Ladies and gentlemen, thank you for standing by. Welcome to the Scripps Quarter Three Earnings Conference Call. At this time, your telephone lines are in a listen-only mode. Later, there will be an opportunity for questions and answers. Instructions will be provided at that time. If you should require assistance during the conference call, please press star then zero, and an AT&T specialist will assist you offline. As a reminder, your call today is being recorded. I'll now turn the conference call over to your host, Head of Investor Relations, Carolyn Micheli. Please go ahead.
Thank you, Alan. Good morning, everyone, and thank you for joining us for a discussion of The E.W. Scripps Company's financial results and business strategies. You can visit scripps.com for more information and a link to the replay of this call. A reminder that our conference call and webcast include forward-looking statements and actual results may differ. Factors that may cause them to differ are outlined in our SEC filings. We do not intend to update any forward-looking statements we make today. Included on this call will be a discussion of certain non-GAAP financial measures that are provided as supplements to assist management and the public in their analysis and valuation of the company. These metrics are not formulated in accordance with GAAP and are not meant to replace GAAP financial measures and may differ from other companies' uses or formulations.
Included in our earnings release are the reconciliations of non-GAAP financial measures to the GAAP measures reported in our financial statements. We'll hear this morning from Scripps President and CEO, Adam Symson, Chief Financial Officer, Jason Combs, Local Media President, Brian Lawlor, and Scripps Networks President, Lisa Knutson. Also on the call is Controller, Dan Perschke. Here's Adam.
Thanks, Carolyn. Good morning, everybody. Thanks for joining us on this midterm election day. If you haven't already, please make sure to take the time to vote. I want to start with the obvious. Political revenue did not meet our very high expectations this year. Early on, things were lining up in a way that led us to believe our portfolio for the midterm would attract spending that would beat our record revenue in 2020's presidential election. Despite a very strong start to the year with record spending for the first half, dynamics suddenly changed. Brian will be along shortly with the detail you're looking for, but let me make one thing clear. Scripps's performance this year breaks our last record level midterm election revenue in local media, raising the bar for midterm election spending.
It wasn't as much as we expected, but in no way should investors have existential questions about politics on broadcast. The Scripps Networks division delivered a solid beat to our revenue expectations at 4% above last year. This comes from a stronger performance in general market advertising and directly as a result of our execution on connected TV. Lisa will share details on the quarter. Given the comparative results of our peers in the national advertising marketplace, and despite the very obvious macroeconomic factors, our performance is a testament to our profit-building growth strategies and the strength of our portfolio with both audiences and advertisers. Let me say more. Much is being written and said about linear television, but I'm afraid that the term linear is being thrown about without enough definition.
It's certainly true that consumers are taking full advantage of on-demand platforms for media and entertainment, spending less time on the traditional platforms. All linear is not created equal. Programmers, like most of our peers in the national networks marketplace, depend on cable and satellite distribution, and as subs decline, so does their reach. Not true for the Scripps Networks, which now engage with 70 million viewers a month and rising. Our networks reach Americans through the same paid TV and virtual MVPD platforms as other networks, but we also have the benefit of the expanding platforms of over-the-air and connected TV FAST networks. This has led us to growing distribution and reach in growing marketplaces, growing audience shares, growing CPMs, and growing revenue. Earlier this year, I told you we had obtained the rights to deliver our network streams into connected TV.
Since then, we've secured distribution for nearly all of our Scripps networks on more FAST platforms, creating new distribution points for our premium programming on the most popular CTV destinations, Samsung TV Plus, Vizio's WatchFree+, The Roku Channel, and Amazon's Freevee, just to name a few. Our premium networks stand out in the FAST marketplace and are performing very well, benefiting Scripps and our platform partners. That's driven nearly 60% growth in the network's CTV revenue and helped drive our industry-leading Q3 ad revenue growth. We are now on track for a CTV revenue run rate of more than $100 million next year, and we're just getting started. While the CTV marketplace is growing, so is free over-the-air. Last year, 32% of American TV households were watching free TV over- the- air.
