. We believe that the production and broadcasting of local news is an important link to the community enhancing a station’s efforts to expand its viewership and helps us differentiate from networks that provide only national news. In addition, local news programming can provide access to advertising sources targeted specifically to local news viewers. Our news stations also produce content on digital platforms such as websites, mobile applications, OTT distributors, social media, digital newsletters, and podcasts.
Our local news initiatives are an important part of our strategy. We have entered into local news sharing arrangements in which we receive news in four markets from other in-market broadcasters. We believe that, in the markets where we have news share arrangements, such arrangements generally provide both higher viewer ratings and revenues for the station receiving the news and generate a profit for the news share provider. Generally, both parties and the local community are beneficiaries of these arrangements.
In addition to our traditional local news stories, we have utilized our national reach and physical presence in the nation’s capital to provide our local viewers with broader national news stories which are relevant to our local viewers.
Our local news coverage is supported by our national news desk. These teams focus on providing context and perspective to important stories in the daily news cycle. This content provides a significant point of difference with a focus on accountability reporting. Available on-air and online, the bureau not only expands our news presence, but gives our local station viewers an opportunity to hear the views of their members of Congress through programs such as “Connect to Congress,” our weekly on-air and digital feature which provides an electronic video pathway for lawmakers to speak to their constituents. Our weekly investigative news program, Full Measure, reinforces our mission to provide our fearless storytelling on significant topics of public importance.
The National News Desk, our flagship national news program, delivers a comprehensive, fact-based overview of the most significant national and regional stories throughout the day. Leveraging our expansive local news network, the program highlights impactful events shaping communities across the country. With reporters embedded in the areas they cover, TNND provides firsthand perspectives on stories that matter most to local residents, seamlessly integrating these insights with major national headlines. TNND weekday and/or weekend editions together air on 83 of our markets and across all of our news websites. Our investigative reporting is supported by more than 30 local investigative reporters. As we continue to expand our investigative footprint, we remain committed to uncovering stories that demand deeper scrutiny and bringing impactful, underreported issues to the forefront.
Sports. Live sports have remained highly popular with fans and advertisers. Sports programming generally elicits strong emotional responses and attracts a loyal and passionate following among fans. Our premium live sports programming typically attracts viewership demographics that are highly desirable to advertisers. Every sports season is a new chapter in a story that has continued for decades and is popular with fans from multiple generations. As media has continued to trend toward on-demand consumption, sports events have remained an “appointment viewing” event. As such, live sports content is frequently the most watched programming in a local market on most nights.
Tennis Channel and T2, Tennis Channel’s first FAST offering in the United States, are the only television-based multiplatform destinations dedicated to both the professional sport and tennis lifestyle. Tennis Channel and T2 have the most concentrated single-sport coverage in television in one of the world’s most voluminous sports, with multiple men’s and women’s tournaments and singles, doubles and mixed competition throughout the year. Tennis Channel and T2 have rights at the four majors - US Open, Wimbledon, Roland Garros (French Open) and Australian Open - and are the exclusive U.S. homes of all men’s ATP World Tour and women’s WTA Tour competitions, Davis Cup, Billie Jean King Cup, United Cup, and Laver Cup. Our stations also broadcast programming and other content provided by Tennis, and we provide access to certain events through our Tennis Channel streaming service, which is available to everyone in the United States and allows subscribers to select from another 10,000 hours of live and on-demand matches and award-winning content from short-form to films throughout the tennis season. Tennis Channel International brings live competition and network content to markets in Europe and Asia via digital subscription and FAST channels. Our www.tennis.com platform is the largest digital outlet dedicated to the sport. Tennis Channel also manages a network of close to 20 podcasts and PBTV
Additionally, some of our television stations have the local television broadcast rights for certain sporting events, including Major League Baseball (“MLB”), National Basketball Association (“NBA”), National Hockey League (“NHL”), National Football League (“NFL”) preseason, and certain other college and high school sports. Our CW and MNT stations generally face fewer preemption restrictions on broadcasting live local sporting events compared with our FOX, ABC, CBS, and NBC stations, which are required to broadcast a greater number of hours of programming supplied by the networks. In addition, our stations that are affiliated with FOX, ABC, CBS, and NBC have network arrangements to broadcast certain MLB, NBA, NHL, NFL, and Professional Golf Association events, as well as other popular sporting events.
Control of Operating and Programming Costs. By employing a disciplined approach to managing programming acquisition and other costs, our stations have been able to achieve operating margins that we believe are very competitive within the television broadcast industry. We believe our national reach as of December 31, 2024 of approximately 39% of the country provides us with a strong position to negotiate with programming providers and, as a result, the opportunity to purchase high quality programming at more favorable prices. Moreover, we emphasize control of each of our station’s programming and operating costs through program-specific profit analysis, detailed budgeting, regionalization of staff, and detailed long-term planning models. We also control our programming costs by creating original high-quality programming that is distributed on our broadcast platform.
Developing Local Franchises. We believe the greatest opportunity for a sustainable and growing customer base lies within our local communities. Therefore, we have focused on developing a strong local sales force, which is comprised of approximately 490 sales professionals and 80 local sales managers company-wide. Excluding political advertising revenue, distribution revenues, and other revenues, 59% and 61% of Sinclair’s net time sales were local for the years ended December 31, 2024 and 2023, respectively, and 61% and 62% of SBG’s net time sales were local for the years ended December 31, 2024 and 2023, respectively. Our goal is to grow our local revenues by increasing our market share, developing new business opportunities, and offering marketing solutions across our platforms.
Attract and Retain High Quality Management. We believe that much of our success is due to our ability to attract and retain highly-skilled and motivated managers at corporate, stations, and other businesses. We provide a combination of base salary, long-term incentive compensation including equity awards and, where appropriate, cash bonus pay designed to be competitive with comparable employers in our industry, competitive health benefits, and learning and development opportunities. A significant portion of the compensation available to certain members of our senior management and our sales force is based on their achievement of certain performance goals. We also encourage station and network managers and employees to utilize our diverse business to grow in their careers while remaining in the Sinclair organization via internal promotion and relocation.
Multi-Channel Broadcasting. FCC rules allow television broadcasters to transmit additional digital channels within the spectrum allocated to each FCC license holder. This provides our stations’ viewers with additional programming alternatives at no additional cost to them. We may consider other alternative programming formats that we could air using our multi-channel digital spectrum space with the goal towards achieving higher profits and community service. As of December 31, 2024, our stations have approximately 458 multi-channels on our digital spectrum.
Distribution Agreements. We have distribution agreements with Distributors and other OTT distributors who compensate us for the right to retransmit our stations and other offerings on their respective distribution platforms. Our successful negotiations with Distributors and other OTT distributors have created agreements that produce meaningful sustainable revenue streams. We intend to maintain strong relationships with our Distributors and other OTT distributors and believe our local news, sports, and entertainment content positions us to continue to extend our agreements within all of these distribution platforms.
Improvement and Maintenance of Broadcast Infrastructure. Our Dielectric subsidiary is a leader in servicing and manufacturing broadcast infrastructure. As a result, we maintain a strong infrastructure through which we provide high quality uninterrupted content on our stations. This subsidiary is critical in the build-out of the infrastructure behind NextGen TV for both our stations and other broadcasters.
Developing New Business. We strive to develop new business models to complement or enhance our traditional television broadcast business. We have developed new ways to sell online, on mobile text messaging, social media advertising, and through audience extension services along with our traditional commercial broadcasting model, including streaming content on connected televisions and the launch of our podcast division. Additionally, we continue to leverage our national reach to provide new high-quality content to our local communities.
We continue to expand our digital distribution platforms through initiatives such as our video management system, which simplifies and automates our broadcast-to-digital streaming workflow and allows for dynamic replacement of broadcast ads with digital ads targeted to each individual viewer and allows us to ingest and redistribute content across our platform so that we can break news first. By using a single ad-serving system across all our web sites, mobile apps, and other digital assets, we are able to streamline our sales workflow, optimize yield, and deliver comprehensive sales opportunities across our digital footprint. Additionally, we are deploying direct-to-consumer (“DTC”) and OTT initiatives, cloud technologies, as well as our own content applications.
Additionally, we continue to develop business opportunities, products, and services associated with NextGen TV (also known as ATSC 3.0) as discussed under Development of Next Generation Wireless Platform below.
Strategic Realignment of Local Media Portfolio. We routinely review potential media acquisitions, dispositions, and swaps, or develop original networks and content in order to optimize our portfolio. We expect to continue to assess divestiture, acquisition and investment opportunities to complement our existing stations and other businesses. As we evaluate potential divestitures, acquisitions and investments, we intend to focus on making disciplined, accretive divestitures, acquisitions and investments that will complement our existing portfolio of television stations while providing increased opportunities and scale. At any given time, we may be in discussions with one or more media owners.
Digital and Internet Expansion of Local Media Segment. Our digital properties are innovative products and extensions of our core broadcast business that allow us to compete for digital, internet, network, and audio impressions and revenues. We continue to seek additional opportunities to invest in emerging digital technologies, ad tech, and digital content companies that support and expand our digital capabilities and non-linear footprint.
Development of Next Generation Wireless Platform. In 2017, the FCC approved the use of NextGen TV (also known as ATSC 3.0), a next generation broadcast transmission standard. NextGen TV is capable of merging broadcast and broadband content and data services using over-the-air spectrum and Internet-provided data connectivity, allowing a mature broadcast industry to reinvent itself due to its mobility, addressability, capacity, Internet Protocol (“IP”) connectivity, and conditional access. In 2023, the FCC announced a public-private partnership, the Future of Television Initiative, to establish a roadmap for the transition to NextGen TV.
NextGen TV will allow us to use our spectrum for more than just video-formatted data as we do today. As a data-agnostic IP based pipe, we also will be able to distribute data including text, audio, video, and software. While our one-to-many architecture will remain a strength, we will be able to deliver “the last mile” from program/data origination to the consumer’s receiver device across a more robust system, connect legacy ATSC 1.0 televisions to NextGen TV using broadcast hot spots and wi-fi functionality, and provide compatible data-offload service offerings in conjunction with certain 5G platforms. Among the many emerging opportunities are hyper-local news, weather, and traffic; dynamic ad insertion; geographic and demographic-targeted advertising; customizable content; better measurement and analytics; the ability to interface with devices connected to the Internet; flexibility to add streams as needed; substantially enhanced picture quality with immersive audio; connectivity to automobiles, including 3D mapping, telematics and infotainment; geo-location services; enhanced global and broadcast positioning systems; distance e-learning; data wholesale models; and other content delivery networks. Conditional access capabilities also permit broadcasters to offer secure “skinny-bundle” pay services as well as various video-on-demand type offerings. In addition, NextGen TV provides new emergency and information capabilities, including advanced alerting functions which can provide crucial rich media including evacuation routes and device wake-up features. All these features will be available to mobile and portable devices, allowing us to reach viewers virtually anywhere.
In order to bring this technology to the market, we have partnered with technology leaders to develop broadcasting solutions and services in the U.S. and globally. We also formed BitPath, a joint venture with another broadcaster, to promote spectrum efficiency and innovation, aggregate and monetize underutilized spectrum capacity over which to deliver national services and create opportunities such as robust video and data exchange. We continue to work with other NextGen TV stakeholders to build and test the single frequency network tower infrastructure, develop systems to allow the convergence of NextGen TV and 5G data delivery, and design NextGen TV receiver chips for mobile, portable and fixed devices. We expect the implementation and adoption of NextGen TV to occur over the next two years. In 2020, we and the industry began deployment of NextGen TV capabilities on some of our own television facilities and in conjunction with other station operators in our markets, as well as non-Sinclair markets. To date, NextGen TV is broadcasting in more than 60 markets, including 45 of our markets. When completed, the country will have a lower-cost, world class wireless IP data distribution network capable of supporting multiple business models. In January 2025, we joined with three broadcast peers and merged BitPath to form a new joint venture company, EdgeBeam Wireless to provide robust wireless data services to a wide range of businesses and industries across the country. This joint venture creates a nationwide spectrum footprint that no individual broadcaster could achieve on its own, unlocking the potential of NextGen TV to offer nationwide coverage for data delivery to billions of potential devices on market-disrupting terms.
Monetization of Certain Intellectual Property Rights. We have developed, through our ONE Media, LLC subsidiary, several NextGen Broadcast-related patents that we intend to monetize directly, through third-party agents, or through a patent pool designed to consolidate similar patents owned by independent licensors for licensing to equipment manufacturers.
New Non-Media Investments. Through Ventures, we expect to make both controlling and minority investments in non-media related businesses where management expects long-term growth.
FEDERAL REGULATION OF TELEVISION BROADCASTING
The ownership, operation, and sale of television stations are subject to the jurisdiction of the FCC, which acts under the authority granted by the Communications Act of 1934, as amended (“the Communications Act”). Among other things, the FCC assigns frequency bands for broadcasting; determines the particular frequencies, locations, and operating power of stations; issues, renews, revokes, and modifies station licenses; regulates equipment used by stations; adopts and implements regulations and policies that directly or indirectly affect the ownership, operation, and employment practices of stations; and has the power to impose penalties for violations of its rules and regulations of the Communications Act.
The following is a summary of certain provisions of the Communications Act and specific FCC regulations and policies. Reference should be made to the Communications Act, FCC rules, and the public notices and rulings of the FCC for further information concerning the nature and extent of federal regulation of broadcast stations.
License Grant and Renewal
Television stations operate pursuant to broadcasting licenses that are granted by the FCC for maximum terms of eight years and are subject to renewal upon application to the FCC. During certain periods when renewal applications are pending, petitions to deny license renewals can be filed by interested parties, including members of the public.
Although historically renewal of a license is granted in the vast majority of cases, even when petitions to deny are filed, there can be no assurance that the license of any station will be renewed or, if renewed, that the renewal terms will be for the maximum term permitted.
The most recent television license renewal application filing cycle began on June 1, 2020 and ended on April 3, 2023 and the majority of our license renewal applications remain pending. Licensees are authorized to continue operating stations in accordance with their existing licenses while their renewal applications are pending before the FCC. We cannot predict when the FCC will take action on the license renewal applications. In the prior completed license renewal cycle, all of our stations’ license renewal applications were granted for the maximum term permitted.
Ownership Matters
General. The Communications Act prohibits the assignment of a broadcast license or the transfer of control of a broadcast licensee without the prior approval of the FCC. In determining whether to permit the assignment or transfer of control of, or the grant or renewal of, a broadcast license, the FCC considers a number of factors pertaining to the licensee, including compliance with various rules limiting common ownership of media properties, the “character” of the licensee and those persons holding “attributable” interests in that licensee and compliance with the Communications Act’s limitations on foreign ownership. The FCC has indicated that in order to approve an assignment or transfer of a broadcast license the FCC must make an affirmative determination that the proposed transaction serves the public interest, not merely that the transaction does not violate its rules or shares factual elements with other transactions previously approved by the FCC, and that it may deny a transaction if it determines that the transaction would not be in the public interest.
The FCC generally applies its ownership limits to “attributable” interests held by an individual, corporation, partnership or other association. In the case of corporations holding, or through subsidiaries controlling, broadcast licenses, the interests of officers, directors and those who, directly or indirectly, have the right to vote 5% or more of the corporation’s stock (or 20% or more of such stock in the case of insurance companies, investment companies and bank trust departments that are passive investors) are generally attributable. In addition, pursuant to what is known as the equity-debt-plus rule, a major programming supplier or same-market media entity will be an attributable owner of a station if the supplier or same-market media entity holds debt or equity, or both, in the station that is greater than 33% of the value of the station’s total debt plus equity. Further, the Communications Act generally prohibits foreign parties from having more than a 20% interest (voting or equity) in a broadcast licensee or more than a 25% interest in the parent of that licensee without receiving prior FCC approval to exceed these limits. Following a Declaratory Ruling in 2013 in which the FCC indicated that it was open to considering proposals for foreign investment in broadcast licenses that exceed the 25% benchmark on a case by case basis, on September 29, 2016, the FCC adopted a Report and Order which among other things, (i) simplified the foreign ownership approval process for broadcast licensees seeking to exceed the 25% benchmark and (ii) modified the methodology a licensee may use to determine compliance with the foreign ownership rules.
We and our subsidiaries are domestic entities, and David D. Smith, Frederick G. Smith, J. Duncan Smith, and Robert E. Smith (collectively, the “Smiths”) (who, as of December 31, 2024, together hold approximately 81.9% of the common voting rights of Sinclair) are all United States citizens. Our articles of incorporation contain limitations on alien ownership and control that are substantially similar to those contained in the Communications Act. Pursuant to the articles of incorporation, we have the right to repurchase alien-owned shares at their fair market value to the extent necessary, in the judgment of the Board, to comply with the alien ownership restrictions.
Additional ownership rules as currently in effect are as follows:
National Ownership Rule. The national television viewing audience reach cap is 39%. Under this rule, where an individual or entity has an attributable interest in more than one television station in a market, the percentage of the national television viewing audience encompassed within that market is only counted once. Additionally, because VHF stations (channels 2 through 13) historically covered a larger portion of the market than UHF stations (channels 14 through 51), only half of the households in the market area of any UHF station are included when calculating an entity’s national television viewing audience (commonly referred to as the “UHF discount”). On December 18, 2017, the FCC released a Notice of Proposed Rulemaking to examine the national ownership rule, including the UHF discount. The rulemaking proceeding remains pending. We cannot predict the outcome of the rulemaking proceeding.
The majority of the stations we own and operate, or to which we provide programming services, are UHF. With the UHF discount, our current reach (for FCC purposes) is approximately 24% of U.S. households. See Item 1A. Risk Factors for further discussion of the risk related to the outcome of rules governing the UHF discount.
Local Television Ownership Rule. A party may own television stations in adjoining markets, even if there is a digital noise limited service contour overlap between the two stations’ broadcast signals, and generally may own two stations in the same market (“local television ownership rule”) only (i) if there is no digital overlap between the stations; or (ii) not more than one station is among the top-four rated stations in the market (“the Top-Four Prohibition”). The FCC will, upon request, consider waiver of the Top-Four Prohibition to allow parties to own up to two top-four rated stations in the same market on a case-by-case basis. On December 22, 2023, the FCC adopted the 2018 Ownership Order, extending the Top-Four Prohibition to prohibit, in certain circumstances, the placement of a second top-four rated programming affiliation on a multicast stream or low power television (LPTV) station and restricting the circumstances under which such existing top-four multicast streams or LPTV stations may be transferred or assigned in the future. Affiliation arrangements existing as of the release of the 2018 Ownership Order that would otherwise violate the expanded Top-Four Prohibition will not be subject to divestiture, but such arrangements will not be transferrable or assignable absent case-by-case approval. The 2018 Ownership Order, including this extension of the Top-Four Prohibition, became effective March 18, 2024 and is currently under appeal in the U.S. Court of Appeals for the Eighth Circuit.
Local Marketing and Outsourcing Agreements
Certain of our stations have entered into agreements with other stations in the same market, through which we provide programming and operating services pursuant to LMAs or provide sales services and other non-programming operating services pursuant to outsourcing agreements, such as JSAs and SSAs. LMAs are attributable where a licensee holds an attributable interest in a television station and (i) programs more than 15% of the weekly broadcast hours and/or (ii) sells more than 15% of the weekly advertising time on another television station in the same market. LMAs existing prior to November 5, 1996, which include all of our LMAs, are currently exempt from attribution until further FCC action. If the FCC were to eliminate the exemption for these LMAs, we would have to terminate or modify these LMAs. JSAs and SSAs currently are not attributable.
In August 2016, the FCC amended its ownership rules to provide for the attribution of JSAs under certain circumstances. The subsequent Ownership Order on Reconsideration eliminated the JSA attribution rule. In the 2018 Ownership Order the FCC declined to reconsider JSA attribution. If we are required to terminate or modify our LMAs or JSAs, our business could be adversely affected in several ways, including losses on investments and termination penalties. For more information on the risks, see “The FCC’s multiple ownership rules and federal antitrust regulation may limit our ability to operate multiple television stations in some markets and may result in a reduction in our revenue or prevent us from reducing costs. Changes in these rules may threaten our existing strategic approach to certain television markets.” under Item 1A. Risk Factors and Changes in the Rules of Television Ownership, Local Marketing Agreements, Joint Sales Agreements, Retransmission Consent Negotiations, and National Ownership Cap under Note 12. Commitments and Contingencies within the Consolidated Financial Statements for further discussion.
Antitrust Regulation. The Department of Justice (“DOJ”) and the Federal Trade Commission have increased their scrutiny of the television industry and have reviewed matters related to the concentration of ownership within markets (including “LMAs” and “outsourcing agreements”) even when ownership or the LMA or other outsourcing agreement in question is permitted under the laws administered by the FCC or by FCC rules and regulations. The DOJ takes the position that an LMA or other outsourcing agreement entered into in anticipation of a station’s acquisition with the proposed buyer of the station constitutes a change in beneficial ownership of the station which, if subject to filing under the Hart-Scott-Rodino Antitrust Improvements Act, cannot be implemented until the waiting period required by that statute has ended or been terminated.
Satellite Carriage
The Satellite Home Viewer Act, as extended by The Satellite Home Viewer Improvement Act of 1999, the Satellite Home Viewer Extension and Reauthorization Act, the Satellite Television Extension and Localism Act of 2010 and the Satellite Television Extension and Localism Act Reauthorization Act of 2014 (“STELAR”) among other things, (i) allows satellite carriers to provide local television signals by satellite within a station market, and requires them to carry all local signals that asserted carriage rights in any market where they carry any local signals, (ii) requires all television stations to elect to exercise certain “must-carry” or “retransmission consent” rights in connection with their carriage by satellite carriers, and (iii) authorizes satellite delivery of distant network signals, significantly viewed signals and local low-power television station signals into local markets under defined circumstances. In adopting fiscal year 2020 appropriations legislation, Congress allowed STELAR to sunset on December 31, 2019 but made permanent STELAR’s (1) requirements that broadcasters and Distributors negotiate retransmission content in good faith and (2) distant signal satellite license provisions for recreational vehicles, truckers, tailgaters and short markets.
Must-Carry / Retransmission Consent
Television broadcasters are required to make triennial elections to exercise either certain “must-carry” or “retransmission consent” rights in connection with their carriage by cable systems in each broadcaster’s local market. By electing to exercise must-carry rights, a broadcaster demands carriage and receives a specific channel on cable systems within its DMA. Must carry rights are not absolute and are dependent on a number of factors which may or may not be present in a particular case. Alternatively, if a broadcaster chooses to exercise retransmission consent rights, it can prohibit cable systems from carrying its signal or grant the appropriate cable system the authority to retransmit the broadcast signal for a fee or other consideration. We have elected to exercise our retransmission consent rights with respect to all of our stations. In February 2015, the FCC issued an order implementing certain statutorily required changes to its rules governing the duty to negotiate retransmission consent agreements in good faith. Under these rules, unless the stations are directly or indirectly under common de jure control as permitted under the FCC regulations, a station may not delegate authority to negotiate or approve a retransmission consent agreement to a station located in the same market or to a third party that negotiates together with another television station in the same market, nor may stations in the same market facilitate or agree to facilitate coordinated negotiation of retransmission consent terms for their stations in that market, including through the sharing of information. In May 2020, the FCC revised its good faith negotiation rules to specify that certain small MVPDs can meet the obligation to negotiate in good faith by negotiating with a large station group through a qualified MVPD buying group and that large station groups have an obligation to negotiate in good faith with such MVPD buying groups.
