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Operator
Ladies and gentlemen, thank you for standing by, and welcome to the Scripps Second Quarter Earnings Call. For the conference, all the participant lines are in a listen-only mode. However, there will be an opportunity for your questions. If you'd like to ask a question at any point during the call, please press 1, then 0. If you should require any assistance, please press star 0, and an operator will assist you offline. As a reminder, today's call is being recorded. I'll turn the call now over to Ms. Carolyn Michele. Please go ahead.
Carolyn Michele
Thanks, John. 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. 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 Simpson, Chief Financial Officer Jason Combs, Local Media President Ryan Lawler, and Scripps Networks President Lisa Knutson. Also on this call is Controller Dan Persky. Here's Adam.
John
Good morning, everybody. Thanks for joining us. We're very pleased to be delivering second quarter financial results that almost fully met and in some cases exceeded expectations we set back in May, despite the ongoing economic uncertainty. demonstrating once again that the company we've been transforming is resilient in its performance, even in the face of macroeconomic challenges. In our local media division, Q2 political advertising reached a record level on a same-station basis, foreshadowing our expectations for the full-year political cycle. We are now moving into the heart of the political spending season when we expect to meet or exceed our 2020 presidential year level. With well over $8 billion in the nationwide political spending arena this season, it should be clear that political revenue defies economic trends. Both Scripps' political and retransmission revenue offset a bit of cyclical softness in core advertising. Driven largely by political, we expect local media to deliver impressive second-half results for total revenue and profitability. Our networks group fell a bit short of our revenue expectations due to the national ad market climate. And yet, we were pleased to see the division achieve the same level it reached in Q2 of last year and perform better, not just than other national networks groups, but also better than the ad revenue performance of some major digital and CTV companies. The profit margin for the Scripps Networks Division also reflects the fundamental productivity and durability of that business. Our Q2 performance illustrates that we have positioned the company well to move through this period because of the work we have done in recent years to strengthen our local media portfolio and improve its financial performance and to create the new high margin networks operating unit. Both divisions are already capitalizing on growth in various TV viewing platforms. And once we move past this economic cycle, we expect a rebound in key local core ad categories and a return to networks division margins in the 35% to 40% range. Like every other company, we'll navigate through the macroeconomic environment. And in the near term, we'll benefit from what we expect will be really robust political revenue this year. However, we also see clearly how this same environment of economic uncertainty will, in fact, play to our advantage. We'd all be smart to remember that the majority of Americans still turn to pay TV for their entertainment, and we expect we'll continue to benefit from growth in retrans revenue near and long term. But our company employs an all-of-the-above approach to reaching audiences, including a unique focus on free over-the-air television. In this inflationary environment, when consumers are already struggling with plus fatigue, we're targeting cord cutters and cord nevers with the benefits they would gain by adding on the free premium programming available from over-the-air television, the best live sports network programming and local and national journalism, informing and entertaining them for free alongside their increasingly expensive subscription bundles. The cost of subscribing to streaming services is going up along with everything else. Moffett Nathanson recently reported that the price of most major streaming subscriptions has nearly doubled in the last four years. According to a May study by Recurly, TV households have an average of five subscriptions, But 31% of respondents also said they plan to cancel some this year. We think Wall Street is already acknowledging this trend. Maybe what investors haven't caught on to yet is how consumers are watching instead. A recent study by Parks Associates found that 31% of people who don't have cable use their digital TV antenna for free over-the-air viewing. a population we expect to grow even faster during a period of inflation and negative consumer sentiment. As we have previously discussed, Scripps is capitalizing on this free TV movement with a consumer marketing campaign touting the benefits of over-the-air television. Last month, we rolled out paid traditional and digital campaigns in 13 test markets, promoting our educational website, thefreetvproject.org, and explaining the quantity and quality of options available for free. We remind consumers that they can get live sports, local news, and Big Four network programming, and our premium networks, without having to subscribe to half a dozen subscription streaming services. And we're working with retailers and installers to make it easy. Pocketbook concerns and rising subscription prices also are benefiting Scripps' free ad-supported connected TV products. All of our local station brands and most of our national networks are now available across a wide range of CTV platforms. And as you can tell from the revenue growth we've shared, gaining traction with audiences. Because we believe consumers will continue to demand a variety of TV viewing options, We see the increasing cost and complexity of streaming platforms