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Has the disruption of COVID-19 permanently reset the core advertising market at a lower level? That question was asked by analyst Alexia Quadrani of JP Morgan during Sinclair Broadcast Group’s third quarter conference call this morning shortly after the company released earnings information.
“From our vantage point, we think things will return to normal when COVID goes away,” replied Sinclair President-CEO Chris Ripley. “One of the great data points that I mentioned earlier in my comments is that on the sports side [regional sports networks], we were up mid-single digits on our advertising revenue. There has been a dislocation in the market because of COVID. There’s no doubt about that. But our inventory still is highly valuable. In fact, it’s only getting more valuable as advertising-based content shrinks and the amount of avails that you can get in front of people — as people migrate to more ad-free platforms — continues to get more scarce,” he said.
Sinclair isn’t giving formal guidance for 2021 due to uncertainty about when COVID will cease to be a factor, but did provide some information on what to expect in the current quarter, as record-breaking political ad revenues move to the rear-view mirror.
“Every month has picked up, which is encouraging. Especially with record political spending and crowd-out, the core has been able to strengthen. It’s too early to tell in the fourth quarter, as we come down from this record political spending,” said Robert Weisbord, president of local news and marketing services.