Beasley Broadcast Group, Inc. (BBGI): 5 FORCES Analysis [Nov-2025 Updated]

You're looking for a clear, no-fluff breakdown of Beasley Broadcast Group, Inc.'s (BBGI) competitive position, and I'll give you the five forces through a late-2025 financial lens to help you map the risks. Honestly, the picture isn't simple: customer power is high, evidenced by that Q3 2025 net revenue drop of 12.4% year-over-year, driven by advertisers easily shifting spend away from terrestrial radio to digital competitors who have zero switching costs. Still, you have high supplier power from music licensors and on-air talent, all while intense rivalry pushes the company toward an operating loss of about $0.3 million in Q3, reflecting the pricing war in a mature industry. Below, we map out exactly how these forces-from the low barrier for digital new entrants to the extremely high threat from streaming substitutes-shape BBGI's near-term strategy.

Beasley Broadcast Group, Inc. (BBGI) - Porter's Five Forces: Bargaining power of suppliers

The bargaining power of suppliers for Beasley Broadcast Group, Inc. (BBGI) is shaped by the necessity of key inputs like content rights and specialized infrastructure, though the company is actively pushing back through aggressive cost management as of late 2025.

Music licensing organizations, such as ASCAP and BMI, inherently hold significant power because they control the rights to the essential content that drives radio listenership and advertising value. While current operating fee data isn't public, the financial history shows the importance of these relationships. For instance, Beasley Broadcast Group, Inc. recorded a $6.0 million gain on the sale of an investment in Broadcast Music, Inc. in the first quarter of 2024, indicating a past financial relationship with one of the major performing rights organizations. This concentration of content control means that any increase in royalty rates directly impacts Beasley Broadcast Group, Inc.'s operating costs.

Similarly, high-demand, local on-air talent represents a segment where individual suppliers can command significant compensation, directly increasing operating expenses. Given the competitive nature of local markets where Beasley Broadcast Group, Inc. operates over 60 radio stations, retaining top-tier talent is crucial for ratings, but it comes at a high price point.

Technical infrastructure inputs, including tower leases and specialized transmission equipment, also present a high barrier due to their specialized nature and the high switching costs involved. Moving a major market signal requires substantial capital expenditure and regulatory navigation, effectively locking Beasley Broadcast Group, Inc. into existing contracts unless a major strategic overhaul is undertaken.

Beasley Broadcast Group, Inc.'s management is clearly pushing back against rising operational costs, which naturally include supplier expenses, through deep structural efficiency gains. The company has reduced total station operating and corporate expenses by $15 million year-to-date for the nine months ending September 30, 2025. This pushback is formalized in the full-year 2025 target to reduce these expenses between $25 million and $30 million, excluding one-time items.

Here's a quick look at the tangible expense discipline as of Q3 2025:

The nature of these cuts suggests a broad effort to manage all variable and fixed costs, which would necessarily include negotiating or reducing exposure to supplier price increases. For example, the nearly 50% reduction in corporate expenses points to streamlining overhead that supports operations, which can reduce the leverage of certain administrative or service suppliers.

The company's actions highlight a strategic response to external pressures, which includes:

• Aggressively retooling the sales organization.
• Focusing on scaling higher-margin digital products.
• Strengthening the balance sheet through planned asset sales, such as the sale of WPBB-FM for $8.0 million.
• Targeting durable structural efficiency gains over temporary belt tightening.

Beasley Broadcast Group, Inc. (BBGI) - Porter's Five Forces: Bargaining power of customers

You're looking at a situation where the customers of Beasley Broadcast Group, Inc. (BBGI) definitely hold significant leverage right now. This power dynamic is clearly reflected in the top-line results from the third quarter of 2025. The continued softness in the traditional agency advertising market is the main driver here, causing Q3 2025 net revenue to fall by 12.4% year-over-year, landing at $51.0 million.

When you look at the revenue composition, you see where the pressure is coming from. National advertisers, who often work through agencies, have a vast array of media choices today. They can pivot their spending to digital platforms-social media, streaming video, search-with relative ease. For Beasley Broadcast Group, Inc. (BBGI), this means those agency-driven dollars are highly elastic and price-sensitive. The market is telling Beasley Broadcast Group, Inc. (BBGI) that its traditional radio inventory is facing intense competition for ad dollars.

