Nexstar delivered a resilient second quarter with net revenue of $1.23 billion (down 3.2% on lower off-cycle political advertising) and adjusted EBITDA of $389 million, while adjusted free cash flow rose to $101 million from $77 million. Non-political advertising declined 2.5%, slightly better than expected, weighed down by auto and goods-based categories, but The CW improved profitability $21 million and NewsNation ranked as the top basic cable network for year-over-year growth. The quarter's strategic focus was regulatory reform, with the FCC refreshing the record on the national ownership cap and the 8th Circuit vacating the top-four rule, setting up potential deregulation that could enable M&A. Management returned 53% of first-half free cash flow to shareholders, refinanced its credit facilities to extend maturities, and reiterated The CW's path to profitability in 2026.
Thank you, Melissa, and good morning, everyone. I'll start by reading the safe harbor language and then we'll get right into the call. All statements and comments made by management during this conference call, other than statements of historical fact, may be deemed forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Nexstar Media Group cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those reflected by the forward-looking statements made during this call. For additional details on these risks and uncertainties, please see Nexstar Media Group's Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the Securities and Exchange Commission and Nexstar Media Group's subsequent public filings with the SEC.
Nexstar Media Group undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. It's now my pleasure to turn the conference over to your host, Nexstar Media Group Founder, Chairman and Chief Executive Officer Perry Sook. Perry, please go ahead.
Thank you, Joe, and good morning, everyone. We appreciate you all joining us today. Michael Biard, our Chief Operating Officer, and Lee Ann Gliha, our Chief Financial Officer, are with me here this morning. Nexstar Media Group delivered another solid quarter of financial results, with our second quarter net revenue, adjusted EBITDA, and adjusted free cash flow benefiting from better than expected advertising revenue, stable distribution revenue, and strong expense management. Overall, our core advertising business remains resilient while the pay TV landscape continues to evolve as we had anticipated. Though we have yet to see a definitive turnaround in video subscriber trends, we are encouraged by consistent early signs of improvement with good reports in recent weeks from two of our largest MVPDs. For the first half of 2025, Nexstar Media Group generated adjusted EBITDA of $770 million and adjusted free cash flow of nearly $450 million.
We returned $238 million, or 53% of adjusted free cash flow, to shareholders through share repurchases and dividends, reducing our shares outstanding by about 1% while also allocating $132 million to debt repayment. Near the end of the quarter, we refinanced the company's credit facilities and term loans, further strengthening our capital structure and our financial flexibility by extending maturities, which positions our balance sheet well in anticipation of expected regulatory relief on the ownership front. The case for local broadcast ownership deregulation remains strong and extends far beyond competitive fairness. It is becoming increasingly clear that bias acknowledged and now admitted in editorial coverage by legacy national networks, false information provided by AI, and social media disinformation are making it almost impossible for Americans to distinguish between fact, opinion, and fiction.
We firmly believe that Nexstar Media Group and the local broadcast industry at large are a solution to these threats. Every day, our local and national news teams bring the public unbiased, fact-based news reporting and information from 113 newsrooms in markets across the country and nationally. On NewsNation, we employ almost 6,000 journalists in total, which is more than any other media company in the United States. Our news teams all adhere to a strict journalistic code of ethics and are dedicated to bringing communities trusted information and local stories that matter to them. For example, in Central Texas during the immediate aftermath of the devastating Guadalupe River flooding, our local reporters were on the ground providing essential news coverage and safety information to our local communities as well as national audiences via NewsNation.
In addition to covering those events, Nexstar station teams in Abilene, San Angelo, and Austin came together to raise nearly $1.4 million for flood victims during a one-hour telethon. Many also volunteered at local relief organizations to help gather and distribute supplies to those in need. Meanwhile, on big tech social media platforms, charlatans chasing clicks circulated misleading videos, some AI-generated and others recycled from unrelated disasters in different states or countries, falsely claiming to depict the Central Texas floods. Others exploited the tragedy by creating fake fundraising pages to scam well-meaning donors. This kind of misinformation and malfeasance undermines search and rescue efforts, erodes public trust, and diverts critical resources from legitimate relief organizations. Unfortunately, this is just another clear example of how Big Tech's unchecked reach and prioritization of engagement over accuracy fuels the rapid spread of fake news.
