Gray Media, Inc: Form 10-Q for the period ended Sep 30, 2025

Executive Overview

Introduction. The following discussion and analysis of the financial condition and results of operations of Gray Media, Inc. and its consolidated subsidiaries (except as the context otherwise provides, “Gray Media,” “Gray,” the “Company,” “we,” “us” or “our”) should be read in conjunction with our unaudited condensed consolidated financial statements and notes thereto included elsewhere herein, as well as with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”) filed with the SEC.

Business Overview. We are a multimedia company headquartered in Atlanta, Georgia. We are the nation’s largest owner of top-rated local television stations and digital assets serving 113 television markets that collectively reach approximately 37 percent of US television households. The portfolio includes 78 markets with the top-rated television station and 99 markets with the first and/or second highest rated television station, as well as the largest Telemundo Affiliate group with 44 markets. We also own Gray Digital Media, a full-service digital agency offering national and local clients digital marketing strategies with the most advanced digital products and services. Our additional media properties include video production companies Raycom Sports, Tupelo Media Group, and PowerNation Studios, and studio production facilities Assembly Atlanta and Third Rail Studios.

Our operating revenues are derived primarily from broadcasting and digital advertising, retransmission consent fees and, to a lesser extent, other sources such as production of television and event programming, television commercials, tower rentals and management fees. For the nine-months ended September 30, 2025 and 2024, we generated revenue of $2.3 billion and $2.6 billion, respectively.

Revenues, Operations, Cyclicality and Seasonality. Broadcast advertising is sold for placement generally preceding or following a television station’s network programming and within local and syndicated programming. Broadcast advertising is sold in time increments and is priced primarily on the basis of a program’s popularity among the specific audience an advertiser desires to reach. In addition, broadcast advertising rates are affected by the number of advertisers competing for the available time, the size and demographic makeup of the market served by the station and the availability of alternative advertising media in the market area. Broadcast advertising rates are generally the highest during the most desirable viewing hours, with corresponding reductions during other hours. The ratings of a local station affiliated with a major network can be affected by ratings of network programming. Most advertising contracts are short-term, and generally run only for a few weeks.

We also sell digital advertising on our stations’ websites and mobile apps. These advertisements may be sold as banner advertisements, video advertisements and other types of advertisements or sponsorships.

Our broadcast and digital advertising revenues are affected by several factors that we consider to be seasonal in nature. These factors include:

• Spending by political candidates, political parties and special interest groups increases during the even-numbered “on-year” of the two-year election cycle. This political spending typically is heaviest during the fourth quarter of such years;
• Broadcast advertising revenue is generally highest in the second and fourth quarters each year. This seasonality results partly from increases in advertising in the spring and in the period leading up to and including the holiday season;
• Core advertising revenue on our NBC-affiliated stations increases in certain years as a result of broadcasts of the Olympic Games; and
• Because our stations and markets are not evenly divided among the Big Four broadcast networks, our local and national advertising revenue can fluctuate between years related to which network broadcasts the Super Bowl.

We derived a material portion of our non-political broadcast advertising revenue from advertisers in a limited number of industries, particularly the services sector, comprising financial, legal and medical advertisers, and the automotive industry. The services sector has become an increasingly important source of advertising revenue over the past few years. During the nine-months ended September 30, 2025 and 2024, approximately 26% and 24%, respectively, of our broadcast advertising revenue (excluding political advertising revenue) was obtained from advertising sales to the services sector. During the nine-months ended September 30, 2025 and 2024 approximately 17% and 19%, respectively, of our broadcast advertising revenue (excluding political advertising revenue) was obtained from advertising sales to automotive customers. Revenue from these industries may represent a higher percentage of total revenue in odd-numbered years due to, among other things, the increased availability of advertising time, as a result of such years being the “off year” of the two-year election cycle.

Our primary broadcasting operating expenses are employee compensation, related benefits and programming costs. In addition, the broadcasting operations incur overhead expenses, such as maintenance, supplies, insurance, rent and utilities. A large portion of the operating expenses of our broadcasting operations is fixed. We continue to monitor our operating expenses and seek opportunities to reduce them where possible.