Still, not all customers are created equal in this environment. The company has a more stable, less price-sensitive base coming from local direct sales. Here's a quick look at the revenue breakdown for the three months ended September 30, 2025, which shows the relative importance of these customer segments:

The 79% figure for local revenue, which includes digital packages sold locally, shows where the core business strength lies, offering a degree of predictability. However, the fact that total digital revenue reached 25% of the net revenue base-up from 19% a year ago-highlights the ongoing shift in customer preference and where the switching cost issue is most acute.

Advertisers face virtually zero switching costs when deciding to move budget away from terrestrial radio, whether it's Beasley Broadcast Group, Inc. (BBGI)'s product or a competitor's, and into digital channels. This ease of movement puts constant downward pressure on pricing for the traditional audio inventory. The company is trying to counter this by scaling higher-margin digital products, which saw a 14.6% year-over-year increase in Q3 2025, but the overall top-line decline of 12.4% shows the agency weakness is still outweighing that digital momentum for the total revenue picture.

• Agency headwinds deepened, with national agency revenue down approximately ~16% year-over-year in Q3 2025.
• Local agency revenue was down approximately ~17% year-over-year.
• Digital revenue growth was 14.6% year-over-year, reaching $13.0 million in Q3 2025.

Finance: draft 13-week cash view by Friday.

Beasley Broadcast Group, Inc. (BBGI) - Porter's Five Forces: Competitive rivalry

You're looking at a market where the established players are definitely fighting tooth and nail for every advertising dollar, which is exactly what we see playing out for Beasley Broadcast Group, Inc. (BBGI). The rivalry is high, driven by price competition because, honestly, the traditional advertising side of the radio industry is mature and seeing revenue shrink. For instance, in the third quarter of 2025, Beasley Broadcast Group, Inc.'s net revenue fell 12.4% year-over-year to $51.0 million. This isn't just a Beasley issue; it reflects broader softness in the traditional agency advertising market.

The intensity of this competition is starkly visible in the financial results. The pressure on pricing directly contributed to Beasley Broadcast Group, Inc. recording an operating loss of approximately $0.3 million in Q3 2025, a significant shift from the $1.2 million operating income in the prior year quarter. That swing shows how tough it is to maintain margins when you're fighting for shrinking ad spend.

Beasley Broadcast Group, Inc. operates across 10 large- and mid-size U.S. markets. In these areas, the major radio rivals, like Audacy and iHeartMedia, are competing directly for the same local and national ad budgets. To give you a sense of the scale and the competitive environment, here's a look at some key operational and competitive metrics as of late 2025:

This rivalry isn't just about who has the best signal; it's about who can offer the most effective advertising package, which increasingly means digital. You can see the pressure in specific ad categories from Q3 2025:

• Automotive ad revenue was down 8 percent year-over-year.
• Retail ad revenue saw a steeper drop, down 22 percent year-over-year.

These declines confirm what Beasley Broadcast Group, Inc.'s CEO noted: advertisers are actively diverting budgets away from traditional broadcast toward digital and data-driven platforms.

The competition extends deep into the digital space, which is where Beasley Broadcast Group, Inc. is accelerating its shift. While the overall revenue picture is tough, the digital segment is showing growth, indicating that the battle for ad dollars is moving online. In Q1 2025, digital revenue was 22% of total net revenue, which improved to 25% by Q3 2025. The digital segment operating margin was 21% in Q3, which is a bright spot, but it means Beasley Broadcast Group, Inc. is now fighting against the entire spectrum of digital advertising platforms, not just other radio groups. The partnership between Audacy and iHeartMedia to expand Audacy's portfolio onto the iHeartRadio app shows major competitors are consolidating digital reach, making the digital rivalry even more fierce for a company of Beasley Broadcast Group, Inc.'s scale.

Beasley Broadcast Group, Inc. (BBGI) - Porter's Five Forces: Threat of substitutes

You're looking at the competitive landscape for Beasley Broadcast Group, Inc. (BBGI), and the threat from substitutes is definitely at the highest level right now. This isn't just about other radio stations; it's about every platform vying for the same advertising dollar and listener ear.

The pressure from digital audio and streaming services like Spotify, Pandora, and SiriusXM is intense. While Beasley Broadcast Group, Inc. (BBGI) is successfully growing its own digital footprint, this growth highlights the underlying shift away from traditional over-the-air listening. For the three months ended September 30, 2025, digital revenue hit $13.0 million, which is 25% of the total net revenue of $51.0 million for the quarter. That's up from just 19% of total revenue in the third quarter of 2024. That shift shows where consumer attention is moving, even if the core audio segment still holds the majority share for now.