as an opportunity to win audiences over to OTA and the shift from traditional platforms as an opportunity to advance our brands on CTV. That's the all-of-the-above approach I mentioned earlier, and it's designed not just to serve audiences but also to meet the needs of the nation's advertisers. While we are clearly big believers in the opportunity in connected TV, we are exceptionally well positioned to benefit from the ongoing attraction advertisers have to the still very dominant and incumbent media marketplace, linear television. Linear TV has maintained its durability because consumer products companies, retail, big pharma, insurance, and other big advertising spenders continue to gravitate to the consistent brand safe and premium programming that delivers their messages effectively and efficiently to the largest audiences. A more than 70-year track record leads CMOs to recognize that there is nothing experimental about their spend in television. Two years ago, as the pandemic was shutting down the nation, Scripps was quietly making plans that led to the creation of a new free cash flow engine, our highly profitable Scripps Networks business. At the same time, we have continued to steadily grow our legacy local television revenue through core advertising, political advertising, and distribution fees. I hope it's clear that, as we did when the pandemic shut down the nation, Scripps will use this blip in the economy to our advantage. and we will again emerge stronger than before. Now here's Jason.
Scripps
Thanks, Adam, and good morning. Before I begin reviewing our second quarter results, I'd like to point out that everything for the quarter is on an as-reported basis. We've now lapped our acquisition of ION and the creation of the Scripps Networks, which took place in early January of 2021. So we do not have any adjusted combined results for Q2. Any full year or year-to-date results would still include comparisons on the adjusted combined basis. Let's begin with the local media division results. Local media revenue was up nearly 10%, driven by political advertising and retrans revenue. Core advertising revenue was down 2%, with strength in services, home improvement, and travel and leisure. Political ad revenue in the quarter was $24 million, That compares to $13 million in Q2 of 2020 and $22 million in Q2 of 2018. Retransmission revenue was up nearly 10% to $171 million. Local media expenses increased less than 6% from the year-ago quarter, excluding programming cost expenses were up less than 4%. Local media segment profit was $81 million. Turning to the Scripps Networks division, revenue for the second quarter of 2022 was $239 million, equal to the prior year quarter despite weakness in the national advertising marketplace. Networks segment expenses rose 26% over Q2 of 2021. Just a reminder that this quarter included first-time costs for producing the Scripps National Spelling Bee, as well as the cost of launching Newsy, Defy TV, and True Reel over the air. We made those strategic investments as part of our commitment to our national network's growth strategy. In the third quarter, we will begin to cycle through those investments. Segment profit for the networks was $73 million. In our segment captioned Other, we reported a loss of $4 million, which includes the spend for our national marketing campaign to promote consumer digital TV antenna use. Shared services and corporate expenses came in $3 million below our guidance at $18 million. We moderated expenses during the quarter due to the economic conditions. The company realized Q2 income from operations of 32 cents per share. As of June 30th, cash and cash equivalents totaled $58 million. Our net debt at quarter end was $3.1 billion, and our net leverage dropped from 4.7 times to 4.5 times per the calculations in our credit agreements. Now I'd like to give guidance for the third quarter of 2022. We expect total local media revenue to increase in the low to mid 20% range from the third quarter of 2021 when our core advertising revenue benefited from the Summer Olympics and the late NBA Finals. We expect local media political ad revenue to be about where we were in Q3 of 2020, which was the $90 million range. We expect retransmission revenue to be up about 10%. We expect Q3 local media expenses to be up in the mid single digit percent range. In the Scripps Networks division, we expect revenue to be flat. Networks expenses are expected to increase in the mid-teens percent range as we finish cycling against the three network launch costs I referenced earlier. By the fourth quarter, we expect networks expenses to be closer to flat to the year-ago period. Third quarter shared services costs are expected to be about $20 million. And a reminder about our segment captioned, Other, it includes the expense for our over-the-air consumer marketing campaign. We expect about a $7 million operating loss in the other segment in Q3, and about two-thirds of that is related to the digital antenna marketing campaign. I'll conclude with updated guidance for a few full-year items. We now expect cash interest payments to be about $150 million, based on the current estimates for the Federal Reserve's rate hikes the remainder of this year. We now expect to pay cash taxes for the year of about $80 million, rather than our original guidance of $100 to $110 million. We now expect capital expenditures of $45 to $55 million. That's down from $70 to $80 million due to our cost reduction initiatives. We now expect free cash flow for the full year of about $400 million, still within the range of our guidance, aided by our expense control. And we have made a slight adjustment in our leverage expectations due to the national ad market climate. We now expect to drop to the low to mid fours by the year end, and we remain committed to debt pay down as our top capital allocation priority. And now, here's Brian to talk about local media.