2025 Refinancing Activities

Revolving Credit Facility. On March 31, 2025, we entered into a fourth amendment (the “Fourth Amendment”) of our Senior Credit Agreement (as defined below). The Fourth Amendment, among other things, increases the aggregate commitments under the Revolving Credit Facility (the “Revolving Credit Facility”) by $20 million, resulting in aggregate commitments under the Revolving Credit Facility of $700 million. Borrowings under the Revolving Credit Facility bear interest, at our option, at either the SOFR rate or the Base Rate, in each case, plus an applicable margin. The costs associated with the amendment were not material.

On July 18, 2025, we entered into a further amendment to the Senior Credit Agreement (the “Fifth Amendment” and as amended, including by the Fifth Amendment, the “Senior Credit Agreement”), dated as of December 1, 2021. The Fifth Amendment, among other things, provided for an increase in the Revolving Credit Facility by $50 million, resulting in aggregate commitments under the Revolving Credit Facility of $750 million and an extension of the term of the commitments under the Revolving Credit Facility to December 1, 2028.

2032 Notes (2L). On July 18, 2025, we issued $900 million in aggregate principal amount of 2032 Notes (2L). The 2032 Notes (2L) were issued at par. Interest in the 2032 Notes (2L) accrues from July 18, 2025, and is payable semiannually, on January 15 and July 15 of each year, beginning on January 15, 2026.

The net proceeds from the 2032 Notes (2L), together with $50 million borrowed under our Revolving Credit Facility, were used to: (i) redeem all of our outstanding 2027 Notes at par; (ii) to repay $403 million of our 2024 Term Loan (1L) under the Senior Credit Agreement; and (iii) pay all transaction expenses incurred in connection with the offering.

2033 Notes (1L). On July 25, 2025, we issued $775 million in aggregate principal amount of 2033 Notes (1L). The 2033 Notes (1L) were issued at par. Interest in the 2033 Notes (1L) accrues from July 25, 2025, and is payable semiannually, on February 15 and August 15 of each year, beginning on February 15, 2026.

The net proceeds from the 2033 Notes (1L) were used to (i): repay $630 million of our 2021 Term Loan (1L); (ii) $80 million of our 2024 Term Loan (1L); (iii) repay all $50 million then outstanding under our Revolving Credit Facility, and; (iv) pay transaction fees and expenses incurred in connection with the offering.

Our primary broadcasting operating expenses are employee compensation, related benefits and programming costs. In addition, the broadcasting operations incur overhead expenses, such as maintenance, supplies, insurance, rent and utilities. A large portion of the operating expenses of our broadcasting operations is fixed. We continue to monitor our operating expenses and seek opportunities to reduce them where possible.

Please see our “Results of Operations” and “Liquidity and Capital Resources” sections below for further discussion of our operating results.

Revenue

Set forth below are the principal types of revenue, less agency commissions, earned by us for the periods indicated and the percentage contribution of each type of revenue to our total revenue (dollars in millions):

Results of Operations

Three-Months Ended September 30, 2025 (“the 2025 three-month period”) Compared to Three-Months Ended September 30, 2024 (“the 2024 three-month period”)

Revenue. Total revenue decreased by $201 million, or 21% in the 2025 three-month period. During the 2025 three-month period:

• Core advertising revenue decreased by $10 million or 3%, primarily resulting from the $16 million of advertising revenue earned on our 53 NBC channels from the broadcast of the 2024 Olympic Games;
• Consistent with 2025 being the “off-year” of the two-year election cycle, political advertising revenue decreased by $165 million, or 95%;
• Retransmission consent revenue decreased by $23 million or 6%, due to a decrease in subscribers and the transition of one television station to independent status during the quarter, offset, in part, by an increase in rates related to the implementation of new retransmission agreements; and
• Production company revenue decreased by $1 million, or 4%, in the 2025 three-month period due to decreases in revenue of $3 million at one of our event production companies, partially offset by increased revenue of $2 million at Assembly Atlanta.

Broadcasting Expenses. Broadcasting expenses (before depreciation, amortization and gain or loss on disposal of assets) decreased $29 million, or 5%, to $542 million in the 2025 three-month period. During the 2025 three-month period:

• Broadcasting total payroll expenses decreased by $5 million primarily as a result of decreases in staffing representing $4 million of the total, and decreases in stock-based compensation, representing $1 million of the total.
• Broadcasting non-payroll expenses decreased by $24 million primarily due to decreased network affiliation expense of $20 million, consistent with decreased retransmission revenue and decreases in our obligations related to the implementation of new network affiliation agreements and the transition of one television station to independent status during the quarter; decreases in business services of $6 million, primarily due to the re-negotiation of certain commercial contracts; but, partially offset by increased bad debt expense of $1 million.
• Broadcasting non-cash stock-based compensation expense was $0 million and $1 million in the 2025 and 2024 three-month periods, respectively.