Nexstar's commitment to high-quality, trustworthy journalism continues to deliver strong viewership, earning trust along with local and national aficionados. Ad Fontes, the respected third-party media watchdog, has rated virtually all news programming provided by Nexstar local stations as well as NewsNation as politically neutral with a rating of reliable for both analysis as well as reporting. In the second quarter, our local journalists earned 52 regional Edward R. Murrow Awards for our outstanding journalism and exceptional locally produced news programming. Public trust in local broadcast journalism remains strong, with Americans citing local television news as the number one most trusted news source. According to a 2024 TBB survey, audiences of all ages and demos are turning into our local news and to other programming, with nearly half of Nexstar's 2024 station viewership coming from non-network programming. That last point is important.
We've seen a number of publications misrepresent data from the latest Nielsen Gage reports by stating that streaming accounts for over 50% of total viewership. The data reflected in that report only includes information from Nielsen's national panel. It completely excludes local station viewership of local content, which we know to be substantial. If you look exclusively at national viewership of long form ad supported programming, the metric that matters most to advertisers, broadcasting and cable together account for 70% of total ad impressions. We believe that the continued strength of our broadcast and cable news assets is a direct result of our long term strategic focus on high impact news and sports programming. We began in 2019 by converting WGN America, the entertainment network we acquired in the Tribune acquisition, into NewsNation.
We made a similar strategic decision with our acquisition of the majority stake in The CW broadcast network in 2022, shifting its focus from scripted series to more broad based and audience expanding programming including a full slate of live sports. I'm proud to share that we've achieved several operational milestones during the quarter highlighting the continued success of our strategies. In April, we celebrated NewsNation's one year anniversary of expanding its news programming to become a 24/7 cable news network. In June, NewsNation was ranked the number one basic cable network for year-over-year growth with overall viewership increasing by nearly 50% and by 67% in the adults age 25-54 demographic according to Nielsen. We believe NewsNation's programming and unique fact based reporting is resonating with viewers who are looking for a refreshingly balanced and impartial take on the news.
At The CW, we've now achieved five consecutive quarters of audience growth and The CW was the number 8 ranked network in total audience growth for the first half of 2025. This is a direct result of the success of our programming strategy including the introduction of sports, which now accounts for over 40% of our total programming hours. Turning to regulatory reform, there have been significant positive developments since our last earnings call. In mid July, the FCC moved to refresh the record on the national ownership cap, opening the door for a new order from the FCC to modify or eliminate the cap, perhaps by the end of this year.
We filed our comments on Monday in that proceeding, and on July 23, the 8th Circuit Court vacated a top four rule which prohibits the owner of television broadcast stations from owning two of the top four rated stations in a local market, finding that the FCC's historical justification for retaining the rule was arbitrary and capricious. We applaud Chairman's vocal support of the Court's decision, describing the FCC's prior retention of the top four prohibition as a decision to retain a regulation that does not match marketplace realities. In summary, the continued success and consistency of Nexstar Media Group's financial performance reflects our stable, diversified revenue base, disciplined operations, and continued execution across our portfolio. With our unmatched scale, robust free cash flow, and consistent track record of delivering value, we remain well positioned to seize the significant opportunities that lie ahead.
We are energized by the prospects of regulatory reform, and we remain laser focused on executing on our 2025 objectives, which include renewing upcoming distribution agreements, continuing The CW's path to profitability next year, and preparing for significant midterm election activity again in 2026. With that said, let me turn the call now over to Michael Biard.
Mike, thanks Perry, and good morning everyone. Nexstar Media Group delivered second quarter net revenue of $1.23 billion, a decline of 3.2% compared to the prior year, primarily reflecting the year-over-year reduction in political advertising. Second quarter distribution revenue of $733 million was essentially flat compared to the prior year quarter, primarily reflecting a modest number of subscribers renewed in 2024 compared to 2023 and MVPD subscriber attrition, partially offset by contractual rate escalators, growth in vMVPD subscribers, and the addition of The CW affiliations on certain of our stations. Although the industry continues to see subscriber attrition, we note recent earnings reports from our distribution partners suggest marginal improvements in subscriber trends. Several industry observers have noted Charter's trending video performance, with at least one highlighting video as a significant opportunity in the context of the Cox transaction.
