OUTFRONT Media (NYSE:OUT) reported fourth-quarter 2025 results that management characterized as “solid,” driven by accelerating demand in transit advertising and continued progress on its strategic initiatives. On the company’s earnings call, CEO Nick Brien and CFO Matthew Siegel also outlined expectations for early 2026, including high-single-digit consolidated revenue growth in the first quarter and “comfortably” double-digit growth in reported adjusted funds from operations (AFFO) for the full year.
Fourth-quarter results: transit strength offsets billboard contract exits
Brien said consolidated revenue increased 4.1% in the fourth quarter, up from 3.5% growth in the third quarter. He attributed the performance to 16% growth in transit and 1% growth in billboards. Adjusted OIBDA rose 12% to $174 million, while AFFO increased 8% to $130 million.
Transit revenue grew 16%, led by the New York MTA, which Brien said was up more than 20% during the quarter. He pointed to strong performance in the finance, tech, and legal verticals.
Digital mix and category trends
Brien said total digital revenue increased about 11% and represented roughly 39% of total revenue in the quarter. Excluding the New York and Los Angeles billboard contracts the company exited, digital revenue growth would have exceeded 16%, he said.
Within transit, digital revenue climbed 37% to $73 million, while static transit revenue declined a little over 2%. Brien said both commercial and enterprise teams contributed to the momentum and added that the strength carried into early 2026.
On advertiser categories, management said stronger areas in the quarter included financial, legal, and tech, while weaker categories were government, political, retail, and auto, which Brien described as consistent with broader industry trends.
Programmatic and digital direct automated sales grew 11.3% and accounted for 16.9% of total digital revenue, slightly higher than the year-ago period.
Margins and expenses: transit profitability surge, billboard margin improvement
Siegel highlighted a decline in total billboard expenses of about $3 million, or 1.4%, year over year. Lease costs fell $4.5 million, or 3.8%, including approximately $9 million related to the exited New York and Los Angeles contracts, partially offset by escalators on fixed leases. Excluding the portfolio exits, billboard property lease expense would have increased about 4%, he said.
Posting, maintenance, and other billboard expenses declined about $1 million on lower production costs, while billboard SG&A increased about $2.3 million due to a higher provision for doubtful accounts, higher professional fees, and increased travel and entertainment.
With modest billboard revenue growth and lower expenses, Siegel said billboard adjusted OIBDA increased by more than $5 million, or 3.4%. Billboard adjusted OIBDA margin rose 120 basis points to 41.5%, and Siegel said he expects billboard margins to continue improving in 2026 versus 2025.
Transit expenses increased about $6 million, or a little over 6%, reflecting higher franchise expenses tied to an annual inflation adjustment to the MTA contract’s minimum annual guarantee (MAG), higher production costs, and higher professional fees in SG&A. With transit revenue up nearly 16%, transit adjusted OIBDA improved more than 56% to over $34 million. Siegel emphasized that incremental growth at the MTA carries “extremely high margin.”
MTA outlook, capital spending, and AFFO framework changes
Siegel said minimum annual payments to the New York MTA will step up about 3% in 2026 to approximately $161 million, driven by a New York City CPI escalator. Included in that figure is a final $11.7 million deferred minimum annual payment related to a 2020 pandemic-era amendment and associated MAG shortfall. The company will continue to account for MTA franchise expense on a straight-line basis, he said.
On capital expenditures, fourth-quarter spending was about $25 million, including roughly $11 million in maintenance. OUTFRONT converted 26 new billboard faces to digital in the quarter, bringing the 2025 total to 103. For 2026, Siegel guided to approximately $90 million of CapEx, with $30 million to $35 million expected to be maintenance and much of the remaining spend earmarked for digital development, primarily digital conversions and new digital boards.
Siegel also noted that the company modified its AFFO calculation at the end of 2025 to include amortization of direct lease acquisition costs instead of cash paid for those costs, which he said better aligns period-to-period measurement and is consistent with the company’s funds-from-operations approach. He said the change resulted in small adjustments—less than $3 million annually—to prior-period AFFO, which were recast.
Early 2026 outlook: first-quarter revenue acceleration and strategic partnerships
Brien said the company expects first-quarter 2026 revenue growth to accelerate from the fourth quarter, with consolidated reported revenue up in the high single digits, driven by high-teens growth in transit and mid-single-digit growth in billboards. He said the outlook includes two non-recurring items:
- A billboard condemnation expected to add approximately $10 million to billboard revenue, anticipated to close at the end of March.
- A headwind from the company’s strategic exit of a marginally profitable Los Angeles billboard contract that contributed about $4.5 million of revenue in the first quarter of 2025.
Adjusting for those items, Brien said first-quarter consolidated revenue growth would still be in the mid- to high-single-digit range based on existing operations.
For the full year 2026, Siegel said the company expects reported consolidated AFFO growth “comfortably in the double-digit range,” primarily driven by OIBDA improvement. He said the outlook assumes $145 million of cash interest, $30 million to $35 million of maintenance CapEx, and $5 million of cash taxes. Management cited items including the World Cup, an election year (though OUTFRONT said it is not a major political advertiser), the first-quarter condemnation benefit, and continued momentum in its “regular way” of business.
Brien also discussed two commercial agreements intended to modernize out-of-home planning, buying, and measurement: a partnership with Amazon Web Services aimed at integrating OUTFRONT inventory and data into holdco media buying systems, and an investment and exclusive commercial arrangement with AdQuick, which he positioned as a platform to simplify planning and purchasing—particularly for SMB and mid-market buyers. Management said it has already signed clients to both initiatives, while noting it will take time for them to fully ramp.
On the balance sheet, Siegel said total net leverage was 4.7x at year-end, within the company’s 4x to 5x target range, and the next debt maturity is not until late 2027. OUTFRONT also maintained its $0.30 cash dividend payable March 31 to shareholders of record as of March 6.
During Q&A, management said tech-related demand includes AI and SaaS advertisers and cited several campaign names, adding it has a dedicated team in San Francisco focused on the category. On the MTA, executives said it is “possible” results could move above the MAG threshold, though they did not provide full-year MTA revenue guidance and said transit bookings typically come later than billboard.
About OUTFRONT Media (NYSE:OUT)
OUTFRONT Media Inc is a leading out-of-home (OOH) advertising company offering a broad range of billboard, transit and digital display solutions across major urban markets in the United States and Canada. Its portfolio encompasses traditional static billboards, high-resolution digital signage, transit media on buses, trains and taxis, as well as street furniture placements such as bus shelters, kiosks and urban panels. The company partners with brand marketers to deliver high-impact campaigns that engage consumers outside the home environment.
Through an extensive network of assets in key metropolitan areas, OUTFRONT provides advertisers with premium visibility along highways, city streets and transit corridors.
