NEXSTAR MEDIA GROUP, INC. (NXST)

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with our Condensed Consolidated Financial Statements and related Notes included elsewhere in this Quarterly Report on Form 10-Q and the Consolidated Financial Statements and related Notes contained in our Annual Report on Form 10-K for the year ended December 31, 2025.

As used in this Quarterly Report on Form 10-Q and unless the context indicates otherwise, “Nexstar” refers to Nexstar Media Group, Inc., a Delaware corporation, and its consolidated wholly owned and majority owned subsidiaries; the “Company” refers to Nexstar and the variable interest entities (“VIEs”) required to be consolidated in our financial statements; and all references to “we,” “our,” “ours,” and “us” refer to Nexstar.

As a result of our deemed controlling financial interests in the consolidated VIEs in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), we consolidate the financial position, results of operations and cash flows of these VIEs as if they were wholly owned entities. We believe this presentation is meaningful for understanding our financial performance. Refer to Note 2 to our Condensed Consolidated Financial Statements for a discussion of our determinations of VIE consolidation under the related authoritative guidance. The following discussion of our financial position and results of operations includes the consolidated VIEs’ financial position and results of operations.

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including but not limited to: the ultimate outcome, benefits and synergies of the merger between Nexstar and TEGNA Inc. (“TEGNA”); the risks and uncertainties of current economic factors that are beyond our control, such as tariffs and other trade barriers, capital markets volatility, sustained inflation and high interest rates and supply chain disruptions; any projections or expectations of earnings, revenue, financial performance, liquidity and capital resources or other financial items; any assumptions or projections about the television broadcasting industry; any statements of our plans, strategies and objectives for our future operations, performance, liquidity and capital resources or other financial items; any statements concerning proposed new products, services or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements may include the words “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and other similar words.

Although we believe that the expectations reflected in our forward-looking statements are reasonable, actual results could differ from a projection or assumption in any of our forward-looking statements. Our future financial position and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties, including those described in our Annual Report on Form 10-K for the year ended December 31, 2025 and in our other filings with the United States Securities and Exchange Commission (the “SEC”). The forward-looking statements made in this Quarterly Report on Form 10-Q are made only as of the date hereof, and we do not have or undertake any obligation to update any forward-looking statements to reflect subsequent events or circumstances.

Executive Summary

Six Months Ended June 30, 2026 Highlights

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Net revenue increased 62.2% to $2.0 billion and 37.7% to $3.4 billion during the three and six months ended June 30, 2026, respectively, compared to the same period in 2025.

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Completed the previously announced merger with TEGNA on March 19, 2026, primarily funded by debt issuance. Refer to Notes 3 and 7 to our Condensed Consolidated Financial Statements for additional information.

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Returned approximately $113 million of capital to shareholders through dividends.

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Refinanced the 5.625% Notes due 2027 with $1,725 million of 7.25% senior unsecured notes due 2034. During the three and six months ended June 30, 2026, the Company also repaid $409 million and $437 million, respectively, of its debt.

Overview of Operations

As of June 30, 2026, we owned, operated, programmed or provided sales and other services to 265 full power television stations, two AM radio stations and one FM radio station, including those television stations owned by VIEs, in 132 markets in 44 states and the District of Columbia. The stations are affiliates of ABC, NBC, FOX, CBS, The CW, MyNetworkTV and other broadcast television networks. Through various local service agreements, we provided sales, programming and other services to 37 full power television stations owned by independent third parties, of which 35 full power television stations are VIEs that are consolidated into our financial statements.

As of June 30, 2026, we also own an 81.1% ownership interest in The CW, the fifth major broadcast network in the U.S.; NewsNation, a national cable news network; Premion, a connected TV and over-the-top advertising platform; four multicast networks, Antenna TV, REWIND TV, True Crime and Quest; multicast network services provided to third parties; Locked On Podcast Network (“Locked On”), a network of sports podcasts; BestReviews LLC (“BestReviews”), a leading consumer product recommendations company; and a 31.3% ownership stake in TV Food Network. Our digital assets include 176 local websites and 292 mobile applications across local stations, NewsNation, The Hill, BestReviews, Locked On and True Crime. The portfolio also includes 160 connected television applications and 54 free ad-supported television channels.

We (excluding The CW) guarantee full payment of all obligations incurred under Mission Broadcasting, Inc.’s (“Mission”) senior secured credit facility in the event of its default. Mission is a guarantor of Nexstar’s senior secured credit facility, Nexstar’s senior secured and senior unsecured notes and TEGNA’s senior unsecured notes. In consideration of our guarantee of Mission’s senior secured credit facility, Mission has granted us purchase options to acquire the assets and assume the liabilities of each Mission station, subject to FCC consent. These option agreements (which expire on various dates between 2026 and 2034) are freely exercisable or assignable by us without consent or approval by Mission or its shareholders. We expect these option agreements to be renewed upon expiration.