That was up from 26%, and Nielsen says the percentage will grow to 45% or 53 million U.S. households by 2025. Scripps's advantage here is that we capture about 30% of that viewing with our local and national brands. Our outsized share is a differentiator that positions us well for future growth in that marketplace, and it's for that reason, as we've told you, that we're giving OTA's growth a push through our Free TV Project consumer education and awareness campaigns. The Free TV Project is gaining measurable traction. During the early stages of our marketing campaign, launched in July in 13 Scripps markets, antenna manufacturers we're working with reported a 30% increase in sales. I'm not surprised Free TV is resonating with Americans right now. Consumers are bearing the burden of broader inflation and interest rate hikes while streamers continue to increase prices.
This has created a period of even greater opportunity for Free TV, both over the air and on connected TV, right in our sweet spot. While we carefully navigate the current negative economic impact on the ad marketplace and we'll keep a tight rein on operating expenses, we will also take advantage of this moment in a way that will benefit Scripps and our shareholders. Yes, you can have your cake and eat it too, because while investors in Scripps will profit from the disruption, we will continue to maximize the significant opportunity we have in paid TV, especially given that we will renew 75% of our local broadcast subscriber households next year.
Looking out a bit further, I'm growing even more enthusiastic about the business opportunities we're developing as a result of ATSC 3.0, both for NextGen TV and the new ways for us to monetize our spectrum. As you know, Scripps is the largest holder of broadcast spectrum in the country, and we are actively developing near-term opportunities with real dollars attached. BIA/Kelsey Consulting Service says the technology could add more than $10 billion in broadcast industry datacasting revenue by 2030. While we're not ready to affirm any numbers yet, we do believe the amount will be significantly meaningful to us and to our industry. I'd like to close by discussing an important announcement we made during the third quarter, the creation of a new national news organization called Scripps News.
Scripps News combines the team at Newsy with our venerable Scripps Washington Bureau and our local divisions' national news resources to form one powerful national news outlet operating more efficiently and more effectively across every platform we own. Beginning in January, the name Newsy will be replaced by Scripps News. The head of the division, veteran broadcast journalism executive Kate O'Brien, joined the Scripps Networks division in April 2021 to oversee Newsy and Court TV. She will now report to me. Scripps News is the first consumer-facing news organization to carry the Scripps name, well-respected in American journalism and by generations of Americans.
We made that decision as a sign of our commitment to serve our audiences with objective, fact-based and nonpartisan news and information that they can trust, just as our company has done for 144 years, a commitment that's sorely needed in this country now more than ever. Here's Jason.
Thanks, Adam, and good morning. The E.W. Scripps Company delivered $612 million in revenue and $145 million in segment profit for the third quarter. Those were year-over-year increases of 10% and 13%, respectively. We saw growth in local media, political advertising and retransmission revenues, as well as in Scripps Networks revenue. Local media revenue was up 14%, driven by political advertising as well as retransmission revenue. Core advertising revenue was down 12%, in line with our guidance as we compared against revenue last Q3 for the NBA Finals, the Summer Olympics, and sports betting launch campaigns. We were the only local broadcaster at that time to outperform our 2019 third quarter number. Local media political ad revenue in the quarter was $63 million. That compares to $56 million in Q3 of 2018.
For the year, we expect to report $200 million of political advertising revenue, a record midterm election performance. Retransmission revenue was up 7% to $165 million. Local media expenses increased less than 5% from the year ago quarter. Excluding programming costs, expenses were actually down about 0.5%. Local media segment profit was about $100 million. Turning to the Scripps Networks division, revenue for the third quarter of 2022 was $235 million, up 4% from the prior year quarter due to connected TV and general market advertising performance. Networks segment expenses rose only 14% over Q3 2021. As of fourth quarter, we have cycled through the investments we made to launch Newsy, Defy TV, and TrueReal over the air. Segment profit for the networks was $72 million.
In other segment results, we reported a loss of $7 million, which includes the spend for our national marketing campaign to promote consumer digital TV antenna use. Shared services and corporate expenses came in at $19.6 million. The company realized Q3 income from operations of $0.38 per share. As of September 30th, cash and cash equivalents totaled $38 million. Our net debt at quarter end was $3 billion, and our net leverage was 4.6x per the calculations in our credit agreements. Now I'd like to give guidance for the fourth quarter of 2022. We expect total local media revenue to increase in the mid-20% range.
