Jason Combs: Yes. So it probably is early to size those. But what I would say is we think we have the ability to move through the rest of this year to manage things really tightly, whether that is pushing out discretionary spend or identifying continued process efficiencies that drive savings for us. And so I’m optimistic those are things that beyond revenue growth, items we talked about in the Scripps, beyond the asset sale. I think expense management is another lever that we are going to pull that’s going to drive deleveraging by the end of this year.
Dan Kurnos: Great. On core, can you just talk through – I mean you said services, I think you said up double digits in April. We continue to hear that 2Q is better than 1Q, and there are some suggestions that core could actually be pretty strong in the back half of the year. I know you guys have a different footprint, and so you might be more exposed to crowd out. But just how should we think about your expectations around core both in 2Q and the back half of the year?
Lisa Knutson: Dan, it’s Lisa Knutson. Sorry, I’ll take that question. So we are definitely seeing some improvement in categories. As we’ve said, automotive was up in Q1. It’s – in 2023, I think it was up 10% for the full year. In terms of other categories, services in April was down slightly. But certainly in first quarter, we continued to see improvement there as well as home improvement which, again, was up in Q1 and we’re seeing it up in April. I think crowd out, we anticipate crowd out in Q3 and Q4 because of political advertising. So – and remember, those are high-margin dollars, and we’ll take those. Certainly, we work with advertisers to make sure that they’re – that we’re finding alternatives for them in terms of the crowd out. But definitely with political numbers that we just guided to, we expect to see that probably starting in Q3 and definitely in the first part of Q4.
Adam Symson: Dan, it’s Adam. I think the general theme you’re seeing is that as part of core; local is hanging in there pretty nicely, doing well. And there’s still some softness in core associated with national. And for us, it’s been really the comps around sports betting that has driven, I think, that performance on the national side.
Dan Kurnos: Got it. That’s super helpful. All right, I won’t hog the call. I’ll get back in the queue and see if my other questions are asked. Thanks, guys.
Adam Symson: Thanks, Dan.
Operator: And we’ll go to the next line, Steven Cahall of Wells Fargo. Please go ahead.
Steven Cahall: Thank you. Lisa, I’m having a little trouble understanding the Networks revenue guide for Q2. Adam, I think you said that direct response and scatter are pacing up quarter-to-quarter – or sorry, year-on-year in the second quarter. And then the guidance is for Networks revenue down mid-single digits. So I just want to understand what I might be missing there. And then Jason, your first sentence mentioned tight cost controls. I think some of that is going to come up in the shared services or other line in your segment profit. But can you just detail what you’re doing differently and maybe any run rate savings that you’re looking to achieve through these initiatives? And then finally, I don’t think you’ve got a free cash flow guide out there right now. So just wondering if we think about free cash flow that you think you can use to pay down debt this year, if there’s any range or numbers you might be able to guide us to. Thank you.
Adam Symson: So, Steven thanks for the question. Look, we are seeing some nice, I would say, rebound momentum in direct-response and in the scatter market, but we also still have to contend with the upfront from last year, which laid in a fair bit of inventory at lower rates. So the good news is scatter rates today are 40% above those rates. And direct-response makes up a very big chunk of our inventory. But we still are dealing with the impact. I would expect, if the rebound continues on track, that what we would see by the fourth quarter would be indicative of the strength of this year’s upfront and hopefully, consistent with the rebound we’re seeing in scatter and direct response.
Jason Combs: Yes. I think from an expense standpoint, I mean, I think there are a variety of places we’re looking, which you saw we did in Q1 and we’re doing in Q2 as well around whether it’s employee costs, trying to manage open positions, trying to identify areas of opportunity. But another thing you heard on the call today was I updated our guide for the Other segment, which had previously been a loss of $7 million to $10 million. We tightened that to $7 million to $8 million. That’s really tied to a little bit of a slowdown in the rollout of Tablo because we’re looking to direct more of – more discretionary cash towards debt paydown in the short-term. And specific to free cash flow guide, we’re not giving out any kind of specific number for the year.
There are still a lot of variables, including a wide political range we gave and a variety of other factors in there. But what I would say is we believe we have the opportunity through political, through a rebounding advertising marketplace, through things like the asset sales we talked about, to make – to generate a significant amount of cash this year and direct all of that to debt paydown as we’ve done in the last couple of years and make a meaningful improvement in leverage by year-end.
Adam Symson: Just a little bit more color on Tablo. First quarter, Tablo hit our plan on consumer sales. But this is a new business for us. And the change you’re seeing in the Other segment reflects essentially expenses moderating because we’re able to lower our average customer acquisition cost and spending.