We do not own the consolidated VIEs or their television stations. However, we are deemed under U.S. GAAP to have controlling financial interests for financial reporting purposes in these entities because of (i) the local service agreements we have with their stations, (ii) our (excluding The CW) guarantee of the obligations incurred under Mission’s senior secured credit facility, (iii) our power over significant activities affecting the consolidated VIEs’ economic performance, including budgeting for advertising revenue, certain advertising sales and, in some cases, hiring and firing of sales force personnel and (iv) purchase options granted by each consolidated VIE which permit us to acquire the assets and assume the liabilities of each of these VIEs’ stations at any time, subject to FCC consent. In compliance with FCC regulations for all the parties, each of the consolidated VIEs maintains complete responsibility for and control over programming, finances and personnel for its stations.

See Note 2, “Variable Interest Entities” to our unaudited Condensed Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for additional information on VIEs, including a discussion of the local service agreements we have with these independent third parties.

The Company’s reportable segments are Broadcast and TEGNA. Our Broadcast segment includes (i) television stations and related local websites owned, operated, programmed or provided sales and other services to by Nexstar (excluding TEGNA) in markets throughout the United States, (ii) NewsNation, a national cable news network, (iii) two owned and operated multicast networks and other multicast network services, and (iv) WGN-AM, a Chicago radio station. The TEGNA segment includes its owned and operated television stations, the Premion advertising platform, and its multicast and podcast networks. TEGNA became a reportable segment in the second quarter of 2026 following Nexstar’s acquisition on March 19, 2026.

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Seasonality

In even-numbered years we generate substantial advertising revenue from the political advertising we sell to candidates, political action committees and political parties. Advertising revenue is also positively affected by certain events such as the Olympic Games or the Super Bowl. Advertising revenue is generally highest in the second and fourth quarters of each year, due in part to increases in consumer advertising in the spring and retail advertising in the period leading up to, and including, the holiday season. As 2025 was not an election year, we expect an increase in political advertising revenue, a component of our advertising revenue, to be reported in 2026 compared to 2025.

Historical Performance

Results of Operations

The following table sets forth the Company’s operating results ($ in millions):

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with our Consolidated Financial Statements and related Notes included in Part IV, Item 15(a) of this Annual Report on Form 10-K.

As a result of our deemed controlling financial interests in the consolidated VIEs in accordance with U.S. GAAP, we consolidate the financial position, results of operations and cash flows of these VIEs as if they were wholly owned entities. We believe this presentation is meaningful for understanding our financial performance. Refer to Note 2 to our Consolidated Financial Statements for a discussion of our determinations of VIE consolidation under the related authoritative guidance. The following discussion of our financial position and results of operations includes the consolidated VIEs’ financial position and results of operations.

Executive Summary

2025 Highlights

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Entered into a definitive agreement to acquire TEGNA Inc. for $6.2 billion in a transaction expected to be accretive to Nexstar’s standalone Adjusted Free Cash Flow. The transaction is subject to regulatory approvals and is anticipated to close by the second half of 2026.

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Returned approximately $351 million of capital to shareholders through repurchases of common stock and dividends.

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Renewed distribution agreements in the fourth quarter, covering more than 60% of our subscriber base.

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Acquired the assets of WBNX-TV, an independent full power television station serving the Cleveland, OH market for a $22 million cash purchase price. On September 1, 2025, the station became affiliated with The CW.

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Completed the refinancing of senior secured credit facilities on June 27, 2025, reducing the interest margin, increasing capacity under our revolver, and extending the maturities. During 2025, the Company repaid $185 million of its debt.

Overview of Operations

As of February 26, 2026, we owned, operated, programmed or provided sales and other services to 201 full power television stations and one AM radio station, including those owned by VIEs, in 116 markets in 40 states and the District of Columbia. The stations are affiliates of ABC, NBC, FOX, CBS, The CW, MNTV and other broadcast television networks.

Through various local service agreements, we provided sales, programming and other services to 37 full power television stations owned by independent third parties, of which 35 full power television stations are VIEs that are consolidated into our financial statements. See Note 2 to our Consolidated Financial Statements included in Part IV, Item 15(a) of this Annual Report on Form 10-K for a discussion of the local service agreements we have with these independent third parties. We do not own the consolidated VIEs or their television stations. However, we are deemed under U.S. GAAP to have controlling financial interests for financial reporting purposes in these entities because of (i) the local service agreements we have with their stations, (ii) our (excluding The CW) guarantee of the obligations incurred under Mission’s senior secured credit facility, (iii) our power over significant activities affecting the consolidated VIEs’ economic performance, including budgeting for advertising revenue, advertising sales and, in some cases, hiring and firing of sales force personnel and (iv) purchase options granted by each consolidated VIE which permit us to acquire the assets and assume the liabilities of each of these VIEs’ stations, subject to FCC consent. In compliance with FCC regulations for all the parties, each of the consolidated VIEs maintains complete responsibility for and control over programming, finances and personnel for its stations.