We expect local media expenses to be up mid-single digits%. In the Scripps Networks division, we expect revenue to be down mid- to high-single digits% against an exceptionally strong fourth quarter results in 2021. Networks expenses are expected to be about flat. Fourth quarter shared services costs are expected to be about $21 million. We expect about a $9 million operating loss in other segment results in Q4, inclusive of the cost for the digital antenna marketing campaign. I'll conclude with updated guidance on a few full-year items. We now expect to pay cash taxes for the year of about $70 million. We now expect capital expenditures of $45 million-$55 million. That's down from our expectations of $70 million-$80 million at the beginning of the year.
We now expect free cash flow for the full year of about $320 million due to lighter than expected political advertising revenue and the macroeconomic impact on the national advertising markets. We now expect leverage to be in the mid-fours by year-end. We plan to reduce debt by another $100 million-$125 million in the fourth quarter, bringing our total debt pay down since the ION Media acquisition to more than $800 million, and we remain committed to debt pay down as our top capital allocation priority. Now here's Brian to talk about Local Media.
Thanks, Jason. Good morning, everybody. As the 2022 election season winds down today, we are pleased to report Local Media has taken in a record amount of midterm political advertising at $200 million. That compares to our last record of $194 million in the 2018 midterm elections. We did not reach the 2020 presidential election level as we had hoped for reasons mostly related to our political market footprint and where money was spent on competitive races across the country. Back on our August earnings call, all signs still pointed to meeting our 2020 revenue number. We began to see signs of shifting spending patterns, especially in three key states. The first was Florida, where we had projected a close race for Senator Marco Rubio, but the polls began to show his lead was widening.
In Montana, which has been a significant political player for us in recent elections, redistricting resulted in less competitive races in a couple of those markets. To scale these, Florida and Montana alone accounted for a decline of about $40 million, and we've seen about $10 million less spent in Nashville as Republicans have gained a solid hold on that state. In addition, $20 million less was spent on ballot issues in our footprint. More broadly across the industry, election ad spending was dampened by lower than projected fundraising. Early estimates were for $9 billion to be spent in the 2022 cycle, but now it looks like spending will be closer to $8 billion.
Within that $8 billion, we do believe we'll see that local broadcasters grew their share because campaigns continue to turn to us as their primary way to reach likely voters. Turning to core advertising revenue, we landed right where we'd expected for the quarter. Keep in mind, our Q3 guidance had a bit lighter forecast than our peers due to our comps against several high-profile sporting events and several events that were unique to our portfolio in the third quarter of 2021. In the prior year quarter, our 11 NBC stations broadcast the Summer Olympics. Also in the 2021 third quarter were the NBA Finals, which were out of their normal broadcast cycle due to the pandemic schedule. The six-game NBA Finals included the Phoenix Suns, which provided a huge upside to our Phoenix ABC station.
At the same time, we saw significant sports betting activity with a number of Scripps markets launching last fall. Aside from those year-over-year comparisons, we did see some displacement from political advertising in our most competitive markets. Driving the core decline was our services category, which accounts for a third of our core advertising. Services was down 12% in the quarter. Our next two largest categories were actually up, auto and home improvement. Auto was up 5% due primarily to spending by domestic dealer groups and domestic factories as they begin to recover from chip shortage issues. Home improvement, which has maintained its pandemic level strength and has been a bright spot in U.S. consumer spending, was up 12%. Gambling was down more than 50% as states cycling through different stages in the legalization of sports betting.
We expect those dollars to continue to be driven by launches in our markets. Ohio and Maryland are our next states to roll out sports betting beginning in January. I'd like to close with a note about our mission. We recently received another reminder of the importance of local broadcasters in keeping our communities safe and informed during crises. As Hurricane Ian was heading toward Florida, our local station, Fox 4 in Fort Myers, began to broadcast from a backup location so it could continue to provide life-saving information to the local residents. Our station employees suffered their own personal hardships, but they persevered to serve their community, and now they're playing a major role in the recovery of Southwest Florida. At Scripps, we are proud to serve our communities, especially when they need us the most.
Now here's Lisa.
