Townsquare Media, Inc.TSQ
Townsquare Media, Inc. Goodwill & Intangibles Disclosure
Goodwill and Other Intangible Assets, Net
Indefinite-lived intangible assets
Indefinite-lived assets consist of goodwill and FCC broadcast licenses.
FCC Broadcast Licenses
FCC licenses represent a substantial portion of the Company’s total assets. The FCC licenses are renewable in the ordinary course of business, generally for a maximum of eight years. The fair value of FCC licenses is primarily dependent on the future cash flows of the radio markets and other assumptions, including, but not limited to, forecasted revenue growth, profit margins and a risk-adjusted discount rate. The Company has selected December 31st as the annual testing date.
The Company evaluates its FCC licenses for impairment annually or more frequently if events or changes in circumstances indicate that the assets might be impaired. Due to changes in forecasted traditional broadcast revenue and market share in the markets in which we operate in and an increase in the estimate of initial capital costs due to rising prices, the Company quantitatively evaluated the fair value of its FCC licenses at June 30, 2025, September 30, 2025, and December 31, 2025.
Based on the results of the Company’s impairment evaluations of its FCC licenses performed at June 30, 2025, September 30, 2025, and December 31, 2025, we incurred total impairment charges of $3.5 million for FCC licenses in 5 of our 74 local markets for the year ended December 31, 2025. The $3.5 million impairment charges recorded during the year were primarily driven by decreases in third-party forecasts of broadcast revenues and an increase in the estimate of initial capital costs due to rising prices.
Based on the results of the Company’s impairment evaluations of its FCC licenses performed at March 31, 2024, June 30, 2024, September 30, 2024, and December 31, 2024, we incurred total impairment charges of $30.9 million for FCC licenses in 27 of our 74 local markets for the year ended December 31, 2024.
Charges related to the impairment of the Company’s FCC licenses are included in the Broadcast Advertising segment results.
Unfavorable changes in key assumptions utilized in the impairment assessment of our FCC licenses may affect future testing results. For example, keeping all other assumptions constant, a 100-basis point increase in the weighted average cost of capital as of the date of our last quantitative assessment would cause the estimated fair values of our FCC licenses to decrease by $26.1 million which would have resulted in an additional impairment charge of $3.1 million as of December 31, 2025. Further, a 100-basis point decline in the long-term revenue growth rate would cause the estimated fair values of our FCC licenses to further decrease by $16.1 million which would have resulted in a further impairment charge of $3.6 million as of December 31, 2025. Finally, a 100-basis point decline in operating profit margins would result in a decrease in the estimated fair values of our FCC licenses of $10.4 million which would result in an incremental impairment charge of $4.2 million.
Assumptions used to estimate the fair value of our FCC licenses are also dependent upon the expected performance and growth of our traditional broadcast operations. In the event broadcast revenue experiences actual or anticipated declines, such declines will have a negative impact on the estimated fair value of our FCC licenses, and the Company could recognize additional impairment charges, which could be material.
Goodwill
During the third quarter of 2025, the Company concluded that the carrying amount of the National Digital reporting unit exceeded its fair value, resulting in the recognition of a non-cash goodwill impairment charge of $3.0 million. An interim impairment assessment was considered necessary as a result of declines in forecasted revenues and profit and increases in the weighted average cost of capital. The Company did not identify indicators of impairment related to any other reporting unit that would have required an interim impairment assessment during the year ended December 31, 2025. Following the non-cash goodwill impairment charge recognized during the third quarter of 2025, the National Digital reporting unit had $3.5 million of goodwill remaining as of December 31, 2025.
Due to reductions in the commitments of its largest customers, the Company concluded that the carrying amount of the Analytical Services reporting unit exceeded its fair value as of December 31, 2025. As a result, the Company recognized a $2.3 million non-cash goodwill impairment charge in the fourth quarter of 2025, resulting in a total of $5.3 million of non-cash goodwill impairment charges during the year ended December 31, 2025. Following the non-cash goodwill impairment charge, the Analytical Services reporting unit had no goodwill remaining as of December 31, 2025.
For its annual impairment testing performed as of December 31, 2025, the Company performed a quantitative assessment for each of its reporting units. Based upon such assessment, the Company determined that the fair value of the following reporting units exceeded their respective carrying amounts as of December 31, 2025. The fair values of our National Digital, Townsquare Ignite and Townsquare Interactive reporting units were in excess of their respective carrying values by approximately 47%, 106% and 152%, respectively. The Local Advertising, Amped, and Live Events reporting units had no goodwill as of December 31, 2025.
The Company recorded total interim non-cash goodwill impairment charges of $4.4 million during the year ended December 31, 2024, of which $2.6 million related to the Live Events reporting unit and $1.8 million related to the National Digital reporting unit. For its annual impairment testing performed as of December 31 2024, in assessing whether goodwill was impaired in connection with its annual impairment testing performed as of December 31st, the Company performed a quantitative assessment for each of its reporting units. Based upon such assessment, the Company determined that the fair value of the following reporting units exceeded their respective carrying amounts as of December 31, 2024. The fair values of our National Digital, Townsquare Ignite, Analytical Services, and Townsquare Interactive reporting units were in excess of their respective carrying values by approximately 39%, 59%, 149%, and 128%, respectively. The Local Advertising, Amped, and Live Events reporting unit had no goodwill as of December 31, 2024.
