Newsmax (NMAX) Q2 2026 Earnings Call Summary

Principais Destaques

• A receita aumentou 16,5% em relação ao mesmo período do ano anterior, atingindo o recorde de US$ 54,1 milhões, impulsionada por taxas de afiliados e licenciamento internacional.
• A Newsmax relatou um lucro líquido trimestral de US$ 2,9 milhões, ou US$ 0,02 por ação, marcando seu primeiro trimestre lucrativo como empresa aberta. O EBITDA ajustado melhorou para US$ 5,7 milhões, ante um resultado negativo de US$ 3,8 milhões.
• A margem bruta expandiu para 43,1%, ante 38,0%, refletindo uma maior contribuição das receitas de afiliados e licenciamento, que possuem margens mais elevadas.
• A receita de afiliados subiu 81,9%, para US$ 13,4 milhões, enquanto a receita de licenciamento aumentou para US$ 4,6 milhões, ante US$ 0,7 milhão.
• A administração reiterou a projeção de receita para o ano todo de 2026 entre US$ 212 milhões e US$ 216 milhões, o que representa um crescimento anual de 13% no ponto médio.
• A Newsmax encerrou o trimestre com US$ 128,3 milhões em caixa e investimentos de curto prazo e sem dívidas no balanço patrimonial.

Principais Dados Financeiros

Desempenho Operacional e dos Negócios

A transmissão permaneceu como o principal motor de crescimento. A receita aumentou 20,5%, para US$ 45,8 milhões, impulsionada pelos reajustes de tarifas de afiliados implementados no final de 2025 e em 2026, combinados com novos relacionamentos contratuais e com a expansão do licenciamento internacional.

O alcance de público totalizou 26,9 milhões de telespectadores, uma alta de 4% em relação ao mesmo período do ano anterior e o maior alcance do segundo trimestre da empresa em quatro anos. Esse número incluiu 11,3 milhões de adultos com idades entre 35 e 64 anos. Os seguidores nas redes sociais aumentaram mais de 28%, superando 26 milhões.

A publicidade digital cresceu 21,3%, mas a receita digital total recuou 1,3% devido ao desempenho mais fraco na receita de assinaturas e vendas de produtos. A administração afirmou que o Newsmax+ agora oferece mais de 300 títulos e continua sendo uma prioridade de investimento, com esforços focados em engajamento, retenção e crescimento de assinantes. O Newsmax2 também continuou a expandir as horas de visualização nas principais plataformas.

O licenciamento internacional está se expandindo rapidamente. A administração espera obter aproximadamente US$ 16 milhões em taxas de licenciamento internacional durante 2026, em comparação com US$ 3,6 milhões em 2025. A empresa lançou a Newsmax Polônia durante o trimestre e agora conta com distribuição em mais de 100 países. Seu modelo internacional baseia-se em operadoras locais licenciando a marca Newsmax e operando canais em seus respectivos mercados.

A Newsmax também firmou uma parceria plurianual de conteúdo de IA com a Meta. Os termos financeiros não foram divulgados. A administração afirmou que a empresa está negociando possíveis acordos com outras empresas de IA e enxerga o licenciamento de IA como uma possível fonte de receita incremental. Internamente, a Newsmax está utilizando ferramentas de IA para acelerar a produção de conteúdo, pesquisas, gráficos e tabelas, ressaltando que o material produzido deve ser checado e verificado.

Projeções da Administração

A administração manteve a projeção de receita para todo o ano de 2026 entre US$ 212 milhões e US$ 216 milhões. O ponto médio sugere um crescimento anual de 13%. A empresa espera que a expansão das taxas de afiliados e do licenciamento continue sendo o principal motor estrutural de crescimento e prevê um perfil operacional anual superior ao de 2025.

Os US$ 16 milhões esperados em receita de licenciamento para 2026 baseiam-se em acordos já firmados e não dependem de contratos futuros. A administração também mencionou uma taxa de execução (run rate) anualizada de licenciamento de US$ 25 milhões para 2027, mas não forneceu projeções além desse número. Os acordos de licenciamento internacional são arranjos plurianuais.

A Newsmax pretende continuar investindo em programação, talentos, tecnologia, distribuição, operações digitais e iniciativas OTT. A administração espera que as receitas de afiliados e licenciamento de maior margem, aliadas aos benefícios de escala e à monetização multiplataforma, sustentem as margens ao longo do tempo.