Thanks, Brian, and good morning, everyone. Scripps Networks delivered Q3 revenue results today that beat our guidance, coming in at 4% above last year's third quarter, despite the macroeconomic challenges to the national ad marketplace. We've been launching nearly all of our networks across the largest connected TV platforms, and those drove our total revenue with nearly 60% increase in connected TV revenue. I wanna reiterate Adam's comments that we're expecting to exit this year with an annual connected TV revenue run rate of more than $100 million. I'll discuss more in a moment about our connected TV distribution, but first, I'd like to continue with another bright spot in the quarter, general market advertising revenue. We grew our general market ad revenue by 7%, commanding higher ad rates as a result of growing or maintaining viewership levels across our networks.
The Scripps Networks audience, as measured by Nielsen, grew 5% among total viewers this quarter. Both our 4% year-over-year growth in Q3 revenue and our viewership performance outpaced our peer group. Most of the other national networks were below or barely above last year's Q3 ad revenue. Meanwhile, linear TV viewing is down 11%, so we're proud to have turned in best-in-class performance again this quarter. Because of our growth against the linear trends, the Scripps Networks now account for more than 4% of all linear viewing and 26% of over-the-air households. As you know, OTA households is an area we're working to grow, and our steady and loyal viewership positions us to rebound quickly along with the national economy. Last quarter, I told you about our experiment to create the technical capacity to test local political advertising on our ION stations.
We were pleased to have fully launched our sales effort in the third quarter, and as of today, we've taken in about $8 million of political advertising revenue for the full year. This is a bit short of what we said we expected in August, and that is due to the same shifts in spending that Brian referenced earlier. We knew this would be a building year for networks, and we look forward to growing our political advertising category even more during the 2024 presidential election. During the third quarter, we successfully completed our second upfront season as a networks portfolio, meaningfully increasing both rates and new business. This year, we built on the momentum of our first year and retained nearly 90% of our new advertisers from last year, and we grew our list of new premium advertisers by nearly 10%.
In addition, we significantly outperformed the market in terms of rate growth, both at ION, which was up mid-single digits, and at Bounce, which was up in the high teens range. Our upfront dollars will again lay in a solid foundation as we move into next year. As I mentioned previously, we've launched nearly all of our networks across the spectrum of connected TV platforms in recent months with a big slate of those beginning in third quarter. All of our streaming channels are now on Roku, Samsung TV Plus, the Amazon service, Freevee, Vizio's WatchFree+, Fox-owned Tubi, and Comcast-owned Xumo. It's still early, but our programming is finding audiences on these services, and that is resulting in our meaningful CTV revenue growth.
Bounce and Grit fully launched on DirecTV's satellite streaming and AT&T U-verse platforms in third quarter. I'm happy to announce we've reached an agreement with YouTube TV to launch ION and Bounce for their 5 million-6 million subscribers on their basic tier. YouTube TV will also relaunch Newsy, soon to be Scripps News, and will continue to carry Court TV. Now I'd like to spend a few minutes sharing our successes at Bounce, which has been serving African American audiences for more than a decade. Over the past year and a half, we have recommitted to building this brand to serving Black communities. I'm excited to share that we're delivering on our promise. Bounce is already making strides in elevating its content with strong storytelling that's relatable and authentic. Johnson is an original series written for, by, and about Black men.
This show completed its second season with great reviews and strong ratings performance. Now we're also airing the original series, Finding Happy, which gives voice to the Black female perspective because it's written for and by Black women. This show, along with our renewed social media strategy around cultural connections, has created significant engagement while driving younger viewers to the network. We're seeing double-digit increases, not just in our social media impressions and audience growth, but also in Bounce revenue. We are pleased to achieve division results this quarter that exceeded our strong performance last year with growth that was better than the national ad marketplace overall. As the economy rebounds, we are poised to capture even greater growth as we expand our margins. Now, operator, we're ready for questions.
Thank you. Ladies and gentlemen, if you do have any questions, please press one then zero on your touch-tone phone. You'll hear an indication you've been placed into queue, and you may remove yourself from the queue by repeating the one then zero command. We ask that you please pick up your handset and make certain your phone is unmuted if you are on a speakerphone. Again, for questions, press one then zero at this time. We'll first go to the line of Dan Kurnos with Benchmark Company. Go ahead, please.