As of December 31, 2025 and 2024, the goodwill balances remaining for each of our reporting units were as follows (amounts in thousands):
Goodwill at December 31, 2025 | Goodwill at December 31, 2024 | ||||||||||
| Reporting Unit: | |||||||||||
Local Advertising | $ | — | $ | — | |||||||
National Digital | 3,489 | 6,489 | |||||||||
Townsquare Ignite | 67,101 | 67,101 | |||||||||
| Amped | — | — | |||||||||
Analytical Services | — | 2,313 | |||||||||
Townsquare Interactive | 77,000 | 77,000 | |||||||||
Live Events / Other | — | — | |||||||||
| Balance | $ | 147,590 | $ | 152,903 | |||||||
The fair values of each of our reporting units were determined using an income approach whereby the fair value was calculated utilizing discounted estimated future cash flows. The income approach requires several
assumptions including future sales growth, EBITDA (earnings before interest, taxes, depreciation and amortization) margins, and capital expenditures and discount rates which are the basis for the information used in the discounted cash flow model. The weighted-average cost of capital used in testing our reporting units for impairment ranged from 13.4% to 18.5% with perpetual growth rates ranging from 1.3% to 6.7%.
Due to the inherent uncertainties involved in making these estimates, assumptions may change in future periods. Estimates and assumptions made for purposes of goodwill impairment testing may prove to be inaccurate predictions of the future, and other factors used in assessing fair value, such as the weighted average cost of capital, are outside the control of management. Unfavorable changes in certain of these key assumptions may affect future testing results. For example, keeping all other assumptions constant, a 100-basis point increase in the weighted average cost of capital assumption for each of our reporting units would cause the estimated fair values of our National Digital, Townsquare Ignite and Townsquare Interactive reporting units to decline, resulting in a decrease in the fair value in excess of their respective carrying values by approximately 3%, 4% and 4%, respectively. Further, keeping all other assumptions constant, a 10% decline in the estimated fair value of each reporting unit, due to other changes in assumptions, including forecasted future cash flows, would not have resulted in incremental goodwill impairment charges to our reporting units for the year ended December 31, 2025.
The following table presents changes in goodwill by segment during each of the two years ended December 31, 2025 and 2024, respectively (in thousands):
| Digital Advertising | Subscription Digital Marketing Solutions | Broadcast Advertising | Other | Total | |||||||||||||||||||||||||
Balance at December 31, 2023 (1) | $ | 77,687 | $ | 77,000 | $ | — | $ | 2,583 | $ | 157,270 | |||||||||||||||||||
| Impairment | (1,784) | — | — | (2,583) | (4,367) | ||||||||||||||||||||||||
Balance at December 31, 2024 | $ | 75,903 | $ | 77,000 | $ | — | $ | — | $ | 152,903 | |||||||||||||||||||
| Impairment | (5,313) | — | — | — | (5,313) | ||||||||||||||||||||||||
Balance at December 31, 2025 | $ | 70,590 | $ | 77,000 | $ | — | $ | — | $ | 147,590 | |||||||||||||||||||
(1) The aggregate goodwill balance as of December 31, 2023 is net of (i) a $69.0 million non-cash goodwill charge related to the local advertising businesses reporting unit in the fourth quarter of 2019; (ii) $48.9 million of accumulated impairment charges incurred in 2017, of which $39.9 million was included as a component of discontinued operations and $9.1 million of which related to the 2017 strategic review and restructuring of our entertainment business; (iii) a $4.1 million write-off of goodwill was recorded in 2017 in connection with business realignments within the entertainment business; and (iv) $2.8 million and $1.4 million non-cash goodwill impairment charges related to the local advertising and live events/other reporting units in the third and fourth quarters of 2023, respectively.
Definite-lived intangible assets
The Company’s definite-lived intangible assets were acquired primarily in various acquisitions as well as in connection with the acquisition of software and music licenses.
Content Rights
The Company enters into multi-year content licensing agreements pursuant to which the Company is required to make payments over the term of the license agreement. These licensing agreements are accounted for as a license of program material in accordance with ASC 920-350, Broadcasters - Intangibles - Goodwill and Other. The Company capitalizes the content licenses and records a related liability at fair value, which includes a discount, on the effective date of the respective license agreement. Amortization of capitalized content licenses is included as a component of direct operating expenses in the Consolidated Statement of Operations. The difference between the gross and net liability is amortized over the term of the license agreements and reflected as a component of interest expense.
The following tables present details of intangible assets as of December 31, 2025 and 2024, respectively (in thousands):
| December 31, 2025 | |||||||||||||||||||||||
| Weighted Average Useful Life (in Years) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||
| Intangible Assets: | |||||||||||||||||||||||
FCC licenses | Indefinite | $ | 146,883 | $ | — | $ | 146,883 | ||||||||||||||||
| Content rights and other intangible assets | 1 - 7 | 22,430 | (14,266) | 8,164 | |||||||||||||||||||
Total | $ | 169,313 | $ | (14,266) | $ | 155,047 | |||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||
| Weighted Average Useful Life (in Years) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||
| Intangible Assets: | |||||||||||||||||||||||
FCC licenses | Indefinite | $ | 150,383 | $ | — | $ | 150,383 | ||||||||||||||||
| Content rights and other intangible assets | 2 - 8 | 22,488 | (10,715) | 11,773 | |||||||||||||||||||
Total | $ | 172,871 | $ | (10,715) | $ | 162,156 | |||||||||||||||||
Amortization expense for definite-lived intangible assets for each of the years ended December 31, 2025 and 2024 was $3.6 million and $7.3 million, respectively.
Estimated future amortization expense for each of the five succeeding fiscal years and thereafter as of December 31, 2025 is as follows (in thousands):
| 2026 | $ | 3,195 | |||
| 2027 | 1,978 | ||||
| 2028 | 1,880 | ||||
| 2029 | 646 | ||||
| 2030 | 152 | ||||
| Thereafter | 313 | ||||
| $ | 8,164 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 16, 2026 | Showing above |
| 2024 | Mar 17, 2025 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.