iHeartMedia Sees $100 Million Radio Programmatic Boost Taking Shape.

iHeartMedia is betting that a major shift in how advertisers buy radio will deliver a significant revenue boost in 2027. With its AudioGraph programmatic platform now rolling out, the company expects to generate approximately $100 million in incremental broadcast radio revenue next year, opening the door to advertising budgets that have historically been directed toward digital media.

The projection is part of a broader programmatic expansion that iHeartMedia expects will double its revenue from automated advertising sales, from approximately $200 million this year to $400 million in 2027.

“Our goal is just to get the advertisers that have not considered us because they spend programmatically to come aboard,” CEO Bob Pittman told analysts during the Q3 earnings call Monday.

AudioGraph is designed to make broadcast radio as easy to purchase as digital, allowing agencies to access iHeartMedia's broadcast stations, streaming services and podcasts through the buying platforms they already use.

The rollout comes as the company works to strengthen its traditional radio operations. Total Q3 revenue increased 3.3% to $1.03 billion. But the Multiplatform Group, which includes broadcast radio, networks and events, reported revenue of $562.4 million, down 4.9% from a year earlier. Broadcast radio revenue declined 4.5% to $407.8 million, while network revenue fell 12% to $100.6 million.

Pittman told analysts that the transition toward programmatic audio buying has accelerated faster than management anticipated. He cited research showing the percentage of advertising agencies buying audio programmatically has climbed from 41% in 2022 to 82% this year.

That shift has created a challenge for traditional radio, which has not historically offered the same automated buying, targeting and attribution capabilities available through digital advertising platforms. Broadcast radio reaches more than 90% of consumers, compared with individual ad-supported digital audio services that reach no more than roughly 20%. Pittman argues that radio's unmatched reach makes it an essential part of audio campaigns once those buying barriers are removed.

"Why would anyone care to put radio into the digital budgets? Because you can't get much reach in digital audio without radio," Pittman said. "Unlike video, unlike TV, radio is still by far the big reach in audio."

 The company also expects AudioGraph's data capabilities to improve targeting, measurement and attribution for advertising purchased through traditional sales channels. Early AudioGraph results are encouraging, according to Pittman, who said AudioGraph campaigns have already demonstrated improved performance.

"They've achieved their goals and performed better than the old way of doing radio advertising," he said.

Political Falls Short

Another factor weighing on iHeart's Q3 was political advertising, which Pittman said accounted for approximately one-third of radio’s revenue shortfall. The company anticipated a particularly strong election cycle for radio, potentially exceeding the 2024 presidential election. Instead, it came in slightly below the 2022 midterms.

Pittman blamed the disappointment largely on broadcast television stations expanding their available inventory, allowing them to capture political advertising dollars that historically would have shifted to radio when TV sold out.

"The big surprise for us was how much money was spent in TV," Pittman said. "We did not anticipate that." Citing AdImpact data, he said broadcast television accounted for 50% of political advertising spending this cycle, compared with its typical 15% share. He also said more political audio advertising moved to programmatic platforms than expected, reinforcing the company's decision to expand radio's automated buying capabilities.

Meanwhile, some large national advertisers delayed their campaigns until after the election to avoid the crowded political advertising environment. Unlike television, which replaced that business with political spending, radio was unable to do the same.

"Political is our highest margin business, and so when you fall short on political, it significantly impacts your [earnings] number more than other categories do,” President/COO Rich Bressler said.

Economic uncertainty also weighed on advertiser budgets, particularly among consumer-facing businesses dealing with inflation and fuel price volatility.

Podcasting Up Double-Digits

While traditional radio faced headwinds, iHeartMedia's podcasting business continued to grow. Third quarter podcast revenue increased 24.4% to $173.7 million, exceeding management's forecast of approximately 20% growth. The broader Digital Audio Group generated $388.7 million in revenue, up 13.8%.

Pittman said advertiser demand for podcasts remains strong, with improving CPMs, increased inventory sales and an expanding roster of programming contributing to growth. The company also continues to expand its video podcast distribution and licensing relationships.

In a significant change planned for 2027, iHeartMedia expects to begin reporting podcasting as a standalone operating segment, providing investors with greater visibility into a business that now accounts for approximately 17% of company revenue.

Fourth Quarter Outlook

Looking ahead, iHeartMedia expects Q4 revenue to increase by a mid-single digits from a year ago, while Multiplatform Group revenue is projected to decline by a low single digits. Podcast revenue is expected to grow approximately 20%. Executives also outlined plans for additional cost efficiencies next year, including expanded use of AI and other technologies.

"This is one of the most uncertain periods in the advertising environment that we have managed through, including COVID, which makes it difficult for us to narrow the range of our expected results,” Bressler said.

Bressler also noted that the company recently extended the maturity of $450 million of debt coming due next year to 2029. He said iHeart also expects to repay $72 million in debt coming due in May 2027.