Appreciate all the color you guys gave us, and pretty actually solid national results, everything considered. Maybe just first, Brian, if we just double-click on political for a second, you guys have sort of a unique perspective. I know it was early and initial, but just any thoughts on how sort of the consortium with Magnite performs 'cause I know you guys did a sort of a, you know, a good job explaining the shift and what you thought was sort of more of a fundraising challenge. It'd be helpful to hear what you're seeing on sort of a cross-platform.
Hey, Dan, it's Adam. I'll take the question on our connected TV efforts for political. You know, we definitely think that connected TV increased its share. I don't think it increased its share nearly as much as I think folks originally thought it would. But you know, we used this year primarily as sort of a test and learn opportunity for us. I think first and foremost, the technical and sales executions that we learned this year will really benefit us in 2024. I think there's some things that we're gonna change about the way we approach this moving forward.
I think we're gonna continue to see more dollars flow into CTV, and I think our sales apparatus will be certainly more fine-tuned in the coming cycles to be able to take advantage of that shift.
Hey, Dan, it's Brian. I'll just add that, you know, we've been doing a lot of reconnaissance, talking to a lot of the leads at the political shops and, you know, from what we're learning, you know, CTV obviously did, you know, pick up a couple of share points in this cycle. We believe broadcast, local broadcast picked up a couple of share points in this cycle. I think the area that probably saw the biggest decline was in digital. That looks like it lost a few points, and radio declined as well. You know, I think as I said in the prepared remarks, we feel good that local more than held its share of the ad dollars.
Got it. That's really helpful and interesting to see how it develops, Adam, I guess, as your CTV portfolio expands. The other sort of top-of-mind question, I'll ask Adam, so I'm sure Brian will answer this one. On retrans, you know, a little bit light, obviously, with some incremental subject lines. You guys clearly have strong footprint coming up. I think it's about evenly split 1Q, 2Q next year. You know, just any updated thoughts on net, given just kind of the broader conversation that's being had in the space right now?
Well, we're gonna really throw you off. This is Jason, so I'm gonna answer this one. From a net retrans perspective, I think the messaging is pretty much aligned with what we've said the last couple of calls, that when you look at this year, based on the cadence of pay TV renewals and affiliate renewals, we're gonna see net retrans from a margin perspective a little bit of a headwind, but dollars that are pretty flat. When you look to that 75% renewing that Adam referenced earlier next year, that we expect some really nice margin and dollar expansion in 2023.
Okay. No impact from any other economics, any economic scenario. All right, I'll try Lisa, and I'm sure I'll get Adam. Lisa, just on the network sort of evolution here, you know, I think it's, you guys really have expanded distribution quite nicely. I guess I'm just trying to get a sense of how you're cross-selling your thoughts on sort of evolving your go-to-market strategy here. You know, and into Q4, I think we had said that, you know, we've heard pretty consistently that pharma's been very strong. I don't know if that's receded some and it's typically driven DR, but you know, just how that might be sort of a leading or a contributing factor to what you guys are seeing.
Yeah. It's definitely, Dan, I think, of all the categories in fourth quarter in our guide, the lightest is probably in DR. In particular, DR is hit, I think from a recession perspective because again, it's a call to action, you know, the 1-800 number dial. I also think, you know, third quarter, DR was light for the quarter, made up for it with political dollars as well as general market advertising and CTV revenue. Our approach to selling our portfolio is not changing. You know, we're cross-platform and cross-portfolio, which we think is really compelling. Our story is all about reach. As Adam said in his comments, you know, we reach 70 million viewers a month across our portfolio, which is really compelling to advertisers.
All right. Great. Thanks very much. Appreciate the color, everyone.
Thanks, Dan.
We'll move next to the line of Steven Cahall with Wells Fargo. Go ahead, please.
Maybe first, for Adam or for Lisa, just on Scripps Networks, I think we're seeing margins now that are kinda well below where they were when you acquired ION pro forma for the other bits in there. I know you've invested a lot between the content and the marketing and the distribution. I was just wondering if there's any good way for us to think about kinda where those segment margins head from here. And Lisa, with YouTube TV, I think there may be 7% or 8% of pay TV subs. Do you expect an immediate revenue pickup from the launch on those services, or do you have any sense of kinda what the demo that subscribes to YouTube TV? Does that cross-sell pretty well against your demo for those networks? Thank you.