Adam
Thanks, Jason. Good morning, everybody. Scripps' political advertising results for the first half of the year continue to confirm our expectations that this midterm election will match the 2020 presidential cycle. You'll recall that early in 2020, Michael Bloomberg was spending heavily in an attempt to establish a viable presidential campaign. Many investors thought it'd be impossible to replace that high level of spending and yet we nearly reached it. In the second quarter specifically, we far surpassed our Q2 2020 levels with our highest Q2 political performance ever on a same-station basis. Nationwide fundraising continues at a record pace. Recent U.S. Supreme Court rulings have only increased our inbound calls. We expect the ballot issues to be a big driver for our markets in Kansas, Kentucky, and Montana. And in Michigan and Wisconsin, the state legislators are in a toss-up scenario. In addition, we expect competitive U.S. Senate races in our states of Arizona, Florida, Nevada, Ohio, and Wisconsin, and competitive governor's races in Arizona, Kansas, Michigan, Nevada, and Wisconsin. We have about 75 competitive U.S. House seats. As we move through the third quarter, we continue to see only positive signs for a heavy political spending cycle. Retransmission revenue was another significant contributor to the 10 percent revenue growth our division delivered for the second quarter. A recent MVPD contract we signed was a tailwind, and subscriber household declines continued to moderate in the quarter, one percent from the previous quarter and one and a half percent from the year-ago period. Strength in virtual MVPD subscribers is driving this improvement. Also during the second quarter, we were pleased to have signed a new multi-year agreement with ABC, our largest network relationship, and with Fox. In the last year, we've renewed 39 of our 42 Big Four affiliated stations. All ahead of next year, when we renew about 75% of our subscriber households. It's helpful to have that visibility going into MVPD negotiations. Our third revenue line, core advertising, held steady in the quarter despite the economic climate. Our largest category, services, continued to show growth even amid local business challenges while maintaining product and employees. Auto, our second largest category, was down again for the quarter but up 20% in June, after improving each month of the quarter. I'm not expecting auto to continue every month with year to year growth, but I do believe we're starting to see improvement in the auto category. Travel and leisure had a good quarter, up double digits, as Americans have returned to more active lives and experiences. For the third quarter, we expect core advertising to be down in the low double digit percentage range, as we're beginning to experience displacement from our projected $90 million of political ad revenue. We'll also be cycling against last year's Summer Olympics, the benefit of the NBA Finals for our Phoenix ABC station in July, as well as last year's strongest quarter of sports betting to support the launches in Arizona, Colorado, and Michigan. Before I wrap up, I'd like to share a highlight regarding our minority investment in the esports company Misfits Gaming. We've developed a number of revenue-generating opportunities with them, including a live Minecraft-themed competition with some of the most popular Gen Z and millennial gaming influencers in the world. It'll be held at Michigan State University on October 2nd. Misfits will produce the event, and our three Michigan TV stations are taking the lead on sales and marketing. We expect to hold similar competitions in other states in the near future. And now here's Lisa.
