So we’re fully loaded with sports and fourth quarter on all networks.
Dan Kurnos: Got it. That’s really comprehensive. Appreciate it.
Rob Weisbord: Thanks, Dan.
Operator: The next question is coming from Aaron Watts from Deutsche Bank. Aaron, your line is live.
Aaron Watts: A couple of questions for me. I’ll start with this one, and I apologize if I missed it, but could you comment on the pace of erosion in your underlying sub base for your station group? And whether recent trends have caused you to reconsider your 3-year outlook for net retrans, which I think Lucy was low single-digit growth?
Chris Ripley: Right. So the trend, by and large, it’s a little bit worse, but we’re still in mid-single digits in terms of churn. and we are not changing our guidance in terms of the 3-year CAGR, 22% to 25% in low single digits. So we still had — we can absorb that small degradation that we’ve seen.
Aaron Watts: Okay. And Chris, I’ve asked you this before, but figured I’d try again today. Any greater clarity on whether the upcoming distribution discussions you mentioned will be representing your station group solely or if the RSNs will still be a part of that? And if it is a return just at the stations, do you see some potential upside from prior terms when the RSNs were in the mix?
Chris Ripley: Right. Well, we — yes, we will be negotiating for — or we’re not — we will not be negotiating for Diamond in these upcoming renewals. So that’s the answer to that question. And I do think that we are very bullish on what the outcomes will be for what is almost 90% of all of our subs coming up in the next 12 months.
Operator: The next question is coming from Steven Cahall from Wells Fargo. Steven, your line is live.
Steven Cahall: Yes. First, maybe to just pick up on the sub comment you just made, Chris. So it looks like that the retrans guidance for Q3 is about a 2% sequential move quarter-to-quarter. — which I guess we would then annualize to about an 8% rate of churn. So just first question, is that kind of the right way to think about churn at this point? And I think also I heard in the prepared comments that you’re seeing some improvement in reverse comp. Should we think of that to mean that the rate of increase in those prices are lower than what they used to be. I think that’s kind of what we’ve heard. And a last retransmit sneak in here is we’ve heard the 3 out of the 4 national networks are now doing a reverse comp is just a programming fee not per sub. So wondering if you could confirm that.
Chris Ripley: So I’ll handle the questions about reverse comp. It’s — most of our deals are fixed programming fees. That’s not new — that is — that’s been that way for well, it really has been that way almost from the start of reverse retrans. And then in terms of increases, we’re definitely seeing reduction in the escalation of those fees as they’ve become quite significant in terms of the aggregate size — and as the attention and focus of the network, the big media companies have turned towards more SVOD and other properties. So as we’ve spoken about in the past, we do think the dynamic — the negotiating dynamic between us of the networks has balanced out and enabled us to manage our programming costs in a much more reasonable way. So that’s what you’re seeing there.
Rob Weisbord: Yes, Stephen. So on the revenue side, as Chris mentioned, we’re seeing mid-single-digit churn on broadcast. And that’s what we’ve modeled into the guidance. From a revenue standpoint, don’t forget there will be YouTube TV, which just launched Tennis in June 1. So you’ll have a full quarter of that in there for third quarter, adding to some of the increase as well as just some escalators year-over-year.
Steven Cahall: Great. And then maybe just a couple on the ventures portfolio. So I was wondering how we think about what the balance sheet entry currently is for some of the assets that you reflect on that Slide 9. The cash and the valley stakes are easy, but just wondering how you currently carry those investments on the balance sheet. And you mentioned that you might want to deploy some of that cash. And with that, could we expect any major exits ahead? And also related on this one, would you ever consider spinning out this business because I wonder if some of the challenges just that as media investors we’re a little out of our element, trying to put all this together sometimes.
Chris Ripley: Sure. So what’s reflected on Page 9 are the current conservative market values of the various assets. So that does not come through on the GAAP balance sheet. On the GAAP balance sheet, it’s the lower of cost or market. And so most of these are going to be listed at cost because their market value is well ahead of their costs. And so — in terms of — so that’s why we have to give the disclosure the way it is. It does not really show up on our balance sheet, and that reflects the true value there. And so in terms of spinning this off, as I mentioned before, I think that sort of goes in the bucket of what would we do to realize value that is something that it’s not currently contemplated, but it’s certainly something that we’ve discussed. And ultimately, if we can’t this valuation discrepancy and may be something that we would do in the future. I think there was one other question embedded there that I might have missed.