Hey, Steven, I'll take the first question. I continue to see the business as a 35%-40% margin business. I think we've now cycled pas t he increased expense that we put in as investment with the launch of three networks last year, as Jason referenced. I also think that when you account for the dislocation, which you know we think is sort of natural as part of what's going on the macroeconomic level, we're back at a 35%-40% margin business. I would expect us to continue to drive towards that zone. You know, look, I think we have to wait and see based on what happens in the national ad marketplace. Our thoughts are exactly in the same place as they've been.
Steven, to answer your question about YouTube, we're really excited about YouTube TV because I think the demographics skew younger on YouTube, so we're excited about that for our, you know, ION Bounce and also reintroducing Scripps News into YouTube. We do know that it takes time to build revenue and people to find you, so we're applying some advertising dollars against that to make sure that audiences find us on YouTube, as they have found us quite nicely on the rest of the connected TV devices.
Thank you. Jason, I know you're not guiding to free cash or EBITDA for next year yet. There's a lot going on. You've got the higher cash interest, some weaker ad trends. It's the big year for retrans. I think what we're trying to figure out is between free cash flow dynamics and EBITDA dynamics, do you think you'll be able to delever next year from that mid-fours where you expect to end at the end of this year? I think that's a big one where we think the stock's gonna be sensitive to kind of the up and down based on that. We'd love any color there. Thank you.
Yeah. I guess I'll start by saying, you know, the 4.6 we're at right now, you know, we're really pleased with that. That's actually ahead of where we thought we'd be at this point in time when we did the ION Media acquisition. By the end of this year, we'll have paid down $800 million in debt since we closed on the ION Media acquisition. Again, pleased with that progress. To your point, we're not giving guidance right now. We're still finalizing up our budgets for 2023. I would say we remain committed to debt pay down as in pushing towards deleveraging as our number one capital allocation priority.
Thanks, Steven.
We'll go next to the line of Nick Zangler with Stephens. Go ahead, please.
Yeah. Hey, guys. I'm curious about core revenues. They were in line in the quarter. I'm curious for the expectation for 4Q because it obviously falls within that local media guide of mid-20% growth. I think if I kinda take your political revenues that you mentioned as of today and trend out some retrans, I'm coming to a core growth of down 12% year-over-year in 4Q, which would obviously be similar to what you just did in 3Q. Curious if that kinda sounds right. Obviously, if so, it would imply an uptick from 3Q to 4Q, as we typically see, and actually similar to last year. That obviously wouldn't be implying too much caution in 4Q.
You know, given some of the you know, more weaker thoughts we've heard going into 4Q from others. Maybe you can just kinda unpack core expectations as we move into the holiday season.
Hey, Nick, it's Brian. I think you know, your math is good. That's the right range for to be thinking about us. Look, I think you know, the biggest factor in a down, I'd call it low double-digit analysis would be you know, the heavy political that we've had, obviously, you know, for the first five weeks. There are some markets where, boy, I don't feel like I've seen too many regular advertisers on the air. Certainly living in Ohio, that's been the case. We have other markets that have been very saturated, and so there's been significant core displacement. That will open up starting at 7:00 P.M. tonight or so. You know, I think we'll remain open for business.
There's a lot of November and December still business to be booked. Many of the markets that were not saturated by political have been having good core performance, and so we think that will continue. I think, you know, when you crowd out so much over five weeks, you can't get much more momentum than what we have.
No, that's fair. Can you repeat the Florida and Montana commentary? Were you saying that the softness in those states from the political aspect impacted revenues in the quarter by $40 million, or was it $40 million across both 3Q and 4Q?
Yeah, it really was over the whole cycle. You know, when we had done our early modeling, Montana, which has been a very significant political state for us, we had expected two very competitive House districts. Redistricting reset Montana and really softened it. I'll tell you, though, that doesn't change how we look at Montana in the next two cycles with Senate and governor up. It'll be very competitive there. Then Florida, you know, as I mentioned in my prepared remarks, you know, we thought Rubio would be a little bit more competitive.