Jason
Thanks, Brian, and good morning, everyone. Pressures from the current macroeconomic climate continue to impact our advertising revenue in the second quarter. And yet, despite these pressures, we were able to hold our revenue at the same level as Q2 of 21 and to deliver ahead of our peer network portfolio groups and the national ad marketplace. Even digital streaming and technology companies are experiencing ad revenue declines due to this cyclical economic downturn. So all things considered, we believe our networks performed quite well. This is a short-term challenge created by the economic conditions, and we are well equipped to manage the rebound. One indication of our ability to be resilient is the viewership growth we are seeing across our portfolio. In Q2, the Scripps portfolio grew its total Nielsen-measured primetime audience by 6% among total viewers. We drew 70 million viewers across our networks, per month during the quarter, and they spent more than 11 hours with us each month. In addition, our share of linear viewing accounts for 26% of all network viewing among over-the-air households. Another sign of our resilience is our ability to optimize our advertising revenue streams through innovation. We have recently done so by creating a new political ad revenue opportunity for the National Networks Division, primarily with IONS. Until now, we've told you that though ION is a collection of local stations, we exclusively sell it in the national ad marketplace like a cable network. That way, we can deliver an efficient, one-stream national programming and advertising model. However, over the last several months, we have created the ability to sell geographically-based political advertising while preserving the efficiency of our national scaled approach. We have built the technical capability to insert political ads at the local level where demand is strong. We're also leveraging Scripps in-house political expertise to help political ad agencies understand this new opportunity. We see 2022 as a year of learning in a few markets and have $15 to $20 million laid into our outlook for the back half of this year. We then expect to grow the network's political revenue stream significantly in 2024. Now I'd like to share a few network highlights. The Bounce Network performed especially well for us in the quarter in terms of both ratings and revenue. Early this year, we launched an effort to help Bounce connect more fully with the black communities and audiences it serves. We have changed some of our programming strategies and increased our social media engagement. In return, we saw Q2 total day ratings increase plus 5% among people 25 to 54 for the bounce cable and over-the-air viewership, defying linear TV trends and driving up ad rates. Bounce revenue grew 38% in the quarter. In addition, during the season's upfront, bounce garnered remarkable year-over-year CPM growth in the mid-to-high teens. Bounce also has a streaming channel called Bounce XL that is now available on eight of the top connected TV services and is garnering nearly 2 million hours of viewing per month. Core TV also delivered a strong second quarter with help from some celebrity dysfunction. The Johnny Depp Amber Heard trial drove record viewership for the network and a 25% year-over-year increase in key viewer demographics. That compares favorably to our area of the Derek Chauvin trial a year ago, so a strong basis. We're expecting Core TV revenue to be up more than 30% for the full year, exceeding our initial expectation. In response to the current advertising climate, we've engaged in several expense control measures. Those include slowing hiring, moderating spending on non-critical capital projects, travel, and other discussionary operating items that won't impact our growth strategies. Turning to distribution, we have been pleased by our steady cadence of connected TV launches this summer. All of our networks are fully distributed to audiences over the air and most have broad cable distribution. We also are capitalizing on the tremendous growth in CTV. As Adam said, it's an all of the above strategy in terms of serving audiences through their various TV viewing choices. The ION network launched on Samsung TV Plus in the spring, and its revenue performance there has exceeded our expectations. ION also launched on TCL and Amazon's Freebie during the quarter, and all three of these platforms will launch our network's ION Mystery and Grit Extra this quarter. We've also reached agreements with Roku, Vizio, Zumo, and Tubi to carry our free ad-supported streaming networks on their platforms beginning this quarter. We expect these recent and upcoming launches to help drive a full-year increase in CTV revenue of more than 25%. Next, I'd like to share highlights from Newsy, which continues to establish itself as a significant national news brand, respected for its fact-based, opinion-free reporting. Newsy's bureaus in multiple U.S. cities and its nimble production teams give it important news-gathering advantages over coastal-based news outlets. For example, when news broke of the tragic shootings at Robb Elementary School in Uvalde, Texas, Newsy was the first national network on the air from the scene. The network's programming, including primetime coverage anchored in Uvalde, were major drivers of viewership. To conclude, we were pleased to achieve division results this quarter that equaled our strong performance last year, and we're much better than the national ad market overall in to deliver margins that are enviable in the industry. We have positioned this division to be resilient, and we look forward to our growth path just ahead. And now, operator, we're ready for questions.