Production Company Expenses. Production company operating expenses (before depreciation, amortization and gain or loss on disposal of assets) were $22 million in each of the 2025 and 2024 three-month periods. During the three-month periods, increases in property tax expense at Assembly Atlanta were offset by decreases in programming and professional service costs.

Corporate and Administrative Expenses. Corporate and administrative expenses (before depreciation, amortization and gain or loss on disposal of assets) increased by $4 million, or 17%, to $28 million. During the 2025 three-month period professional services increased by $4 million primarily related to our pending business combination transactions. Non-cash stock-based compensation expenses were $4 million in each of the 2025 and 2024 three-month periods.

Depreciation. Depreciation of property and equipment totaled $33 million and $36 million in the 2025 and 2024 three-month periods, respectively. Depreciation expenses have decreased as the related assets become fully depreciated.

Amortization. Amortization of intangible assets totaled $23 million and $31 million in the 2025 and 2024 three-month periods, respectively. The decrease in amortization expense was the result of finite-lived intangible assets becoming fully amortized and the impairment of certain finite-lived intangible assets earlier in 2025.

(Gain) Loss on Disposal of Assets, Net. Gain on disposal of assets was a gain of $1 million and a loss of $16 million in the 2025 and 2024 three-month periods, respectively, primarily resulting from the sale of easements and the assignment of leases at some of our television broadcast tower sites in 2025.

Miscellaneous (Expense) Income, Net. Miscellaneous expense, net totaled $3 million in the 2025 three-month period and miscellaneous income, net totaled $2 million in the 2024 three-month period. In the 2025 three-month period, the Gray Pension Plan entered into an annuity contract that assumed the obligation to provide monthly annuity payments for a subset of the plan’s retirees beginning July 1, 2025. As a result, the plan was remeasured as of September 30, 2025, and we recorded a settlement charge of $4 million in the 2025 three-month period.

Interest Expense. Interest expense decreased by $10 million to $120 million in the 2025 three-month period compared to $130 million in the 2024 three-month period primarily due to decreases in our outstanding debt balance and lower interest rates on our floating rate Senior Credit Agreement, partially offset by increased interest expenses on our Notes resulting from our 2025 refinancing activities.

(Loss) Gain from Early Extinguishment of Debt. During the 2025 three-month period, we have recorded a loss of $7 million primarily as a result of the issuance of our 2032 Notes (2L) and 2033 Notes (1L), the repayment of our 2027 Notes and the repayment of portions of our 2024 and 2021Term Loans during the quarter. During the 2024 three-month period, we recorded a gain of $6 million primarily as a result of purchases of our 2027 Notes and 2021 Term Loan (1L)s on the open market at a discount to their face value.

Income Tax (Benefit) Expense. We recognized an income tax benefit of $18 million in the 2025 three month period and income tax expense of $32 million in the 2024 three-month period. Our effective income tax benefit rate was 64% in the 2025 three month period and income tax expense rate was 25% in the 2024 three-month period. We estimate our differences between taxable income or loss and recorded income or loss on an annual basis. Our income tax provision for each interim period is based upon these full year projections that are revised each reporting period. These projections incorporate estimates of permanent differences between U.S. GAAP income or loss and taxable income or loss, state income taxes and adjustments to our liability for unrecognized tax benefits. For the 2025 three-month period, these estimates increased our statutory federal income tax benefit rate of 21% to our effective income tax benefit rate of 64% as follows: state income taxes added 12%, permanent difference between our U.S. GAAP income and taxable income added 33% and discrete items reduced our rate by 2%.