I think one of the things that, you know, we started to recognize, in kind of talking with pollsters and others were that, while it might have only looked like he was running three or four points ahead, there have been several million Republicans that have moved to Florida in the last two years. Once you factor them into the modeling, the belief was that the lead was much greater, since they weren't in that sample. In addition to that, you know, we had hoped and expected that Florida would put sports betting on its ballot for this year. That didn't happen. All those things rolled up to why Florida and Montana would be 2 of the places that were fairly significant and kept us from getting to our early optimistic targets.
Got it. Very helpful. Last one for me. You mentioned that the digital space lost political ad dollars. Specifically, when you refer to digital, do you mean maybe more like the social media players? Just 'cause I would still expect, like, you know, CTV as a digital platform to gain share. But just a clarification, like maybe where specifically within digital you think political ads been shifted out of?
Yeah, Nick, look, I agree. CTV, I think we look at separately, and we've broken that out. As we said, that did pick up a couple of share points. I think as we think about digital, specifically, what we're seeing is Google and Facebook, and to some people we've talked to, it looks like they may have been down as much as 50% in the money that was allocated to those platforms.
Wow, okay. Great. All right. Thanks so much, guys. Appreciate it. Good luck.
Thanks, Nick.
We'll go next to the line of Pat McCann with Noble Capital Markets. Go ahead, please.
Good morning. I just had a question or two on behalf of Mike Kupinski. Could you guys just given the shift in political spending and kind of what you mentioned earlier, does that have any implications, I guess, for you know what will be the battleground markets in 2024 and kind of how we should look at that going forward?
Look, I think we're. It's Adam, Pat. I think we're, you know, obviously gonna do the same kind of analysis we do ahead of every cycle to determine where the races are tight, where the issues will be on the ballot, and what the opportunity will be for us, first for 2023 and then for 2024. I don't think we've seen any secular change to political spending that give us any pause relative to broadcasters take. In fact, as we've said a couple of times, we actually think the broadcast space will have gained share during this cycle. We will, as we always do, assess our footprint for the opportunity as we move into the next year.
Hey, Pat, it's Brian. I would just add, you know, we're sitting here on election morning but know that we're already looking ahead and, you know, 2024, 33 Senate races, we'll have 17 of them. A couple of them we would expect at this time to be pretty competitive. Cruz in Texas, Tester in Montana, we think will be very aggressive. Sinema in Arizona, Ohio with Brown. And then, you know, a couple of big governors races, we think are Gianforte in Montana will be another big race. We know where the races will be. You know, as we get closer, we'll see how competitive they are, where the money shifts. I mean, I think, you know, that's certainly what we dealt with here. You know, the money's in the system.
You just gotta be where the races are close and tight, and then a lot of money moves there. That's certainly what we have seen now, you know, in the last couple of weeks. You know, unfortunately, that last run of spending here over the last couple of weeks, heavy money went into Pennsylvania, New Hampshire, Washington, New Mexico, Georgia, North Carolina. We don't have stations in any of those places. I mean, there are other places that money kept going, and we benefited from that, but a lot of money moved to those, you know, that maybe would've been earmarked to our markets, but our markets weren't as competitive as we would've hoped down the stretch.
Gotcha. Thank you. One other just kind of you mentioned some Q4 pacings, you know, guidance. Just kind of on an ex-political basis, sort of thinking ahead to, you know, say December and, you know, is there a kind of a, how should we look at, you know, revenues, sort of ex-political in Q4?
Look, I think, you know, as I said, there's still a lot of business to be written. You know, December, we expect a lot of points still to be written there. I wouldn't move beyond our guidance other than to say that, you know, we do have some momentum in a couple of categories. I'll speak to. I'm sure somebody was gonna ask about automotive anyway. We spoke about the fact that automotive was up 5%. That's the first quarter in years that we've seen quarter-to-quarter growth. It built through the quarter in the third quarter. Automotive was down 12% in July, up 4% in August, up 25% in September.