Operator
Thank you. And once again, ladies and gentlemen, if you would like to ask a question, please press 1, then 0 on your telephone keypad. You may withdraw your question at any time by repeating the 1-0 command. And first go to the line of Dan Kernos with Benchmark. Please go ahead. Great. Thanks.
Dan Kernos
Good morning. Lots to dive into here, but just before I start, Adam, I just want to congratulate you on your contract extension. I think it's really well-deserved, especially given the transformation you've taken this company through. So just wanted to throw that out there first. Thank you, Dan. The second thing, Brian, maybe just on local You guys have sort of that unique setup in Q3 given the NBA finals, obviously the Olympics. Can you like carve out what local is doing in Q3 X kind of those items and just, you know, we've heard kind of that oddness with auto sort of coming back, but just how you think sequentially categorically things are pacing in Q3 from an underlying perspective.
Adam
Yeah. Hey, Dan, good to hear from you. You know, look, I think that, as you saw, we are, you know, kind of forecasting a little bit of a stronger decline than some of our peers. Part of that is clearly attributed to the fact that the Phoenix Suns hosted the NBA finals last year. We had the Summer Olympics at the same time. We also, our footprint is was heavy weighted to the benefit of sports betting in Q3 last year, where Michigan, Arizona, and Colorado were all launching at the same time, which was significant dollars. Those are obviously into maintenance mode right now, and we really don't have any states launching in the Q3. And just a reminder, we were, I believe, the only broadcast group last Q3 to report that we had surpassed Q3 of 2019. So We had a heck of a quarter. I think we also reported that we had done $19 million in new business. Last third quarter was really good. That Phoenix Suns thing is probably, you know, three or four points, so probably starts to get us in line with what others are reporting. As I, you know, kind of look at the categories in the months, look, I think Q3 is starting to look sort of like Q2 did. Q2 started with April was lousy. It was down 7.7%. But then May rebounded to down about half a percentage point, and then June was up a couple of points. And I think that in this new economy, people are waiting to see, am I going to have product? Am I going to have people to do the work? And then they're booking. And so it looks like kind of Q3 is laying out the same way, where we didn't have a great July, but August is much better July overall and in almost every category. And we've still got a couple of weeks to see how September plays out, but I think we may get that same sort of traction and momentum. So, you know, specifically you asked about auto. We talked about it rebounding in June. I can tell you right now that July was down a little bit, but August and September, August is flat right now to last August with still some business to write. So I think we may still see a little bit of a build there. So I know I threw a lot at you there. Anything else? You want it to probe on?
Dan Kernos
No, that's really helpful color. That gives a little bit more background for just how to view the delta. Not to monopolize, I just want to move over quickly then to just sort of Adam and Lisa on the national side, on the network side, sorry. I guess it's interesting because you've got a lot of moving parts, right? You've got new network launches. The upfronts are going to kick in. Your guide was actually in line with where we thought you'd come in, which is Pretty good considering I think everybody else is saying high singles down for national, at least is sort of the number that we're kind of hearing. So can you just talk us through maybe the underlying trends that you're seeing, how you're optimizing yield? I know you guys talk about that a lot between DR and general market. DR sounds like it's been continued to be pretty weak. And then when we get into Q4... you know, I don't know how much you sold through in the upfront, but I'm just trying to understand, A, the level of risk, and B, subsequently, the benefit that it sounds like you're getting from some pretty good CPM increases. So, like, how do we think about – I know no one has an economic crystal ball, but how do we think about the networks business maybe sequentially from Q3 into Q4? Yeah.