Here's a quick look at how the revenue mix has changed year-over-year based on the latest reported figures:

The growth in Beasley Broadcast Group, Inc. (BBGI)'s own digital revenue was strong, with same-station digital revenue growing 28% year-over-year for Q3 2025. Still, the fact that the core audio segment revenue declined year-over-year shows the substitute threat is actively eroding the legacy business model.

Also, don't forget the non-audio media platforms. Netflix, YouTube, and various social media channels are aggressively competing for the same limited pool of advertising dollars and, critically, consumer time. When a consumer spends an hour watching a YouTube creator or scrolling TikTok, that's an hour they aren't spending listening to a Beasley Broadcast Group, Inc. (BBGI) station, which directly impacts the value proposition for advertisers.

The in-car experience is changing fast, too. Consumer adoption of integrated digital audio platforms within new and late-model vehicles reduces the reliance on tuning traditional FM/AM broadcasts. If the car defaults to a streaming app or a satellite radio interface, the traditional terrestrial radio signal becomes a secondary, less convenient option. This structural change in the listening environment is a major long-term substitute risk for Beasley Broadcast Group, Inc. (BBGI).

• Digital revenue share grew from 19% to 25% in one year.
• Same-station digital revenue grew 28% year-over-year in Q3 2025.
• Total Q3 2025 net revenue was $51.0 million.
• Core audio advertising remains challenged by digital alternatives.

Finance: draft a sensitivity analysis on the impact of digital revenue hitting 40% of total revenue by the end of 2026 by Friday.

Beasley Broadcast Group, Inc. (BBGI) - Porter's Five Forces: Threat of new entrants

You're looking at the barriers to entry for Beasley Broadcast Group, Inc. (BBGI) in late 2025, and the picture is split. For the traditional terrestrial radio business, the threat of new entrants remains relatively low. This is primarily due to the high capital costs associated with acquiring the necessary spectrum rights and the significant regulatory hurdles imposed by the Federal Communications Commission (FCC).

The core asset base for Beasley Broadcast Group is its collection of licensed stations. As of the first quarter of 2025, Beasley Broadcast Group was operating 57 AM and FM radio stations across its markets. This portfolio represents a significant, difficult-to-replicate asset base that new competitors cannot easily duplicate without substantial investment and time navigating the regulatory environment. To give you a sense of the regulatory cost, the 2025 FCC fee schedule shows that obtaining an FM radio construction permit costs $1,000, while an AM radio construction permit costs $570. These fees are just the application costs, not the market value of the actual license or the required infrastructure.

The high barrier to entry for established broadcast properties is clearly demonstrated by recent transactions. For instance, Beasley Broadcast Group's sale of WPBB-FM in the Tampa Bay market fetched $8.0 million. Furthermore, in a separate set of deals announced in Q2 2025, the company agreed to sell five radio stations in its home market for a combined $18 million. These figures underscore the high price tag required to immediately acquire established, operating broadcast assets in desirable markets.

However, the threat profile flips entirely when you look at digital audio. For new digital audio entrants, such as podcasting or streaming platforms, the threat is high. These ventures require minimal physical infrastructure investment compared to broadcast towers and spectrum. The barrier to entry is low, allowing for rapid market entry and scaling, often with just a laptop and an internet connection.

Here's a quick comparison showing the cost disparity between the two entry modes:

The success of Beasley Broadcast Group's digital pivot shows where the new competition is focusing its energy. Digital revenue reached 22% of net revenue in Q1 2025, growing to 25% by Q2 2025. This segment is proving scalable, with management noting meaningful expansion in digital segment operating income. The ease of entry into this space means Beasley Broadcast Group faces constant pressure from new, digitally-native competitors who can launch with low overhead and target niche audiences effectively. The company's focus on scaling these higher-margin digital products is a direct response to this low-cost competitive threat.

The key factors defining the threat of new entrants for Beasley Broadcast Group are:

• Regulatory hurdles and high capital costs for terrestrial radio.
• The value of existing licenses, evidenced by the $8.0 million WPBB-FM sale.
• Low infrastructure investment for digital audio startups.
• FCC FM construction permit fee of $1,000 in 2025.
• Digital revenue now accounts for 25% of total revenue.

Finance: draft 13-week cash view by Friday.