Further, in September 2015, the FCC released a Notice of Proposed Rulemaking in response to a Congressional directive in STELAR to examine the “totality of the circumstances test” for good-faith negotiations of retransmission consent. The proposed rulemaking sought comment on new factors and evidence to consider in its evaluation of claims of bad faith negotiation, including service interruptions prior to a “marquee sports or entertainment event,” restrictions on online access to broadcast programming during negotiation impasses, broadcasters’ ability to offer bundles of broadcast signals with other broadcast stations or cable networks, and broadcasters’ ability to invoke the FCC’s exclusivity rules during service interruptions. On July 14, 2016, the FCC’s then-Chairman Wheeler announced that the FCC would not, at that time, proceed to adopt additional rules governing good faith negotiations of retransmission consent. No formal action has yet been taken on this Proposed Rulemaking, and we cannot predict if the FCC will terminate the Rulemaking or take other action.
Network Non-Duplication / Syndicated Exclusivity / Territorial Exclusivity
The FCC’s syndicated exclusivity rules allow local broadcast television stations to demand that cable operators black out syndicated non-network programming carried on “distant signals” (i.e., signals of broadcast stations, including so-called “superstations,” which serve areas substantially removed from the cable systems’ local community). The FCC’s network non-duplication rules allow local broadcast, network affiliated stations to require that cable operators black out duplicate network programming carried on distant signals. Both rules are subject to various exceptions and limitations. In a number of markets in which we own or program stations affiliated with a network, a station that is affiliated with the same network in a nearby market is carried on cable systems in our markets. Such significantly viewed signals are not subject to black out pursuant to the FCC’s network non-duplication rules. The carriage of two network stations on the same cable system could result in a decline of viewership, adversely affecting the revenues of our owned or programmed stations. In March 2014, the FCC issued a Report and Order and Further Notice of Proposed Rulemaking, requesting comments on whether it has authority to, and should, eliminate or modify its network non-duplication and/or syndicated exclusivity rules. This proceeding is pending and we cannot predict when or how the FCC will resolve that rulemaking. The FCC’s syndicated exclusivity rules allow local broadcast television stations to demand that cable operators black out syndicated non-network programming carried on “distant signals” (i.e., signals of broadcast stations, including so-called “superstations,” which serve areas substantially removed from the cable systems’ local community). The FCC’s network non-duplication rules allow local broadcast, network affiliated stations to require that cable operators black out duplicate network programming carried on distant signals. Both rules are subject to various exceptions and limitations. In a number of markets in which we own or program stations affiliated with a network, a station that is affiliated with the same network in a nearby market is carried on cable systems in our markets. Such significantly viewed signals are not subject to black out pursuant to the FCC’s network non-duplication rules. The carriage of two network stations on the same cable system could result in a decline of viewership, adversely affecting the revenues of our owned or programmed stations. In March 2014, the FCC issued a Report and Order and Further Notice of Proposed Rulemaking, requesting comments on whether it has authority to, and should, eliminate or modify its network non-duplication and/or syndicated exclusivity rules. This proceeding is pending and we cannot predict when or how the FCC will resolve that rulemaking.
Digital Television
FCC rules provide that television broadcast licensees may use their digital television (“DTV”) channels for a wide variety of services such as HD television, multiple standard definition television programming, audio, data, and other types of communications, subject to the requirement that each broadcaster provide at least one free video channel equal in quality to the current technical standard and further subject to the requirement that broadcasters pay a fee of 5% of gross revenues from any DTV ancillary or supplementary service for which there is a subscription fee or for which the licensee receives a fee from a third party. These rules could impact the profitability related to ancillary or supplementary services provided as discussed within Development of Next Generation Wireless Platform under Operating Strategy above. In addition, the recent extension of the Top-Four Prohibition to multicasting as discussed above and within Changes in the Rules of Television Ownership, Local Marketing Agreements, Joint Sales Agreements, Retransmission Consent Negotiations, and National Ownership Cap could impact the way we currently use our DTV channels and the services we are able to offer on those channels.
Programming and Operations
The Communications Act requires broadcasters to serve the “public interest.” The FCC has relaxed or eliminated many of the more formalized procedures it had developed in the past to promote the broadcast of certain types of programming responsive to the needs of a station’s community of license. FCC licensees continue to be required, however, to present programming that is responsive to the needs and interests of their communities and to maintain certain records demonstrating such responsiveness. Complaints from viewers concerning a station’s programming may be considered by the FCC when it evaluates renewal applications of a licensee, although such complaints may be filed at any time and generally may be considered by the FCC at any time. Stations also must pay regulatory and application fees and follow various rules promulgated under the Communications Act that regulate, among other things, political advertising, sponsorship identifications, obscene and indecent broadcasts, and technical operations, including limits on radio frequency radiation. In addition, television licensees have obligations to create and follow employment outreach programs, provide a minimum amount of programming for children, comply with rules relating to the emergency alert system, maintain an online public inspection file, and abide by regulations specifying requirements to provide closed captions for its programming. FCC licensees are, in general, responsible for the content of their broadcast programming, including that supplied by television networks. Accordingly, there is a risk of being fined as a result of our broadcast programming, including network programming.
Other Pending Matters
Congress and the FCC have under consideration, and in the future may consider and adopt, new laws, regulations, and policies regarding a wide variety of matters that could affect, directly or indirectly, the operation, ownership, and profitability of our broadcast stations, result in the loss of audience share and advertising revenues for our broadcast stations, and affect our ability to acquire additional broadcast stations or finance such acquisitions.
On November 16, 2017, the FCC adopted a Report and Order and Further Notice of Proposed Rulemaking authorizing the voluntary deployment of NextGen TV and adopting rules to afford broadcasters flexibility to deploy NextGen TV based transmissions while minimizing impact on consumers and industry stakeholders and seeking comment on certain additional matters. On June 3, 2020, the FCC adopted the Second Report and Order and Order on Reconsideration, providing additional guidance to broadcasters deploying NextGen TV. On November 9, 2020, the National Association of Broadcasters filed a Petition for Declaratory Ruling and Petition for Rulemaking requesting that the FCC (1) clarify that its existing regulatory framework for the hosting of simulcast primary programming streams also applies to simulcast multicast streams, and (2) expand the application of these rules to cover the transmission of ATSC 1.0 multicast streams regardless of whether those streams are simulcast in ATSC 3.0. On November 5, 2021, the FCC released a Second Further Notice of Proposed Rulemaking seeking comment on these multicast host station licensing issues, and on June 22, 2022, the FCC released a Third Further Notice of Proposed Rulemaking seeking comment on the state of the ATSC 3.0 transition and the scheduled sunsets of two rules adopted in the 2017 Report and Order. On June 20, 2023, the FCC adopted a Third Report and Order and Fourth Further Notice of Proposed Rulemaking that (1) generally adopted the proposals to allow a NextGen TV station to seek modification of its license to include certain multicast streams that are aired on host stations; (2) extended the sunsets of the substantially similar rule for simulcast streams and the requirement to comply with the ATSC A/322 standard on primary ATSC 3.0 streams to July 17, 2027; and (3) sought comment on the current marketplace for ATSC 3.0 standard essential patents and the ability of third parties to develop products that rely upon them. The proceeding remains pending and we cannot predict what the outcome will be.
On December 22, 2022, the FCC released a Public Notice to initiate the 2022 Quadrennial Regulatory Review, seeking comment on the Local Radio Ownership Rule, the Local Television Ownership Rule, and the Dual Network Rule. The proceeding remains pending and we cannot predict what the outcome will be.
Other matters that could affect our broadcast properties include technological innovations and developments generally affecting competition in the mass communications industry, such as DTC offerings, direct television broadcast satellite service, Class A television service, the continued establishment of wireless cable systems and low power television stations, digital television technologies, the internet and mobility, and portability of our broadcast signal to hand-held devices.
Other Considerations
The preceding summary is not a complete discussion of all provisions of the Communications Act or other congressional acts or of the regulations and policies of the FCC, or in some cases, the DOJ. For further information, reference should be made to the Communications Act, other congressional acts and regulations, and public notices circulated from time to time by the FCC, or in some cases, the DOJ. There are additional regulations and policies of the FCC and other federal agencies that govern political broadcasts, advertising, equal employment opportunity, and other matters affecting our business and operations.
ENVIRONMENTAL REGULATION
Prior to our ownership or operation of our facilities, substances or waste that are, or might be considered, hazardous under applicable environmental laws may have been generated, used, stored, or disposed of at certain of those facilities. In addition, environmental conditions relating to the soil and groundwater at or under our facilities may be affected by the proximity of nearby properties that have generated, used, stored, or disposed of hazardous substances. As a result, it is possible that we could become subject to environmental liabilities in the future in connection with these facilities under applicable environmental laws and regulations. Although we believe that we are in substantial compliance with such environmental requirements and have not in the past been required to incur significant costs in connection therewith, there can be no assurance that our costs to comply with such requirements will not increase in the future or that we will not become subject to new governmental regulations, including those pertaining to potential climate change legislation, that may impose additional restrictions or costs on us. We presently believe that none of our properties have any condition that is likely to have a material adverse effect on our consolidated balance sheets, consolidated statements of operations, or consolidated statements of cash flows.
COMPETITION
Our stations and networks compete for audience share and advertising revenue with other television stations and cable networks in their markets, as well as with other advertising media such as Distributors, other OTT distributors, cable networks, video on-demand, radio, newspapers, magazines, outdoor advertising, transit advertising, telecommunications providers, direct mail, internet, podcasts, other digital media, and Big Tech (such as Alphabet, Amazon, Apple, Meta, and Microsoft).
Our stations and networks compete for television audience share primarily on the basis of program popularity, digital advertising impressions compete for audience share primarily based on content and reach, and podcast listeners compete for audience share based upon content subject matter, all of which has a direct effect on advertising rates within each of these platforms.
Our network affiliated stations are largely dependent upon the performance of network provided programs in order to attract viewers. Non-network time periods are programmed by the station primarily with syndicated programs purchased for cash, as well as through self-produced news, live local sporting events, and other programming. We also compete for programming which involves negotiating with national program distributors or syndicators that sell first-run and rerun packages of programming. Our stations and networks compete for access to those programs against in-market broadcast station competitors for syndicated products and with national cable networks. Public broadcasting stations generally compete with commercial broadcasters for viewers, but not for advertising dollars.
Competition in the television broadcasting industry occurs primarily in individual DMAs. Generally, a television broadcasting station in one DMA does not compete with stations in other DMAs. Our stations are located in highly competitive DMAs. Distributors can increase competition for viewership and broadcast television advertising inventory by carrying additional cable network channels within the same DMA as the broadcast television stations. Distributors sell advertising on these cable networks to local advertisers. These narrow cable network channels are typically low rated, and, as a result, advertisements are inexpensive to the local advertisers. Distributors may also connect two or more cable systems together, also called an interconnect, which gives advertisers the option to reach more households in a market with a single buy. In addition, certain of our DMAs are overlapped by over-the-air stations from adjacent DMAs and Distributors of stations from other DMAs, which tends to spread viewership and advertising expenditures over a larger number of television stations. In addition, there is significant increased competition with Google, Facebook, social media, OTT offerings, and the multitude of other digital offerings that air video advertisements and sell programmatically to agencies and advertisers. Distributor and OTT offerings have an ability to either blanket the market or target their advertising which broadcast stations do not.
Advertising rates are based upon factors which include the size of the market in which the stations operate; a program’s popularity among the viewers that an advertiser wishes to attract; the number of advertisers competing for the available time; the demographic makeup of the market served by the stations; the availability of alternative advertising media in the DMA; the aggressiveness and knowledge of the sales forces in the market to call on and understand their client’s need; and development of projects, features, and programs that tie advertiser messages to programming. We believe that our sales and programming strategies allow us to compete effectively for advertising revenues within the stations’ markets.
Further, the process of obtaining distribution is highly competitive. Our stations and networks face competition from other television stations and cable networks for the right to be carried by a particular Distributor, and for the right to be carried on the service tier that will attract the most subscribers. Once one of our stations and networks obtains distribution, it competes for viewers not only with the other channels available through the Distributor, but also with over-the-air television, pay-per-view channels and video-on-demand channels, as well as online services, mobile services, radio, print, streaming services, and other sources of media and information, sporting events, and entertainment. Important to our success in each area of competition the station or network faces are the price the station or network charges for its carriage; the quantity, quality, and variety of programming offered; and the effectiveness of its marketing efforts.
Our stations’ and networks’ ability to successfully compete with other television stations and cable networks for distribution may be hampered because the Distributors, through which distribution is sought, may be affiliated with other television stations, broadcast networks, or cable networks. Those Distributors may place their affiliated television station or cable network on a more desirable tier, thereby giving the affiliated television station or cable network a competitive advantage over our stations' and networks’ own programming. Additionally, broadcast networks putting programming content on their own DTC platforms may also hinder our stations’ and networks’ ability to successfully compete within the broadcast market.
Moreover, technological advances and regulatory changes affecting programming delivery through fiber optic lines, video compression, and new wireless uses could lower entry barriers for new video channels and encourage the further development of increasingly specialized “niche” programming. Telecommunication companies are permitted to provide video distribution services, on a common carrier basis, as “cable systems” or as “open video systems,” each pursuant to different regulatory schemes. Additionally, OTT services allow consumers to consume programming on-demand through access to the Internet and without a subscription with a Distributor. We continue to compete with these OTT services for viewership, which has become increasingly difficult as OTT distributors have begun to bundle their products with other OTT offerings.
The financial success of our stations and networks also depends in part upon unpredictable and volatile factors beyond our control, such as viewer preferences, the strength of the advertising market, the quality and appeal of competing programming, and the availability of other entertainment activities.
We believe we compete favorably against other television stations and cable networks because of our management skill and experience, our ability historically to generate revenue share greater than our audience share, our network affiliations and program service arrangements, and our local program acceptance. In addition, we believe that we benefit from the operation of multiple broadcast and network properties, affording us certain non-quantifiable economies of scale and competitive advantages in the purchase of programming.
CORPORATE SOCIAL RESPONSIBILITY PRACTICES
We have a long history of supporting corporate social responsibility activities and, in the past few years, we have taken steps to better measure and quantify our progress in these areas.
In April 2024, we published our 2023 Corporate Social Responsibility report, detailing our achievements and underscoring our core strategies, which are the foundation of our corporate social responsibility commitments, including:
•Identifying and implementing ways to reduce our impact on the environment through the education and engagement of internal and external audiences around sustainable solutions that can be adopted;
•Supporting employees by ensuring a fair, ethical, and safe workplace where our employees can grow, develop, and thrive;
•Providing news consumers with access to a broad range of ideas and perspectives, both on-air and online, and connecting people with important, informational content, everywhere; and
•Providing transparency, accountability, and diverse thinking that seeks to minimize risk, while ensuring all stakeholders understand the direction, performance, and financial stability of the organization.
Human Capital
Our success is driven by our most important asset - our employees. It is their hard work and dedication that enables us to be a trusted partner to our viewers and a valuable resource to our communities. As of December 31, 2024, we had approximately 7,200 employees, including part-time and temporary employees. Approximately 580 employees are represented by labor unions under certain collective bargaining agreements.
We support our employees by ensuring that we provide a fair, ethical, and safe workplace.
•We take pride in our practices to ensure the safety, health, and well-being of our employees. We maintain best practices for safety and health through policies and procedures and access to our employee assistance program.
•Our employment practices are rooted in our policies against discrimination, harassment, and retaliation to ensure a positive working environment for all.
•We are committed to an ethical workplace and provide our employees with guidance and reporting mechanisms to foster a culture of honesty and accountability.
•We provide our employees a comprehensive benefits package, recognition for their efforts, and resources to enable and enhance learning and development, and we have worked hard to ensure we provide a workplace where employees can feel that they belong.
Corporate Culture. We are committed to maintaining a safe, ethical, and harassment-free workplace. We recognize that our success as a team, and in our communications with one another, is grounded in our ability to trust team members to be fully engaged and to do the right thing. We support trusting relationships by offering clear guidance, structure, resources, and accountability. To this end, we maintain governance policies that apply to all of our directors, officers, and employees, including a code of business conduct and ethics, employee safety program, and no harassment and open-door policies. These policies are intended to identify, provide mechanisms for reporting, and provide a framework for solving potential issues. These policies are reviewed and updated by management, together with the Board, as our needs grow and change and upon stakeholder feedback and changes in applicable laws, regulations, and stock exchange requirements.
Employee Engagement. We regularly gather feedback from employees to gain an understanding of and improve our employee experience and to foster an engaged workforce. This feedback is used to help create new, and refine existing, employee-related programs and processes.
Sinclair takes a strategic approach to talent development. We provide on-the-job training and other learning opportunities to employees so that they gain and develop necessary skills for optimal job performance and to foster a creative and collaborative work environment. We encourage employees to complete areas of professional development using our learning and development platform, Sinclair University, where employees have access to a vast collection of learning and development content. We also provide leadership development through targeted training programs. In addition, many of our leaders have their own employee development offerings, specific to their department and position, including mentoring programs.
We actively promote our internal job announcement program as a part of our efforts to support employee growth by taking on new career opportunities within Sinclair.
Our innovation project is a strategic lever that drives revenue, reduces waste, and engages employees to serve our customers and shareholders as a pioneer in the industry. We believe that the “next big idea” could come from anyone or anywhere and with this in mind, we gather innovation ideas from employees company-wide. Our dedicated Innovation & Strategy team builds on our rich history of innovation to accelerate efforts across content, technology, audience development, distribution, marketing services, and business transformation.
Health, Safety, and Wellness. The health, safety, and wellness of our employees is vital to our success, and we maintain and continuously enhance affordable health care options for them. We continuously work to improve our practices, policies, and benefits to make meaningful impacts on our employees personal and professional lives, sponsoring an employee assistance program aimed at enhancing their physical, financial, and mental well-being; sponsoring a program to provide employees and spouses discounted access to fitness facilities; and offering critical illness, accident, and hospital indemnity insurance to provide comprehensive protection and financial security during unforeseen circumstances.
Compensation. Our employee compensation includes market-competitive pay; a 401(k) plan; an employee stock purchase plan; healthcare benefits; three weeks minimum paid time off; family leave, including six weeks of paid parental leave; and employer paid life and disability insurance. We continue to improve our compensation offerings. In 2024, we again offered our employees the opportunity for additional time off through the Vacation Exchange Program.
Social Responsibility
As a local news broadcaster, we believe it is our responsibility to raise issues of local importance, through deep investigative reporting at our stations, and provide critical and relevant information to our viewers, including crucial news updates during potentially life-threatening situations when our viewers need them most. We are committed to getting results for the people living in the communities we serve. Our journalists’ ground-breaking reporting has prompted government investigations as well as changes in government policies and new state and federal laws. Our unique reporting in under-served arenas has sparked much-needed public engagement on topics of high local importance and concern. WBFF’s “Project Baltimore,” which is now heading into its ninth year in 2025, has produced hundreds of stories chronicling the struggles and issues facing Maryland public schools and the students that attend those schools. Reporting by our journalists in 2024 on topics such as the issues facing public schools, juvenile justice reform, illegal weapons, and toxic metals in baby foods, to name just a few, were cited by elected officials and lead to new state legislation. Our journalists are committed to providing citizens with relentless, in-depth reporting that holds public officials accountable, tracks the spending of taxpayer dollars, and gives a voice to the voiceless in the communities we serve.
In 2024, our news division was again recognized by industry peers for its groundbreaking reporting by being awarded 232 journalism awards, including a national Emmy Award to WBFF for their reporting to expose how Baltimore City schools denied students with disabilities a proper education; our first ever national Edward R. Murrow Award to WCHS for shedding a light on systemic issues in the West Virginia criminal plea system; and eight Telly Awards to Full Measure for their fearless reporting on topics often ignored by other media organizations.
Connect to Congress is our multimedia initiative that enables Members of Congress from our news markets to speak directly to their constituents on a regular basis, through their local TV news stations. The initiative, which launched in 2015, offers our local market viewers new ways to get answers to questions about what matters most to them at home. Each Wednesday when Congress is in session, we set up cameras in the Capitol Rotunda, connected remotely to our local stations, with anchors and reporters conducting interviews with lawmakers about the key issues affecting constituents, connecting our local stations directly to Congress. This also offers the hundreds of Congressional Members in our news markets their own media voice in their home districts.
In our 13-year history of producing “Your Voice Your Future” Town Halls, we’ve produced over 1,600 productions. This distinctive series recognizes the importance of producing disruptive programming, with disciplined discussions and solutions for the communities we serve. Our goal from the beginning has been to inform, educate and protect our viewers. Our Town Halls are produced in local markets and give our viewers an opportunity to have a voice and ask their elected leaders questions on important local and national topics. In 2024, we produced 217 Town Hall productions throughout the country, covering a variety of topics including education and school safety, mental health, antisemitism, Black History Month, and veterans. We also produced over 54 separate debates and Beyond the Podium specials with candidates for elected office. We remain committed to uncovering stories that demand deeper scrutiny and bringing impactful, underreported issues to the forefront.
We have steadfast dedication to providing content that alerts, protects, and empowers our audience. Distinctive, Disruptive, and Disciplined; these three simple words carry a great deal of weight as we meet the demands of today’s news consumer.
We believe it is our responsibility to be involved in our local communities. Sinclair Cares is our Company-wide community service and relief campaign program, which utilizes the strength of our properties to uplift organizations and inspire our audiences and employees to make a positive impact in our communities. Sinclair Cares mobilizes Sinclair’s assets to support various community and charitable endeavors and responses to natural disasters through financial assistance, volunteerism, and raising awareness of important topics through our media platforms. Over the last seven years, Sinclair Cares has spearheaded the Company’s efforts, including fund-raising and blood donations during weather and climate catastrophes, and raising funds and awareness for important social causes. Recent initiatives include:
•Sinclair Cares: Supporting Children’s Literacy - a partnership with Reading Is Fundamental, the nation’s leading children’s literacy nonprofit, to create awareness around children’s literacy challenges and help get books into the hands of children across the U.S. through a virtual book drive.
•Sinclair Cares: Summer Hunger Relief - a fundraising partnership with Feeding America to help provide meals to children and families across the U.S. in the summer. Including Sinclair’s corporate donation of $25,000, the campaign provided nearly 1.2 million meals to children and families, with funds going directly to the local Feeding America food bank in each donors’ community.
•Sinclair Cares: Hurricane Helene Relief - a fundraising partnership with the Salvation Army and The United Way to assist with humanitarian relief efforts on the ground in Western North Carolina, South Carolina, Georgia, Florida, Virginia, and Tennessee in the aftermath of Hurricanes Helene and Milton. Including Sinclair’s corporate donation of $50,000, the campaign raised nearly $1.3 million in donations designated for delivering emergency aid, including food, water, shelter, and cleanup kits.
•Sinclair Cares: California Wildfires Relief - a fundraising partnership with the Salvation Army to provide disaster relief support across Southern California which helped provide critical aid, shelter, food, fresh water, and support for wildfire survivors and first responders in Los Angeles.
Our stations also sponsor countless philanthropic campaigns and events such as health expos, parades, and blood drives in their local markets and contribute to local charities. We encourage not only our stations, but also our employees to engage in the communities in which we serve and live. In 2024, Sinclair partnered with more than 400 nonprofit and civic organizations locally and across the country to help raise nearly $25 million for nonprofit organizations, schools, community agencies, and local disaster relief. In addition, Sinclair helped to collect over 4.3 million pounds of food, over 250,000 diapers, over 300,000 toys, and almost 6,300 units of blood for those in need, while donating over $7 million in promotional airtime to organizations.