Riscos e Pontos de Atenção

• A receita de publicidade caiu 3,5% devido ao enfraquecimento no volume de pedidos de clientes e a uma base de comparação difícil em relação à demanda eleitoral do ano anterior.
• A receita de assinaturas recuou 9,9% devido à menor aquisição de clientes, enquanto as vendas de produtos caíram 31,7%.
• A administração não divulgou a fatia de contratos de afiliados prestes a vencer. A redução da diferença tarifária de afiliados em relação aos concorrentes dependerá da audiência, da força da marca, da programação, dos talentos e da execução da distribuição.
• Os gastos contínuos com conteúdo, produção, tecnologia e iniciativas OTT podem compensar parcialmente a alavancagem operacional no curto prazo.
• A administração enxerga potencial na receita de licenciamento de IA, mas não forneceu projeções financeiras para essa frente.
• A administração espera que a movimentação eleitoral favoreça o engajamento, embora tenha ressaltado que a publicidade política em eleições de meio de mandato costuma ter foco local e pode não se traduzir em receitas expressivas de publicidade nacional.

Destaques das Perguntas e Respostas dos Analistas

Potencial de alta nas taxas de afiliados: A administração evitou quantificar as próximas renovações contratuais, mas apontou o aumento de 81,9% na receita de afiliados do 2º trimestre como evidência do avanço de sua estratégia de tarifas e renovações. Afirmou ainda que os índices de audiência e o valor da marca continuam sendo seus principais trunfos de negociação.

Visibilidade do licenciamento internacional: A projeção de US$ 16 milhões em taxas de licenciamento para 2026 é respaldada por acordos já assinados. A administração descreveu a base de receita como estável e informou que projetos internacionais adicionais permanecem em análise.

Monetização de IA: O acordo com a Meta é plurianual e representa uma relação de licenciamento independente. A administração declarou que a IA pode se tornar, no futuro, uma fonte expressiva de receita de licenciamento, mas não assumiu compromissos nem forneceu estimativas específicas.

Retorno sobre investimentos em conteúdo: A administração espera que os investimentos em conteúdo e tecnologia beneficiem simultaneamente várias fontes de receita. Audiências mais elevadas podem impulsionar a demanda por publicidade, as assinaturas do Newsmax+ e as negociações de taxas de afiliados, melhorando o retorno potencial dos gastos com programação à medida que a empresa ganha escala.

Estratégia de público multiplataforma: A Newsmax não enxerga as redes sociais apenas como um funil de assinantes. Em vez disso, utiliza a promoção cruzada entre redes sociais, seu site, aplicativos, TV linear, Newsmax2 e Newsmax+ para ampliar o alcance e o engajamento.

Transcrição Completa da Teleconferência de Resultados

Transcrição completa da teleconferência de resultados

Comentários da administração

Operator

Good day, ladies and gentlemen, and welcome to the Newsmax Second Quarter 2026 Earnings Conference Call.

[Operator Instructions]

Please note, this conference call is being recorded. I will now turn the conference over to your host, Mr. Chris Odeh with Investor Relations. Sir, the floor is yours.

Chris Odeh

Good afternoon, and welcome to Newsmax's Second Quarter 2026 Earnings Conference Call. I'm joined today by Chris Ruddy, Chief Executive Officer; and Darryle Burnham, Chief Financial Officer. On this call, Chris and Darryle will provide prepared remarks on the most recent quarter. We will then take questions from the investment community. A recording of this conference call will be available on our Investor Relations website shortly after the call has ended.

Please note that this call may include forward-looking statements regarding Newsmax's financial performance and operating results. These statements are based on management's current expectations. Actual results could differ from what is stated due to certain factors identified on today's call and in the company's SEC filings.

Additionally, this call will include certain non-GAAP financial measures. Reconciliations of these measures are included in the earnings release and our SEC filings, which are available in the Investor Relations section of our website.

I will now turn the call over to Chris Ruddy, Chief Executive Officer of Newsmax. Chris?

Christopher Ruddy

Thank you, Chris, and welcome, everyone, to our second quarter 2026 earnings call. The story of the second quarter is simple. We did what we said we would do and more. Revenue came in at a record $54.1 million, up 16.5% year-over-year. And for the first time as a public company, Newsmax was profitable. We delivered net income for the quarter of $2.9 million and adjusted EBITDA of $5.7 million.