Nine-Months Ended September 30, 2025 (“the 2025 nine-month period”) Compared to Nine-Months Ended September 30, 2024 (“the 2024 nine-month period”)

Revenue. Total revenue decreased by $296 million, or 11%, in the 2025 nine-month period from the 2024 nine-month period. During the 2025 nine-month period:

• Core advertising revenue decreased by $50 million or 5%, due primarily to macro-economic softness. In addition, our advertising revenue of $9 million from the broadcast of the Super Bowl on our 33 FOX channels in the 2025 nine-month period, compared to an aggregate of $18 million of advertising revenue relating to the broadcast of the Super Bowl on our 54 CBS channels during the 2024 nine-month period. We were very pleased that our Super Bowl advertising revenue on our FOX channels increased to $9 million in 2025, compared to $6 million on our FOX channels in 2023. In addition, our Core advertising revenue benefited from the $16 million of advertising revenue earned on our 53 NBC channels from the broadcast of the 2024 Olympic Games in the 2024 nine-month period. Our Core advertising revenue during the 2025 nine-month period was also negatively impacted by one less selling day due to Leap Day, which we estimate impacted Core advertising revenue by $4 million.
• Consistent with 2025 being the “off-year” of the two-year election cycle, political advertising revenue decreased by $217 million, or 88%;
• Retransmission consent revenue decreased by $27 million or 2%, due to a decrease in subscribers and the transition of one television station to independent status during the nine-month period, offset, in part, by an increase in rates related to the implementation of new retransmission agreements; and
• Production company revenue increased by $2 million, or 3%.

Broadcasting Expenses. Broadcasting expenses (before depreciation, amortization, impairment and gain or loss on disposal of assets) decreased $37 million or 2%, to $1.7 billion. During the 2025 nine-month period:

• Broadcasting payroll expenses decreased by $20 million primarily as a result of: decreases in staffing representing $10 million of the total; decreases in incentive compensation, consistent with decreases in revenue, representing $6 million of the total; and decreases in stock-based compensation, representing $3 million of the total.
• Broadcasting non-payroll expenses decreased by $17 million primarily due to: decreased network affiliation expense of $20 million, consistent with decreased retransmission revenue and decreases in our obligations related to the implementation of new network affiliation agreements and the transition of one television station to independent status during the nine-month period; decreases in business services of $7 million, primarily re-negotiation of certain commercial contracts; partially offset by increased programming expenses of $9 million and increased bad debt expense of $2 million.
• Broadcast non-cash stock-based compensation expense were $1 million and $4 million in the 2025 and 2024 nine-month periods, respectively.

Production Company Expenses. Production company expenses (before depreciation, amortization, and gain or loss on disposal of assets) increased by approximately $5 million in the 2025 nine-month period to $62 million nine-month period, compared to $57 million in the 2024 nine-month period. Production company operating expenses in the 2025 nine-month period increased by $8 million reflecting increases in property taxes at Assembly Atlanta, partially offset by decreased programming expenses of $3 million.

Corporate and Administrative Expenses. Corporate and administrative expenses (before depreciation, amortization and gain or loss on disposal of assets) increased by $5 million to $85 million in the 2025 nine-month period. During the 2025 nine-month period professional services increased by $5 million primarily related to our pending business combination transactions, partially offset by decreases in promotion expenses of $3 million. Non-cash stock-based compensation expenses increased to $16 million in the 2025 nine-month period compared to $13 million in the 2024 nine-month period.

Depreciation. Depreciation of property and equipment totaled $99 million and $108 million in the 2025 nine-month period and the 2024 nine-month period, respectively. Depreciation expenses have decreased as the related assets become fully depreciated.

Amortization. Amortization of intangible assets totaled $80 million and $94 million in the 2025 nine-month period and the 2024 nine-month period, respectively. Amortization decreased primarily due to finite-lived intangible assets becoming fully amortized.

Impairment of Intangible Assets. During the 2025 nine-month period, we recorded a non-cash impairment charge of $28 million related to the changes to the network affiliation at one station.

(Gain) Loss on Disposal of Assets, Net. We recognized a gain on disposal of assets of $9 million in the 2025 nine-month period primarily due to on the sale of easements and the assignment of leases at some of our television broadcast tower sites, compared to a loss on disposal of assets of $15 million in the 2024 nine-month period. The loss in the 2024 nine-month period was primarily related to the acquisition of a construction permit to build television station KCBU in exchange for the divestiture of television stations KCWY and KGWN in which we recognized a loss of $14 million in the 2024 nine-month period.

Miscellaneous (Expense) Income, Net. Miscellaneous expense, net totaled $2 million in the 2025 nine-month period and $114 million of miscellaneous income, net in the 2024 nine-month period. Miscellaneous income, net in the 2024 nine-month period was due primarily to a gain of $110 million from the sale of our investment in Broadcast Music, Inc.