We sponsor a program to match certain employee charitable cash donations in order to encourage our employees to make charitable contributions to support activities and efforts that are important to them, and, in 2024, we held our second annual Sinclair Day of Service whereby all employees were encouraged to volunteer that day for charitable causes. Over 1,300 employees volunteered a total of more than 3,700 hours that day to help out in their communities.
Our Diversity Scholarship Fund provides support to college students demonstrating a promising future in the broadcast industry. In 2024, we awarded a total of $56,000 to 12 winning applicants from across the country. We have distributed nearly $400,000 in tuition assistance since 2013, with a goal to invest in the future of the broadcast industry and to help students from diverse backgrounds, who reflect our audiences nationwide, complete their education and pursue careers in broadcast journalism, digital storytelling, and marketing.
Our news team hosts News Reporter and Producer Academies, a series of interactive, virtual workshops for college students interested in pursuing careers in journalism, including reporting, producing, and weather.
Environmental Responsibility
Our mission is to identify and implement ways to reduce our impact on the environment through the education and engagement of internal and external audiences around sustainable solutions that can be adopted. We have accelerated actions within our organization to lessen our use of electricity over time and to measure and eventually report on our electricity usage. Our sustainability group is tasked with finding ways to help lower our carbon footprint through lowering our electricity consumption, purchasing greener supplies, and recycling. Some of these initiatives are the efforts we are undertaking in proactively replacing our existing less efficient lighting with LED lighting, replacing HVAC equipment with higher efficiency models, and exploring electric vehicles as other ways our company can reduce its reliance on energy sources that result in emissions of greenhouse gasses that are harmful to the environment. We recently implemented a solution to process utility bills which will gather and track energy consumption and measure this portion of our carbon footprint. Since 2017, we have installed 145 new, energy efficient television transmitters, which are typically 25% more energy efficient than the units that they replace and generate less waste heat, and are currently installing, or have plans to install, an additional 18 during 2025 and 2026. We successfully implemented a battery recycling operation across our television station footprint in order to reduce the amount of waste moving to landfills. In conjunction with this, we have begun a company-wide transition to the use of rechargeable batteries for all studio operations at our stations. Throughout the organization, we are seeking to reduce the use of paper products and, whenever possible, recycling paper, electronics, and other items.
In addition to our direct efforts to reduce our impact on the environment, we produce high quality news to increase our viewers’ general awareness of environmental issues and programs by providing them information on how they can participate in improving environmental sustainability.
Governance
Sinclair takes corporate governance and responsibilities to its stakeholders very seriously. We remain committed to finding the best representation to drive success in the organization in the years ahead. Diversity of thought, skills, background, and experience are important elements the Company looks for in its leadership team. The Board includes a regulatory, nominating and corporate governance committee. Sinclair’s Chief Compliance Officer provides regular updates to Company management and meets quarterly with the Board’s regulatory committee. The Board’s audit committee meets jointly with the regulatory committee at two of the regulatory committee’s quarterly meetings. The Company conducts an annual Enterprise Risk Assessment and reports the results to the Audit Committee. Our Code of Business Conduct and Ethics identifies the ethical duties and responsibilities of the Company’s officers, directors, and employees, and fosters a culture of honesty, integrity, and accountability.
Managing and governing cybersecurity risk remains a high priority. We continue to make investments to ensure continuous improvement of our cybersecurity control effectiveness and governance. We maintain a data protection policy and have invested in additional cybersecurity solutions, professional services, and the growth of our information security department. We continue to work closely with our key partners and supporting agencies to mature our security posture and quickly adjust to today’s rapidly changing threat landscape. We continue to execute our plans to strengthen our existing cybersecurity defenses and intend to make further investments in the upcoming year. We did not experience any material cybersecurity incidents during 2024. See Item 1C. Cybersecurity below for further discussion regarding our cybersecurity program. In addition, our comprehensive enterprise risk management program is designed to both identify risks across the Company and to take actions to mitigate those risks.
AVAILABLE INFORMATION
We regularly use our website as a source of company information and it can be accessed at www.sbgi.net. We make available, free of charge through our website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after such documents are electronically submitted to the SEC, who also makes these reports available at http://www.sec.gov. We intend to comply with the requirements of Item 5.05 of Form 8-K regarding amendments to and waivers under the code of business conduct and ethics applicable to our Chief Executive Officer, Principal Financial Officer and Principal Accounting Officer by providing such information on our website within four days after effecting any amendment to, or granting any waiver under, that code, and we will maintain such information on our website for at least twelve months. In addition, a replay of each of our quarterly earnings conference calls is available on our website until the subsequent quarter’s earnings call. The information contained on, or otherwise accessible through, our website is not a part of this Annual Report on Form 10-K and is not incorporated herein by reference.

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ITEM 1A. RISK FACTORS
ITEM 1A. RISK FACTORS
You should carefully consider the risks described below before investing in our securities. The risks described below, along with risks not currently known to us or that we currently believe are immaterial, may impair our business operations and our liquidity in an adverse way.
RISKS RELATING TO OUR OPERATIONS
If the rate of decline in the number of subscribers to Distributor services increases or these subscribers shift to other services or bundles that do not include our stations or programming networks, there may be a material adverse effect on our revenues.
The number of subscribers to Distributor services in the United States has been declining as technological advancements have driven changes in consumer behavior and have empowered consumers to seek more control over when, where and how they consume news, sports, and other entertainment, including through the so-called “cutting the cord” and other consumption strategies. The Distributor subscriber decline has led to a decline in subscribers from some of our stations and networks. In addition, Distributors have introduced, marketed, and/or modified tiers or bundles of programming that have impacted the number of subscribers that receive our programming networks, including tiers or bundles of programming that exclude our programming networks. Broadcast networks have also introduced DTC platforms that have impacted the number of subscribers to Distributor services.
If Distributor service offerings are not attractive to consumers for any reason (pricing, increased competition from OTT and DTC services, increased dissatisfaction with the quality of Distributor services, poor economic conditions or other factors), more consumers may (i) cancel their Distributor service subscriptions, (ii) elect to instead subscribe to OTT and DTC services, which in some cases may be offered at lower prices, or (iii) elect to subscribe to Distributors with smaller bundles of programming which may not include our programming networks.
If the rate of decline in the number of Distributor service subscribers increases or if subscribers shift to OTT services or smaller bundles of programming that do not include our programming networks, this may have a material adverse effect on our revenues.
If subscribers shift to DTC platforms, this may have a material adverse effect on our revenues.
We may not be able to renegotiate distribution agreements at terms comparable to or more favorable than our current agreements and networks with which we are affiliated currently, or in the future, may require us to share revenue from distribution agreements with them.
As distribution agreements expire, we may not be able to renegotiate such agreements at terms comparable to or more favorable than our current agreements. This may cause revenues and/or revenue growth from our distribution agreements to decrease under the renegotiated terms despite the fact that our current distribution agreements include automatic annual fee escalators. In addition, certain networks or program service providers with which our stations are affiliated are currently, or in the future are expected to, require us to share revenue from distribution agreements with them as part of renewing expiring affiliation agreements or pursuant to certain rights contained in existing affiliation agreements. Generally, our distribution agreements and agreements with networks or program service providers are for different lengths of time and expire in different periods. If we are unable to negotiate a distribution agreement or the revenue received as part of those agreements declines over time, then we may be exposed to a reduction in or loss from distribution revenue net of revenue shared with networks and program service providers. We cannot predict the outcome or provide assurances as to the outcome of any future negotiations relating to our distribution agreements or what impact, if any, they may have on our financial condition and results of operations. See Television Markets and Stations within Item 1. Business for a listing of current expirations of our affiliation agreements.
Any changes in the current retransmission consent regulations could have an adverse effect on our business, financial condition, and results of operations.
Distributors lobby to change the regulations under which retransmission consent is negotiated before both Congress and the FCC in order to increase their bargaining leverage with television stations.
In September 2015, the FCC released a Notice of Proposed Rulemaking in response to a Congressional directive in STELAR to examine the “totality of the circumstances test” for good-faith negotiations of retransmission consent. The proposed rulemaking seeks comment on new factors and evidence to consider in its evaluation of claims of bad faith negotiation, including service
interruptions prior to a “marquee sports or entertainment event,” restrictions on online access to broadcast programming during negotiation impasses, broadcasters’ ability to offer bundles of broadcast signals with other broadcast stations or cable networks, and broadcasters’ ability to invoke the FCC’s exclusivity rules during service interruptions. On July 14, 2016, the FCC’s Chairman at the time announced that the FCC would not, at that time, proceed to adopt additional rules governing good faith negotiations of retransmission consent but did not formally terminate the rulemaking. No formal action has yet been taken on this Proposed Rulemaking, and we cannot predict if the FCC will terminate the rulemaking or take other action.
The FCC rules governing “good faith” retransmission consent negotiations provide that, among other things, it is a per se violation of the statutory duty to negotiate in good faith for a television broadcast station to negotiate retransmission consent jointly with another station in the same market if the stations are not commonly owned. In May 2020, the FCC revised its good faith negotiation rules to specify that certain small MVPDs can meet the obligation to negotiate in good faith by negotiating with a large station group through a qualified MVPD buying group and that large station groups have an obligation to negotiate in good faith with such MVPD buying groups.
As further described under Item 1. Business - Federal Regulation of Television Broadcasting, the FCC also has a Further Notice of Proposed Rulemaking pending which seeks additional comment on whether it has authority to, and should, eliminate or modify its network non-duplication and syndicated exclusivity rules.
The FCC’s prohibition on certain joint retransmission consent negotiations and the possible elimination or modification of the network non-duplication and syndicated exclusivity protection rules may affect our ability to sustain our current level of distribution revenues or grow such revenues in the future and could have an adverse effect on our business, financial condition and results of operations.
Our acquisitions and investments could pose various risks and increase our financial leverage.
We have pursued and intend to selectively continue to pursue divestitures, acquisitions and investments, which may include, mergers, station swaps and joint ventures, subject to market conditions, our liquidity, and the availability of attractive acquisition and investment candidates, with the goal of enhancing or expanding our existing business and to acquire and develop new products and services. In the future, we may not be able to identify attractive acquisitions and investments, or we may not be able to fund additional acquisitions and investments.
Acquisitions and investments involve inherent risks, such as increasing leverage and debt service requirements and combining company cultures and facilities, and we may not be able to successfully implement effective cost controls, achieve expected synergies, or increase revenues as a result of an acquisition or investment. Future acquisitions and investments may result in our assumption of unexpected liabilities, may result in the diversion of management’s attention from the operation of our core business and may limit our ability to generate higher returns elsewhere. Additionally, acquisitions and investments present numerous growth challenges, and our investments may not be favorably received by the market and may fail to grow.
Certain acquisitions and investments, such as those involving television stations, are subject to the approval of the FCC and potentially, other regulatory authorities, such as the DOJ. The need for FCC and other regulatory approvals could restrict our ability to consummate future transactions and potentially require us to divest certain television stations or businesses if the FCC or other regulatory authority believes that a proposed acquisition would result in excessive concentration in a market, even if the proposed combinations may otherwise comply with FCC ownership limitations or other regulations. There can be no assurance that future acquisitions and investments will be approved by the FCC or other regulatory authorities, or that a requirement to divest existing stations or businesses will not have an adverse outcome on the transaction.
We face intense, wide-ranging competition for viewers and advertisers.
We compete, in certain respects and to varying degrees, for viewers and advertisers with other programming networks, pay-per-view, video on demand, online streaming services, and other content offered by Distributors. We also compete for viewers, listeners and advertisers with OTT and DTC, mobile media, radio, motion picture, home video, stadiums and arenas, podcasts, outdoor advertising and other sources of information and entertainment and advertising services. Important competitive factors are the prices we charge for our programming networks, the quantity, quality and variety of the programming offered and the effectiveness of marketing efforts.
With respect to advertising services, factors affecting the degree and extent of competition include prices, reach and audience demographics, among others. Some of our competitors are large companies that have greater financial resources available to them than we do, which could impact our viewership and the resulting advertising revenues.
Rivals that may have greater resources than we have include:
•other local free over-the-air broadcast television and radio stations;
•Distributors, such as telecommunication companies, cable providers and direct broadcast satellite providers;
•print media providers such as newspapers, direct mail and periodicals;
•internet search engines, internet service providers, social media platforms, websites, gaming platforms, and mobile applications;
•OTT technologies;
•Distributor “skinny” packages;
•mobile and connected television;
•Big Tech (such as Alphabet, Amazon, Apple, Meta and Microsoft); and
•other emerging technologies.
Our ability to adapt to competition from other broadcasters, other content providers and changes in consumer behavior and technology may adversely affect our business.
The ways in which consumers view content and technology and business models in our industry continue to rapidly evolve and new distribution platforms and increased competition from new entrants and emerging technologies have added to the complexity of maintaining predictable revenue streams. Technological advancements have driven changes in consumer behavior as consumers seek more control over when, where and how they consume content and have affected advertisers’ options for reaching their target audiences. Consumer preferences have evolved towards subscription video on demand and free advertising supported video on demand services and other DTC offerings and there has been a substantial increase in the availability of content with reduced advertising or without advertising at all. Consumers are also increasingly using time-shifting and advertising-skipping technologies that enable them to fast-forward or circumvent advertisements. There has also been a proliferation of high-speed internet connections and expansion of 5G networks able to support high-quality streaming video within increasingly interactive and interconnected digital environments and on a wide variety of devices other than traditional televisions. Additionally, gaming and other consoles are establishing themselves as providers of video services. Substantial use of these technologies could impact the attractiveness of the Company’s programming to advertisers and adversely affect our advertising revenues. Our ability to meet consumer demands and expectations in today’s evolving mobile, multi-screen and multi-platform environment and to successfully adapt to technological advances in our industry, including alternative distribution platforms and viewing technologies, may affect the attractiveness of our offerings. Ineffective technology and product integration, lack of specific features and functionalities, poor interface design or ease of use, or performance issues, among other factors, may cause viewers to favor alternative offerings. Failure to adapt or to remain competitive with these developing technologies could have an adverse effect on our business, financial condition and results of operations.
Distributors are developing or have developed new technology that allows them to transmit more channels on their existing equipment to highly targeted audiences, reducing the cost of creating channels and potentially leading to the division of the television industry into ever more specialized niche markets. Competitors who target programming to such sharply defined markets may gain an advantage over us for television advertising revenues. The decreased cost of creating channels may also encourage new competitors to enter our markets and compete with us for advertising revenue.
Advertising revenues can be significantly impacted by new technologies, since advertising sales are dependent on audience measurement provided by third parties, and the results of audience measurement techniques can vary independent of the size of the audience for a variety of reasons, including variations in, and difficulties related to, the employed statistical sampling methods, new distribution platforms and viewing technologies (such as digital recording and time-skipping technologies), and the shifting of the marketplace to the use of measurement of different viewer behaviors, such as delayed viewing. Nielsen’s statistical sampling method is the primary measurement technique used in our television advertising sales; however, the industry is expected to adopt new measurement currencies in the near-future and Nielsen is making methodological changes to the way it measures viewing by incorporating set top box and smart TV data. The emerging measurement currencies generally undercount over-the-air viewing and Nielsen has not prioritized over-the-air enhancements. If measurement evolves in a
direction that is unfavorable to over-the-air viewing it could reduce the attractiveness of our audiences to advertisers. In addition to traditional measurement currencies, we also measure and monetize our campaign reach and frequency on and across digital platforms based on other third-party data using a variety of methods including the number of impressions served and demographics. These variations and changes could have a significant negative effect on advertising revenues.
We depend on the appeal of our programming, which may be unpredictable, and increased programming costs or the loss of key entertainment and sports programming previously exclusively available to Distributor subscribers may have a material negative effect on our business and on our results of operations.
We depend in part upon viewer preferences and audience acceptance of the programming on our stations and networks. These factors are often unpredictable and subject to influences that are beyond our control, such as the quality and appeal of competing programming, general economic conditions and the availability of other entertainment options. We may not be able to successfully predict interest in proposed new programming and viewer preferences could cause new programming not to be successful or cause our existing programming to decline in popularity. An increase in our costs associated with programming, including original programming, or a decrease in viewership of our programming, may materially negatively affect us and our results of operations.
In addition, we rely on third parties for broadcast, entertainment, news, sports and other programming for our stations and networks. We compete with other providers of programming to acquire the rights to distribute such programming. If we fail to continue to obtain broadcast, entertainment, news, sports and other programming for our stations and networks on reasonable terms for any reason, including as a result of competition, we could be forced to incur additional costs to acquire such programming or look for alternative programming, which may have a material negative effect on us and our results of operations.
Theft of our intellectual property, including on digital platforms, may have a material negative effect on us and our results of operations, and we may become subject to infringement or other claims relating to our content or technology.
Our success depends in part on our ability to maintain and monetize the material intellectual property rights in our programming, technology, digital and other content. Our intellectual property rights may be infringed upon by unauthorized usage of original broadcast content (including, without limitation, live and non-live content). Such unauthorized usage may occur on any and all distribution platforms, including, without limitation, linear and streaming services. Additionally, our intellectual property rights may be further infringed upon by third-party unauthorized distribution of original broadcast content, game content and/or highlights on social media platforms on a live or near live basis. Third-party licensors of content may infringe upon our intellectual property rights by not complying with content distribution rules.
Theft, misappropriation or the invalidity of our intellectual property or the intellectual property that is licensed to us by licensors could have a material negative effect on us and our results of operations by potentially reducing the revenue that we are able to obtain from the legitimate sale and distribution of our content, undermining lawful and revenue-generating distribution channels, limiting our ability to control the marketing of our content and inhibiting our ability to recoup expenses or profit from the costs we incur creating our programming content. Litigation may be necessary to enforce our intellectual property rights or protect our trade secrets. Any litigation of this nature, regardless of outcome, could cause us to incur significant costs and could divert management’s attention from the operation of our business. Any impairment of our intellectual property rights, including due to changes in U.S. or foreign intellectual property laws or the absence of effective legal protections or enforcement measures, could have a materially negative impact on our business and the results of our operations.
While our programming personnel regularly monitor third-party streaming platforms and social media pages in an effort to identify intellectual property infringement and work closely with content distributors to notify content protection representatives to take the necessary steps to protect our and their intellectual property rights, those protective measures cannot ensure that theft, misappropriation or the invalidity of our intellectual property or the intellectual property that is licensed to us by licensors will not occur.
In addition, from time to time, third parties may assert claims against us alleging intellectual property infringement or other claims relating to our programming, technology, digital or other content. If any such infringement claim results in the loss of certain of our intellectual property rights, it could have a materially negative impact on our business and the results of our operations.
We have experienced a cyber security breach in the past and may be vulnerable to future security breaches, data privacy, and other information technology failures that could have a material adverse effect on our financial performance and operating results and disrupt our operations.
Our information technology systems are critically important to operating our business efficiently and effectively. We rely on our information technology systems to manage our data, communications, news, and advertising content, digital products, and other business processes, including many third-party systems and software, which are subject to supply chain and other cyber- attacks.
We recurringly identify cyber threats as well as vulnerabilities in our systems and work to address them. Despite our efforts and the efforts of our third-party vendors to ensure the integrity of our software, computers, systems and information, we may not be able to anticipate, detect or recognize threats to our systems and assets, or to implement effective preventive measures against all cyber threats, especially because the techniques used are increasingly sophisticated, including the use of artificial intelligence, change frequently, are complex, and are often not recognized until launched. Cyber-attacks can originate from a variety of sources, including external parties who are affiliated with foreign governments or are involved with organized crime or terrorist organizations. Third parties may also attempt to induce employees, customers or other users of our systems to disclose sensitive information or provide access to our systems or network, or to our data or that of our counterparties, and these types of risks may be difficult to detect or prevent. Despite our security measures (including, employee training, multi-factor authentication, security information and event management, firewalls and testing tools, and backup and recovery systems), in 2021, we detected an incident that resulted in the loss in the fourth quarter of 2021 of approximately $63 million of advertising revenue, primarily related to our local media segment, as well as approximately $7 million in costs and expenses related to mitigation efforts, our investigation and the security improvements resulting therefrom. These amounts exceeded the limits under our insurance policies and thus, based on the known effects of the cyber incident, the cyber incident resulted in approximately $20 million of unrecoverable net loss through December 31, 2022. We expect cyber-attack and breach incidents to continue, and we are unable to predict the direct or indirect impact of future attacks or breaches on our business operations.
Investigations of cyber-attacks are inherently unpredictable, and it takes time to complete an investigation and have full and reliable information. While we are investigating a cyber attack, we do not necessarily know the extent of the harm or how best to remediate it, and we can repeat or compound certain errors or actions before we discover and remediate them.
The occurrence of a cyber attack, breach, unauthorized access, misuse, ransomware, computer virus or other malicious code or other cybersecurity event could jeopardize or result in the unauthorized disclosure, gathering, monitoring, misuse, corruption, loss or destruction of confidential and other information that belongs to us, our customers, our counterparties, our employees, and third-party service providers that is processed and stored in, and transmitted through, our computer systems and networks. The occurrence of such an event could also result in damage to our software, computers or systems, or otherwise cause interruptions or malfunctions in our, our customers’, our counterparties’ or third parties’ operations. This could result in significant financial losses, loss of customers and business opportunities, reputational damage, litigation, regulatory fines, penalties, significant intervention, reimbursement or other compensatory costs, significant costs to investigate the event, remediate vulnerabilities and modify our protective measures, or otherwise adversely affect our business, financial condition or results of operations. While we maintain insurance to cover losses related to cybersecurity risks and business interruption, such policies, as was the case with respect to the October 2021 cybersecurity incident, may not be sufficient to cover all losses of this incident or any future incidents.
Data privacy, data protection, and information security may require significant resources and present certain risks, including risks related to compliance with domestic and international privacy and data protection laws.
We collect, store, have access to and otherwise process certain confidential or sensitive data, including proprietary business information, personal data or other information that is subject to privacy and security laws, regulations and/or customer-imposed controls. Despite our efforts to protect such data, we may be vulnerable to material security breaches, theft, misplaced or lost data, programming errors, or employee errors that could potentially lead to the compromising of such data, improper use of our systems, software solutions or networks, unauthorized access, use, disclosure, modification or destruction of information, and operational disruptions.
We are also subject to domestic laws associated with the collection, storage, use and protection of personal, confidential or sensitive data, including under several comprehensive U.S. state privacy laws, including the California Consumer Privacy Act (“CCPA”) and the California Privacy Rights Act (“CPRA”), in addition to other laws and regulations. These laws and regulations are continually evolving and additional laws may be enacted in the future. These evolving privacy, security, and data protection laws may require us to expend significant resources to implement additional data protection measures. In addition, we operate in an environment in which there are different and potentially conflicting data privacy laws in effect in the
various U.S. states in which we operate, and we must understand and comply with each law and standard in each of these jurisdictions while ensuring the data is secure. Our failure to comply with these laws and regulations, or to adequately secure the information we hold, could result in significant liability or reputational harm and may have a materially adverse effect on our financial condition and results of operations.
We rely upon cloud computing services to operate certain significant aspects of our business and any disruption could have an adverse effect on our financial condition and results of operations.
Our business depends upon cloud computing services provided by third-parties to provide a distributed computing infrastructure platform for certain of our business operations, including data processing, storage capabilities, and other services. Such third-party cloud computing services are vulnerable to damage or interruption from infrastructure changes, natural disasters, cybersecurity attacks, power outages, terrorist attacks, and other events or acts. In the future we could experience interruptions, delays and outages in service and availability from our third-party cloud computing providers from time to time due to a variety of factors, including, but not limited to, infrastructure changes, human or software errors, website hosting disruptions and capacity constraints. Because we cannot easily switch our cloud computing operations to other third-party providers without significant costs, any disruption of or interference with our use of third-party cloud computing service providers could have a materially negative impact on our business and the results of our operations.