Let me put the profitability in perspective. The onetime costs of becoming a public company and legal costs are now largely behind us. These numbers carry less noise and give a cleaner view of the business. We are encouraged by what we see, and we'll look to invest behind this growth. We remain in strategic investment mode. That will not change. We are also seeing growth in key areas of our business.

Broadcast revenue rose 20.5% to $45.8 million, led by our higher-margin affiliate fees and licensing. Overall, the value creation opportunities of our multi-platform model are showing positive results. Our audience tells the same story. Despite the post-cycle normalization, total viewership rose again. We reached 26.9 million total viewers, up 4% year-over-year. This represents our highest second quarter reach in the past 4 years. Our total viewers also include 11.3 million adults 35-64.

We remain the fourth highest-rated cable news channel and ranked #2 in the category for engagement among adults 35-64. Even when the news cycle slows, our viewers stay with us, and we continue to grow. Our audience is highly loyal. That is one of the great strengths of the Newsmax brand. The way people find news is not standing still and neither are we. We maintain a strong presence on social media. Our growth there is resilient. Total followers climbed over 28% year-over-year to over 26 million. This shift in news consumption has also increasingly been moving to AI and we continue to be at the forefront in meeting viewers where their preferences evolve.

We are excited about our multiyear AI content partnership with Meta. Our journalism and reporting will help power AI answers across Meta's ecosystem, social, streaming, AI. We see this as the beginning of our AI efforts and it's nice to start with a bang by partnering with one of the largest online companies in the nation. None of this works without a solid foundation. Newsmax is the fastest-growing basic cable network since Nielsen began measuring us in 2020, up more than 280% across key dayparts. That broadcast strength is what allows us to invest in the rest of the platform.

Even as consumption shifts across platforms, there is still a strong place for linear news. We are well positioned to maintain that presence. Streaming continues to be a strategic focus for us. It's a key investment area and the next frontier of our business evolution. On our year-end call, we said Newsmax+ needed stronger content and more on-demand programming and that we would put resources behind it. We have the Newsmax+ catalog now tops 300 titles, including broadening our content library of family-friendly content, including more new original premium specials and documentaries.

Newsmax2, our free streaming channel, keeps gaining ground on the major platforms with news hours continuing to grow. Subscription revenue is still an area we are building. You will be hearing a lot more about those efforts in the months ahead. We will keep taking deliberate steps to improve engagement, strengthen retention and translate the expanded lineup into subscriber growth.

Our international business is building rapidly. In 2025, we reported $3.6 million in international licensing fees. This year, we expect fees of about $16 million, a 344% increase. During the past quarter, we officially launched Newsmax Poland, solidifying our already vast distribution footprint in more than 100 countries. These are true partnerships. The operators know their markets, run the channels locally and license the Newsmax brand. We provide our high-quality content and the editorial framework. It is a capital-efficient way to add value for all parties, especially the viewers.

Most importantly, we are bringing independent center-right journalism to these underserved audiences around the world. We believe Newsmax can become a truly global news brand and we are building toward exactly that.

Looking ahead, we are reiterating our full year 2026 revenue guidance of $212 million to $216 million, representing 13% growth at the midpoint. We continue to expect this growth to be structural, not cyclical, led by affiliate fee expansion and licensing. We also expect the full year operating profile to improve compared to 2025.

Let me close with the big picture. Nearly half the country feels underserved by legacy media with trust at an all-time low. The center right audience is underserved both domestically and internationally. That creates a significant and durable opportunity. This audience is not shrinking and few media companies can reach it with the scale, credibility and multi-platform presence of Newsmax. We deliver independent values-driven journalism across cable, streaming and digital.

Our social audience is large and highly engaged. Our reach continues to expand. We are also positioning Newsmax at the forefront of emerging technology as AI becomes a more important channel for news discovery and consumption. I'd like to say that Newsmax is leading a news revolution and I don't say it lightly. We continue to grow, reach millions of Americans digitally on social and on TV, both linear and streaming as well as through our plus service, podcasting and radio and now in a very robust way across the globe.

