Salem Media Cuts Costs, Reduces Debt As WaterStone Takeover Nears.

Salem Media appears to be entering its final weeks as a publicly traded company, reaffirming that it expects its sale to WaterStone to close this month as the broadcaster reports a return to positive Adjusted EBITDA despite another double-digit revenue decline.

Salem entered a definitive agreement May 12 to be acquired by The Christian Community Foundation, which does business as WaterStone. The deal calls for WaterStone to acquire all outstanding Salem shares for $1 per share and take the company private. The transaction has been approved by Salem’s board and shareholders, and the company continues to expect an August closing, subject to regulatory approval.

The second-quarter results could therefore be among Salem’s final financial reports as a public company. They show a smaller operation, with expenses falling faster than revenue as Salem continues to cut costs, sell assets and reduce debt.

Second-quarter revenue fell 15.2% year over year to $45.9 million from $54.1 million. Salem attributed $2.1 million of the decline to asset sales. Excluding those sales, revenue decreased 11.7%, or $6.1 million.

Digital revenue accounted for much of the decline, falling $4 million primarily due to the loss of a podcaster. Nonpolitical network revenue declined $1.2 million, while programming revenue excluding political fell $1 million, primarily at Salem’s Christian Teaching and Talk stations. Nonpolitical spot advertising revenue declined $300,000.

Political advertising provided an offset, with revenue more than doubling to $1.3 million from $600,000 a year earlier, an increase of 110%.

The bigger improvement came on the expense side. Selling, general and administrative expenses plunged 21.5% to $40.2 million from $51.2 million. Even excluding $2.4 million tied to asset sales, SG&A declined 17.8%, or $8.6 million.

Workforce reductions lowered payroll-related costs by $3.6 million. Salem also reduced professional services expenses by $2.1 million, facility costs by $1.1 million, third-party marketing by $900,000 and health insurance costs by $700,000.

The cost reductions helped Salem generate $1.2 million in Adjusted EBITDA, compared with a $1.1 million loss in the year-ago quarter. Net loss narrowed to $3.4 million from $17.6 million.

The year-over-year comparison also benefited from a smaller broadcast-license impairment charge. Salem recorded a $4.8 million write-down after determining licenses in 10 market clusters were impaired, compared with a $25.2 million impairment a year earlier. The latest charge was primarily driven by changes in the company’s weighted average cost of capital.

Salem continues to sell assets and reduce debt ahead of the expected transition to private ownership. On June 30, it sold its Irving, TX building for $6 million, generating a $1.7 million pretax gain. In March, it sold its economic interest in a Honolulu tower site for $700,000. Those transactions generated roughly $7.1 million in cash during the first half.

They follow a broader portfolio overhaul that included last year’s $80 million sale of Salem’s remaining seven Contemporary Christian Music stations, along with other stations, real estate and its Salem Author Services publishing business.

Proceeds from the CCM station sale were used to repay a $72 million secured promissory note. During the first half of 2026, Salem made another $6.3 million in net repayments on its asset-based revolving credit facility. As of June 30, $4.3 million remained outstanding, with $6.6 million in available borrowing capacity. The $26 million facility matures in December 2027.

Salem’s fixed-charge coverage ratio was negative 0.4 at the end of June, below the 1.0 threshold required to remove a $2 million availability block. The company says its remaining borrowing capacity should be sufficient to meet operating, capital expenditure and debt-service needs for at least the next 12 months.

For the first six months, revenue declined 13.3% to $91.8 million. Excluding asset sales, revenue was down 7.8%. SG&A fell 20.2%, including a $6.3 million reduction in payroll-related costs.

Political revenue increased 74% to $2.4 million, while Salem posted a six-month net loss of $6 million, improved from a $24.7 million loss in the first half of 2025.

The results show a significantly smaller Salem with a lower expense base and substantially reduced conventional debt. With shareholder approval secured and an August closing with WaterStone still expected, the second quarter could be one of the final public looks at Salem’s finances before the company enters private ownership.