The loss of key personnel, including talent, could disrupt the management or operations of our business and could have an adverse effect on our financial condition and results of operations.
Our business depends upon the continued efforts, abilities and expertise of our Executive Chairman, Chief Executive Officer and other key employees. We believe that the unique combination of skills and experience possessed by our Executive Chairman, Chief Executive Officer and executive officers would be difficult to replace, and that the loss of our executive officers could have a material adverse effect on us, including the impairment of our ability to execute our business strategy. While we do not maintain a written succession plan with respect to the Executive Chairman or Chief Executive Officer, in accordance with our Corporate Governance Guidelines, the Nominating and Corporate Governance Committee of the Board periodically reviews and reports to the Board regarding succession planning for all executive officers, including the Executive Chairman and Chief Executive Officer, and all directors.
We could be adversely affected by labor disputes, other union activity and related legislation.
The cost of producing and distributing entertainment programming has increased substantially in recent years due to, among other things, the increasing demands of creative talent and industry-wide collective bargaining agreements. Although we generally purchase programming content from others rather than produce such content ourselves, our program suppliers engage the services of writers, directors, actors and on-air and other talent, trade employees, and others, some of whom are subject to these collective bargaining agreements. Approximately 580 of our employees and freelance employees are represented by labor unions under collective bargaining agreements. If we or our program suppliers are unable to renew expiring collective bargaining agreements, it is possible that the affected unions could take action in the form of strikes or work stoppages. Failure to renew these agreements, higher costs in connection with these agreements or a significant labor dispute could adversely affect our business by causing, among other things, delays in production that lead to declining viewers, a significant disruption of operations, and reductions in the profit margins of our programming and the amounts we can charge advertisers for time. Our stations also broadcast certain professional sporting events, and our viewership may be adversely affected by player strikes or lockouts which could adversely affect our advertising revenues, results of operations and result in rebates to our Distributors for not meeting minimum event thresholds. The amounts paid under our sports licensing agreements could be negatively impacted by rising professional player salaries and collective bargaining agreements. Further, any changes in the existing labor laws, including the possible enactment of the Employee Free Choice Act, may further the realization of the foregoing risks.
Unrelated third parties may bring claims against us based on the nature and content of information posted on our linear programming, social platforms, and websites maintained by us.
We host internet services that enable individuals to exchange information, generate content, comment on our content, and engage in various online activities. The law relating to the liability of providers of these online services for activities of their users is currently unsettled both within the United States and internationally. Claims may be brought against us for defamation, negligence, copyright or trademark infringement, unlawful activity, tort, including personal injury, fraud, or other theories based on the nature and content of information that may be posted online or generated by our users. Our defense of such actions could be costly and involve significant time and attention of our management and other resources.
Our advertising revenue can vary substantially from period to period based on many factors beyond our control. This volatility affects our operating results and may reduce our ability to repay debt or reduce the market value of our securities.
We rely on sales of advertising time for a significant portion of our revenues and, as a result, our operating results depend on the amount of advertising revenue we generate. If we generate less advertising revenue, it may be more difficult for us to repay debt and meet our debt service obligations, and the value of our business may decline. Our ability to sell advertising time depends on:
•the levels of automotive and services advertising, which historically have represented a large portion of our advertising revenue;
•the levels of political advertising, which are significantly higher in even-number years and elevated further every four years related to the state, congressional, and presidential election cycles (as was the case in 2024), historically have represented a large portion of our advertising revenue; for the year ended December 31, 2024 (a political year), political advertising represented 26% of local media segment advertising revenue, and for the year ended December 31, 2023 (a non-political year), political advertising represented 4% of local media segment advertising revenue;
•the levels of political advertising and volume of ballot issues, which are affected by political beliefs, public opinion, campaign finance laws, and the ability of political candidates and political action committees to raise and spend funds which are subject to seasonal fluctuations;
•the health of the economy in the areas where our television stations are located and in the nation as a whole;
•the popularity of our programming and that of our competition;
•the effects of declining live/appointment viewership as reported through rating systems and local television efforts to adopt and receive credit for same day viewing plus viewing on-demand thereafter;
•the effects of new rating methodologies;
•changes in the makeup of the population in the areas where our stations are located;
•the financial health of our underlying advertisers’ businesses and demand for their products;
•the activities of our competitors, including increased competition from other forms of advertising-based mediums, such as other broadcast television stations, radio stations, Distributors, internet and broadband content providers and other print, outdoor, social media, and media outlets serving in the same markets;
•OTT, DTC, and other emerging technologies and their potential impact on cord-cutting;
•the impact of Distributors and OTT distributors offering “skinny” programming or sports bundles that may not include all programming of television broadcast stations and/or cable channels, such as Tennis;
•changes in pricing and sellout levels;
•the financial health of our underlying customers’ that we provide management services to;
•the effectiveness of our salespeople; and
•other factors that may be beyond our control.
There can be no assurance that our advertising revenue will not be volatile in the future or that such volatility will not have an adverse impact on our business, financial condition, or results of operations.
We internally originate and purchase programming in advance based on expectations about future revenues. Actual revenues may be lower than our expectations. If this happens, it could have an adverse effect on our business, financial condition and results of operations.
The production of internally originated programming requires a large up-front investment and the revenues derived from the airing of internally originated programming primarily depends upon its acceptance by the public, which is difficult to predict. The commercial success of original content also depends upon the quality and acceptance of other competing content released into the marketplace at or near the same time, the availability of a growing number of alternative forms of entertainment, general economic conditions and their effects on consumer spending, and other tangible and intangible factors, all of which can change and cannot be predicted with certainty. Any of these factors could reduce our revenues or otherwise cause our costs to escalate relative to revenues. These factors are exacerbated during a weak advertising market.
One of our stations’ most significant costs is network and syndicated programming. We generally purchase syndicated programming content from others rather than producing such content ourselves, therefore, we have limited control over the costs of the programming. Often, we must purchase syndicated programming several years in advance and may have to commit to purchase more than one year’s worth of programming. We may replace programs that are doing poorly before we have recaptured any significant portion of the costs we incurred or before we have fully amortized the costs. We also receive programming from networks with which we have network affiliation agreements. The popularity of networks can affect revenue earned on those channels. If a particular network or program is not popular in relation to its costs, we may not be able to sell enough advertising time to cover the cost. Any of these factors could reduce our revenues or otherwise cause our costs to escalate relative to revenues and are likewise exacerbated during a weak advertising market.
We may lose a large amount of programming if a network terminates its affiliation or program service arrangement with us, we are not able to negotiate arrangements at terms comparable to or more favorable than our current agreements, or if networks make programming available through services other than our local affiliates, which could increase our costs and/or reduce our revenue.
The networks produce and distribute programming in exchange for each station’s commitment to air the programming at specified times and for commercial announcement time during programming and for cash fees. The amount and quality of programming provided by each network varies. See Television Markets and Stations within Item 1. Business for a detailed listing of our stations and channels as of December 31, 2024.
As network affiliation agreements come up for renewal, we (or licensees of the stations we provide programming and/or sales services to), may not be able to negotiate terms comparable to or more favorable than our current agreements. The non-renewal or termination of any of our network affiliation agreements would prevent us from being able to carry programming of the relevant network. This loss of programming would require us to obtain replacement programming, which may involve higher costs and which may not be as attractive to our target audiences, resulting in reduced revenues. Upon the termination of any of our network affiliation agreements, we would be required to establish a new network affiliation agreement for the affected station with another network or operate as an independent station.
We cannot predict the outcome of any future negotiations relating to our affiliation agreements or what impact, if any, they may have on our financial condition and results of operations. Additionally, we cannot predict the future availability of network programming as broadcast networks continue to launch and expand their own DTC platforms. In addition, the impact of an increase in reverse network compensation payments, under which we compensate the network for programming pursuant to our affiliation agreements, may have a negative effect on our financial condition or results of operations. See Television Markets and Stations within Item 1. Business for a listing of current expirations of our affiliation agreements.
We may be subject to investigations or fines from governmental authorities, such as, but not limited to penalties related to violations of FCC indecency, children’s programming, sponsorship identification, closed captioning and other FCC rules and policies, the enforcement of which has increased in recent years, and complaints related to such violations may delay our FCC license renewal applications with the FCC.
We provide a significant amount of live news reporting that is provided by the broadcast networks or is controlled by our on-air news talent. Although both broadcast network and our on-air talent have generally been professional and careful about the information they communicate, there is always the possibility that information may be reported that is inaccurate or even in violation of certain indecency rules promulgated by the FCC. In addition, entertainment and sports programming provided by broadcast syndicators and networks may contain content that is in violation of the indecency rules promulgated by the FCC. Because the interpretation by the courts and the FCC of the indecency rules is not always clear, it is sometimes difficult for us to determine in advance what may be indecent programming. We have insurance to cover some of the liabilities that may occur, but the FCC has enhanced its enforcement efforts relating to the regulation of indecency. Also, the FCC has various rules governing children’s television programming, including commercial matter limitations, closed captioning and sponsorship identification. We are subject to such rules regardless of whether the programming is produced by us or by third parties. Violation of the indecency, children’s programming, closed captioning or sponsorship identification rules could potentially subject us to penalties, license revocation, or renewal or qualification proceedings. For example, as described under Litigation within FCC Matters under Note 12. Commitments and Contingencies within the Consolidated Financial Statements, on May 22, 2020, the FCC released an Order and Consent Decree pursuant to which we agreed to pay $48 million and implement a four year compliance plan to resolve various matters (which compliance plan terminated on May 29, 2024) and on September 21, 2022 issued a Notice of Apparent Liability (NAL) alleging violations of the FCC’s limits on commercial matter in children’s television programming and proposing a forfeiture of $2.7 million against the Company, and fines ranging from $20,000 to $26,000 per station for other licensees covered by the NAL (including certain stations with whom the Company has an LMA, JSA, and/or SSA), for a total of $3.4 million. On October 21, 2022, the Company filed a written response seeking reduction of the proposed fine amount. On September 6, 2024, the FCC denied the Company’s request for reduction of the fine (and similar requests filed by certain other licensees) and issued a forfeiture order imposing the fine as proposed in the NAL. The Company and all other affected licensees filed a joint petition for reconsideration of the forfeiture order on October 7, 2024 and the matter remains pending. There can be no assurance that future incidents that may lead to significant fines or other penalties by the FCC can be avoided.
From time to time, we may be the subject of an investigation by governmental authorities, which could lead to an action or proceeding against us. In the event an action or proceeding is commenced, we may be subject to fines, penalties and changes in our business that could have a negative effect on our financial condition and results of operations.
Federal regulation of the broadcasting industry limits our operating flexibility, which may affect our ability to generate revenue or reduce our costs.
The FCC regulates our local media segment, just as it does all other companies in the broadcasting industry. We must obtain the FCC’s approval whenever we need a new license, seek to renew, assign or modify a license, purchase a new station, sell an existing station, or transfer the control of one of our subsidiaries that hold a license. Our FCC licenses are critical to our local media segment operations; we cannot operate without them. We cannot be certain that the FCC will renew these licenses in the future or approve new acquisitions in a timely manner, if at all. If licenses are not renewed or acquisitions are not approved, we may lose revenue that we otherwise could have earned.
In addition, Congress and the FCC may, in the future, adopt new laws, regulations and policies regarding a wide variety of matters (including, but not limited to, technological changes in spectrum assigned to particular services) that could, directly or indirectly, materially and adversely affect the operation and ownership of our broadcast properties. (See Item 1. Business.)
The FCC’s multiple ownership rules and federal antitrust regulation may limit our ability to operate multiple television stations in some markets and may result in a reduction in our revenue or prevent us from reducing costs. Changes in these rules may threaten our existing strategic approach to certain television markets.
Television station ownership
As discussed in National Ownership Rule under Ownership Matters under Federal Regulation of Television Broadcasting within Item 1. Business, in December 2017, the FCC released a Notice of Proposed Rulemaking to examine the National Ownership Rule, including the UHF discount, which remains pending. Because we are near the 39% cap without application of the UHF discount, changes to the UHF discount or National Ownership Rule could limit our ability to acquire television stations in additional markets.
As discussed in Local Television Ownership Rule under Ownership Matters under Federal Regulation of Television Broadcasting within Item 1. Business, in December 2023, the FCC adopted the 2018 Ownership Order, extending the Top-Four Prohibition to prohibit, in certain circumstances, the placement of a second top-four rated programming affiliation on a multicast stream or low power television (LPTV) station and restricting the circumstances under which such existing top-four multicast streams or LPTV stations may be transferred or assigned in the future, which may affect the Company’s ability to acquire programming or to sell or acquire stations due to the need to divest grandfathered affiliations.
As discussed in Local Marketing and Outsourcing Agreements under Federal Regulation of Television Broadcasting within Item 1. Business certain of our stations have entered into outsourcing or joint sales agreements (“JSAs”) pursuant to which we may sell more than 15% of advertising time on a separately owned television station in the same market. In August 2016, the FCC amended its ownership rules to provide for the attribution of such JSAs. The FCC subsequently adopted an Ownership Order on Reconsideration in 2017 and eliminated the JSA attribution rule. The Order on Reconsideration was appealed but ultimately upheld by the Supreme Court and became effective in June 2021. In December 2022, the FCC adopted the 2018 Quadrennial Ownership Order and declined to reconsider JSA attribution. The 2022 Quadrennial Regulatory Review proceeding remains pending. We have entered into JSAs whereby 34 stations provide various non-programming related services such as sales, operational, and managerial services to other stations within the same markets. For additional information, refer to Television Markets and Stations within Item 1. Business. See Note 13. Variable Interest Entities within the Consolidated Financial Statements for further discussion of our JSAs which we consolidate as variable interest entities.
Certain of our stations have entered into LMAs pursuant to which we may provide programming to and sell advertising on a separately owned television station serving the same market. The FCC attributes LMAs to the programmer if the programmer provides more than 15% of a station’s weekly broadcast programming; provided, that, LMAs entered into prior to November 5, 1996, including ours, are currently exempt from attribution. The FCC may review these exempted LMAs in the future and if it determines to terminate or modify the exempt period and make all LMAs fully attributable we will be required to terminate or modify our exempted LMAs unless the FCC’s local ownership rules would permit us to own both stations. As of December 31, 2021, we provide services under exempted LMAs to eight television stations owned by third parties. See Note 13. Variable Interest Entities within the Consolidated Financial Statements for further discussion of our LMAs which we consolidate as variable interest entities.
If we are required to terminate or modify our LMAs, JSAs and other outsourcing agreements, our business could be affected in the following ways:
•Loss of revenues. If the FCC requires us to modify or terminate existing arrangements, we would lose some or all of the revenues generated from those arrangements. We would lose revenue because we will have fewer demographic options, a smaller audience distribution and lower revenue share to offer to advertisers.
•Increased costs. If the FCC requires us to modify or terminate existing arrangements, our cost structure would increase as we would potentially lose significant operating synergies and we may also need to add new employees. With termination of LMAs, we likely would incur increased programming costs because we will be competing with the separately owned station for syndicated programming.
•Losses on investments. As part of certain of our arrangements, we own the non-license assets used by the stations with which we have arrangements. If certain of these arrangements are no longer permitted, we
would be forced to sell these assets, restructure our agreements or find another use for them. If this happens, the market for such assets may not be as good as when we purchased them and, therefore, we cannot be certain of a favorable return on our original investments.
•Termination penalties. If the FCC requires us to modify or terminate existing arrangements before the terms of the arrangements expire, or under certain circumstances, we elect not to extend the terms of the arrangements, we may be forced to pay termination penalties under the terms of certain of our arrangements. Any such termination penalties could be material.
•Alternative arrangements. If the FCC requires us to terminate the existing arrangements, we may enter into one or more alternative arrangements. Any such arrangements may be on terms that are less beneficial to us than the existing arrangements.
See Changes in the Rules of Television Ownership, Local Marketing Agreements, Joint Sales Agreements, Retransmission Consent Negotiations, and National Ownership Cap under Note 12. Commitments and Contingencies within the Consolidated Financial Statements.
Failure of owner / licensee to exercise control
The FCC requires the owner / licensee of a station to maintain independent control over the programming and operations of the station. As a result, the owners / licensees of those stations with which we have outsourcing agreements can exert their control in ways that may be counter to our interests, including the right to preempt or terminate programming in certain instances. The preemption and termination rights cause some uncertainty as to whether we will be able to air all of the programming that we have purchased under our LMAs and therefore, uncertainty about the advertising revenue that we will receive from such programming. In addition, if the FCC determines that the owner / licensee is not exercising sufficient control, it may penalize the owner licensee by a fine, revocation of the license for the station or a denial of the renewal of that license. Any one of these scenarios, especially the revocation of or denial of renewal of a license, might result in a reduction of our cash flow or margins and an increase in our operating costs. In addition, penalties might also affect our qualifications to hold FCC licenses, putting our own licenses at risk.
The pendency and indeterminacy of the outcome of these ownership rules, which may limit our ability to provide services to additional or existing stations pursuant to licenses, LMAs, outsourcing agreements or otherwise, expose us to a certain amount of volatility, particularly if the outcomes are adverse to us. Further, resolution of these ownership rules has been and will likely continue to be a cost burden and a distraction to our management and the continued absence of a resolution may have a negative effect on our business.
We have invested and will continue to invest in new technology initiatives which may not result in usable technology or intellectual property.
We have heavily invested in the development of the NextGen TV platforms as discussed in Development of Next Generation Wireless Platform under Operating Strategy within Item 1. Business. We do not know whether the outcome of our research and development will result in technology that will be usable on our distribution platform or available to license to third parties. Any failure to develop this technology could result in the loss of our investment. Our costs incurred related to the development of the NextGen TV platform is recorded within non-media expenses within our consolidated statements of operations. Additionally, we have developed, on our own and through joint ventures, several NextGen TV related patents that we will attempt to monetize directly, through third-party agents, or through a patent pool designed to consolidate similar patents owned by independent licensors for licensing to equipment manufacturers. We do not know whether our attempts at monetization will result in licensing arrangements that will be accepted by such equipment manufacturers or result in any royalty payments for our intellectual property rights.
We have also invested in, and will continue to invest in, the development of other technologies and products. Product development is a costly, complex and time-consuming process, and the investment in product development often involves a long wait until a return, if any, is achieved on such investment. We continue to make significant investments in research and development relating to our technologies and products. Investments in new technology and processes are inherently speculative. Technical obstacles and challenges we encounter in our research and development process may result in delays in or abandonment of product commercialization, substantially increase the costs of development and negatively affect our results of operations.
We have limited experience in operating or investing in non-broadcast related businesses.
We have invested in, and will continue to invest in, businesses that have a limited connection with our core business, including non-broadcast related businesses and international businesses. Our executive officers and employees have limited experience in the management of non-broadcast businesses. Our management team may not successfully or effectively manage or operate our non-broadcast businesses and an increasing amount of their time may be devoted to these activities which would result in less time being devoted to the management and growth of our core business. Our management team has goals to grow these non-broadcast related businesses through continued investment which may require us to receive external financing, as well as incur costs related to the acquisition of personnel with the appropriate level of knowledge, experience, and training to operate these non-core businesses to achieve these goals. These efforts may not be successful and may have a negative effect on our financial condition and our results of operations.
Our operations and business have in the past been, and could in the future be, materially adversely impacted by a pandemic or other health emergency.
Pandemics, such as the COVID-19 pandemic, and public health emergencies have affected and may, in the future, adversely affect our businesses. We experienced adverse business impacts relating to advertising sales, the suspension of content production, delays in the creation and availability of our programming, and other negative effects on our business during the COVID-19 pandemic. Additionally, if portions of our workforce, including key personnel, are unable to work effectively because of illness, government actions or other restrictions in connections with a pandemic or other public health emergency, there may be significant adverse effects on our business. In addition to the risks described above, a pandemic or other public health emergency may heighten other risks described in this section.
Our response to corporate social responsibility considerations, and compliance with laws and regulations related thereto may adversely impact our business.
State and federal regulators, investors, consumers, and other stakeholders are increasingly focused on environmental, social, and governance (“ESG”) considerations. While we engage in various initiatives to help manage our corporate social responsibility profile and respond to stakeholder expectations, which continue to evolve, such initiatives can be costly and may not have the desired effect. As with other companies, our approach to such matters also evolves, and we cannot guarantee that our approach will align with the expectations or preferences of any particular stakeholder. Moreover, stakeholder expectations are not uniform, and both opponents and proponents of various ESG-related matters have increasingly resulted in a range of activism to advocate for their positions.
Under the Biden administration, the SEC adopted regulations requiring disclosure related to our management of human capital resources to enhance and standardize climate-related disclosures, although the climate-related regulations are subject to voluntary stay pending legal challenges. These increased disclosure obligations have required and may continue to require us to implement new practices and reporting processes, and have created, and will continue to create, additional compliance risk. These increased disclosure obligations could also cause us to incur increased costs to track, measure, and report on the results of these practices and could negatively impact our operating results.
However, on January 21, 2025, President Trump issued an Executive Order requiring all federal agencies to terminate any policies establishing diversity, equity and inclusion (“DEI”)-based preferences, and to enforce federal civil rights laws to combat such preferences of entities operating in the private sector. Further, the Executive Order directs federal agencies to take appropriate action to discourage private sector DEI-based initiatives. While the enforceability of the Executive Order and the steps that various federal agencies may take in response to it are uncertain at this time, the Executive Order signals a material shift in federal DEI policy that reasonably can be expected to have implications for the private sector, including those in the communications industry, which is regulated by the FCC. In this regard, any scrutiny by federal government authorities of the Company’s corporate social responsibility practices, or those of the communications industry generally, may have a material adverse effect on us. Additionally, the increased SEC disclosure rules discussed above may be abandoned by new leadership at the SEC, new regulations might be implemented that limit ESG shareholder proposals that may be considered, and Congress may continue to conduct investigations into companies’ ESG initiatives and priorities.
Navigating varying expectations of policymakers and other stakeholders has inherent costs, and any failure to successfully navigate such expectations may expose us to negative publicity, shareholder activism, and litigation or other engagement from pro- and anti-ESG stakeholders, as well as the potential for civil investigations and enforcement by federal governmental authorities. We could be required to incur significant costs responding to any such activity and our relationships and reputation could be affected as well. This, in turn, could have an adverse effect on our results of operations.
The effects of the economic environment could require us to record an asset impairment of goodwill, indefinite-lived and definite-lived intangible assets or our investments.
We are required to evaluate our goodwill, indefinite-lived and definite-lived intangible assets for impairment. We evaluate our goodwill and indefinite-lived intangible assets for impairment annually, or more frequently, if events or changes in circumstances indicate an impairment may exist. For the year ended December 31, 2024, we did not identify any indicators that our definite-lived intangible assets may not be recoverable or that our goodwill or indefinite-lived assets were impaired. However, future losses of Distributors, continued elevated level of subscriber erosion, and any other factors that cause a deterioration in our financial results could result in future impairments charges. For additional information regarding impairments to our goodwill and intangible assets, see Valuation of Goodwill and Indefinite-Lived Intangible Assets under Critical Accounting Policies and Estimates within Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 4. Goodwill, Indefinite-Lived Intangible Assets, and Other Intangible Assets within the Consolidated Financial Statements.
We are subject to risks related to our use of Artificial Intelligence (AI), a new and emerging technology, which is in the early stages of commercial use.