This quarter showed that the foundation of our revolution is stronger than ever, record revenue, a growing international footprint, our first profitable quarter as a public company, a strong cash position and debt-free balance sheet, financial flexibility to support investments in content and growth. We are operating from a position of strength and we are excited about the journey ahead.

To our readers, our viewers, our advertisers and you, our shareholders, thank you. With that, I will turn it over to our Chief Financial Officer, Darryle Burnham, to walk through the financials. Darryle?

Darryle Burnham

Thank you, Chris, and thank you, everyone, for joining us today. As Chris highlighted, we delivered record revenues and our first quarterly net income since becoming a public company. The way we got there is just as important as the result. Our revenue mix continued to shift toward affiliate fee and licensing revenues and higher rates across both expanded gross margin to 43.1% from 38% in the prior year quarter.

We are also operating with better visibility, absence of the prior year legal settlement expense, allowing strong top line growth to flow through to the bottom line. Importantly, profitability does not change our investment plans. Our capital allocation priorities remain focused on supporting long-term growth, which includes investment in programming, talent, technology, distribution, digital initiatives and other strategic opportunities. With improved visibility into our cost base, our focus is on sustaining this operating leverage as we continue to grow.

Turning to our second quarter results. In the second quarter, we delivered $54.1 million in total revenues, representing a 16.5% increase year-over-year. Breaking this down by revenue stream for the quarter, first, starting with our reportable segments. Total broadcasting revenues grew by 20.5% year-over-year to $45.8 million in the second quarter of 2026. Our growth in broadcasting was driven by higher affiliate fee revenue attributed to new contractual relationships and rate increases that took effect in late 2025 and 2026 as well as expanded international licensing agreements.

Total digital revenues declined 1.3% year-over-year to $8.3 million in the second quarter of 2026. Growth in digital advertising, driven by new contractual relationships was offset by lower subscription revenue and product sales.

Now turning to our revenue by component. Advertising revenues decreased to $28.8 million, a 3.5% year-over-year decline, mainly due to lower customer order volume and a challenging comparison from election-related demand last year. This was partially offset by digital advertising growth of 21.3%. Affiliate revenues increased 81.9% year-over-year to $13.4 million, driven by new contractual relationships as well as rate increases that took effect in late 2025 and 2026.

Subscription revenues of $6.3 million were down 9.9% year-over-year due to lower new customer acquisition, partially offset by gains from expanded affiliate agreements that make Newsmax available on more linear cable providers. Product sales revenue decreased 31.7% year-over-year to $1.1 million, primarily driven by decreased book and supplement sales.

Licensing revenues were $4.6 million, up from $0.7 million in the prior year quarter, driven by expanded international licensing agreements. We reported quarterly net income of $2.9 million or $0.02 per share compared to a net loss of $75.2 million in the prior year quarter. The improvement was primarily driven by higher total revenue, improved operating efficiency and the absence of legal settlement expenses recorded in the prior year period.

Our quarterly adjusted EBITDA was $5.7 million, an improvement of $9.5 million from negative $3.8 million reported in the same quarter last year, primarily due to growth in high-margin affiliate fee and licensing revenue and lower general and administrative expenses, partially offset by continued investment in programming, production and OTT initiatives. We ended the quarter with $25.9 million in cash and cash equivalents and $102.4 million in short-term investments, bringing our total cash and investment position to $128.3 million with no debt on the balance sheet.

We are encouraged by our performance through the first half of the year and remain confident in our previously disclosed full year revenue guidance of $212 million to $216 million, representing 13% year-over-year growth at the midpoint of the range, an acceleration on the growth we realized in 2025. Our higher-margin affiliate fees and licensing streams are the biggest levers to our margin improvement in the near term. At the same time, we continue to scale the business. We expect opportunities to improve margins through revenue growth from content investment, technology and monetization across multiple platforms.

In closing, we remain focused on disciplined execution as we continue to invest in content, distribution and OTT initiatives that support long-term growth. With a strong balance sheet and a diversified multi-platform revenue model, we believe we are well positioned to build on this quarter's progress and deliver sustainable value for our shareholders.

Thank you for your time today, and we look forward to updating you on our continued progress during the next quarter earnings call. Now we would like to open the line for analyst questions. Operator?

Operator

[Operator Instructions]

Our first question today is coming from Michael Kupinski with NOBLE Capital Markets.

