iHeartMedia: Podcasting +100%, international opportunities, and the long tail

In the company’s Q4 earnings call last week, iHeartMedia CEO Bob Pittman and COO/CFO Rich Bressler emphasized podcasting and recent digital audio acquisitions, and touched on a new view of international opportunity for iHeart. (Also see our coverage of iHeart’s reorganization HERE.)


One clear headline of the presentation is that iHeart’s podcasting revenue grew by a clean 100% in Q4 compared to the prior year. Here is Pittman running down some growth financials: “Our Digital revenues have continued their accelerated growth trajectory, increasing 53% year-over-year, which includes our fast-growing podcast business, whose Q4 revenue grew 100% year-over-year. Importantly, excluding the impact of podcasting, Digital grew 42% year-over-year, demonstrating the importance of our broad digital offerings that are in high demand despite the economic downturn.”

Later in the call Bressler noted that January’s year-over-year number, +126% for podcasting, exceeded the Q4 gain.

The Long Tail Opportunity

One investor asked whether the podcast revenue growth in Q4 and in January was sustainable. Pittman pointed to two recent acquisitions, and emphasized prospective value in digging into below-the-surface monetization: “The Voxnest acquisition and the Triton acquisition are very important to us to begin to monetize the long tail of the podcast […] ¬†We know we have a very strong growth business that was somewhat hidden. And I think what you’re beginning to see here are the first signs of when you can see it, what kind of growth business that is.”

Digging into long-tail revenue potential is certainly key to the Voxnest acquisition, as the company made clear in the Q3 earnings call last fall. The more recent acquisition of Triton Digital (not yet closed) contributes to that strategy as well, with Triton’s comprehensive suite of ad-tech tools including digital audio programmatic which can target by listener characteristics across shows and audience sizes.

In that regard, Pittman has an expansive view of how Triton fits in, saying the acquisition “will establish us as the only company able to provide a complete ad tech solution for all forms of audio: on demand, broadcast radio, digital streaming radio and podcasting. It also provides unique solutions for hosting and infrastructure, monetization and measurement. We are now uniquely positioned to benefit from the continued shift of the broadcast and digital advertising marketplaces toward data-infused electronic platforms.”

Potential for International Business

iHeartMedia has always been a firmly bounded American audio company, and now is acquiring publishing and technology firms with broad international reach. Voxnest is an international hosting platform which had European executive leadership before it was acquired, and Triton has spent years building a global span of clients. Accordingly, this earnings call entertained aspirations of building business abroad. Bob Pittman noted “the opportunity for us to expand beyond our traditional U.S. operations and establish new growth markets internationally through ad tech.”

“With Triton as the final piece of the puzzle,” Pittman continued, “we also see a meaningful opportunity to provide our complete audio ad tech platform worldwide.” […] “We think the global market is a robust new opportunity for us and allows us to build a new revenue stream over time for our ad tech products. Rich and I and the rest of the iHeart management team are excited about the new opportunities across the audio, advertising and data analytics sectors.”


Brad Hill