We continually evaluate the use of AI in our business processes. In recent years, the use of AI has come under increased scrutiny. This technology, which is a new and emerging technology in early stages of commercial use, presents a number of risks inherent in its use, including ethical considerations, public perception and reputation concerns, intellectual property protection, regulatory compliance, privacy and data security concerns and reliability and accuracy of the information produced, all of which could have a material adverse effect on our business, results of operations and financial position. Further, new laws, guidance and decisions in this area may limit our ability to use AI or decrease its usefulness. As a result, we cannot predict future developments in AI and related impacts to our business and our industry. If we are unable to successfully adapt to new developments related to, and risks and challenges associated with AI, our business, results of operations and financial position could be negatively impacted.
RISKS RELATING TO OUR CONCENTRATED VOTING STOCK OWNERSHIP
The Smiths exercise control over most matters submitted to a stockholder vote and may have interests that differ from other security holders. They may, therefore, take actions that are not in the interests of other security holders.
As of December 31, 2024, the Smiths hold shares representing approximately 81.9% of our common stock voting rights and, therefore, control the outcome of most matters submitted to a vote of our stockholders, including, but not limited to, electing directors, adopting amendments to our certificate of incorporation, and approving corporate transactions. The Smiths hold substantially all of the Class B Common Stock, which have ten votes per share. Our Class A Common Stock has only one vote per share. Future transfers by holders of Class B Common Stock will generally result in those shares converting to Class A Common Stock, subject to limited exceptions, such as transfers effected for estate planning purposes. The conversion of Class B Common Stock to Class A Common Stock will have the effect, over time, of increasing the relative voting power of those holders of Class B Common Stock who retain their shares in the long term. In addition, the Smiths hold four of the Board’s seats and, therefore, have the power to exert significant influence over our corporate management and policies. The Smiths have entered into a stockholders’ agreement pursuant to which they have agreed to vote for each other as candidates for election to the Board until December 31, 2025.
Although in the past the Smiths have recused themselves from related person transactions, circumstances may occur in which the interests of the Smiths, as the controlling security holders, could be in conflict with the interests of other security holders and the Smiths would have the ability to cause us to take actions in their interest. In addition, the Smiths could pursue acquisitions, divestitures, or other transactions that, in their judgment, could enhance their equity investment, even though such transactions might involve risks to our other security holders. Further, the concentration of ownership the Smiths possess may have the effect of discouraging, delaying, or preventing a future change of control, which could deprive our stockholders of an opportunity to receive a premium for their shares as part of a sale of our company and might reduce the price of our shares.
(See Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters and Item 13. Certain Relationships and Related Transactions, which will be included as part of our Proxy Statement for our 2025 Annual Meeting.)
Significant divestitures by the Smiths could cause them to own or control less than 51% of the voting power of our shares, which in turn (i) could, as discussed under A failure to comply with covenants under debt instruments could result in a default
under such debt instruments, acceleration of amounts due under our debt and loss of assets securing our loans within Item 1A. Risk Factors, under certain circumstances require us to offer to buy back some or all of our outstanding STG 5.125% unsecured notes due 2027, the STG 5.500% unsecured notes due 2030, the STG first-out first lien secured notes due 2033, the STG second-out first lien secured notes due 2022, and the STG senior secured second lien notes due 2033 (the STG notes are collectively referred to as the “STG Notes”) and could result in an event of default under our new credit agreement as described under Liquidity and Capital Resources within Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations below (“New Credit Agreement”) and (ii) give Cunningham Broadcasting Corporation (“Cunningham”) the right to terminate the LMAs and other outsourcing agreements with Cunningham due to a “change in control.” Any such termination of LMAs could have an adverse effect on our results of operations. The FCC’s multiple ownership rules may limit our ability to operate multiple television stations in some markets and may result in a reduction in our revenue or prevent us from reducing costs. Changes in these rules may threaten our existing strategic approach to certain television markets. See the risk factor below regarding the FCC’s multiple ownership rules.
RISKS RELATING TO OUR DEBT
Our substantial debt could adversely affect our financial condition and prevent us from fulfilling our debt obligations.
We have a high level of debt, totaling $4,129 million at December 31, 2024, compared to the book value of shareholders’ equity of $516 million on the same date.
Our high level of debt poses risks, including the following risks, particularly in periods of declining revenues:
•we may be unable to service our debt obligations, especially during negative economic, financial credit and market industry conditions;
•we may require a significant portion of our cash flow to pay principal and interest on our outstanding debt, especially during negative economic and market industry conditions;
•the amount available for joint ventures, working capital, capital expenditures, dividends and other general corporate purposes may be limited because a significant portion of cash flow is used to pay principal and interest on outstanding debt;
•if our distribution and advertising revenues decline, we may not be able to service our debt;
•our lenders may not be as willing to lend additional amounts to us for future joint ventures, working capital needs, additional acquisitions or other purposes;
•our lenders may not be willing to refinance both our fixed and variable rate debt instruments as they come due or the rates the debt is refinanced at are not equal to or lower than the maturing rates;
•rating agencies may downgrade our corporate family rating and/or debt ratings which could impair our ability to raise funds, refinance debt, or incur a higher financing cost;
•the cost to borrow from lenders may increase or market rates may increase;
•our ability to access the capital markets may be limited, and we may be unable to issue securities with pricing or other terms that we find attractive, if at all;
•if our cash flow were inadequate to make interest and principal payments, we might have to restructure or refinance our debt or sell an equity interest in one or more of our broadcast stations to reduce debt service obligations;
•our interest rate hedges incurring losses and causing us to make additional interest payments;
•we may be limited in our flexibility in planning for and reacting to changes in the industry in which we compete; and
•we may be more vulnerable to adverse economic and industry conditions than less leveraged competitors and thus, less able to withstand competitive pressures.
Any of these events could reduce our ability to generate cash available for debt service, investment, repay, restructure or refinance our debt, seek additional debt or equity capital, make capital improvements or to respond to events that would enhance profitability.
We may not be able to generate sufficient cash to service all of our debt and may be forced to take other actions to satisfy our obligations under our debt, which may not be successful.
Our ability to make scheduled payments on or refinance our debt obligations depends on our financial condition and operating performance, which are subject to prevailing economic and competitive conditions and to certain financial, business, competitive, legislative, regulatory and other factors beyond our control. We may be unable to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our debt.
If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures, or to dispose of equity interests in our equity investments, other material assets or operations, seek additional debt or equity capital or restructure or refinance our debt. We may not be able to affect any such alternative measures, if necessary, on commercially reasonable terms or at all and, even if successful, those alternative actions may not allow us to meet our scheduled debt service obligations. The New Credit Agreement, and each of the indentures that govern the STG Notes restrict our ability to dispose of assets and use the proceeds from such dispositions and restrict our ability to raise debt or equity capital to be used to repay other debt when it becomes due. We may not be able to consummate those dispositions or to obtain proceeds in an amount sufficient to meet any debt service obligations then due.
If we cannot make scheduled payments on our debt, we will be in default and holders of our debt could declare all outstanding principal and interest to be due and payable, the lenders under the New Credit Agreement could terminate their commitments to loan us money, the holders of our debt could foreclose against the assets securing their obligations and we and/or STG could be forced into bankruptcy or liquidation.
Despite our current level of debt, we and our subsidiaries may still be able to incur substantially more debt. This could further exacerbate the risks to our financial condition described herein.
We and our subsidiaries may be able to incur additional indebtedness in the future. Although the terms of the debt instruments to which we are subject contain restrictions on the incurrence of additional debt, these restrictions are subject to a number of qualifications and exceptions, and the additional debt incurred in compliance with these restrictions could be substantial. These restrictions also will not prevent us from incurring obligations that do not constitute indebtedness. If new debt is added to our current debt levels, the related risks that we and the guarantors now face could intensify.
Our variable rate debt subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.
Interest rates may increase in the future. As a result, interest rates on the obligations under the New Credit Agreement or other variable rate debt offerings could be higher or lower than current levels. As of December 31, 2024, approximately $2,620 million principal amount of our debt relates to the credit agreement in effect as of the end of 2024 (the “Bank Credit Agreement”) and is subject to variable interest rates. If interest rates increase, our debt service obligations on our variable rate debt would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our debt, would correspondingly decrease. While we may continue to enter into interest rate hedging agreements with respect to our borrowings under certain credit agreements, such agreements are not expected to fully mitigate against interest rate risk.
In addition, our New Credit Agreement references the Secured Overnight Financing Rate (“SOFR”) as the primary benchmark rate for our variable rate indebtedness. SOFR is a relatively new reference rate and with a limited history, and changes in SOFR have, on occasion, been more volatile than changes in other benchmark or market rates. As a result, the amount of interest we may pay on our variable rate indebtedness is difficult to predict.
Our use of derivative financial instruments to reduce interest rate risk may result in added volatility in our financial results and cash flows, including increased interest expense.
We do not hold or issue derivative financial instruments for trading purposes. However, we do utilize derivative financial instruments to reduce interest rate risk associated with our indebtedness. To manage variable interest rate risk, we entered into an interest rate swap agreement in February 2023, which will effectively convert a portion of our variable rate indebtedness into
a fixed rate loan. The associated impact on our operating results is directly related to changes in prevailing interest rates. Consequently, these swaps may introduce additional volatility into our operating results by either increasing or decreasing interest costs depending upon the position of the swap.
Commitments we have made to our lenders and noteholders limit our ability to take actions that could increase the value of our securities and business or may require us to take actions that decrease the value of our securities and business.
Our financing agreements prevent us from taking certain actions and require us to meet certain tests. These restrictions and tests may require us to conduct our business in ways that make it more difficult to repay unsecured debt or decrease the value of our securities and business. These restrictions and tests include the following:
•restrictions on the incurrence, assumption or guaranteeing of additional debt, or the issuance of disqualified stock or preferred stock;
•restrictions on the payment of dividends, other distributions or repurchases of equity;
•restrictions on certain investments and other restricted payments;
•restrictions on transactions with affiliates;
•restrictions on the creation, incurrence, assumption, or suffering the existence of liens;
•restrictions on the sale and disposition of certain assets to third parties;
•restrictions on the issuance of guarantees of and pledges for debt;
•restrictions on consolidation, merger or sale of all or substantially all of our assets;
•restrictions on the ability of certain subsidiaries to limit their ability to pay dividends and make other payments to the Issuers or the guarantors;
•restrictions on the ability to designate restricted subsidiaries as unrestricted subsidiaries and on transfers of assets to unrestricted subsidiaries and other non-guarantor subsidiaries; and
•restrictions on our ability to refinance, amend, or repay existing debt, including through certain types of liability management transactions and “priming” or similar financing transactions that modify the priority of liens or right of payment with respect to our debt.
Future financing arrangements may contain additional restrictions, tests, and restrictive covenants that may limit our ability to pursue certain opportunities, limit our ability to raise additional debt or equity financing to operate during general economic or business downturns, and prevent us from taking action that could increase the value of our securities or require actions that decrease the value of our securities.
In addition, we may fail to meet the tests and thereby default on one or more of our obligations (particularly if the economy weakens and reduces our advertising revenues). If we default on our obligations, creditors could require immediate payment of the obligations or foreclose on collateral. If this happens, we could be forced to sell equity interests in our equity investments, broadcast stations or other assets or take other actions that could significantly reduce our value and we may not have sufficient assets or funds to pay our debt obligations.
A failure to comply with covenants under debt instruments could result in a default under such debt instruments, acceleration of amounts due under our debt, and loss of assets securing our loans.
Certain of our debt agreements will contain cross-default provisions with other debt, which means that a default under certain of our debt instruments may cause a default under such other debt.
If we breach certain of our debt covenants, we will be unable to utilize the full borrowing capacity under our debt arrangements and our lenders could require us to repay the debt immediately, and, if the debt is secured, could immediately take possession of the property securing such debt. In addition, because certain of our debt agreements contain cross-default and cross-acceleration
provisions with other debt, if any other debtholder of STG were to declare its loan due and payable as a result of a default, the holders of the respective debt of STG, might be able to require us to pay those debts immediately.
As a result, any default under debt covenants could have a material adverse effect on our financial condition and our ability to meet our obligations.
GENERAL RISK FACTORS
Financial and economic conditions, including inflation, may have an adverse impact on our industry, business, and results of operations or financial condition.
Financial, economic and geopolitical conditions are by their nature unpredictable and the deterioration or worsening of those conditions could have an adverse effect on the fundamentals of our business, results of operations, and/or financial condition. Poor economic and industry conditions, including inflation, could have a negative impact on our industry or the industry of those customers who advertise on our stations, including, among others, the automotive industry and service businesses, each of which is a significant source of our advertising revenue. Additionally, financial institutions, capital providers, or other consumers may be adversely affected. Potential consequences of any financial and economic decline include:
•the financial condition of those companies that advertise on our stations and digital platforms, including, among others, the automobile manufacturers and dealers, may be adversely affected and could result in a significant decline in our advertising revenue;
•geopolitical conditions, including the war in Ukraine, conflicts in the Middle East and international trade sanctions, could negatively impact global supply prices and disrupt supply chain levels, which could negatively impact the operations of us, our customers’, our vendors’ and our Distributors’;
•our ability to pursue the divestiture of certain assets at attractive values may be limited;
•the possibility that our business partners, such as counterparties to our outsourcing and news share arrangements, could be negatively impacted and our ability to maintain these business relationships could also be impaired;
•our ability to refinance our existing debt on terms and at interest rates we find attractive, if at all, may be impaired;
•our ability to make certain capital expenditures may be significantly impaired;
•our ability to pursue the acquisition of attractive assets may be limited if we are unable to obtain any necessary additional capital on favorable terms, if at all;
•content providers may cut back on the amount of content we can acquire to program stations; and
•the possibility of our distribution customers losing subscribers, thereby impacting our distribution revenues.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.

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ITEM 2. PROPERTIES
ITEM 2. PROPERTIES
We own and lease facilities consisting of offices, studios, sales offices, and tower and transmitter sites throughout the U.S. Our owned and leased transmitter and tower sites are located in areas to provide maximum signal coverage to our stations’ markets. We believe that all of our properties, both owned and leased, are generally in good operating condition, subject to normal wear and tear, and are suitable and adequate for our current business operations. We believe that no one property represents a material amount of the total properties owned or leased.

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ITEM 3. LEGAL PROCEEDINGS
ITEM 3. LEGAL PROCEEDINGS
We are a party to lawsuits, claims, and regulatory matters from time to time in the ordinary course of business. Actions currently pending are in various stages and no material judgments or decisions have been rendered by hearing boards or courts in connection with such actions.
See Litigation under Note 12. Commitments and Contingencies within the Sinclair’s Consolidated Financial Statements and Litigation under Note 11. Commitments and Contingencies within SBG’s Consolidated Financial Statements for discussion related to certain pending lawsuits.

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ITEM 4. MINE SAFETY DISCLOSURE
ITEM 4. MINE SAFETY DISCLOSURES
None.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
SINCLAIR, INC.
Sinclair’s Class A Common Stock is listed for trading on the NASDAQ stock market under the symbol “SBGI”. Sinclair’s Class B Common Stock is not traded on a public trading market or quotation system.
As of February 24, 2025, there are approximately 32 shareholders of record of Sinclair’s Class A Common Stock. Many of Sinclair’s shares of Class A Common Stock are held by brokers and institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders.
We intend to pay regular quarterly dividends to our stockholders, although all future dividends on our Common Stock, if any, will be at the discretion of the Board and will depend on several factors including our results of operations, cash requirements and surplus, financial condition, covenant restrictions, and other factors that the Board may deem relevant.
In February 2025, Sinclair declared a quarterly cash dividend of $0.25 per share.
See Note 2. Stock-Based Compensation Plans within Sinclair’s Consolidated Financial Statements for discussion of our stock-based compensation plans.
Comparative Stock Performance
The graph below matches Sinclair, Inc.’s cumulative 5-Year total shareholder return on common stock with the cumulative total returns of the NASDAQ Composite index and the NASDAQ Telecommunications index. The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from December 31, 2019 to December 31, 2024.
Company/Index/Market 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024
Sinclair, Inc. 100.00 99.09 84.43 51.76 46.69 62.00
NASDAQ Composite Index 100.00 144.92 177.06 119.45 172.77 223.87
NASDAQ Telecommunications Index 100.00 110.08 112.44 82.21 90.96 103.21
Stock Repurchases
For the quarter ended December 31, 2024: None
SINCLAIR BROADCAST GROUP, LLC
Not applicable.

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ITEM 6. SELECTED FINANCIAL DATA
ITEM 6. [RESERVED]

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward Looking Statements
We make statements in this section that are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section in this report entitled “Forward-Looking Statements.” Certain risks may cause our actual results, performance, or achievements to differ materially from those expressed or implied by the following discussion. For a discussion of such risk factors, see Item 1A. Risk Factors.
Overview
The following Management’s Discussion and Analysis provides qualitative and quantitative information about Sinclair’s and SBG’s financial performance and condition which should be read in conjunction with the other sections in this annual report, including Item 1. Business and the Consolidated Financial Statements, including the accompanying notes to those statements. This discussion consists of the following sections:
Executive Overview - a description of our business, summary of significant events, and information about industry trends;
Critical Accounting Policies and Estimates - a discussion of the accounting policies that are most important in understanding the assumptions and judgments incorporated in the Consolidated Financial Statements and a summary of recent accounting pronouncements;
Results of Operations - a summary of the components of Sinclair’s and SBG’s revenues by category and by network affiliation, a summary of other operating data, and an analysis of Sinclair’s and SBG’s revenues and expenses for 2024, 2023, and 2022, including a comparison between 2024 and 2023; and
Liquidity and Capital Resources - a discussion of Sinclair’s and SBG’s primary sources of liquidity and contractual cash obligations and an analysis of Sinclair’s and SBG’s cash flows from or used in operating activities, investing activities, and financing activities.
EXECUTIVE OVERVIEW
We are a diversified media company with national reach and a strong focus on providing high-quality content on our local television stations and digital platform. The content, distributed through our broadcast platform and third-party platforms, consists of programming provided by third-party networks and syndicators, local news, sports, and other original programming produced by us and our owned networks. Additionally, we own digital media products that are complementary to our extensive portfolio of television station related digital properties and we have interests in, own, manage and/or operate technical and software services companies, research and development for the advancement of broadcast technology, and other media and non-media related businesses and assets, including real estate, venture capital, private equity, and direct investments.
As of December 31, 2024, Sinclair had two reportable segments, local media and tennis, and SBG had one reportable segment, local media. Sinclair and SBG’s local media segment is comprised of our television stations, which are owned and/or operated by Sinclair and SBG’s wholly-owned subsidiary, Sinclair Television Group, Inc. (“STG”) and its direct and indirect subsidiaries, original networks and content. Sinclair’s tennis segment primarily consists of Tennis Channel, a cable network which includes coverage of many of tennis’ top tournaments and original professional sports and tennis lifestyle shows. Sinclair also earns revenues from non-broadcast digital and internet services, technical services, and non-media investments, included within “other.” Other and corporate are not reportable segments for either Sinclair or SBG.
As of December 31, 2024, STG, for which certain assets and results of operations are included in the local media segment and which is one of Sinclair and SBG’s wholly owned subsidiaries, was the primary obligor under the Bank Credit Agreement and the STG Notes. SBG and substantially all of STG’s subsidiaries are guarantors under the STG debt instruments. Sinclair’s Class A Common Stock and Class B Common Stock remain securities of Sinclair and not obligations or securities of STG.
For more information about our business, reportable segments, and our operating strategy, see Item 1. Business in this Annual Report on Form 10-K.
Summary of Significant Events
Content and Distribution
•In January 2024, Sinclair announced a comprehensive multi-year distribution agreement with Verizon for carriage on FiOS TV, covering Tennis Channel and SBG’s local television stations in 10 markets.
•In January 2024, Sinclair renewed its distribution agreement with the National Content & Technology Cooperative (“NCTC”) that allows NCTC’s member companies to opt into a multi-year retransmission consent agreement for SBG’s owned and operated stations and includes an agreement for Tennis Channel.
•In January 2024, SBG and FOX Corporation reached an agreement for a multi-year renewal of all FOX affiliations in SBG markets, including where SBG provides sales and other services under JSAs or MSAs.
•In March 2024, Sinclair reached a comprehensive, multiyear distribution agreement with Charter Communications, Inc. for continued carriage of Tennis Channel and SBG’s owned local broadcast stations.
•In May 2024, Sinclair reached a comprehensive, multiyear distribution agreement with Cox Communications, Inc. for continued carriage of Tennis Channel and SBG’s owned local broadcast stations.
•In August and September 2024, Sinclair expanded its podcast division, launching a new slate of sports programming featuring top athletes, coaches, and experts including “The Triple Option,” hosted by Urban Meyer, Mark Ingram II, and Rob Stone and “Throwbacks” with Matt Leinart and Jerry Ferrara.
•In the third quarter 2024, Sinclair entered into a multi-year renewal with Altice USA for continued carriage of SBG’s broadcast stations and Tennis Channel on Altice’s Optimum and Suddenlink owned systems.
•In the third quarter 2024, Sinclair entered into a multi-year renewal with DIRECTV for continued carriage of SBG’s broadcast stations and Tennis Channel across DIRECTV, DIRECTV Stream, and U-verse.
•In October 2024, SBG launched the Rip City Television Network, a network of SBG affiliates throughout the Pacific Northwest to serve as the new television home of Trail Blazers starting with the 2024-25 season.
•In October 2024, Sinclair announced the launch of a soccer-focused podcast, “Unfiltered Soccer with Landon and Tim,” featuring former U.S. soccer stars Landon Donovan and Tim Howard.
•In November 2024, Tennis Channel introduced a direct-to-consumer streaming service that merges its flagship 24-hour network with extensive live and on-demand multicourt coverage.
•In the fourth quarter 2024, Sinclair finalized a renewal with DISH Network (“DISH”), for the continued multi-year carriage of SBG’s broadcast television stations and Tennis Channel on DISH’s direct broadcast satellite system.
•In January 2025, SBG and NBC announced a comprehensive multi-year agreement that renews station affiliation agreements for 21 of SBG’s owned and/or operated NBC affiliates and affiliations in five markets where SBG provides sales and other services under a joint sales agreement or marketing service agreement.
Corporate Social Responsibility Practices
•In March 2024, Sinclair launched Sinclair Cares: Supporting Children’s Literacy, a partnership with Reading Is Fundamental, the nation’s leading children’s literacy nonprofit, to create awareness around children’s literacy challenges and help get books into the hands of children across the U.S. through a virtual book drive.
•In April 2024, WBFF FOX 45, Baltimore’s #1 ranked news outlet, and the David D. Smith Family Foundation donated $50 thousand and $100 thousand, respectively, to the Maryland Tough Baltimore Strong Key Bridge Fund.
•In April 2024, Sinclair published its 2023 Corporate Social Responsibility report, detailing the Company’s achievements and progress in its social responsibility journey.
•In April 2024, Sinclair held its second annual Sinclair Day of Service, whereby all employees were encouraged to volunteer that day for charitable causes. Over 1,300 employees volunteered a total of more than 3,700 hours that day.
•In June 2024, Sinclair partnered with Feeding America to coordinate Sinclair Cares: Summer Hunger Relief, an awareness and fundraising campaign to help provide meals to children and families across the U.S. in the summer.
•In July 2024, Sinclair awarded scholarships to 12 university students as a part of its annual Diversity Scholarship program.
•In October 2024, Sinclair ran Sinclair Cares: Hurricane Helene Relief, a fundraising partnership with the Salvation Army and The United Way to assist with humanitarian relief efforts on the ground in Western North Carolina, South Carolina, Georgia, Florida, Virginia, and Tennessee in the aftermath of Hurricanes Helene and Milton. Including Sinclair’s corporate donation of $50,000, the campaign raised nearly $1.3 million in donations designated for delivering emergency aid, including food, water, shelter, and cleanup kits.