Perguntas e respostas

Michael Kupinski

Congratulations on a solid quarter. A couple of quick questions here. I know in your presentation, you highlight that Newsmax affiliate rates are roughly 7x below peers on average, and that's in spite of the fact that your distribution ratings are increasingly comparable. And I know that you've been reluctant to talk about this in the past, but I just thought I'd ask anyway, what percentage of your subscriber base is scheduled for renewal over the next 12 to 24 months? And then I guess the real question would be, how quickly do you think you can close that rate gap without sacrificing your distribution?

Christopher Ruddy

Darryle, do you want to chat about the first part?

Darryle Burnham

Yes, absolutely. Michael, thank you for the question. It's good talking to you again. So consistent with what we've talked about before, we haven't really publicly disclosed what percentage of our affiliate fees are coming up for renewal. But I think what is beneficial is to look at some of the history on this, right?

So we've talked about the fact that there's always a large opportunity for growth in affiliate fees and that comes with the fact of the renewal for the contracts because we're a relatively new entrant into the affiliate fee world. When you look at some of the changes that we've seen in 2026 compared to 2025, I think you can see that already -- that strategy already really kind of coming through to fruition.

So the goal really is to continue to execute on future renewals similar to what we have in the past. Whether or not we'll be able to close the 7x gap is going to be contingent on our continued execution of our strategic vision by increasing in programming and talent and distribution across all of the areas that we can so that we're in the best position to be able to negotiate any of those renewals.

Christopher Ruddy

I would just add that the best leverage is always ratings and that our growing brand value. And I think that has been -- that has carried us forth through a lot of years. I mean people have said when we first started in the mid-2015 period, you're never going to get on any cable systems. We got on all the system. You're never going to get a cable fee. We got cable fees from everyone. You'll never get renewals. We've gotten renewals from every major player. And we just keep growing. And affiliate fees were up 81% year-over-year. So I think that is the start of a lot of these are rolling agreements. And so we're going to continue to see strength there.

Michael Kupinski

Got you. I know that licensing revenue is obviously incredibly growing fast there as well. I was just wondering how much of that $16 million in terms of your guide is already contracted versus dependent on additional agreements? And then looking to 2027, how should we think about licensing as a recurring base that what should it grow from $16 million as we look into 2027?

Christopher Ruddy

Darryle?

Darryle Burnham

Well, the guidance that we've given on licensing so far this year was based on factual evidence of agreements that we had in place. So the $16 million that we gave for this year is not contingent on any future agreements. The $25 million that we talk about as an annualized run rate for next year gives you some indication of the overall growth. And we're very excited with the growth in the interest really in conservative news internationally and globally. So it's become an area of focus within the company now. We want to continue to focus on that because we do believe that there is an interest in conservative news across the country or across the world. And as a result of that, that's something where we've got a number of different projects that we're continuing to look at.

So right now, the $16 million is, I think, a very stable number. You can see that based on the results of the first 2 quarters. And right now, we're not giving any guidance past the $25 million that we've already put out in the press release for 2027, but we are excited that there are additional opportunities in international licensing in the future.

Christopher Ruddy

And all our agreements are multiyear agreements. We're not doing this just as a one-off for 1 year or 2 years. So I think you can see something over the horizon on these deals, and then we hope we get renewals in years out. We have gotten renewals on our main deal that started in Serbia some years ago. So we're hoping that, that continues. We don't have any reason to believe it won't for the moment. But we do think this is a huge area of opportunity for the company that was somewhat surprising for us, right? It was not something we talked about much in the IPO process, and it's just another add-on and the market for the global news is huge.

Michael Kupinski

That's pretty exciting. And if I can squeeze one more in. Your Meta agreement is your first major AI content partnership. And I was just wondering if you can maybe discuss the economics of that relationship without obviously getting into contractual specifics, but if you can just give us some more color there? And are you currently in discussions with other major AI platforms as well?

Christopher Ruddy

I would say that we're not revealing the financial details of that agreement. It's a multiyear agreement, and we think it's consistent with market, and it's very powerful. Think about this, our first AI agreement, major AI agreement is with Facebook Meta, which is a huge Internet company. So I think it shows the value again of Newsmax as a brand and that Meta, which is investing, I think, over $100 billion in AI sees Newsmax as an important partner and that they were interested in doing a partnership with us.