Jason
So, thanks, Dan. You know, I would say we're – Our team is really navigating, I think, and stewarding our businesses through this challenging economic time. While there has been broadly reported weakness for, for instance, in July, the Scripps networks are not necessarily seeing a decline. In fact, our CTV revenues for July outperformed our expectations. And additionally, while far from a strong market, the pace of scatter has improved from Q1 and Q2. This is true both from a general market perspective and on the DR side. Our pipeline in general market is fairly steady this far into Q3, and pricing on the DR side has stabilized with a slight increase in demand. Again, our portfolio approach, I think, is resonating even in a somewhat challenged market. In terms of the upfront, you know, we were really, really pleased with, you know, despite the challenging macroeconomic conditions. We were pleased with our performance in the upfront. We're actually not quite finished. We're still in some negotiations. But really, I think it proved our enormous value in terms of a content portfolio and also our advertising clients as a differentiated means to service brands. And, you know, we saw at the beginning of one of our networks, had CPM growth. Obviously, I called out bounce as the most significant in the upfront. And I do think what you'll see is as we turn to fourth quarter, we've given ourselves room to take advantage of, I think, what's improving, although not significantly, the scatter market. So we've typically have our scatter rates are 30 to 40% higher than our upfront rates, so we've given ourselves plenty of room for growth in the fourth quarter.
John
Dan, the other thing I'd highlight from Lisa's prepared remarks is the potential contribution of political in third and fourth quarter. I think, Dan, you may have been the one that asked on the call when we acquired whether or not we thought political would be an option. And at the time, we did reference the fact that, you know, ION is sold in the national ad marketplace. But really, thanks to, I think, the strength of our political office and presence in Washington, D.C., and some really significant technological innovation that Lisa and her team have executed, we're able to generate upside in networks that we think will add on somewhere between $15 and $20 million in political revenue on top of the $270 million we're already talking about local. And that's, you know, experimental stage, to be quite frank. We really expect this to be something that could be quite significant in 2024. So stay tuned for performance on that as we move through the back half of the year, something we're really excited about, a big opportunity for the Scripps Networks to generate political from what we're sort of referring to as server side or transmitter side ad insertion to take advantage of crowd out.
Dan Kernos
Yeah, Adam, I didn't want to hog the call, but, you know, given now first the Magnite deal to expand outside of your Zips, which I also don't think is included in your political guide, plus this now, you guys have been very, very creative in using that at DC News Desk, so. you know, kudos to you guys on that. Thank you. Thanks, Dan.
Operator
Our next question is from Stephen Cahill with Wells Fargo. Please go ahead.
Stephen Cahill
Thanks. Maybe just to follow up on that immediate point. So the opportunity for political on ION, whether that's you know, through the linear network or whether that's in the digital space. Is that included in the free cash flow guidance that you've given for the year, or would that be incremental to that? And then, Lisa, maybe just sticking with ION, thanks for some of those revenue trends at court and balance. I was just wondering if you could maybe isolate ION a little bit in terms of how that's performing in terms of revenue growth and margins. I know the direct response in national has been tough in the macro, so just kind of wondering if you could help us unpack some of the trends there. And then finally, just Adam, on the marketing campaigns you've been doing for OTA, could you give us any sense of what the KPIs are you're seeing there and how those are performing against some of your goals? Thank you.
Scripps
Hey, Steve, I'll go first because it'll be quick. Yes, the ION political revenue was included in our original guidance of $400 to $450 million at the beginning of the year.
Jason
In terms of ION, it was the brand that was probably, because it's more general market than DR advertising, and we sell more in the upfront, ION has definitely been more challenged throughout the first half of the year. As I said in my response to Dan's question, we are starting to see some improvement from Q1 to Q2 in terms of the the pace of the scatter market and also seeing some, you know, both on the general market side and the DR side. So our pipeline, specifically for ION, has improved in the back half of the year.
John
Stephen, in terms of the leading indicators on the marketing campaign, it's really very simple. I mean, in addition to, I think, the general lead gen metrics you'd expect when you're pushing people to a website, we're working with retailers to track Antenna sales, we expect antenna sales will open up opportunity for additional viewing, especially given our 26% to 30% share in the OTA marketplace. And we expect that to lead to higher revenue. So we are still in the experimental stage or the earliest stage right now in 13 markets. We just started last month. But I expect as we head towards third quarter and then fourth quarter, we'll be able to give you an update on the efficacy of our campaign. But it really comes down to the opportunity this company has to disproportionately profit from the growth of the over-the-air marketplace, something we think is going to happen anyway as a result of the economy. I mean, it's that and NFL's move to put everything on broadcast we think bodes very well for the growth of the OTA marketplace.