•For the year ended December 31, 2024, our newsrooms won a total of 232 journalism awards, including 22 regional and two national RTDNA Edward R. Murrow awards and 37 regional and one national Emmy awards.
•In January 2025, Sinclair and Tennis Channel announced Sinclair Cares: California Wildfires Relief, a fundraising partnership with the Salvation Army to provide disaster relief support across Southern California which helped provide critical aid, shelter, food, fresh water, and support for wildfire survivors and first responders in Los Angeles.
NextGen TV (ATSC 3.0)
•In April 2024, Sinclair announced the launch of its Broadspan datacasting platform to enable data distribution capability across all current Sinclair NextGen TV markets where it serves as the host station.
•In 2024, Sinclair, in coordination with other broadcasters, and led by BitPath, Sinclair’s joint venture with another broadcaster, deployed NextGen TV in the two additional markets below. This brings the total number of our markets in which NextGen TV has been deployed to 45:
Month Market Number of Stations Company Stations
April 2024 Portland, ME 5 WGME (CBS), WPFO(a) (FOX)
June 2024 Myrtle Beach, SC 4 WPDE (ABC)
(a)The license and programming assets for these stations are currently owned by a third party. SBG provides certain non-programming related sales, operational, and administrative services to these stations pursuant to a service agreement, such as a JSA and SSA.
•In January 2025, Sinclair joined with three broadcast peers and merged BitPath to form a new company, EdgeBeam Wireless, to provide robust wireless data services to a wide range of businesses and industries across the country.
Financing, Capital Allocation, and Shareholder Returns
•In January 2024, STG purchased $27 million aggregate principal amount of the Term Loan B-2, due September 30, 2026, for consideration of $25 million and during the first quarter of 2024 we repaid $34 million across all tranches of the Term Loan B in scheduled principal payments.
•For the year ended December 31, 2024, Sinclair paid dividends of $1.00 per share. In February 2025, Sinclair declared a quarterly cash dividend of $0.25 per share.
•In February 2025, Sinclair closed a new money financing and debt recapitalization to strengthen Sinclair’s balance sheet and better position it for long-term growth, which transactions are described more fully under Liquidity and Capital Resources below.
Other Events
•In January 2024, Sinclair announced that it has agreed, subject to Sinclair and Diamond Sports Group, LLC (“DSG”) completing definitive documentation, to a global settlement and release of all claims associated with the litigation filed by DSG and DSG’s wholly-owned subsidiary, Diamond Sports Net, LLC, in July 2023 and on March 1, 2024, the court approved the settlement. The settlement terms included Sinclair’s cash payment to DSG of $495 million. Additionally, under the terms of the settlement, Sinclair provided transition services to DSG to allow DSG to become a self-standing entity going forward. An initial payment of $50 million was made in March 2024, which was funded by Ventures, and the remaining $445 million was paid in April 2024, of which $347 million was paid by STG and $98 million was paid by Ventures. On January 2, 2025, DSG announced that it had emerged from bankruptcy, at which time, Sinclair’s and SBG’s equity interest in DSG was terminated.
•In December 2024, Sinclair acquired SK Telecom's stake in CAST.ERA, previously a joint venture with the leading mobile operator in South Korea, to develop wireless, cloud infrastructure and artificial intelligence technologies related to NextGen Broadcasting.
Industry Trends
•During the last few years, the number of subscribers to Distributor services in the United States has been declining, as technological advancements have driven changes in consumer behavior and have empowered consumers to seek more control over when, where, and how they consume news, sports, and other entertainment, including through the so-called “cutting the cord” and other consumption strategies.
•The Distributor industry has continued to undergo significant consolidation, which gives top Distributors negotiating power.
•vMVPDs have continued to gain increasing importance and have quickly become a critical segment of the market. These vMVPDs offer a limited number of networks at a lower price point as compared to the traditional cable offering.
•Political spending is significantly higher in the even-numbered years due to the cyclicality of political elections. In addition, every four years, political spending is typically elevated further due to the advertising related to the presidential election.
•The FCC has permitted broadcast television stations to use their digital spectrum for a wide variety of services including multi-channel broadcasts. The FCC “must-carry” rules only apply to a station’s primary digital stream.
•Seasonal advertising increases within our local media segment occur in the second and fourth quarters due to the anticipation of certain seasonal and holiday spending by consumers.
•Broadcasters have found ways to increase returns on their news programming initiatives while continuing to maintain locally produced content through the use of news sharing arrangements.
•Viewership of content on connected or smart TV’s continues to rise which has led to the shifting of advertising spend to this content from other forms of media.
•Professional sporting events have begun to migrate back to broadcast television.
•Big Tech (such as Alphabet, Amazon, Apple, Meta, and Microsoft) has begun offering OTT platforms.
•Broadcast networks have begun launching and expanding their own DTC platforms.
•Advertising revenue on digital platforms continues to grow.
•Advertising revenue related to the Summer Olympics occurs in even numbered years. Advertising revenue related to the Winter Olympics also occurs in even numbered years but are two years apart from the Summer Olympics. The Super Bowl is aired on a different network each year. All of these popularly viewed events can have an impact on our advertising revenues.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
This discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates including those related to revenue recognition, goodwill and intangible assets, program costs, income taxes and variable interest entities. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. These estimates have been consistently applied for all years presented in this report and in the past we have not experienced material differences between these estimates and actual results. However, because future events and their effects cannot be determined with certainty, actual results could differ from our estimates and such differences could be material.
We consider the following accounting policies to be the most critical as they are important to our financial condition and results of operations, and require significant judgment and estimates on the part of management in their application. For a detailed discussion of the application of these and other accounting policies, see Note 1. Nature of Operations and Summary of Significant Accounting Policies within each of Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements.
Revenue Recognition. As discussed in Revenue Recognition under Note 1. Nature of Operations and Summary of Significant Accounting Policies within each of Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements, we generate advertising revenue primarily from the sale of advertising spots/impressions on our broadcast television, digital platforms, and, prior to the Deconsolidation, the RSNs. Core and political advertising revenue is recognized in the period in which the advertising spots/impressions are delivered. In arrangements where we provide audience ratings guarantees, to the extent that there is a ratings shortfall, we will defer a proportionate amount of revenue until the ratings shortfall is settled through the delivery of additional advertising. The term of our advertising arrangements is generally less than one year and the timing between when an advertisement is aired and when payment is realized is not significant. In certain circumstances, we require customers to pay in advance; payments received in advance of satisfying our performance obligations are reflected as deferred revenue.
We generate distribution revenue through fees received from Distributors and other OTT providers for the right to distribute our broadcast channels and cable networks on their distribution platforms. Distribution arrangements are generally governed by multi-year contracts and the underlying fees are based upon a contractual monthly rate per subscriber. These arrangements represent licenses of intellectual property; revenue is recognized as the signal is provided to our customers (as usage occurs) which corresponds with the satisfaction of our performance obligation. Revenue is calculated based upon the contractual rate multiplied by an estimated number of subscribers. Our customers will remit payments based upon actual subscribers a short time after the conclusion of a month, which generally does not exceed 120 days. Historical adjustments to subscriber estimates have not been material.
Impairment of Goodwill, Indefinite-Lived Intangible Assets, and Other Long-Lived Assets. We evaluate our goodwill and indefinite-lived intangible assets for impairment annually, or more frequently, if events or changes in circumstances indicate an impairment may exist. As of December 31, 2024, Sinclair’s consolidated balance sheet included $2,082 million and $150 million of goodwill and indefinite-lived intangible assets, respectively, and SBG’s consolidated balance sheet included $2,016 million and $123 million of goodwill and indefinite-lived intangible assets, respectively. We evaluate long-lived assets, including definite-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying value of our asset groups may not be recoverable.
In the performance of our annual goodwill and indefinite-lived intangible asset impairment assessments we have the option to qualitatively assess whether it is more likely-than-not that the respective asset has been impaired. If we conclude that it is more-likely-than-not that a reporting unit or an indefinite-lived intangible asset is impaired, we apply the quantitative assessment, which involves comparing the estimated fair value of the reporting unit or indefinite-lived intangible asset to its respective carrying value. See Impairment of Goodwill, Indefinite-lived Intangible Assets and Other Long-lived Assets under Note 1. Nature of Operations and Summary of Significant Accounting Policies within each of Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements for further discussion of the significant judgments and estimates inherent in both qualitatively assessing whether impairment may exist and estimating the fair values of the reporting units and indefinite-lived intangible assets if a quantitative assessment is deemed necessary.
We are required to analyze our long-lived assets, including definite-lived intangible assets, for impairment. We evaluate our definite-lived intangible assets for impairment if events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. In the event we identify indicators that these assets are not recoverable, we evaluate the recoverability of definite-lived intangible assets by comparing the carrying amount of the assets within an asset group to the estimated undiscounted future cash flows associated with the asset group. An asset group represents the lowest level of cash flows generated by a group of assets that are largely independent of the cash flows of other assets. At the time that such evaluations indicate that the future undiscounted cash flows are not sufficient to recover the carrying value of the asset group, an impairment loss is determined by comparing the estimated fair value of the asset group to the carrying value. We estimate fair value using an income approach involving the performance of a discounted cash flow analysis.
We believe we have made reasonable estimates and utilized appropriate assumptions in the performance of our impairment assessments. If future results are not consistent with our assumptions and estimates, including future events such as a deterioration of market conditions, loss of significant customers, and significant increases in discount rates, among other factors, we could be exposed to impairment charges in the future. Any resulting impairment loss could have a material adverse impact on our consolidated balance sheets, consolidated statements of operations, and consolidated statements of cash flows.
Program Costs. As discussed in Broadcast Television Programming under Note 1. Nature of Operations and Summary of Significant Accounting Policies within each of Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements, we record an asset and corresponding liability for programming rights when the program is available for its first showing or telecast. These costs are expensed over the period in which an economic benefit is expected to be derived. To ensure the related assets for the programming rights are reflected in our consolidated balance sheets at the lower of unamortized cost or fair value, management estimates future advertising revenue to be generated by the remaining program material available under the contract terms. Management’s judgment is required in determining the timing of expense for these costs, which is dependent on the economic benefit expected to be generated from the program and may significantly differ from the timing of related payments under the contractual obligation. If our estimates of future advertising revenues decline, amortization expense could be accelerated or fair value adjustments may be required.
Fair Value Measurements of Investments in Bally’s Securities. As discussed in Note 5. Other Assets and Note 17. Fair Value Measurements within Sinclair’s Consolidated Financial Statements, we entered into a commercial agreement with Bally’s Corporation (“Bally’s”) on November 18, 2020. As part of this arrangement, we received warrants and options to acquire common equity in the business. These financial instruments are measured each period at fair value. The fair value of the options are derived utilizing a Black Scholes valuation model which utilizes a number of inputs which most significantly includes the trading price of the underlying common stock and the exercise price of the options. The fair value of the warrants are primarily derived from the trading price of the underlying common stock and the exercise price of the warrants. The determination of the fair value of these financial instruments requires the Company to exercise judgment.
Income Tax. As discussed in Income Taxes under Note 1. Nature of Operations and Summary of Significant Accounting Policies within each of Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements, we recognize deferred tax assets and liabilities based on the differences between the financial statement carrying amounts and the tax bases of assets and liabilities. We provide a valuation allowance for deferred tax assets if we determine that it is more likely than not that some or all of the deferred tax assets will not be realized. In evaluating our ability to realize net deferred tax assets, we consider all available evidence, both positive and negative, including our past operating results, tax planning strategies, current and cumulative losses, and forecasts of future taxable income. In considering these sources of taxable income, we must make certain judgments that are based on the plans and estimates used to manage our underlying businesses on a long-term basis. As of December 31, 2024 and 2023, a valuation allowance has been provided for deferred tax assets related to certain temporary basis differences, and a substantial amount of our available state net operating loss carryforwards based on past operating results, expected timing of the reversals of existing temporary basis differences, alternative tax strategies and projected future taxable income. Future changes in operating and/or taxable income or other changes in facts and circumstances could significantly impact the ability to realize our deferred tax assets which could have a material effect on our consolidated financial statements.
Management periodically performs a comprehensive review of our tax positions, and we record a liability for unrecognized tax benefits if such tax positions are more likely than not to be sustained upon examination based on their technical merits, including the resolution of any appeals or litigation processes. Significant judgment is required in determining whether positions taken are more likely than not to be sustained, and it is based on a variety of facts and circumstances, including interpretation of the relevant federal and state income tax codes, regulations, case law and other authoritative pronouncements. Based on this analysis, the status of ongoing audits and the expiration of applicable statute of limitations, liabilities are adjusted as necessary. The resolution of audits is unpredictable and could result in tax liabilities that are significantly higher or lower than for what we have provided. See Note 11. Income Taxes within Sinclair’s Consolidated Financial Statements and Note 10. Income Taxes within SBG’s Consolidated Financial Statements, for further discussion of accrued unrecognized tax benefits.
Variable Interest Entities (“VIEs”). As discussed in Note 13. Variable Interest Entities within Sinclair’s Consolidated Financial Statements and Note 12. Variable Interest Entities within SBG’s Consolidated Financial Statements, we have determined that certain third-party licensees of stations for which we perform services pursuant to arrangements, including LMAs, JSAs, and SSAs, are VIEs and we are the primary beneficiary of those variable interests because, subject to the ultimate control of the licensees, we have the power to direct the activities which significantly impact the economic performance of the VIE through the services we provide and because we absorb losses and returns that would be considered significant to the VIEs.
Transactions with Related Parties. We have determined that we conduct certain business-related transactions with related persons or entities. See Note 14. Related Person Transactions within Sinclair’s Consolidated Financial Statements and Note 13. Related Person Transactions within SBG’s Consolidated Financial Statements for discussion of these transactions.
RECENT ACCOUNTING PRONOUNCEMENTS
See Recent Accounting Pronouncements under Note 1. Nature of Operations and Summary of Significant Accounting Policies within each of Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements for a discussion of recent accounting policies and their impact on Sinclair’s and SBG’s financial statements.
SINCLAIR, INC. RESULTS OF OPERATIONS
SINCLAIR, INC. RESULTS OF OPERATIONS
Any references to the first, second, third, or fourth quarters are to the three months ended March 31, June 30, September 30, or December 31, respectively, for the year being discussed. As of December 31, 2024, we had two reportable segments for accounting purposes, local media and tennis.
Seasonality / Cyclicality
The operating results of our local media segment are usually subject to cyclical fluctuations from political advertising. In even numbered years, political spending is usually significantly higher than in odd numbered years due to advertising expenditures preceding local and national elections. Additionally, every four years, political spending is usually elevated further due to advertising expenditures preceding the presidential election. Also, the second and fourth quarters’ operating results are usually higher than the first and third quarters’ operating results because advertising expenditures are increased in anticipation of certain seasonal and holiday spending by consumers.
The operating results of our tennis segment are usually subject to cyclical fluctuations due to the amount and significance of tournaments that take place in the respective quarters during the year. The first and fourth quarter operating results are usually higher than the second and third quarters’ because of the amount and significance of tournaments that are played during those periods.
Consolidated Operating Data
The following table sets forth certain of our consolidated operating data for the years ended December 31, 2024, 2023, and 2022 (in millions).
Years Ended December 31,
2024 2023 2022
Media revenues $ 3,511 $ 3,106 $ 3,894
Non-media revenues 37 28 34
Total revenues 3,548 3,134 3,928
Media programming and production expenses 1,661 1,611 1,942
Media selling, general and administrative expenses 794 747 812
Depreciation and amortization expenses 250 271 321
Amortization of program costs 74 80 90
Non-media expenses 53 49 44
Corporate general and administrative expenses 185 694 160
Loss (gain) on deconsolidation of subsidiary - 10 (3,357)
(Gain) loss on asset dispositions and other, net of impairment (20) 3 (64)
Operating income (loss) $ 551 $ (331) $ 3,980
Net income (loss) attributable to Sinclair $ 310 $ (291) $ 2,652
A discussion regarding our financial results and operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 is presented below. A discussion regarding our financial results and operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 can be found under Item 7 of Part II of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 29, 2024 (our “2023 Annual Report”), which is available free of charge on the SEC’s website at www.sec.gov and our Investor Relations website at www.sbgi.net/investor-relations.
SINCLAIR, INC. RESULTS OF OPERATIONS
Local Media Segment
The following table sets forth our revenue and expenses for our local media segment for the years ended December 31, 2024, 2023, and 2022 (in millions):
Percent Change
Increase / (Decrease)
2024 2023 2022 ‘24 vs.‘23 ‘23 vs.‘22
Revenue:
Distribution revenue $ 1,543 $ 1,491 $ 1,531 4% (3)%
Core advertising revenue 1,152 1,192 1,186 (3)% 1%
Political advertising revenue 405 44 332 n/m (87)%
Other media revenue (a) 154 139 144 11% (3)%
Media revenues (b) $ 3,254 $ 2,866 $ 3,193 14% (10)%
Operating Expenses:
Media programming and production expenses $ 1,536 $ 1,488 $ 1,450 3% 3%
Media selling, general and administrative expenses (c) 742 694 704 7% (1)%
Depreciation and amortization expenses 231 243 243 (5)% -%
Amortization of program costs 74 80 90 (8)% (11)%
Corporate general and administrative expenses 117 134 117 (13)% 15%
Non-media expenses 8 14 15 (43)% (7)%
Gain on asset dispositions and other, net of impairment (18) (14) (17) 29% (18)%
Operating income $ 564 $ 227 $ 591 n/m (62)%
Interest expense including amortization of debt discount and deferred financing costs $ 304 $ 305 $ 226 -% 35%
Gain on extinguishment of debt $ 1 $ 15 $ 3 (93)% n/m
Other income, net $ 40 $ 33 $ 28 21% 18%
n/m - not meaningful
(a)Includes $26 million for the year ended December 31, 2022 of intercompany revenue related to certain services provided by the local media segment to other and the local sports segment, prior to the Deconsolidation, under management services agreements, which is eliminated in consolidation.
(b)Includes $9 million, $6 million, and $4 million for the years ended December 31, 2024, 2023, and 2022, respectively, of intercompany revenue related to certain services provided to the tennis segment, which is eliminated in consolidation.
(c)Includes $13 million, $8 million, and $12 million for the years ended December 31, 2024, 2023, and 2022, respectively, of intercompany expense related to certain services provided by other, which is eliminated in consolidation.
Revenues
Distribution revenue. Distribution revenue, which represents fees earned from Distributors for our broadcast signals, increased $52 million or 4% in 2024, when compared to the same period in 2023. Contractual rate increases favorably impacted period-over-period distribution revenue by high-teen percentages for the year ended December 31, 2024. The increase in distribution revenue as a result of increased contractual rates was offset by a decrease in subscribers by low double-digit percentages for 2024.
Core advertising revenue. Core advertising revenue decreased $40 million in 2024, when compared to the same period in 2023, with no particular product/services category dominating the variance and was primarily a result of the political crowd out effect.
Political advertising revenue. Political advertising revenue increased $361 million in 2024, when compared to the same period in 2023, primarily due to 2024 being a presidential political year, compared to 2023 which was an off-year election cycle, and therefore only had a small number of political races and correspondingly less political advertising spend.
SINCLAIR, INC. RESULTS OF OPERATIONS
The following table sets forth our primary types of programming and their approximate percentages of advertising revenue for the years ended December 31, 2024, 2023, and 2022:
Percent of Advertising Revenue
2024 2023 2022
Syndicated/Other programming 35% 38% 35%
Local news 30% 29% 32%
Network programming (a) 17% 15% 19%
Sports programming (a) 16% 13% 11%
Paid programming 2% 5% 3%
(a)Sports programming includes both local and network sports programming. Network programming is exclusive of any network sports programming.
The following table sets forth our affiliate percentages of advertising revenue for the years ended December 31, 2024, 2023, and 2022:
# of Percent of Advertising Revenue
Channels 2024 2023 2022
ABC 40 27% 29% 28%
FOX 55 23% 24% 22%
CBS 30 20% 20% 19%
NBC 24 16% 12% 17%
CW 47 4% 5% 5%
MNT 39 3% 4% 3%
Other 406 7% 6% 6%
Total 641
Other media revenue. Other media revenue increased $15 million in 2024, when compared to the same period in 2023, primarily due to an increase related to providing certain services under management service agreements.
Expenses
Media programming and production expenses. Media programming and production expenses increased $48 million in 2024, when compared to the same period in 2023, primarily due to an increase in fees pursuant to network affiliation agreements as a result of increased contractual rates and an increase in information technology cost.
Media selling, general and administrative expenses. Media selling, general and administrative expenses increased $48 million during 2024, when compared to the same period in 2023, primarily due to a $20 million increase in national sale commissions due to an increase in national advertising sales, a $14 million increase in third-party fulfillment costs from our digital business as a result of increased digital revenues, a $5 million increase in payment processing fees due to an increase in advertising revenue, a $3 million increase in employee compensation cost, and a $2 million increase in trade related expenses.
Amortization of program costs. The amortization of program costs decreased $6 million during 2024, when compared to the same period in 2023, primarily due to reduced programming costs.
Corporate general and administrative expenses. See explanation under Corporate and Unallocated Expenses.
Non-media expenses. Non-media expenses decreased $6 million during 2024, when compared to the same period in 2023, primarily related to a decrease in expenses associated with our broadcast technology related initiatives.
Depreciation and amortization expenses. Depreciation of property and equipment and amortization of definite-lived intangibles and other assets decreased $12 million during 2024, when compared to the same period in 2023, primarily due to assets retired during 2024.
SINCLAIR, INC. RESULTS OF OPERATIONS
Interest expense including amortization of debt discount and deferred financing costs. Interest expense decreased by $1 million in 2024, when compared to the same period in 2023, primarily due to decreased interest expense related to our variable rate debt as a result of lower interest rates.
Gain on extinguishment of debt. For the year ended December 31, 2023, we repurchased $64 million in aggregate principal across multiple tranches of debt and recognized a gain on extinguishment of approximately $15 million. See Bank Credit Agreement and STG Notes under Note 6. Notes Payable and Commercial Bank Financing within Sinclair’s Consolidated Financial Statements.
Other income, net. For the year ended December 31, 2024, we recognized a $26 million gain related to the sale of certain broadcast related assets and $12 million in interest income.
Tennis Segment
The following table sets forth our revenue and expenses for our tennis segment for the periods presented (in millions):
Percent Change
Increase / (Decrease)
2024 2023 2022 ‘24 vs.‘23 ‘23 vs.‘22
Revenue:
Distribution revenue $ 203 $ 189 $ 179 7% 6%
Core advertising revenue 39 37 33 5% 12%
Other media revenues 5 2 5 n/m (60)%
Media revenues $ 247 $ 228 $ 217 8% 5%
Operating Expenses:
Media programming and production expenses $ 125 $ 115 $ 97 9% 19%
Media selling, general and administrative expenses (a) 53 41 47 29% (13)%
Depreciation and amortization expenses 21 21 21 -% -%
Corporate general and administrative expenses 2 1 - n/m n/m
Operating income $ 46 $ 50 $ 52 (8)% (4)%
n/m - not meaningful
(a)Includes $9 million, $6 million, and $4 million for years ended December 31, 2024, 2023, and 2022, respectively, of intercompany expense related to certain advertising services provided by the local media segment, which is eliminated in consolidation.
Revenue
Distribution revenue. Distribution revenue, which represents fees earned from Distributors for the right to distribute Tennis Channel, increased $14 million or 7% in 2024, when compared to the same period in 2023. Contractual rate increases favorably impacted period-over-period distribution revenue by low double-digit percentages for the year ended December 31, 2024. The increase in distribution revenue was offset by a decrease in subscribers by low single-digit percentages for 2024.