So I think it's a very good milestone for the company and we say in our release and what we talked about is that this is the beginning. We are in discussions with a number of AI companies, and we hope to have more developments on that in the future. So we do think it's an area of incremental and strong supplemental revenue, but also the company hopes to develop its own approaches to AI that we think will be beneficial to the shareholders in the company, not just as a licensing, but also incorporating AI into our infrastructure.

Michael Kupinski

Chris, if I could just follow up quickly on that. Can this partnership, would it -- I'm just trying to understand the AI licensing. Could it become a meaningful stand-alone revenue stream going forward? I'm just kind of curious on how that relationship would work.

Christopher Ruddy

Well, I'm not an accountant. I don't know what stand-alone revenue stream means. It's already a stand-alone revenue.

Michael Kupinski

Much like your licensing...

Christopher Ruddy

Correct. Well, we're hoping that the licensing, we are hoping, I can't promise that, but it could potentially be a significant licensing stream for us. I mean AI is taking is a revolutionary thing, and it's happening in very big ways. We have a lot of content. AI companies need content.

Darryle Burnham

And I think that's kind of the key on this one, Michael, if I can add a little bit, right? I mean AI is becoming an important channel for news discovery. And I think, as Chris said, it shows the strength of the Newsmax brand with the fact that Meta wanted to partner with us to help kind of train the AI model. So we're all aware of the fact that there's a lot of capital that's being invested into AI. There's no real way that we can predict what that might be. But I think we're very excited that we're able to participate in that. And hopefully, we can continue to participate in that in a meaningful way. So as that grows, could it be some stand-alone revenue stream in the future? We certainly hope so, but we're not giving any guidance specific to that.

Operator

Our next question is coming from Alicia Reese.

Alicia Reese

I wanted to dig into a couple of different things. One, the gross margin or the margin improvements that you cited that were related to improved operating efficiencies outside of just higher affiliate fees. Can you dig in a little bit on that and detail some of the improvements that you've made perhaps over the last quarter over the last year?

Darryle Burnham

Sure. Well, I think it's a couple of areas, right? I mean the obvious ones are increases in the affiliate fee license and the licensing revenue because those are both high-margin contributors to the business overall. And the other part would be just operating efficiencies that we've seen now that we're kind of through that first year as a public company. We don't have some of those same first year public company expenses. A lot of the legal expenses we've gotten through that wouldn't affect the margins as much.

But overall, we've just seen the ability to focus more on the business, and we're focused on some of those high-margin components of the business. And we're constantly looking at ways that we can utilize new tools to become more efficient within the business as well. I mean there's been a total transformation in broadcasting over the last 10 years. And the things that the equipment and the content generation that used to be significantly more expensive, advances in AI, all of these things are tools that we're looking at as ways to become as efficient as we can on containing the cost within the business overall.

Alicia Reese

And I think that might answer at least some of my follow-up question with that because you had mentioned that you expect to get more margin expansion, of course, from affiliate fees in the future, but more so from tech and content investments. So I wanted to focus on that content investment category. Is that due to the lower cost of content due to the AI implementation? Or are there other avenues by which you can come to those lower content fees? Or is it just driving higher users that would create the better margins on content?

Darryle Burnham

I think, go ahead, Chris.

Christopher Ruddy

Yes. I think that the obvious one is the ability -- AI helps you create and put together content. It's not perfect. It's not something you can go to print with just because it's -- but it helps speed up what our editors noticed on the digital side, on the TV production side. It speeds up the process of putting content together. It gives you a lot of background information. It all has to be double checked, but it's putting it together in a very coherent, logical, typically good manner, but needs to be checked and verified.

And so we're finding that it is speeding up the process and reducing some costs and you hope more on the digital side. TV production is seeing similar things. And graphics, too. It's very good at producing graphics and charts, which are usually time-consuming and costly on the television side.

So in social media, we use a lot of graphics. So I think that's where the reduction of cost comes in. We're not implementing so far like an AI feature on Newsmax. So we're not really getting any users from that yet. But we are hoping that other companies we can partner with for our content, they can have access to that way like we're doing on the Meta deal.