We're encouraged by those trends and continue to monitor the space closely as we work to secure agreements that are better aligned with the value Nexstar Media Group delivers to our partners and their customers. Advertising revenue of $475 million decreased $47 million or 9% over the comparable prior year quarter, primarily reflecting a $36 million year-over-year decrease in political advertising. Non-political advertising declined by 2.5% year-over-year, slightly better than our expectations. Non-political advertising was impacted by a high single-digit decline in goods-based advertising, of which more than half was attributable to the automotive category, and a slight reduction in services-based advertising, though this segment remains much more stable and resilient overall, contributing positively to the quarter. We saw growth in key categories including attorneys and home repair, along with improved performance from some of our national digital businesses, including Best Reviews.
We generated approximately $9 million in political advertising revenue during the quarter, primarily driven by issue spending related to the One Big Beautiful Bill, the New York City mayoral primary, and the Virginia primaries. Looking ahead to the third quarter, non-political advertising is currently forecast to be down in the low single digits on a year-over-year basis. This is despite the comp with 2024 Olympic-related advertising and the benefit in part from the lack of political crowd out in the quarter. Although some broader economic headlines may suggest caution, our view of the advertising outlook remains stable for now. As we noted on last quarter's call, approximately 15% of our total revenue is tied to goods-based businesses that could be impacted by tariffs.
Turning to The CW, as Perry Sook mentioned earlier, we continue to see favorable returns on our programming investments, with sports now accounting for more than 40% of The CW's programming hours, and we continue to build The CW sports portfolio. During the second quarter, we renewed our agreement with the Pac-12 Conference to nationally broadcast nine college football games this fall, including a new Pac-12 double feature on Saturday, September 6th, showcasing two of the key schools that will anchor the expanded Pac-12 Conference next year. We also announced a multi-year partnership with the Professional Bowlers Association to air 10 live events on Sunday afternoons beginning in 2026. In July, we announced a multi-year agreement with Professional Bull Riders to be the exclusive live broadcast partner of the PBR Teams series on Saturdays and Sundays.
The CW will air the first of 11 PBR events this year this coming Saturday, August 9th. Our sports programming continues to perform well, demonstrating both the power of broadcast television and The CW Network. Specifically, both WWE NXT and NASCAR Xfinity Racing ratings are up 7% and 16%, respectively, versus the second quarter of last year when those events were primarily on cable. Moreover, our entire CW programming strategy is working. As mentioned, we've seen five consecutive quarters of primetime ratings growth, elevating The CW into position as the 8th most watched network overall for the first half of this year. On any given night, The CW is now beating the big four networks with regularity, with 126 instances since the beginning of this broadcast season in October 2024 versus 53 in the entire prior season, firmly establishing The CW as a major broadcast network in the second quarter.
As expected, The CW's profitability improved by $21 million year-over-year, driven by reduced amortization of broadcast rights and lower operating expenses following our Q4 restructuring. Our outlook for the year remains unchanged, and we continue to project improved profitability of about 25% in 2025 over 2024, with our continued expectation of achieving profitability in 2026. In addition, the company continues to benefit from moving CW affiliations to our owned and operated stations during the quarter. We finalized agreements to move three additional CW affiliations next month to Nexstar stations in Charlotte, North Carolina, Erie, Pennsylvania, and Elmira, New York. To close, let me reiterate confidence in Nexstar's long term outlook and the enduring strength of our broadcast business model.
Our news and sports focused programming strategies continue to deliver demonstrable results for The CW and NewsNation, and we remain committed to unlocking greater value from these valuable assets as our audiences continue to expand. As the industry continues to evolve, we believe the momentum is shifting in favor of our core businesses, and we remain committed to pursuing opportunities that drive long term value for our shareholders. With that, it's my pleasure to turn the call over to Lee Ann for the remainder of the financial review.
Ann, thank you, Mike, and good morning, everyone. Mike gave you most of the details on the revenue side and on The CW, so I'll provide a review of expenses, adjusted EBITDA, and adjusted free cash flow along with a review of our capital allocation activities together. Second quarter direct operating and SG&A expenses, excluding D&A and corporate expenses, declined by $13 million or 2%, primarily driven by our operational restructuring initiatives undertaken in the fourth quarter, offset in part by increased variable expenses related to our growth in digital revenue. Q2 2025 total corporate expense was $64 million, including non-cash compensation expense of $21 million, compared to $54 million, including non-cash compensation expense of $20 million in the second quarter of 2024. The $10 million increase is primarily due to one-time expenses associated with the refinancing we completed in the quarter.