Interest Expense. Interest expense decreased $8 million, or 2%, to $355 million for the 2025 nine-month period compared to the 2024 nine-month period. This decrease was primarily attributable to a combination of factors including: decreases in the outstanding debt balance and lower interest rates on our floating rate Senior Credit Agreement in the 2025 nine-month period compared to the 2024 nine-month period; offset by the increase in the balance outstanding and interest rates on our Notes resulting from our 2025 refinancing activities. Our average outstanding total long-term debt balance was $5.7 billion and $6.2 billion during the 2025 and 2024 nine-month periods, respectively. Our average total interest rate was 7.5% and 7.0% during the 2025 and 2024 nine-month periods, respectively.

Loss from Early Extinguishment of Debt. The actions taken in our 2025 refinancing activities have resulted in a total net loss on early extinguishment of debt of $6 million in the 2025 nine-month period primarily as a result of the issuance of our 2032 Notes (2L) and 2033 Notes (1L), the repayment of our 2027 Notes and the repayment of portions of our 2024 and 2021Term Loans (1L) during the quarter.

Income Tax (Benefit) Expense. We recognized an income tax benefit of $12 million and an income tax expense of $70 million in the 2025 and 2024 nine-month periods, respectively. Our effective income tax benefit rate was 14% in the 2025 nine-month period. Our effective income tax expense rate was 25% in the 2024 nine-month period. We estimate our differences between taxable income or loss and recorded income or loss on an annual basis. Our tax provision for each interim period is based upon these full year projections that are revised each reporting period. These projections incorporate estimates of permanent differences between U.S. GAAP income or loss and taxable income or loss, state income taxes and adjustments to our liability for unrecognized tax benefits. For the 2025 nine-month period, these estimates increased our statutory federal income tax benefit rate of 21% to our effective income tax benefit rate of 14% as follows: state income taxes added 2%, permanent differences between our U.S. GAAP income and taxable income reduced our rate by 7% and discrete items reduced our rate by 2%.

Liquidity and Capital Resources

General. The following table presents data that we believe is helpful in evaluating our liquidity and capital resources (in millions):

Net Cash Provided By (Used In) Operating, Investing and Financing Activities. Net cash provided by operating activities was $177 million in the 2025 nine-month period compared to $383 million in the 2024 nine-month period. The decrease in net cash provided by operating activities in the 2025 nine-month period compared to the 2024 nine-month period was due primarily to a decrease in net income, partially offset by the decrease in non-cash adjustments to net income.

Net cash used in investing activities was $34 million in the 2025 nine-month period compared to net cash provided by investing activities of $10 million for the 2024 nine-month period. The increase in the net amount used was primarily due to a decrease in cash proceeds received from the sale of investments and other assets.

Net cash used in financing activities was $96 million in the 2025 nine-month period compared to net cash used in financing activities of $345 million in the 2024 nine-month period. Excluding temporary borrowings and re-payments of amounts under our Revolving Credit Facility, in the 2025 nine-month period, we issued $900 million of our 2032 Notes (2L) and $775 million of our 2033 Notes (1L). We used the proceeds of those offerings and cash provided by operations, to pre-pay all $528 million of our 2027 Notes as well as $488 million of the 2024 Term Loan (1L) and $656 million of our 2021 Term Loan (1L). In connection with these financing transactions we paid $25 million in in fees and expenses in the 2025 nine-month period. In the in the 2024 nine-month period, we issued $1.25 billion in of our 2029 Notes (1L) and $500 million of the 2024 Term Loan (1L) to pre-pay our $1.2 billion 2019 Term Loan all under the Senior Credit Facility. In addition, we repurchased in a tender offer, $690 million of face value of our outstanding 2026 Notes. In connection with these transactions, we paid $47 million in fees and expenses in the 2024 nine-month period. Furthermore, in the 2024 nine-month period, we used $72 million, to repurchase a portion of our 2027 Notes, and $14 million, to repurchase a portion of our 2021 Term Loan (1L) on the open market. During each period, we used $39 million of cash to pay dividends to holders of our preferred stock and $24 million to pay dividends to holders of our common stock.

Liquidity. Based on our debt outstanding as of September 30, 2025, we estimate that we will make approximately $453 million in debt interest payments over the twelve months immediately following September 30, 2025. Although our cash flows from operations are subject to a number of risks and uncertainties, we anticipate that our cash on hand, future cash expected to be generated from operations, borrowings from time to time under the Senior Credit Facility (or any such other credit facility as may be in place at the appropriate time) and, potentially, external equity or debt financing, will be sufficient to fund any debt service obligations, estimated capital expenditures and acquisition-related obligations for the next twelve months and the forseeable future. Any potential equity or debt financing would depend upon, among other things, the costs and availability of such financing at the appropriate time. We also believe that our future cash expected to be generated from operations and borrowing availability under the Senior Credit Facility (or any such other credit facility) will be sufficient to fund our future capital expenditures and long-term debt service obligations for the next twelve months and the forseeable future.