Core advertising revenue. Core advertising revenue is primarily generated from sales of commercial time within Tennis Channel programming. Core advertising revenue increased $2 million in 2024, when compared to the same period in 2023, primarily due to a shift in the 2024 tournament calendar compared to the 2023 tournament calendar.
Expenses
Media programming and production expenses. Media programming and production expenses increased $10 million in 2024, when compared to the same period in 2023, primarily due to an increase in costs associated with the build-out, launch and marketing of the DTC platform.
Media selling, general and administrative expenses. Media selling, general and administrative expenses increased $12 million in 2024, when compared to the same period in 2023, primarily due to an increase in expenses related to certain services provided by the local media segment, which is eliminated in consolidation, and employee compensation cost.
SINCLAIR, INC. RESULTS OF OPERATIONS
Corporate general and administrative expenses. See explanation under Corporate and Unallocated Expenses.
Other
The following table sets forth our revenue and expenses for our non-broadcast digital and internet solutions, technical sales and services, and non-media investments (collectively, “Other”) for the years ended December 31, 2024, 2023, and 2022 (in millions):
Percent Change
Increase / (Decrease)
2024 2023 2022 ‘24 vs.‘23 ‘23 vs.‘22
Revenue:
Media revenues (a) $ 33 $ 28 $ 51 18% (45)%
Non-media revenues (b) $ 43 $ 34 $ 44 26% (23)%
Operating Expenses:
Media expenses (c) $ 21 $ 35 $ 73 (40)% (52)%
Non-media expenses (d) $ 48 $ 39 $ 36 23% 8%
(Gain) loss on asset dispositions and other, net of impairments $ (2) $ 18 $ (12) n/m n/m
Operating income (loss) $ 4 $ (44) $ (9) n/m n/m
Income from equity method investments $ 121 $ 31 $ 46 n/m (33)%
n/m - not meaningful
(a)Media revenues for the years ended December 31, 2024, 2023, and 2022 include $13 million, $8 million, and $12 million, respectively, of intercompany revenues related to certain services and sales provided to the local media segment, which are eliminated in consolidation.
(b)Non-media revenues for the years ended December 31, 2024, 2023, and 2022 include $6 million, $6 million, and $10 million, respectively, of intercompany revenues related to certain services and sales provided to the local media segment, which are eliminated in consolidation.
(c)Media expenses for the years ended December 31, 2023 and 2022 include $2 million and $7 million, respectively, of intercompany expenses primarily related to certain services provided by the local media segment, which are eliminated in consolidation.
(d)Non-media expenses for the years ended December 31, 2024, 2023, and 2022 include $3 million, $4 million, and $7 million, respectively, of intercompany expenses related to certain services provided by the local media segment, which are eliminated in consolidation.
Revenue. Media revenues increased $5 million during 2024, when compared to the same period in 2023, primarily due to an increase in advertising revenue related to our digital initiatives of $10 million, offset by a decrease in revenue due the sale of the Stadium Network (“Stadium”) of $4 million. Non-media revenues increased $9 million during 2024, when compared to the same period in 2023, primarily due to an increase in broadcast equipment sales.
Expenses. Media expenses decreased $14 million during 2024, when compared to the same period in 2023, primarily due to the sale of Stadium. Non-media expenses increased $9 million during 2024, when compared to the same period in 2023, primarily due to an increase in expenses related to our technical services business and an increase in expenses associated with higher broadcast equipment sales.
(Gain) loss on asset dispositions and other, net of impairments. For the year ended December 31, 2023, we recognized a loss of $12 million related to the sale of Stadium.
Income from equity method investments. Income from equity method investments increased $90 million during 2024, when compared to the same period in 2023, primarily due to the sale of one of our investments for $93 million, which is included in income from equity method investments in our consolidated statements of operations.
SINCLAIR, INC. RESULTS OF OPERATIONS
Corporate and Unallocated Expenses
The following table presents our corporate and unallocated expenses for the years ended December 31, 2024, 2023, and 2022 (in millions):
Percent Change
Increase/ (Decrease)
2024 2023 2022 ‘24 vs.‘23 ‘23 vs.‘22
Corporate general and administrative expenses $ 185 $ 694 $ 160 (73)% n/m
Loss (gain) on deconsolidation of subsidiary $ - $ 10 $ (3,357) n/m n/m
Income tax (provision) benefit $ (76) $ 358 $ (913) n/m n/m
n/m - not meaningful
Corporate general and administrative expenses. The table above and the explanation that follows cover total consolidated corporate general and administrative expenses. Corporate general and administrative expenses decreased $509 million in 2024, when compared to the same period in 2023, primarily due to a decrease in legal, consulting, and regulatory costs, primarily related to the litigation discussed under Note 12. Commitments and Contingencies within Sinclair’s Consolidated Financial Statements, most notably the previously disclosed $495 million DSG litigation settlement.
Income tax (provision) benefit. The 2024 income tax provision for our pre-tax income of $395 million resulted in an effective tax rate of 19.1%. The 2023 income tax benefit for our pre-tax loss of $637 million resulted in an effective tax rate of 56.3%. The decrease in the effective tax rate from 2023 to 2024 is primarily due to the 2023 benefit from the release of valuation allowance on deferred tax assets relating to deductibility of interest expense under the IRC Section 163(j).
As of December 31, 2024, we had a net deferred tax liability of $335 million as compared to a net deferred tax liability of $252 million as of December 31, 2023. The increase in net deferred tax liability primarily relates to changes in tax basis of our investment in DSIH.
As of December 31, 2024, we had $15 million of gross unrecognized tax benefits, all of which, if recognized, would favorably affect our effective tax rate. As of December 31, 2023, we had $14 million of gross unrecognized tax benefits, all of which, if recognized, would favorably affect our effective tax rate. We recognized $1 million of income tax expense for interest related to uncertain tax positions for both of the years ended December 31, 2024 and 2023. See Note 11. Income Taxes within Sinclair’s Consolidated Financial Statements for further information.
SINCLAIR BROADCAST GROUP, LLC RESULTS OF OPERATIONS
SINCLAIR BROADCAST GROUP, LLC RESULTS OF OPERATIONS
Any references to the first, second, third, or fourth quarters are to the three months ended March 31, June 30, September 30, or December 31, respectively, for the year being discussed. As of December 31, 2024, SBG had one reportable segment for accounting purposes, local media.
Seasonality / Cyclicality
The operating results of SBG’s local media segment are usually subject to cyclical fluctuations from political advertising. In even numbered years, political spending is usually significantly higher than in odd numbered years due to advertising expenditures preceding local and national elections. Additionally, every four years, political spending is usually elevated further due to advertising expenditures preceding the presidential election. Also, the second and fourth quarters’ operating results are usually higher than the first and third quarters’ operating results because advertising expenditures are increased in anticipation of certain seasonal and holiday spending by consumers.
Consolidated Operating Data
The following table sets forth certain of SBG’s consolidated operating data for the years ended December 31, 2024, 2023, and 2022 (in millions).
Years Ended December 31,
2024 2023 2022
Media revenues $ 3,254 $ 2,968 $ 3,894
Non-media revenues - 10 34
Total revenues 3,254 2,978 3,928
Media programming and production expenses 1,536 1,543 1,942
Media selling, general and administrative expenses 742 719 812
Depreciation and amortization expenses 231 252 321
Amortization of program costs 74 80 90
Non-media expenses 8 24 44
Corporate general and administrative expenses 123 654 160
Loss (gain) on deconsolidation of subsidiary - 10 (3,357)
Gain on asset dispositions and other, net of impairment (18) (2) (64)
Operating income (loss) $ 558 $ (302) $ 3,980
Net income (loss) attributable to SBG $ 229 $ (257) $ 2,652
A discussion regarding SBG’s financial results and operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 is presented below. A discussion regarding SBG’s financial results and operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 can be found under Item 7 of Part II of the 2023 Annual Report, which is available free of charge on the SEC’s website at www.sec.gov and our Investor Relations website at www.sbgi.net/investor-relations.
Local Media Segment
Refer to Local Media Segment above under Sinclair’s Results of Operations for a discussion of SBG’s local media segment, which is the same as Sinclair’s local media segment for all of the years ended December 31, 2024, 2023, and 2022.
As of December 31, 2024 the unrestricted subsidiaries (as defined in the Bank Credit Agreement, “Unrestricted Subsidiaries”) represented 0% of SBG’s total assets. For the year ended December 31, 2024 the Unrestricted Subsidiaries represented 0% of SBG’s total revenues and (1%) of SBG’s total operating income (loss).
As of December 31, 2024 and for the year ended December 31, 2024 there were no restricted subsidiaries that were non-guarantors (as defined in the Bank Credit Agreement) of SBG.
SINCLAIR BROADCAST GROUP, LLC RESULTS OF OPERATIONS
Other
The following table sets forth SBG’s revenue and expenses for tennis, non-broadcast digital and internet solutions, technical services, and non-media investments (collectively, “Other”) for the years ended December 31, 2023 and 2022 (in millions):
Percent Change
Increase / (Decrease)
2023 2022 ‘23 vs.‘22
Revenue: (e)
Distribution revenue $ 76 $ 179 (58)%
Core advertising revenue 29 74 (61)%
Other media revenues 3 15 (80)%
Media revenues (a) $ 108 $ 268 (60)%
Non-media revenues (b) $ 11 $ 44 (75)%
Operating Expenses:
Media expenses (c) $ 86 $ 217 (60)%
Non-media expenses (d) $ 10 $ 36 (72)%
Loss (gain) on asset dispositions and other, net of impairments $ 13 $ (12) n/m
Operating income $ - $ 43 n/m
Income from equity method investments $ 31 $ 46 (33)%
n/m - not meaningful
(a)Media revenues for the years ended December 31, 2023 and 2022 include $3 million and $12 million, respectively, of intercompany revenues related to certain services and sales provided to the local media segment, which are eliminated in consolidation.
(b)Non-media revenues for the years ended December 31, 2023 and 2022 include $1 million and $10 million, respectively, of intercompany revenues related to certain services and sales provided to the local media segment, which are eliminated in consolidation.
(c)Media expenses for the years ended December 31, 2023 and 2022 include $1 million and $11 million, respectively, of intercompany expenses primarily related to certain services provided by the local media segment, which are eliminated in consolidation.
(d)Non-media expenses for the years ended December 31, 2023 and 2022 include $1 million and $7 million, respectively, of intercompany expenses related to certain services provided by the local media segment, which are eliminated in consolidation.
(e)Represents the activity prior to the Reorganization on June 1, 2023. There was no reportable activity for the June through December period in the year ended December 31, 2023 following the Reorganization on June 1, 2023. See Company Reorganization under Note 1. Nature of Operations and Summary of Significant Accounting Policies within SBG’s Consolidated Financial Statements.
Corporate and Unallocated Expenses
The following table presents SBG’s corporate and unallocated expenses for the years ended December 31, 2024, 2023, and 2022 (in millions):
Percent Change
Increase/ (Decrease)
2024 2023 2022 ‘24 vs.‘23 ‘23 vs.‘22
Corporate general and administrative expenses $ 123 $ 654 $ 160 (81)% n/m
Loss (gain) on deconsolidation of subsidiary $ - $ 10 $ (3,357) n/m n/m
Income tax (provision) benefit $ (60) $ 359 $ (913) n/m n/m
n/m - not meaningful
Corporate general and administrative expenses. The table above and the explanation that follows cover total consolidated corporate general and administrative expenses. Corporate general and administrative expenses decreased $531 million in 2024, when compared to the same period in 2023, primarily due to a decrease in legal, consulting, and regulatory costs, primarily related to the litigation discussed under Note 11. Commitments and Contingencies within SBG’s Consolidated Financial Statements, most notably the previously disclosed $495 million DSG litigation settlement.
SINCLAIR BROADCAST GROUP, LLC RESULTS OF OPERATIONS
Income tax (provision) benefit. The 2024 income tax provision for SBG’s pre-tax income of $295 million resulted in an effective tax rate of 20.3%. The 2023 income tax benefit for SBG’s pre-tax loss of $604 million resulted in an effective tax rate of 59.4%. The decrease in the effective tax rate from 2023 to 2024 is primarily due to the 2023 benefit from the release of valuation allowance on deferred tax assets relating to deductibility of interest expense under the IRC Section 163(j).
As of December 31, 2024, SBG had a net deferred tax liability of $373 million as compared to a net deferred tax liability of $283 million as of December 31, 2023. The increase in net deferred tax liability primarily relates to changes in tax basis of SBG’s investment in DSIH.
As of December 31, 2024, SBG had $13 million of gross unrecognized tax benefits, all of which, if recognized, would favorably affect SBG’s effective tax rate. As of December 31, 2023, SBG had $12 million of gross unrecognized tax benefits, all of which, if recognized, would favorably affect SBG’s effective tax rate. SBG recognized $1 million of income tax expense for interest related to uncertain tax positions for both of the years ended December 31, 2024 and 2023. See Note 10. Income Taxes within SBG’s Consolidated Financial Statements for further information.
LIQUIDITY AND CAPITAL RESOURCES
LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2024, Sinclair had net working capital of approximately $880 million, including $697 million in cash and cash equivalent balances and approximately $650 million of available borrowing capacity. As of December 31, 2024, cash on hand, cash generated by Sinclair’s operations, and borrowing capacity under the Bank Credit Agreement were used as Sinclair’s primary sources of liquidity.
As of December 31, 2024, SBG had net working capital of approximately $447 million, including $291 million in cash and cash equivalent balances and approximately $650 million of available borrowing capacity. As of December 31, 2024, cash on hand, cash generated by SBG’s operations, and borrowing capacity under the Bank Credit Agreement were used as SBG’s primary sources of liquidity.
As of December 31, 2024, the Bank Credit Agreement included a financial maintenance covenant, the first lien leverage ratio (as defined in the Bank Credit Agreement), which required such ratio not to exceed 4.5x, measured as of the end of each fiscal quarter. As of December 31, 2024, the STG first lien leverage ratio was below 4.5x. Under the Bank Credit Agreement, a financial maintenance covenant was only applicable if 35% or more of the capacity (as a percentage of total commitments) under the revolving credit facility, measured as of the last day of each fiscal quarter, was drawn under the revolving credit facility as of such date. Since there was no utilization under the revolving credit facility as of December 31, 2024, STG was not subject to the financial maintenance covenant under the Bank Credit Agreement. The Bank Credit Agreement contained other restrictions and covenants with which STG was in compliance as of December 31, 2024.
In January 2024, STG purchased $27 million aggregate principal amount of the Term Loan B-2 for consideration of $25 million.
For the year ending December 31, 2025, Sinclair expects capital expenditures to be within the range of $83 million to $86 million, primarily related to station technical, maintenance, and building projects, and SBG expects capital expenditures to be within the range of $81 million to $84 million, primarily related to station technical, maintenance, and building projects.
Sinclair and SBG have various contractual obligations which are recorded as liabilities in Sinclair’s and SBG’s consolidated financial statements, such as notes payable, finance leases, and commercial bank financing; operating leases; and active television program contracts. Certain other contractual obligations have not been recognized as liabilities in Sinclair’s and SBG’s consolidated financial statements, such as certain future television program contracts and network programming rights. Active television program contracts are included in Sinclair’s and SBG’s balance sheets as an asset and liability while future television program contracts are excluded until the cost is known, the program is available for its first showing or telecast, and the licensee has accepted the program. Industry protocol typically enables us to make payments for television program contracts on a three-month lag, which differs from the contractual timing. As of December 31, 2024, Sinclair’s and SBG’s significant contractual obligations included:
Sinclair:
•Total debt of Sinclair, defined as current and long-term notes payable, finance leases, and commercial bank financing, including finance leases of affiliates, of $4,129 million, including current debt, due within the next 12 months, of $38 million.
•Interest due on Sinclair’s total debt in the next twelve months of $274 million, including interest estimated on Sinclair’s variable rate debt calculated at an effective weighted average interest rate of 7.66% as of December 31, 2024.
•Sinclair’s contractual amounts owed through the expiration date of the underlying agreement for active and future television program contracts, network programming rights, and Tennis programming rights of $2,548 million, including $1,084 million due within the next 12 months. Network programming agreements may include variable fee components such as subscriber levels, which in certain circumstances have been estimated and reflected in the previous amounts based on current subscriber amounts.
LIQUIDITY AND CAPITAL RESOURCES
SBG:
•Total debt of SBG, defined as current and long-term notes payable, finance leases, and commercial bank financing, including finance leases of affiliates, of $4,129 million, including current debt, due within the next 12 months, of $38 million.
•Interest due on SBG’s total debt in the next twelve months of $274 million, including interest estimated on SBG’s variable rate debt calculated at an effective weighted average interest rate of 7.66% as of December 31, 2024.
•SBG’s contractual amounts owed through the expiration date of the underlying agreement for active and future television program contracts and network programming rights of $2,172 million, including $1,023 million due within the next 12 months. Network programming agreements may include variable fee components such as subscriber levels, which in certain circumstances have been estimated and reflected in the previous amounts based on current subscriber amounts.
See Note 6. Notes Payable and Commercial Bank Financing, Note 7. Leases, and Note 8. Program Contracts within Sinclair’s Consolidated Financial Statements and Note 6. Notes Payable and Commercial Bank Financing, Note 7. Leases, and Note 8. Program Contracts within SBG’s Consolidated Financial Statements for further information.
In February 2025, STG substantially completed a series of financing transactions, including a new money financing and debt recapitalization, which strengthened the Company’s balance sheet and better positioned it for long-term growth. STG’s nearest term maturity, Term Loan B-2 due 2026, was repaid with proceeds from the issuance of a new first-out first lien secured bond, along with the extension of maturities of other debt tranches, which significantly extended STG’s maturity profile. See Note 18. Subsequent Events within Sinclair’s Consolidated Financial Statements and Note 16. Subsequent Events within SBG’s Consolidated Financial Statements, for further information.
Sinclair and SBG anticipate that existing cash and cash equivalents, cash flow from the local media segment’s operations, and borrowing capacity under the Amended Credit Agreement and the New Credit Agreement will be sufficient to satisfy the local media segment’s debt service obligations, capital expenditure requirements, and working capital needs for the next twelve months. Sinclair anticipates that existing cash and cash equivalents and cash flow from SBG, the tennis segment and other’s operations will be sufficient to satisfy SBG’s, the tennis segment and other’s debt service obligations, capital expenditure requirements, and working capital needs for the next twelve months. However, certain factors, including but not limited to the war in Ukraine, conflict in the Middle East, and other geopolitical matters, natural disasters, and pandemics, and their resulting effect on the economy, Sinclair’s and SBG’s advertisers, and Sinclair’s and SBG’s Distributors and their subscribers, could affect Sinclair’s and SBG’s liquidity and first lien leverage ratio which could affect Sinclair’s and SBG’s ability to access the full borrowing capacity under the New Credit Agreement. In addition to the sources described above, Sinclair and SBG may rely upon various sources for long-term liquidity needs, such as but not limited to, the issuance of long-term debt (including, for example, an accounts receivable securitization facility), the issuance of Sinclair equity, for Sinclair only, the issuance of Ventures equity or debt, or other instruments convertible into or exchangeable for Sinclair equity, or the sale of assets. However, there can be no assurance that additional financing or capital or buyers of assets will be available, or that the terms of any transactions will be acceptable or advantageous to Sinclair or SBG.
LIQUIDITY AND CAPITAL RESOURCES
Sinclair, Inc. Sources and Uses of Cash
The following table sets forth Sinclair’s cash flows for the years ended December 31, 2024, 2023, and 2022 (in millions):
2024 2023 2022
Net cash flows from operating activities $ 98 $ 235 $ 799
Cash flow from (used in) investing activities:
Acquisition of property and equipment $ (84) $ (92) $ (105)
Deconsolidation of subsidiary cash - - (315)
Purchases of investments (50) (72) (75)
Distributions and proceeds from investments 203 206 99
Other, net 8 10 15
Net cash flows from (used in) investing activities $ 77 $ 52 $ (381)
Cash flows used in financing activities:
Proceeds from notes payable and commercial bank financing $ - $ - $ 728
Repayments of notes payable, commercial bank financing, and finance leases (61) (85) (863)
Repurchase of outstanding Class A Common Stock - (153) (120)
Dividends paid on Class A and Class B Common Stock (66) (65) (70)
Dividends paid on redeemable subsidiary preferred equity - - (7)
Repurchase of redeemable subsidiary preferred equity - (190) -
Distributions to noncontrolling interests (12) (13) (12)
Other, net (1) (3) (9)
Net cash flows used in financing activities $ (140) $ (509) $ (353)
Operating Activities
Net cash flows from Sinclair’s operating activities decreased for the year ended December 31, 2024, when compared to the same period in 2023, primarily due to the payment of the DSG litigation settlement and an increase in production and overhead costs, partially offset by an increase in cash collections related to political revenue and Distributors.
Investing Activities
Net cash flows from Sinclair’s investing activities increased for the year ended December 31, 2024, when compared to the same period in 2023, primarily due to a decrease in the purchase of investments in the current period.
Financing Activities
Net cash flows used in Sinclair’s financing activities decreased for the year ended December 31, 2024, when compared to the same period in 2023, primarily due to the repurchase of outstanding Common Stock and the redeemable subsidiary preferred equity in the prior period and a decrease in the repayment of debt in the current period.
LIQUIDITY AND CAPITAL RESOURCES
Sinclair Broadcast Group, LLC Sources and Uses of Cash
The following table sets forth SBG’s cash flows for the years ended December 31, 2024, 2023, and 2022 (in millions):
2024 2023 2022
Net cash flows from operating activities $ 71 $ 260 $ 799
Cash flows (used in) from investing activities:
Acquisition of property and equipment $ (80) $ (90) $ (105)
Deconsolidation of subsidiary cash - - (315)
Purchases of investments (4) (39) (75)
Distributions and proceeds from investments 43 204 99
Other, net 3 9 15
Net cash flows (used in) from investing activities $ (38) $ 84 $ (381)
Cash flows used in financing activities:
Proceeds from notes payable and commercial bank financing $ - $ - $ 728
Repayments of notes payable, commercial bank financing, and finance leases (61) (85) (863)
Repurchase of outstanding Old Sinclair Class A Common Stock - (153) (120)
Dividends paid on Old Sinclair Class A and Class B Common Stock - (18) (70)
Dividends paid on redeemable subsidiary preferred equity - - (7)
Repurchase of redeemable subsidiary preferred equity - (190) -
Contributions from (distribution to) member, net 10 (448) -
Distributions to noncontrolling interests (10) (12) (12)
Other, net - (3) (9)
Net cash flows used in financing activities $ (61) $ (909) $ (353)
Operating Activities
Net cash flows from SBG’s operating activities decreased for the year ended December 31, 2024, when compared to the same period in 2023, primarily due to the payment of the DSG litigation settlement and an increase in production and overhead costs, partially offset by an increase in cash collections related to political revenue and Distributors, as well as the impact of the Reorganization, as discussed in Company Reorganization under Note 1. Nature of Operations and Summary of Significant Accounting Policies within SBG’s Consolidated Financial Statements.
Investing Activities
Net cash flows used in SBG’s investing activities increased for the year ended December 31, 2024, when compared to the same period in 2023, primarily due to the $193 million A/R Facility principal payment received from Diamond Sports Finance SPV, LLC in the prior period, offset by a decrease in the purchases of investments in the current period, as a result of the Reorganization, as discussed in Company Reorganization under Note 1. Nature of Operations and Summary of Significant Accounting Policies within SBG’s Consolidated Financial Statements, and a decrease in the acquisition of property and equipment in the current period.