As of December 31, 2025, we also own an 80.8% ownership interest in The CW, the fifth major broadcast network in the U.S., NewsNation, a national news network, two multicast networks, Antenna TV and REWIND TV, multicast network services provided to third parties, and a 31.3% ownership stake in TV Food Network. Our digital assets include 125 local websites and 229 mobile applications across local stations, NewsNation and The Hill. The portfolio also includes 110 CTV applications and three FAST channels from The CW and The Hill.

The Company generates revenue primarily from distribution and advertising. Distribution revenue consists of fees received for the retransmission of our stations’ signals and for the carriage of our cable and broadcast networks by cable, satellite, and other MVPDs, vMVPDs, and direct-to-consumer OTT services. Advertising revenue is derived from the sale of local and national advertising across our stations, networks, websites, apps, and other digital platforms, including through third‑party media partners. In even-numbered years, we also earn significant political advertising revenue from candidates, political action committees, political parties, and interest groups.

Our principal operating expenses include third-party programming, news production, promotion, sales, digital cost of goods sold, content creation, and other administrative and corporate costs.

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For additional information, see Item 1. “Business” and Item 1A. “Risk Factors.”

Merger Agreement with TEGNA

On August 18, 2025, we entered into a definitive Merger Agreement to acquire the outstanding equity of TEGNA. TEGNA owns and operates 64 television stations and two radio stations in 51 DMAs in the U.S. The Merger is anticipated to close by the second half of 2026. Upon closing, the Merger is expected to increase our operational and geographic diversity and scale, enhance our presence in various localities and extend our footprint to additional areas experiencing contested elections. Pursuant to the Merger Agreement, we will acquire TEGNA’s outstanding equity for a cash payment of $22 per share. The transaction is valued at an estimated $6.2 billion, which includes the estimated purchase price of $5.8 billion (comprising the Merger Consideration and the refinancing of certain existing TEGNA debt), financing fees and transaction costs and expenses. On August 18, 2025, we entered into a debt commitment letter, which was subsequently amended and restated on September 11, 2025, pursuant to which a syndicate of financial institutions committed to provide debt financing up to a maximum of $5.725 billion to consummate the Merger, the refinancing of certain of TEGNA’s existing debt and related transactions.

The Merger Agreement has been approved by the boards of directors of both companies and by the stockholders of TEGNA. The consummation of the Merger is subject to the satisfaction of certain customary conditions, including receipt of regulatory approvals.

See Note 1 to our Consolidated Financial Statements included in Part IV, Item 15(a) of this Annual Report on Form 10-K for additional information.

Regulatory Developments

As a television broadcaster, the Company is highly regulated, and its operations require that it retain or renew a variety of government approvals and comply with changing federal regulations. In December 2023, the FCC issued an order concluding its 2018 quadrennial review of certain media ownership rules. The order retained the local television ownership rule in its then-existing form without deregulatory changes while extending the rule to prohibit, in certain circumstances, the acquisition of a network affiliation that would establish a “top four” combination involving a network affiliated LPTV station or digital multicast stream. In a July 2025 decision on appeal of the FCC’s 2018 quadrennial review order, a federal court of appeals vacated the “top four” portion of the local television ownership rule, which had generally prohibited common ownership of two of the top four highest-rated stations in a DMA. The court also vacated the December 2023 rule prohibiting certain “top four” combinations involving LPTV stations or digital multicast streams.

The FCC has not yet issued an order repealing the “top four” portion of the duopoly rule and the “top four” rule concerning LPTV stations and digital multicasts. Moreover, the FCC’s 2022 quadrennial media ownership review and an FCC proceeding to review the current national limit on television ownership are currently pending. The FCC could reinstitute earlier television ownership restrictions or impose other limitations in these or any future reviews.

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Historical Performance

Results of Operations

The following table sets forth the Company’s operating results:

NM = Not Meaningful

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Year Ended December 31, 2025 Compared to Year Ended December 31, 2024

The Company’s revenues decreased 8.5% for the year ended December 31, 2025, compared to the same period in 2024, primarily due to lower revenues from advertising.

Distribution revenue decreased by $4 million primarily due to the impact of MVPD subscriber attrition and the nonrecurring resolution of a disputed customer claim, offset in part by annual rate escalators, growth in vMVPD subscribers, and the addition of CW affiliations on certain of our stations.

Advertising revenue decreased by $456 million, due to a decrease in political advertising by $446 million, as 2025 is not an election year, and a decrease in non-political revenue of $10 million due to ongoing advertising market softness.

Direct operating expenses, consisting primarily of programming, news and technical expenses, and selling, general and administrative expenses decreased by $11 million primarily due to recent restructuring initiatives to streamli

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