Darryle Burnham

And I might add -- the other area, just to add one more point to that, that I think is important to understand is that when you're looking at our investment in content and programming and technology and some of the things that we referenced in the press release, some of those investments are across multiple product streams, right? So when we're investing, for example, in programming and content and efficiencies within our Newsmax1 channel, we get the benefit, and that's all to drive ratings and ratings will increase advertiser demand, right?

So that gets the benefit of driving increased margin just through economies of scale because we're driving increased demand for advertising because news is still a primary source that advertisers covet because people are still watching news live. The other benefit to that is that it continues to add to the value proposition for our Newsmax+ streaming service and that continues to potentially give us the ability to attract additional subscribers to the Newsmax+ service. And it puts us in a better position, as Chris mentioned earlier, with the ratings when we're negotiating for additional affiliate fees. So we get an economy of scale with this as well where the investment starts to have a higher ROI just as we grow.

Alicia Reese

Excellent. That makes a lot of sense. And I have one more, if I may. I was just wondering, and I hope this isn't too naive of a question, but I'm wondering about the funnel as you acquire new users. I assume a lot of it is through the social media, but I wonder to what extent people stay there and you're fine with that because it's useful as its own means of delivering news to users on those platforms. But to what extent is that a funnel to perhaps Newsmax2 and Newsmax+ now or any potential for that in the future?

Christopher Ruddy

Well, I'm not so sure that we have a funnel out of social media. I would like to say that we're for all people on all platforms, and we've discovered in the old days where you were siloed, you were newspaper, radio business, those days are over. And even digital means a lot, right? Podcasting is included, that includes video on digital side. So there's a lot going on. Social media is falls under the umbrella of digital. And there are some people that just want to consume news on social and not come to our platform. And so that we try to service those people, we try to give them information.

We really do like it when they see us in social and they're more likely to come to the website. They're more likely to download our app, which then leads them to the Newsmax+ service to check their cable guide and watch us on cable. So we're constantly -- what I like to use the word instead of funnel is cross-promoting. So TV will promote digital, digital promotes TV and TV being both linear and streaming. And then we have the app. And the app notifications promote the TV channel and the digital stuff.

So if you looked at like a line chart, there'll be lines going all over the place, but it seems to work and the overall impact is pretty significant because you have synergies and the synergistic effect of all of those promotions and mentions. I think it's a key reason. If you look, Newsmax consider our revenue base, consider what we come from and that we're Reuters in one of the recent studies had one of the top 12 U.S. news brands. We're frequently listed as one of the top major Marquette Law School just did a survey of viewership and news coverage, and they listed us as one of the top news media outlets in the country.

I think we're going our revenue monetization is going to grow pretty significantly because of the brand and the reach that we have. And people obviously -- hopefully, we hope shareholders and investors see that, but we certainly see it.

Operator

Our next question is coming from Tom Forte with Maxim Group.

Henry Dare

This is Henry Dare. I'm calling in for Tom. Just one quick question. Chris, you've talked about this in the past, but we would appreciate your current thoughts on what the midterms could mean for your audience engagement, both for your cable news network and digital efforts as well as your sales and profits for the back half of 2026?

Christopher Ruddy

Well, elections are always good for engagement, even if we don't necessarily get a lot of advertising fees. A lot of the midterm elections are very local oriented and people don't see them as national elections, they're state races, congressional races and what have you there. And so those advertising campaigns don't -- typically, we get some increase, but we do see a lot more engagement because a lot of those races around the country.

We certainly think right after that election turns over, I think you'll see even more engagement. You'll see it for 2 reasons. One is I think there's a great likelihood of the Democrats getting control of the House of Representatives. And then there's a potential likelihood of them controlling the Senate, divided government tends to mean more news, more conflicting stories and more engagement, I think, by both sides.

The second is the presidential campaign really begins in earnest. Some would argue it's already begun. But the first Iowa debate typically is in the summer of the following year. So next year would be the summer -- so Iowa is going to be in play and discussed going -- there'll be probably at least a half dozen candidates from what we're hearing running for President. So that will be good for engagement, we believe, for some revenues. So it's very exciting. I think we have a 2-year great window to continue building out post-IPO now and continuing our reach on all of the different platforms that we are engaging people.

Operator

Ladies and gentlemen, as we have no further questions on the lines at this time, this will conclude our question-and-answer session and today's call. You may disconnect your lines at this time, and we thank you so much for your participation.