Collateral, Covenants and Restrictions of our credit agreements. Our obligations under the Senior Credit Agreement, the 2029 Notes (1L), the 2033 Notes (1L) and the 2032 Notes (2L) are secured by substantially all of our consolidated assets, excluding real estate. In addition, substantially all of our subsidiaries (subject to certain limited exceptions) are joint and several guarantors of, and our ownership interests in those subsidiaries are pledged to collateralize, our obligations under the Senior Credit Agreement, the 2029 Notes (1L), the 2033 Notes (1L) and the 2032 Notes (2L). Gray Media, Inc. is a holding company, and has no material independent assets or operations. For all applicable periods, the 2026 Notes, 2030 Notes and 2031 Notes have been fully and unconditionally guaranteed, on a joint and several, senior unsecured basis, by substantially all of Gray Media, Inc.'s subsidiaries (subject to certain limited exceptions). Any subsidiaries of Gray Media, Inc. that do not guarantee the 2026 Notes, 2030 Notes, 2031 Notes, the Senior Credit Agreement, the 2029 Notes (1L), the 2033 Notes (1L) and 2032 Notes (2L) are not material or are designated as unrestricted under the Senior Credit Agreement. As of September 30, 2025, there were no significant restrictions on our subsidiaries to distribute cash to us or to the guarantor subsidiaries.

The Senior Credit Agreement contains affirmative and restrictive covenants with which we must comply, including: (a) limitations on additional indebtedness, (b) limitations on liens, (c) limitations on the sale of assets, (d) limitations on guarantees, (e) limitations on investments and acquisitions, (f) limitations on the payment of dividends and share repurchases, (g) limitations on mergers and (h) maintenance of the First Lien Leverage Ratio while any amount is outstanding under the Revolving Credit Facility, as well as other customary covenants for credit facilities of this type. The 2026 Notes, 2029 Notes (1L), 2030 Notes, 2031 Notes, the 2032 Notes (2L) and 2033 Notes (1L) include covenants with which we must comply which are typical for financing transactions of their nature. As of September 30, 2025 and December 31, 2024, we were in compliance with all required covenants under all of our debt obligations.

In addition to results prepared in accordance with U.S. GAAP, “Leverage Ratio Denominator” is a metric that management uses to calculate our compliance with our financial covenants in our indebtedness agreements. This metric is calculated as specified in our Senior Credit Agreement and is a significant measure that represents the denominator of a formula used to calculate compliance with material financial covenants within the Senior Credit Agreement that govern our ability to incur indebtedness, incur liens, make investments and make restricted payments, among other limitations usual and customary for credit agreements of this type. Accordingly, management believes this metric is a very material metric to our debt and equity investors.

Leverage Ratio Denominator gives effect to the revenue and broadcast expenses of all completed acquisitions and divestitures as if they had been acquired or divested, respectively, on October 1, 2023. It also gives effect to certain operating synergies expected from the acquisitions and related financings, and adds back professional fees incurred in completing the acquisitions. Certain of the financial information related to the acquisitions, if applicable, has been derived from, and adjusted based on, unaudited, un-reviewed financial information prepared by other entities, which Gray cannot independently verify. We cannot assure you that such financial information would not be materially different if such information were audited or reviewed and no assurances can be provided as to the accuracy of such information, or that our actual results would not differ materially from this financial information if the acquisitions had been completed on the stated date. In addition, the presentation of Leverage Ratio Denominator as determined in the Senior Credit Agreement and the adjustments to such information, including expected synergies, if applicable, resulting from such transactions, may not comply with U.S. GAAP or the requirements for pro forma financial information under Regulation S-X under the Securities Act of 1933. Leverage Ratio Denominator, as determined in the Senior Credit Agreement, represents an average amount for the preceding eight quarters then ended.

Our “Adjusted Total Indebtedness”, “First Lien Adjusted Total Indebtedness” and “Secured Adjusted Total Indebtedness”, in each case “Net of All Cash”, represents the amount of outstanding principal of our long-term debt, plus certain other obligations as defined in our Senior Credit Agreement, less all cash (excluding restricted cash) for the applicable amount of indebtedness.