I'll tell you that in October and November, we continue to see more than 20% growth in automotive. You know, that's one key category that's now coming back fairly strongly. I would guess I would just also add that I think we're starting to feel like the biggest pressure from supply chain is behind us because not only do we see automotive now gaining momentum, but other categories or subcategories that last year were held back by supply chain issues like appliances, hot tubs, all of those categories are up. They're up double digits. We feel like finally the supply is catching up and providing an opportunity.
Excellent. Thank you so much.
We'll go next to the line of Craig Huber with Huber Research Partners. Go ahead, please.
Great. Thank you. Brian, I guess my first question is your retrans subs, what was the year-over-year percent change in those that affected your retrans revenues in the third quarter?
Hey, Craig. It's Jason. We were down on a trailing 12 months mid-single digits after talking the last couple of quarters of being down in the low single digits. You know, this slight change in subscriber churn really from our perspective just brings that trailing 12-month trend back in line with our modeling assumption that we've had for a while now of down mid-single digits.
How are you thinking about that number as you think about next year in your budgets? Do you think that's a reasonable range to be in for next year, or you think it could be worse, better? What are you thinking?
I think we've thought that was a reasonable range for a while now, and we'll continue to think that mid-single digits is a reasonable range.
Okay, my next question please. Net retrans this year, what are you expecting that to be, the percent change versus last year?
Net retrans this year based on the timing of pay TV and affiliate renewals is down a bit for us this year, but net dollars are flat. When you look ahead to next year with 75% renewing, we expect some nice margin and dollar expansion.
Okay. Brian, is there anything else you can tell us about the core advertising? I know you've talked about this a bit here, post the election, some of the other categories. I mean, I guess my bottom line is I'm asking is from the macro perspective, are you seeing a significant pinch from the headwinds on the macro side in your core advertisers? Or is it just too hard to break that out in your mind right now?
Look, I don't think it's too hard to break down. You know, you always have the inconsistency of a fourth quarter where you have political that dominates five or six weeks, and so you have the markets that are just completely consumed by it. You also have the markets that you expected to be fully consumed by it and then suddenly wound up a little bit lighter. I do expect a lot of momentum now in the next couple of weeks. I mean, I spoke to auto there, Craig, a lot of momentum there. We talked about, you know, the travel and leisure being up, home improvement up. We, you know, we do have some categories that are up.
We are also seeing, you know, the effects of the economy and you know, some of the price implications that are having impact on some services or you know, grocery and other subcategories. I think, look, overall, I think you know, we feel good about some of the build that's happening, especially in categories that were dominated by supply chain challenges over the last two years.
Back on your political comments, I appreciate what you've given us so far. I mean, every one of your TV pure play peers out there seemingly have reported disappointing political numbers for the third quarter, the outlook for the fourth quarter here. I mean, it sounds like you're part of what you're saying here is the overall fundraising was meaningfully lower, not the $9 billion, but roughly about $8 billion in total. That sounds like that was a big part of it in your mind of the shortfall. You also talked about political dollars shifting to markets that Scripps is not in. You mentioned Washington, you know, Georgia, North Carolina, but all of your other peers have all, just like you guys had a shortfall here in political. Where do those dollars go when you say that on a net basis?
I mean, who's really benefiting here at the end of the day? Was it just the top 20 markets that the pure play guys are not in? Is all the network guys owning those stations?
No. Look, I think. Hey, Craig , it's Adam . A couple things. First, post-primary, there were some candidates that won that were very popular with the electorate but were not popular with the big donors. Those candidates probably Those candidates winning the primaries probably led to some of the shortfall in fundraising. Second of all, the widening of the races in certain markets allowed dominant candidates to build war chests and hold on to their dollars and not necessarily spend them. Okay. You have the, you have the effect of the, of the, portfolio or the footprint. I don't really believe that this resolved itself in any way, in any sort of negative way for broadcasters. I mean, in reality, we broke our last record for the midterms.
If anything, I think it just didn't meet our expectations of surpassing the presidential cycle, which has got a different dynamic working for it. You know, the American people are very entrenched where they stand, and I think early in the summer, the spending didn't necessarily move people off their positions and races widened. I don't think there's an existential question out there around political revenue in broadcasting.
Okay, great. Thanks, guys.
Thanks, Craig.
We have no further questions in queue at this time.
Great. Thank you so much, Alan. Thanks everyone for joining us today. Take care.
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