Q2 2025 depreciation and amortization was $197 million versus $208 million in the comparable prior year quarter, a decrease of $11 million. Of these amounts included in our definition of adjusted EBITDA is $79 million related to the amortization of broadcast rights for Q2 of 2025 compared to $87 million for Q2 2024. The decrease in amortization of broadcast rights by $8 million was primarily due to lower programming costs at The CW versus the comparable prior year quarter. Q2 2025 income from equity method investments, which primarily reflects our 31% ownership in TV Food Network, declined by $5 million versus the comparable prior year quarter, primarily related to TV Food Network's lower revenue. Putting it all together, on a consolidated basis, second quarter adjusted EBITDA was $389 million, representing a 31.7% margin and a decrease of $25 million from the second quarter 2024 of $414 million.
Moving to the components of free cash flow and adjusted free cash flow, second quarter CapEx is $29 million, a decrease from $37 million in the second quarter of last year due primarily to timing of CapEx projects and lower total amount of CapEx in non-election years. Second quarter net interest expense was $97 million, a reduction of $16 million from the second quarter of 2024. On a cash basis, this compares to $94 million in Q2 2025 versus $110 million in Q2 2024. The reduction in interest expense was primarily related to a reduction in SOFR and Nexstar's reduced debt balances. Second quarter operating cash taxes were $140 million compared to $164 million last year. Payments for capitalized software obligations and pension credits net of proceeds from disposal of assets insurance recoveries were $14 million versus $16 million in last year's Q2.
Cash distributions from the TV Food Network were $11 million in the second quarter, which amount is captured in our free cash flow and adjusted free cash flow definition. This amount reflects our pro rata share of distributions to cover tax from our proportionate share in the income of the JV. Included in the second quarter's adjusted EBITDA but excluded from adjusted free cash flow is $11 million of income for amortization from equity method investments, which is primarily our pro rata share of TV Food Network net income in the second quarter of 2025. In Q2, programming amortization costs were lower than cash payments by $2 million compared to Q2 2024 as certain deferred programming payments were paid. Putting this all together, consolidated second quarter 2025 adjusted free cash flow was $101 million as compared to $77 million in last year's Q2.
A few additional points of guidance with respect to adjusted free cash flow: we are currently projecting CapEx of $25 to $30 million in Q3. Based on the current yield curve and our mandatory amortization payments, Q3 interest expense is expected to be in the $93 million range. Q3 2025 cash taxes are expected to be in the $35 million-$40 million range. In Q3 2025, cash distributions from the TV Food Network are expected to be in the low to mid single-digit million dollar range, and payments for programming are expected to be in excess of amortization by about $25 million, primarily due to prepayment of future programming payments and payment of deferred programming.
Turning to capital allocation and our balance sheet, together with the cash from operations generated in the quarter and cash on hand, we returned $106 million to shareholders, comprised of $56 million in dividends and the repurchase of $50 million of stock at an average price of $159.71 per share, reducing our shares outstanding. During the quarter, we completed the refinancing of our revolver, Term Loan A, and Term Loan B, and Mission completed the refinancing of its revolver. In connection with the refinancing, we extended our maturities on our revolvers and Term Loan A to June 2030 and extended the maturity on our Term Loan B to June 2032. In addition, we increased the size of our revolver to $750 million and eliminated the 10 basis points-11 basis point credit spread adjustment across all the facilities we received.
In addition, we converted our covenant calculation to reflect a last eight quarter annualized EBITDA calculation for the denominator to better align with broadcast industry practice and better reflect our leverage across an election year where we generate additional political advertising revenue and a non-election year when we do not. We closed the refinancing on June 27, and Nexstar's outstanding debt at June 30, 2025, was $6.4 billion, a reduction of $101 million, as we made optional repayments on our debt balances. Our cash balance at quarter end is $234 million, including $23 million of cash related to The CW. Because we designated The CW as an unrestricted subsidiary, the losses associated with The CW are not included in our calculation of leverage for purposes of our credit agreement.
As such, our net first lien covenant ratio for Nexstar at June 30, 2025, which is now calculated on a last eight quarter annualized basis, was 1.81 times, which is well below our first lien and only covenant of 4.25 times. Total net leverage for Nexstar was 3.19 times at quarter end. These leverage statistics are calculated pursuant to the description in our credit agreement. With that, I will open up the call for questions. Operator, can you go to our first question?