Financing Activities
Net cash flows used in SBG’s financing activities decreased for the year ended December 31, 2024, when compared to the same period in 2023, primarily due to a decrease in the repayment of debt in the current period and an increase in net contributions from member in the current period, as a result of the Reorganization, as discussed in Company Reorganization under Note 1. Nature of Operations and Summary of Significant Accounting Policies within SBG’s Consolidated Financial Statements, and the repurchase of outstanding Old Sinclair Common Stock, dividends paid on Old Sinclair Class A and Class B Common Stock, and the repurchase of the redeemable subsidiary preferred equity in the prior period.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Sinclair and SBG are exposed to market risk from changes in interest rates and consider entering into derivative instruments primarily for the purpose of reducing the impact of changing interest rates on our floating rate debt and to reduce the impact of changing fair market values on Sinclair’s and SBG’s fixed rate debt. See Note 6. Notes Payable and Commercial Bank Financing within each of Sinclair’s Consolidated Financial Statements and SBG’s Consolidated Financial Statements for further discussion. During the year ended December 31, 2023, STG entered into an interest rate swap effective February 7, 2023 and terminating on February 28, 2026 in order to manage a portion of STG’s exposure to variable interest rates. The swap agreement has a notional amount of $600 million, bears a fixed interest rate of 3.9%, and STG receives a floating rate of interest based on SOFR. See Hedge Accounting in Note 1. Nature of Operations and Summary of Significant Accounting Policies and Interest Rate Swap in Note 6. Notes Payable and Commercial Bank Financing within Sinclair’s Consolidated Financial Statements. See Hedge Accounting in Note 1. Nature of Operations and Summary of Significant Accounting Policies and Interest Rate Swap in Note 6. Notes Payable and Commercial Bank Financing within SBG’s Consolidated Financial Statements. Sinclair and SBG did not have any outstanding derivative instruments during the year ended December 31, 2022.
Sinclair and SBG are exposed to risk from the changing interest rates of their variable rate debt issued under the Bank Credit Agreement. Based on Sinclair and SBG’s total variable rate debt under the Bank Credit Agreement as of December 31, 2024 of $2,620 million Sinclair and SBG estimate that adding 1% to respective interest rates would result in an increase in each of Sinclair and SBG’s interest expense of $26 million, exclusive of any impact of our interest rate swap and prior to the impact of the refinancing activities discussed within Note 18. Subsequent Events within Sinclair’s Consolidated Financial Statements and Note 16. Subsequent Events within SBG’s Consolidated Financial Statements.
ITEM 8A. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA OF SINCLAIR, INC.
The financial statements and supplementary data of Sinclair, Inc. required by this item are filed as exhibits to this report, are listed under Item 15(a)(1) and (2), and are incorporated by reference in this report.
ITEM 8B. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA OF SINCLAIR BROADCAST GROUP, LLC
The financial statements and supplementary data of Sinclair Broadcast Group, LLC required by this item are filed as exhibits to this report, are listed under Item 15(a)(1) and (2), and are incorporated by reference in this report.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
There were no changes in and/or disagreements with accountants on accounting and financial disclosure during the year ended December 31, 2024.

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ITEM 9A. CONTROLS AND PROCEDURES
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures and Internal Control over Financial Reporting
Each of Sinclair’s and SBG’s management, under the supervision and with the participation of its respective Chief Executive Officer and Chief Financial Officer, evaluated the design and effectiveness of its disclosure controls and procedures and its internal control over financial reporting as of December 31, 2024.
The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
The term “internal control over financial reporting,” as defined in Rules 13a-15d-15(f) under the Exchange Act, means a process designed by, or under the supervision of Sinclair’s and SBG’s Chief Executive Officer and Chief Financial Officer and effected by its Board of Directors or Board of Managers, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles (“GAAP”) and includes those policies and procedures that:
•pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of Sinclair’s and SBG’s assets;
•provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that our receipts and expenditures are being made in accordance with authorizations of management or its Board of Directors or Board of Managers; and
•provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of Sinclair’s and SBG’s assets that could have a material adverse effect on Sinclair’s and SBG’s financial statements.
Assessment of Effectiveness of Disclosure Controls and Procedures
Based on the evaluation of its disclosure controls and procedures as of December 31, 2024, each of Sinclair’s and SBG’s Chief Executive Officer and Chief Financial Officer concluded that, as of such date, Sinclair’s and SBG’s disclosure controls and procedures were effective at the reasonable assurance level.
Report of Management on Internal Control over Financial Reporting
Sinclair’s and SBG’s management is responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision and with the participation of Sinclair’s and SBG’s management, including Sinclair’s and SBG’s Chief Executive Officer and Chief Financial Officer, Sinclair and SBG assessed the effectiveness of its internal control over financial reporting as of December 31, 2024 based on the criteria set forth in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (“COSO”). Based on Sinclair’s and SBG’s assessment, Sinclair’s and SBG’s management has concluded that, as of December 31, 2024, Sinclair’s and SBG’s internal control over financial reporting was effective based on those criteria.
The effectiveness of Sinclair’s and SBG’s internal control over financial reporting as of December 31, 2024 have been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their reports which are included herein.
Changes in Internal Control over Financial Reporting
There have been no changes in Sinclair’s and SBG’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended December 31, 2024, that have materially affected, or are reasonably likely to materially affect, Sinclair’s and SBG’s internal control over financial reporting.
Limitations on the Effectiveness of Controls
Management, including each of Sinclair’s and SBG’s Chief Executive Officer and Chief Financial Officer, do not expect that Sinclair’s and SBG’s disclosure controls and procedures or its internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within each company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management’s override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

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ITEM 9B. OTHER INFORMATION
ITEM 9B. OTHER INFORMATION
During the three months ended December 31, 2024, none of Sinclair’s or SBG’s directors, managers, or officers, as applicable, adopted or terminated any contract, instruction, or written plan for the purchase or sale of Sinclair’s securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”
Annual Incentive Plan
On February 25, 2025, the Board adopted the Sinclair, Inc. Annual Incentive Plan (the “Plan”). The Plan is a cash-based incentive program which is intended to provide awards to certain employees of the Company to motivate them to perform to the best of their abilities and achieve the Company’s objectives. The Compensation Committee is responsible for administering the Plan and, in its sole discretion, will provide eligible participants, including any executive, officer, key employee or other Committee-designated employee of the Company or of an affiliate, the opportunity to earn specific cash bonuses for a given performance period. Performance periods are determined by the Compensation Committee and may be divided into one or more shorter periods. As an example, the Compensation Committee may desire to measure some performance criteria over a twelve- month period and other criteria over a three-month period. The Compensation Committee, in its sole discretion, will select the eligible participants for any performance period and an employee who is a participant for a given performance period in no way is guaranteed or assured of being selected for participation in any subsequent performance period or periods.
Under the Plan, the Compensation Committee will establish a target award, at 100% target level of achievement, for each participant, which may be a percentage of a participant’s annual base salary as of the beginning or end of the performance period or a fixed dollar amount. Furthermore, the Compensation Committee will, in its sole discretion, determine the performance goals applicable to any target award from the criteria set forth in the Plan, including, by way of example only, unlevered free cash flow, stock price and relative total stockholder return. These performance goals may include threshold levels of performance below which no actual award will be paid, levels of performance at which specified percentages of the target award will be paid and may also include a maximum level of performance above which no additional actual award amount will be paid. The Compensation Committee may, in its sole discretion, increase, reduce, or eliminate a participant’s actual award. Each actual award under the Plan will be paid in cash (or its equivalent).
PART III

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information required by this Item will be included in Sinclair’s Proxy Statement for Sinclair’s 2025 Annual Meeting of Stockholders under the captions, “Directors, Executive Officers and Key Employees,” “Delinquent Section 16(a) Reports,” “Code of Business Conduct and Ethics,” “Corporate Governance,” and “Related Person Transactions,” as applicable, which will be filed with the SEC no later than 120 days after the close of the fiscal year ended December 31, 2024 and is incorporated by reference in this report.

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ITEM 11. EXECUTIVE COMPENSATION
ITEM 11. EXECUTIVE COMPENSATION
The information required by this Item will be included in Sinclair’s Proxy Statement for Sinclair’s 2025 Annual Meeting of Stockholders under the captions, “Compensation Discussion and Analysis”, “Director Compensation for 2024,” “Compensation Committee Interlocks and Insider Participation,” and “Compensation Committee Report,” which will be filed with the SEC no later than 120 days after the close of the fiscal year ended December 31, 2024 and is incorporated by reference in this report.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information required by this Item will be included in Sinclair’s Proxy Statement for Sinclair’s 2025 Annual Meeting of Stockholders under the caption, “Security Ownership of Certain Beneficial Owners and Management,” which will be filed with the SEC no later than 120 days after the close of the fiscal year ended December 31, 2024 and is incorporated by reference in this report.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by this Item will be included in Sinclair’s Proxy Statement for Sinclair’s 2025 Annual Meeting of Stockholders under the captions, “Related Person Transactions” and “Director Independence,” which will be filed with the SEC no later than 120 days after the close of the fiscal year ended December 31, 2024 and is incorporated by reference in this report.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The information required by this Item will be included in Sinclair’s Proxy Statement for Sinclair’s 2025 Annual Meeting of Stockholders under the caption, “Disclosure of Fees Charged by Independent Registered Public Accounting Firm,” which will be filed with the SEC no later than 120 days after the close of the fiscal year ended December 31, 2024 and is incorporated by reference in this report.
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a) (1) Financial Statements
The following consolidated financial statements of Sinclair, Inc. required by this item are submitted in a separate section beginning on page of this report.
Sinclair, Inc. Financial Statements: Page:
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets as of December 31, 2024 and 2023
Consolidated Statements of Operations for the Years Ended December 31, 2024, 2023, and 2022
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2024, 2023, and 2022
Consolidated Statement of Equity for the Year Ended December 31, 2024 and Consolidated Statements of Equity (Deficit) and Redeemable Noncontrolling Interests for the Years Ended December 31, 2023 and 2022
Consolidated Statements of Cash Flows for the Years Ended December 31, 2024, 2023, and 2022
Notes to Consolidated Financial Statements
The following consolidated financial statements of Sinclair Broadcast Group, LLC required by this item are submitted in a separate section beginning on page of this report.
Sinclair Broadcast Group, LLC Financial Statements: Page:
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets as of December 31, 2024 and 2023
Consolidated Statements of Operations for the Years Ended December 31, 2024, 2023, and 2022
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2024, 2023, and 2022
Consolidated Statement of Member's Deficit for the Year Ended December 31, 2024, Consolidated Statement of Member's Equity (Deficit) and Redeemable Noncontrolling Interests for the Year Ended December 31, 2023, and Consolidated Statement of (Deficit) Equity and Redeemable Noncontrolling Interests for the Year Ended December 31, 2022
Consolidated Statements of Cash Flows for the Years Ended December 31, 2024, 2023, and 2022
Notes to Consolidated Financial Statements
(a) (2) Financial Statements Schedules
All schedules are omitted because they are not applicable or the required information is shown in the Financial Statements or the accompanying notes.
(a) (3) Exhibits
The following exhibits are filed with this report:
EXHIBIT NO. EXHIBIT DESCRIPTION
2.1 Agreement of Share Exchange and Plan of Reorganization, dated as of April 3, 2023, by and among Old Sinclair, Sinclair, and Sinclair Holdings (incorporated by reference from Exhibit 2.1 to Old Sinclair’s Current Report on Form 8-K filed April 3, 2023).
3.1 Articles of Amendment and Restatement of Sinclair, Inc., effective June 1, 2023 (Incorporated by reference from Exhibit 3.1 to Registrant’s Current Report on Form 8-K filed on June 1, 2023.)
3.2 Amended and Restated Bylaws of Sinclair, Inc., effective June 1, 2023 (Incorporated by reference from Exhibit 3.2 to Registrant’s Current Report on Form 8-K filed on June 1, 2023.)
3.3 Articles of Share Exchange between Sinclair Broadcast Group, Inc. and Sinclair, Inc. (Incorporated by reference from Exhibit 3.3 to Registrant’s Current Report on Form 8-K filed on June 1, 2023.)
EXHIBIT NO. EXHIBIT DESCRIPTION
3.4 Articles of Conversion of Sinclair Broadcast Group, Inc. into Sinclair Broadcast Group, LLC effective June 1, 2023. (Incorporated by reference from Exhibit 3.1 to Registrant’s Quarterly Report on Form 10-Q filed on August 9, 2023.)
3.5 Articles of Organization of Sinclair Broadcast Group, LLC dated June 1, 2023. (Incorporated by reference from Exhibit 3.2 to Registrant’s Quarterly Report on Form 10-Q filed on August 9, 2023.)
3.6 Operating Agreement of Sinclair Broadcast Group, LLC dated June 1, 2023. (Incorporated by reference from Exhibit 3.3 to Registrant’s Quarterly Report on Form 10-Q filed on August 9, 2023.)
3.7 First Amended and Restated Operating Agreement of Sinclair Broadcast Group, LLC dated June 2, 2023. (Incorporated by reference from Exhibit 3.4 to Registrant’s Quarterly Report on Form 10-Q filed on August 9, 2023.)
4.1 Indenture, dated as of August 30, 2016, by and among Sinclair Television Group, Inc., the guarantors identified therein and U.S. Bank National Association, as trustee. (Incorporated by reference from Exhibit 4.1 to Old Sinclair’s Current Report on Form 8-K filed on September 2, 2016.)
4.2 Indenture, dated as of November 27, 2019, by and among Sinclair Television Group, Inc., the guarantors party thereto and U.S. Bank National Association, as trustee. (Incorporated by reference from Exhibit 4.1 to Old Sinclair's Current Report on Form 8-K filed on November 27, 2019.)
4.3 Secured Notes Indenture, dated as of December 4, 2020, by and among Sinclair Television Group, Inc., the guarantors party thereto and U.S. Bank National Association as trustee and notes collateral agent. (Incorporated by reference from Exhibit 4.1 to Old Sinclair's Current Report on Form 8-K filed on December 4, 2020.)
4.4 Description of Sinclair, Inc.'s Class A Common Stock. (Incorporated by reference from Exhibit 4.4 to Sinclair, Inc.’s Annual Report on Form 10-K filed February 29. 2024.)
10.1* Sinclair, Inc. 2022 Stock Incentive Plan (Incorporated by reference from Exhibit A to Old Sinclair's Proxy Statement on Schedule 14A filed April 22, 2022.)
10.2* Form of Restricted Stock Award Agreement - March 2024 Grants. (Incorporated by reference from Exhibit 10.1 to Sinclair, Inc.’s Quarterly Report on Form 10-Q filed on May 10, 2024.)
10.3* Form of Stock Appreciation Rights Agreement - March 2024 Grants. (Incorporated by reference from Exhibit 10.2 to Sinclair. Inc.’s Quarterly Report on Form 10-Q filed on May 10, 2024.)
10.4* Employment Agreement by and between Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.) and Frederick G. Smith, dated June 12, 1998. (Incorporated by reference from Exhibit 10.2 to Old Sinclair’s Quarterly Report on Form 10-Q filed November 13, 1998.)
10.5* Employment Agreement by and between Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.) and J. Duncan Smith, dated June 12, 1998. (Incorporated by reference from Exhibit 10.1 to Old Sinclair’s Quarterly Report on Form 10-Q filed November 13, 1998.)
10.6* Second Amended and Restated Employment Agreement Sinclair, Inc, Sinclair, Broadcast Group LLC, and Christopher Ripley dated August 8, 2024. (Incorporated by reference from Exhibit 10.1 to Sinclair, Inc.’s Quarterly Report on Form 10-Q filed on November 8, 2024.)
10.7* Amended and Restated Employment Agreement by and between Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.) and Lucy Rutishauser dated August 28, 2017. (Incorporated by reference from Exhibit 10.2 to Old Sinclair's Quarterly Report on Form 10-Q filed on November 8, 2017.)
10.8* Amended and Restated Employment Agreement by and between Sinclair Television Group, Inc. and Robert Weisbord dated January 16, 2020. (Incorporated by reference from Exhibit 10.3 to Old Sinclair's Quarterly Report on Form 10-Q filed on May 10, 2021.)
10.9* Amendment No. 1 dated June 20, 2023 with an effective date of January 1, 2023 to the Amended and Restated Employment Agreement between Sinclair Television Group, Inc. and Robert Weisbord effective as of January 1, 2020. (Incorporated by reference from Exhibit 10.2 to Registrant's Quarterly Report on Form 10-Q filed on August 9, 2023.)
10.10* Employment Agreement by and between Sinclair, Inc., Sinclair Broadcast Group, LLC, and David B. Gibber dated March 27, 2024. (Incorporated by reference from Exhibit 10.3 to Sinclair, Inc.’s Quarterly Report on Form 10-Q Filed on May 10, 2024.)
10.11 Amended and Restated Lease dated as of February 8, 2010 between Gerstell Development Limited Partnership and Sinclair Media I, Inc. (Incorporated by reference from Exhibit 10.24 to Old Sinclair’s Annual Report on Form 10-K filed March 5, 2010.)
10.12 Amended and Restated Lease dated as of February 8, 2010 between Cunningham Communications, Inc. and Sinclair Communications, LLC. (Incorporated by reference from Exhibit 10.25 to Old Sinclair’s Annual Report on Form 10-K filed March 5, 2010.)
10.13 Amended and Restated Lease dated as of February 8, 2010 between Keyser Investment Group, Inc. and Sinclair Communications, LLC. (Incorporated by reference from Exhibit 10.26 to Old Sinclair’s Annual Report on Form 10-K filed March 5, 2010.)
EXHIBIT NO. EXHIBIT DESCRIPTION
10.14 Amended and Restated Lease dated as of February 8, 2010 between Keyser Investment Group, Inc. and Sinclair Communications, LLC. (Incorporated by reference from Exhibit 10.27 to Old Sinclair's Annual Report on Form 10-K filed March 5, 2010.)
10.15 Amendment No. 1 to Lease dated as of January 1, 2013 between Keyser Investment Group, Inc. and Sinclair Communications LLC. (Incorporated by reference from Exhibit 10.34 to Old Sinclair’s Annual Report on Form 10-K filed on March 12, 2013.)
10.16 Amendment No. 2 to Lease dated as of January 1, 2024 between Keyser Investment Group, Inc. and Sinclair Communications LLC. (Incorporated by reference from Exhibit 10.15 to Sinclair, Inc.’s Annual Report on Form 10-K filed on February 29, 2024.)
10.17 Amendment of Lease dated as of March 28, 2008 by and between Beaver Dam Limited Liability Company and Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.). (Incorporated by reference from Old Sinclair's Quarterly Report on Form 10-Q filed on May 10, 2018.)
10.18 Professional Services Agreement dated as of March 2, 2022 by and between Executive Flight Solutions, LLC and Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.). (Incorporated by reference from Exhibit 10.17 to Sinclair, Inc.’s Annual Report on Form 10-K filed on February 29, 2024.)
10.19 Seventh Amended and Restated Credit Agreement, dated as of August 23, 2019, by and among Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.), Sinclair Television Group, Inc., the guarantors party thereto, JP Morgan Chase Bank, N.A., as administrative agent and collateral agent, and the lenders party thereto. (Incorporated by reference from Exhibit 10.4 to Old Sinclair's Current Report on Form 8-K filed on August 23, 2019.)
10.20 First Amendment, dated as of December 20, 2019, to the Seventh Amended and Restated Credit Agreement, dated as of August 23, 2019, among Sinclair Television Group, Inc., Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.), the guarantors party thereto, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent and collateral agent. (Incorporated by reference from Exhibit 10.38 to Old Sinclair's Annual Report on Form 10-K filed on March 1, 2021.)
10.21 Second Amendment, dated as of December 4, 2020, to the Seventh Amended and Restated Credit Agreement by and among Sinclair Television Group, Inc., Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.), the guarantors party thereto, the lenders party thereto, JPMorgan Chase Bank, N.A., as the administrative agent. (Incorporated by reference from Exhibit 10.1 to Old Sinclair's Current Report on Form 8-K filed on December 4, 2020.)
10.22 Third Amendment, dated as of April 1, 2021, to the Seventh Amended and Restated Credit Agreement by and among Sinclair Television Group, Inc., Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.), the guarantors party thereto, the lenders party thereto, and JPMorgan Chase Bank, N.A., as the administrative agent and collateral agent. (Incorporated by reference from Exhibit 10.1 to Old Sinclair's Current Report on Form 8-K filed on April 1, 2021.)
10.23 Fourth Amendment, dated as of April 21, 2022, to the Seventh Amended and Restated Credit Agreement by and among Sinclair Television Group, Inc., Sinclair Broadcast Group, LLC (formerly Sinclair Broadcast Group, Inc.), the guarantors party thereto, the lenders party thereto, and JPMorgan Chase Bank, N.A., as the administrative agent and collateral agent (incorporated by reference from Exhibit 10.1 to Old Sinclair’s Current Report on Form 8-K filed on April 21, 2022).
10.24 Omnibus Assignment, Assumption and Amendment Agreement, by and between Old Sinclair and New Sinclair, effective as of June 1, 2023. (Incorporated by reference from Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on June 1, 2023.)
19† Sinclair, Inc. Policy Memorandum Concerning Securities Trading (as amended effective June 1, 2023).
21† Significant Subsidiaries of Sinclair and SBG.
23† Consent of PricewaterhouseCoopers LLP Independent Registered Public Accounting Firm.
24 Power of Attorney; included on the Signatures page of this Annual Report on Form 10-K.
31.1 Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair, Inc., pursuant to § 302 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. § 7241).
31.2 Certification by Lucy A. Rutishauser, as Chief Financial Officer of Sinclair, Inc., pursuant to § 302 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. § 7241).
31.3 Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair Broadcast Group, LLC, pursuant to § 302 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. § 7241).
31.4 Certification by Lucy A. Rutishauser, as Chief Financial Officer of Sinclair Broadcast Group, LLC, pursuant to § 302 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. § 7241).
32.1‡ Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair, Inc., pursuant to § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350).
32.2‡ Certification by Lucy A. Rutishauser, as Chief Financial Officer of Sinclair, Inc., pursuant to § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350).
EXHIBIT NO. EXHIBIT DESCRIPTION
32.3‡ Certification by Christopher S. Ripley, as Chief Executive Officer of Sinclair Broadcast Group, LLC, pursuant to § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350).
32.4‡ Certification by Lucy A. Rutishauser, as Chief Financial Officer of Sinclair Broadcast Group, LLC, pursuant to § 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350).
97.1 Sinclair, Inc. Incentive-Based Compensation Clawback Policy, effective as of October 2, 2023. (Incorporated by reference from Exhibit 97.1 to Sinclair, Inc.’s Annual Report on Form 10-K filed on February 29, 2024.)
99.1 Stockholders’ Agreement dated as of June 1, 2023 by and among the Smith Brothers. (Incorporated by reference from Exhibit 99.1 to Registrant’s Current Report on Form 8-K filed on June 1, 2023.)
101† The Company's Consolidated Financial Statements and related Notes for the year ended December 31, 2024 from this Annual Report on Form 10-K, formatted in iXBRL (Inline eXtensible Business Reporting Language).**
* Management contracts and compensatory plans or arrangements required to be filed as an exhibit pursuant to Item 15(b) of Form 10-K.
† Filed herewith.
‡ In accordance with Item 601(b)(32) of Regulation S-K, this Exhibit is not deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.
(b) Exhibits
The exhibits required by this Item are listed under Item 15 (a) (3).