Entrevision (EVC) Q3 2025: ATS Revenue Surges 104% as Media Segment Faces Political Ad Gap
Entrevision’s Q3 was defined by a stark split: robust ATS growth offset by media headwinds from the political off-cycle, driving a pivot in investment and cost structure. The company’s ad tech and services segment delivered triple-digit growth, while the legacy media business contracted sharply, prompting restructuring and targeted cost actions. Management is positioning for a political revenue rebound in 2026 and ongoing ATS expansion, but margin pressures and execution risk remain central to the near-term outlook.
Summary
- ATS Expansion Outpaces Legacy Media: Ad tech and services growth is now the primary earnings engine.
- Media Segment Restructuring Accelerates: Workforce reductions and digital pivot aim to stem losses.
- 2026 Political Cycle Looms Large: Election-year ad spend is expected to revive media revenues.
Performance Analysis
Entrevision’s Q3 2025 results highlight a decisive divergence between its two core segments. Consolidated revenue increased 24% year over year to $120.6 million, powered by a 104% surge in the advertising technology and services (ATS) business, which now accounts for nearly two-thirds of total revenue. ATS benefited from both a higher number of monthly active accounts and greater revenue per account, reflecting traction in platform technology and AI-driven solutions.
In contrast, the media segment saw revenue drop 26% versus last year, driven by the absence of political advertising and weaker national TV and radio spend. Local media advertiser counts and revenue per advertiser were flat, underscoring ongoing secular pressure. The media business posted an operating loss, while ATS delivered a significant profit increase. Consolidated operating results swung to a loss, weighed by restructuring and impairment charges, as well as elevated investment in digital and sales capabilities.
- ATS Operating Leverage: ATS operating profit rose 378% year over year, with expenses growing at a slower pace than revenue.
- Media Segment Drag: Media operating loss of $3.5 million erased prior-year profit, reflecting structural and cyclical headwinds.
- Restructuring Impact: Non-cash impairment and restructuring costs totaled $9 million, driving the overall operating loss.
The company’s strong cash balance and continued debt reduction provide financial flexibility, but the core challenge remains restoring segment profitability while managing the transition from legacy media to high-growth ATS platforms.
Executive Commentary
"In media, we're investing to increase our local sales capacity and to expand our digital sales and digital sales operations capabilities, more sellers and more digital. In ATS, We're investing to add more engineers, to advance our technology, and to increase our sales capacity. So more technology, better technology, and more sellers. We believe these investments will help us build a stronger company."
Michael Christensen, Chief Executive Officer
"Our goal for this business is to generate positive operating leverage, and the ATS revenue increase did exceed the expense increase in terms of percentage and absolute dollars. The operations of both segments together generated a consolidated segment operating profit of $6.2 million. This was a 55% decrease compared to third quarter 2024, attributable primarily to the media segment."
Mark Belke, Chief Financial Officer
Strategic Positioning
1. ATS as Growth Engine
The ATS segment, Entrevision’s digital ad platform and services business, has become the company’s primary growth lever. Management is investing in engineering talent and AI capabilities to further differentiate its offering, while also expanding the salesforce and geographic footprint. The segment’s ability to scale revenue faster than expenses is expected to deliver positive operating leverage as it matures.
2. Media Segment Restructuring
Legacy media operations, focused on TV and radio, are undergoing significant restructuring. Investments in local sales capacity and digital sales specialists aim to capture advertisers shifting to digital channels, but cost actions—including a 5% workforce reduction and remote work transitions—underscore the urgency to align expenses with secularly pressured revenue. The segment’s future will hinge on digital execution and political ad cycles.
3. Political Advertising Cyclicality
Entrevision’s media revenue is highly sensitive to election-year political spending. Management is positioning for a major rebound in 2026, with significant exposure in key swing states and districts. The company’s unique reach with Latino audiences is a strategic asset, but the off-cycle in 2025 exposed the volatility of this revenue stream.
4. Capital Allocation Discipline
Entrevision’s balance sheet strength is a differentiator, with $66 million in cash and ongoing debt reduction. Dividend payments continue, but leadership is prioritizing debt paydown and financial flexibility, reflecting a cautious stance amid operational transition.
Key Considerations
This quarter’s results reflect a business in transition, with ATS growth and media headwinds driving management’s operational and capital allocation priorities. Investors should weigh the following:
Key Considerations:
- ATS Investment Payoff: Sustained engineering and sales investments are critical to maintaining ATS momentum and margin expansion.
- Media Segment Turnaround: The pace and effectiveness of restructuring, especially in digital sales execution, will determine if losses can be contained ahead of the 2026 political cycle.
- Political Revenue Volatility: The business remains exposed to large swings in political ad spend, which are outside management’s control and create lumpy earnings patterns.
- Cost Control and Leverage: Realizing operating leverage in ATS and achieving sustainable cost reductions in media are essential for consolidated profitability.
- Affiliation Agreement Renewal: The pending renewal with Televisa Univision, a key distribution partner, remains a watchpoint for future media segment stability.
Risks
Entrevision faces material risks from secular media declines, the unpredictability of political advertising cycles, and potential execution missteps in ATS scaling and digital transformation. Failure to renew key affiliation agreements or achieve expected cost savings could further pressure results. Management’s forward-looking statements rest on successful execution and external factors beyond their control.
Forward Outlook
For Q4 2025, Entrevision guided to:
- ATS and consolidated revenue and earnings comparable to Q3 levels
- Continued cost discipline and restructuring benefits flowing into 2026
For full-year 2025, management did not provide explicit guidance but emphasized:
- Focus on profitability in each segment and on a consolidated basis
- Positioning for political advertising recovery in 2026
Management highlighted several factors that will shape results:
- Ongoing investment in ATS technology and sales capacity
- Expense reductions in media and corporate overhead
Takeaways
Entrevision’s Q3 underscores a business model pivot, as ATS becomes the main growth and profit driver while legacy media undergoes restructuring and digital transformation. The 2026 election cycle is a critical catalyst, but near-term results will depend on cost control and execution in both segments.
- ATS Outperformance: Triple-digit ATS growth validates the strategy but sustaining this pace will require continued technology and sales investments.
- Media Headwinds Persist: Losses in the media segment emphasize the urgency of restructuring and the risks of political ad cyclicality.
- 2026 as Inflection Point: Investors should monitor ATS margin trends and the build-up to the next political cycle as key drivers of future value.
Conclusion
Entrevision’s results reveal a company in active transition, leaning on ATS growth to offset structural media weakness while executing cost actions and digital pivots. The next year will test management’s ability to deliver on both operational discipline and strategic renewal ahead of a pivotal political advertising cycle.
Industry Read-Through
Entrevision’s sharp ATS growth and media contraction mirror broader trends in the advertising and broadcast sectors, where digital platforms are outpacing traditional channels and political cycles drive volatility. Legacy media operators face mounting pressure to digitize and restructure, while ad tech players that can scale technology and AI capabilities are gaining share. The critical role of political advertising as a swing factor highlights the need for diversified revenue streams and operational agility across the sector.