Pink's Bottom Line on Media, Money and Sports
Local advertising, earnings from Macy's and why college basketball resembles college football
In today’s newsletter, I discuss the local television advertising market, sales from bellwether brick-and-mortar retailer Macy’s and why college basketball resembles college football.
MEDIA: Local Political Advertising
The Sinclair Broadcast Group, which operates a number of local television stations and regional sports networks, reported earnings today. (Click here to read the company’s earnings press release.)
In that report, Sinclair reported that advertising revenues grew last quarter to $554 million compared $456 million in the same period a year ago.
Political advertising, which benefited from the presidential election last quarter, grew to $205 million compared to $25 million during the same quarter last year.
Pink's Bottom Line
Those advertising revenue numbers tell two distinct stories.
First, it’s clear that political ad spend was a very strong revenue driver for Sinclair last quarter — and for much of last year.
Second, it shows that other advertising revenue besides political ads appears to have declined on a year-over-year basis, suggesting that the local ad market had likely been impacted by the coronavirus pandemic.
As such, if the local ad market does manage to recover the rest of this year, it could offset a decline in political advertising that’s inevitably going to occur in a non-presidential election year.
MONEY: Macy’s Numbers
Macy’s, the large department store retailer, reported quarterly earnings Tuesday that show net sales fell in the three months ending January 30 compared to a year ago. (Click here to read the company’s earnings press release.)
Macy’s reported net sales of $6.78 billion dollars in its latest quarter compared to $8.33 billion in the same quarter a year ago.
Pink's Bottom Line
On a same-store basis — an indicator of the performance of Macy’s traditional physical stores — sales declined 17.1% last quarter from a year ago.
Macy’s did improve its digital revenue performance as e-commerce sales rose 21% in its latest quarter.
It is yet more evidence of the coronavirus pandemic impacting traditional retail and accelerating the adoption of e-commerce, including brick-and-mortar retailers.
SPORTS: Men’s College Basketball
If you look among the top ten ranked teams in men’s college basketball, you won’t find many of the usual suspects like Duke or Kentucky though Gonzaga, a recent basketball power, does sit atop the rankings at the moment.
What you will find, though, are a number of traditional football schools among the top ten including Michigan, Ohio State, Alabama and Oklahoma.
Pink's Bottom Line
The emergence of non-traditional basketball schools to the top of the rankings appears to be happening for two reasons.
First, schedules and rosters have been disrupted all season due to the coronavirus pandemic, and that has created a great degree of uncertainty for many teams.
Second, a number of elite players who would have played in college — and would have played for the top teams — have opted to play elsewhere including the NBA’s G League.
All in all, it suggests that this year’s NCAA Basketball Tournament will likely be wide open and that we should expect even more madness than ever this March.
Jeremy Pink is currently COO of Geniecast, a leading virtual content and experience company. He is the former CEO of private-equity backed Broadcast Sports International where he helped lead the company to a successful sale and exit during his tenure there. He is also a former CNBC television executive in New York, London and Singapore.
The information contained in this communication is strictly for general informational and entertainment purposes and is not meant to be construed as financial, investment, tax, or legal advice. This communication is not a solicitation to buy or sell any securities. I am not a financial advisor or offering professional advice of any kind. Users should not act upon the content or information found within this communication without first seeking professional advice appropriate for their individual situation. Decisions based on information contained in this communication are the sole responsibility of the user, and use of this communication and its contents constitutes an explicit understanding and acceptance of the foregoing disclaimers.
(Newsletter Editor: Karina Pink)