Stephen Cahill
And maybe, Adam, just to follow up on that, it does look like cord cutting picked up a bit in the second quarter. Do you have any data yet as to whether or not those folks are reengaging on OTA, kind of as you planned?
John
Yeah, I mean, I think the percentages of cord cutters and cord nevers that continue to add on a digital antenna to their self-bundle has remained steady. Somewhere between a quarter and 20% of broadband-only homes are leveraging a digital antenna. We think that should be higher. We think there's still not enough information out there about the opportunity for folks that use SVOD services to bundle in free premium programming from over the air, and we expect to inform them and educate them on that opportunity, work with retailers and installers to make it easy for them to do as well. Great. Thank you. Thanks, Stephen.
Operator
Next, we'll go to Craig Huber with Huber Research. Please go ahead.
Craig Huber
Great, thank you. On the Scripps Network side, I wanted to ask if you could share some data with us on the ratings or viewership trends in the latest quarter that you have, please. We'll start there.
Jason
Yeah, Craig, in terms of viewership, we saw across the portfolio, you know, our Nielsen, not all of our networks are Nielsen rated, but primetime audience grew by 6% among total viewers. I mentioned in my prepared remarks that we are drawing nearly 70 million viewers across all of our networks during the quarter. Second quarter, once again, we grew share and linear. I talked about the fact that we make up 26% of our viewing that happens over the year is done on our networks. Total primetime viewership, again, was up 6% year over year. The growth came from total nationwide linear usage. Of course, that is against a comparison of all viewing of down 8%. So it's sort of defying, in many ways, defying logic in terms of our networks really growing. Our ratings are obviously impacted by total TV viewing trends, but our programming strategy and really intentional investments are certainly offsetting those trends.
Craig Huber
In the data you guys have, what percentage of the U.S. households do you think have an antenna right now?
John
I think the latest data, yeah, I think about 30% of U.S. households are using an antenna. It's growing. We expect it to continue to grow. I think forecasts show it going up to 45% within the next couple of years. Antenna sales have been between 8 and 12 million a year. pretty steady over the last couple of years.
Craig Huber
Okay, and then I wanted to ask you, you talked a lot about the political opportunity with the Scripps Networks inserting political ads there. I assume those ads would get slotted in there like where a promotional spot used to be, as opposed to it's not going to be taken away from a core advertising slot on the Scripps Network.
John
Yeah, no, not necessarily because we want to maximize the opportunity. So we do, you know, we're essentially running yield management with a pretty complicated algorithm that allows us to understand what the loss will be in the national reach when we do local ad insertion. So what we're actually running is direct response in that time period or in that avail. And so we're able to cover the direct response ads without negatively impacting the direct response rates. We cover the direct response ads in the specific markets where there's high demand for political and where the CPMs are high enough that we incrementally improve the yield on the network.
Craig Huber
Okay, very good. My last question, guys, if I could ask, on the TV station side, Brian or somebody, the percent of response retrain subs up for renewal this year. And what's that number for next year? So let's see if that's changed at all.
Adam
Yeah, so hey, Craig, it's Brian, we're done this year. Next year, 75% of our subs are up in 2023, drops back to about 5% in 2024. And then 25% come up in 2025. And what is the cadence in 2023 number, please? All are in the, well, the majority is in the first half. And, you know, there's a good chunk in the first quarter and a good chunk in the second quarter.
Scripps
Largely at the end of the first quarter and the second quarter.
Adam
Correct.
Scripps
For your modeling. Okay, great. Thanks, guys. That's all I have.
Operator
Thanks, Craig. And just as a quick reminder, if you would like to ask a question on the call, please press 1, then 0. And allow me a few moments. No further questions coming in.
Carolyn Michele
All right. Thank you very much, John. We'll let you go ahead and give the replay information. Thanks to everyone for joining us.
Operator
Thank you. And ladies and gentlemen, this conference is available for replay. It starts today at 1130 Eastern Time through September 7, 2022 at midnight. You may access the replay at any time by dialing 866-207-1041. International callers, please dial 402-970-0847. The access code is 480-8441. Those numbers again, 866-207-1041 or 402-970-0847. Access code 480-8441. That does conclude your conference for today. Thank you for your participation. You may now disconnect.
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