Below is a calculation of our “Leverage Ratio”, “First Lien Leverage Ratio” and “Secured Leverage Ratio” as defined in our Senior Credit Agreement as of September 30, 2025:

Calculation of Leverage Ratio, First Lien Leverage Ratio and Secured Leverage Ratio, as each is defined in our Senior Credit Agreement (Unaudited):

(in millions)

(dollars in millions)

(1) At any time any amounts are outstanding under our revolving credit facility, our maximum First Lien Leverage Ratio cannot exceed 4.25 to 1.00.

(2) For the 2032 Notes (2L) the maximum permitted SECOND LIEN incurrence is 4.5 to 1.00.

34

Debt. As of September 30, 2025, long-term debt consisted of obligations under our Senior Credit Facility, the $2 million in aggregate principal amount outstanding under 2026 Notes, $1.25 billion in aggregate principal amount of our 2029 Notes (1L), $790 million in aggregate principal amount outstanding of our 2030 Notes, $1.2 billion outstanding of our 2031 Notes, $900 million outstanding under our 2032 Notes (2L) and $775 million outstanding under our 2033 Notes (1L). As of September 30, 2025, the Senior Credit Facility provided total commitments of $1.5 billion, consisting of $739 million under our 2021 Term Loan (1L) facility, $10 million under our 2024 Term Loan (1L) facility, and $742 million available under our Revolving Credit Facility. We were in compliance with the covenants in these debt agreements at September 30, 2025.

Repurchase of Debt. On May 6, 2024, our Board of Directors authorized us to use up to $250 million of available liquidity to repurchase our outstanding indebtedness. On November 20, 2024, our Board of Directors replenished and extended the repurchase authorization through December 31, 2025. The extent of such repurchases, including the amount and timing of any repurchases, will depend on general market conditions, regulatory requirements, alternative investment opportunities and other considerations. This repurchase program does not require us to repurchase a minimum amount of debt, and it may be modified, suspended or terminated at any time without prior notice. We currently have approximately $232 million of availability to repurchase our outstanding indebtedness remaining under this authorization.

Acquisitions and Divestitures. During the three months ended September 30, 2025, we entered into separate agreements involving television station acquisitions and divestitures with The E.W. Scripps Company (“Scripps”), Sagamore Hill Broadcasting, Inc. (“SGH”), Block Communications, Inc. (“BCI”) and Allen Media Group, Inc. (“AMG”). As a result we expect to enter six new markets with the local news station that was ranked #1 in all-day ratings in the respective markets in 2024 according to Comscore. In addition, these transactions when closed will create 11 new full-power “duopolies” of stations affiliated with a “Big Four” network. In all of these markets, we expect to leverage our news, sales, and sports strategies for the benefit of the local communities and the public interest.

Each of these transactions also furthers our commitment to pursuing tuck-in and duopoly-creating transactions in a prudent manner. After completing all four transactions, we expect to add strong assets that will be cash flow accretive and therefore will contribute to our efforts to improve the company’s balance sheet.

The parties to these transactions are currently working to secure regulatory approvals, including certain waivers, and other customary approvals necessary to close the transactions; however, we can provide no assurance that we will receive the necessary regulatory approvals, or that the transactions will close on the timelines currently contemplated, or at all. We expect to fund the closing of these acquisitions with cash on hand and/or borrowings under our Revolving Credit Facility. The stations to be acquired and divested under each agreement are as follows:

Capital Expenditures. Including capital expenditures related to our Assembly Atlanta project, we currently expect that our routine capital expenditures will be in a range of approximately $37 million to $42 million for the remainder of 2025. We incurred costs to build public infrastructure within the Assembly Atlanta project. Pursuant to our Purchase and Sale Agreement with the Doraville Community Improvement District (the “CID”), we receive cash reimbursements for the transfer of specific infrastructure projects to the CID and for other construction costs previously incurred. Consistent with previous practice, we anticipate transferring certain public infrastructure at Assembly Atlanta to the CID for which we anticipate receiving proceeds during 2025. We received reimbursements totaling $5 million in the 2025 nine-month period and we expect reimbursements of approximately $25 million during the remainder of 2025, and that our capital expenditures for Assembly Atlanta in 2025 will approximate the reimbursements we expect to receive. We can give no assurances of the actual proceeds to be received in the future from the CID, nor the timing of any such proceeds.

Other. We file a consolidated federal income tax return and such state and local tax returns as are required. During the 2025 three and nine-month period, we made $39 million of federal or state income tax payments. We currently expect that for the remainder of 2025, we will not be required to make any material income tax payments. As of September 30, 2025, we have an aggregate of approximately $252 million of various state operating loss carryforwards, of which we expect that approximately $173 million will not be utilized due to Section 382 limitations under the Internal Revenue Code and those that will expire prior to utilization. After applying our state effective tax rate, this amount is included in our valuation allowance for deferred tax assets.

The Gray Pension Plan. On April 25, 2025, the Gray Media, Inc. Retirement Plan (“the Gray Pension Plan”) purchased a non-participating single premium group annuity contract for $18 million from American United Life Insurance Company, a OneAmerica Financial Company. The contract assumes the obligation to provide monthly annuity payments for a subset of the plan’s retirees beginning July 1, 2025. On September 1, 2025, the Gray Pension Plan paid out $15 million in lump sum payments to terminated participants with a vested benefit. The Gray Pension Plan was amended for this temporary opportunity.

The plan was remeasured as of September 30, 2025, to reflect both events, resulting in a decrease to the projected benefit obligation of $33 million. A settlement charge of $4 million is recognized in the net benefit cost for the nine-month period ended September 30, 2025. The accumulated other comprehensive income associated with the plan decreased by $3 million, net of the related income tax benefit, for the nine-month period ended September 30, 2025.

During the 2025 nine-month period, we did not make a contribution to our defined benefit pension plan. During the remainder of 2025, we do not expect to contribute to this pension plan.

Critical Accounting Policies

The preparation of financial statements in conformity with U.S. GAAP requires management to make judgments and estimations that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. We consider our accounting policies relating to intangible assets and income taxes to be critical policies that require judgments or estimations in their application where variances in those judgments or estimations could make a significant difference to future reported results. These critical accounting policies and estimates are more fully discussed in our 2024 Form 10-K.

Cautionary Note Regarding Forward-Looking Statements

This quarterly report on Form 10-Q contains and incorporates by reference “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. Forward-looking statements are all statements other than those of historical fact. When used in this annual report, the words “believes,” “expects,” “anticipates,” “estimates,” “will,” “may,” “should” and similar words and expressions are generally intended to identify forward-looking statements. These forward-looking statements reflect our then-current expectations and are based upon data available to us at the time the statements are made. Forward-looking statements may relate to, among other things, the economy in general, our strategies, expected results of operations, general and industry-specific economic conditions, future pension plan contributions, future capital expenditures, future proceeds from Assembly Atlanta CID infrastructure related payments and land sales, future income tax payments, future payments of interest and principal on our long-term debt, future interest expenses under our Securitization Facility, future interest expense under our interest rate caps, assumptions underlying various estimates and estimates of future obligations and commitments, and should be considered in context with the various other disclosures made by us about our business. Readers are cautioned that any forward-looking statements, including those regarding the intent, belief or current expectations of our management, are not guarantees of future performance, results or events and involve significant risks and uncertainties, and that actual results and events may differ materially from those contained in the forward-looking statements as a result of various factors including, but not limited to, those listed in Item 1A. of our Annual Report and the other factors described from time to time in our SEC filings. The forward-looking statements included in this quarterly report are made only as of the date hereof. We undertake no obligation to update such forward-looking statements to reflect subsequent events or circumstances.

We believe that the market risk of our financial instruments as of September 30, 2025 has not materially changed since December 31, 2024. Our market risk profile on December 31, 2024 is disclosed in our 2024 Form 10-K.

Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this quarterly report, an evaluation was carried out under the supervision and with the participation of management, including the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), of the design and operation of the Company’s “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended. Based on this evaluation, the CEO and CFO have concluded that our controls and procedures were effective as of September 30, 2025.

Changes in Internal Control Over Financial Reporting. There have been no changes in the Company’s internal control over financial reporting during the nine-months ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

In addition to the other information set forth in this quarterly report on Form 10-Q, you should carefully consider the risk factors that affect our business and financial results that are discussed in Part I, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. These factors could materially adversely affect our business, financial condition, liquidity, results of operations and capital position, and could cause our actual results to differ materially from our historical results or the results contemplated by the forward-looking statements contained in this report. There have been no material changes to such risk factors.