(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

As of ~~July 31, 2017,~~August 2, 2018, there were ~~66,138,506~~64,567,384 shares, $0.0001 par value per share, of the registrant’s Class A common stock outstanding, 14,927,613 shares, $0.0001 par value per share, of the registrant’s Class B common stock outstanding and 9,352,729 shares, $0.0001 par value per share, of the registrant’s Class U common stock outstanding.

This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing.

Forward-looking statements may include the words “may,” “could,” “will,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words. These forward-looking statements present our estimates and assumptions only as of the date of this report. Except for our ongoing obligation to disclose material information as required by the federal securities laws, we do not intend, and undertake no obligation, to update any forward-looking statement.

Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. Some of the key factors impacting these risks and uncertainties include, but are not limited to:

For a detailed description of these and other factors that could cause actual results to differ materially from those expressed in any forward-looking statement, please see the section entitled “Risk Factors,” beginning on page 2930 of our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017.

	June 30,			December 31,			June 30,			December 31,
	2017			2016			2018			2017
ASSETS
Current assets
Cash and cash equivalents	$	60,637		$	61,520		$	108,892			39,560
Trade receivables, net of allowance for doubtful accounts of $3,449 and $2,550 (including related parties of $2,652 and $7,357)		70,781			65,072
Marketable securities								132,435			-
Restricted cash								769			222,294
Trade receivables, (including related parties of $5,356 and $4,653) net of allowance for doubtful accounts of $3,167 and $2,566								76,378			84,348
Assets held for sale								1,179			-
Prepaid expenses and other current assets (including related parties of $274 and $274)		6,183			4,870			11,990			6,260
Total current assets		137,601			131,462			331,643			352,462
Property and equipment, net of accumulated depreciation of $178,680 and $204,343		56,837			55,368
Intangible assets subject to amortization, net of accumulated amortization of $84,553 and $81,770 (including related parties of $10,437 and $11,598)		27,437			13,120
Property and equipment, net of accumulated depreciation of $184,093 and $179,869								58,562			60,337
Intangible assets subject to amortization, net of accumulated amortization of $90,562 and $87,632 (including related parties of $8,941 and $9,555)								25,828			26,758
Intangible assets not subject to amortization		220,701			220,701			254,506			251,163
Goodwill		69,316			50,081			73,566			70,557
Deferred income taxes		36,558			44,677
Other assets		4,594			2,512			4,442			4,690
Total assets	$	553,044		$	517,921		$	748,547		$	765,967

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt	$	3,750		$	3,750		$	3,000		$	3,000
Accounts payable and accrued expenses (including related parties of $4,114 and $3,886)		47,183			30,810
Accounts payable and accrued expenses (including related parties of $1,920 and $2,548)								52,787			57,563
Deferred revenue								3,386			1,959
Total current liabilities		50,933			34,560			59,173			62,522
Long-term debt, less current maturities, net of unamortized debt issuance costs of $2,034 and $2,365		285,153			286,697
Long-term debt, less current maturities, net of unamortized debt issuance costs of $3,513 and $3,761								291,237			292,489
Other long-term liabilities		27,132			13,208			19,553			21,447
Deferred income taxes								42,326			40,639
Total liabilities		363,218			334,465			412,289			417,097

Commitments and contingencies (note 4)
Commitments and contingencies (note 5)

Stockholders' equity
Class A common stock, $0.0001 par value, 260,000,000 shares authorized; shares issued and outstanding 2017 66,133,006; 2016 65,886,256		7			7
Class B common stock, $0.0001 par value, 40,000,000 shares authorized; shares issued and outstanding 2017 and 2016 14,927,613		2			2
Class U common stock, $0.0001 par value, 40,000,000 shares authorized; shares issued and outstanding 2017 and 2016 9,352,729		1			1
Class A common stock, $0.0001 par value, 260,000,000 shares authorized; shares issued and outstanding 2018 64,554,155; 2017 66,069,325								6			7
Class B common stock, $0.0001 par value, 40,000,000 shares authorized; shares issued and outstanding 2018 and 2017 14,927,613								2			2
Class U common stock, $0.0001 par value, 40,000,000 shares authorized; shares issued and outstanding 2018 and 2017 9,352,729								1			1
Additional paid-in capital		901,806			904,867			874,508			888,650
Accumulated deficit		(709,910	)		(718,444	)		(536,697	)		(539,730	)
Accumulated other comprehensive income (loss)		(2,080	)		(2,977	)		(1,562	)		(60	)
Total stockholders' equity		189,826			183,456			336,258			348,870
Total liabilities and stockholders' equity	$	553,044		$	517,921		$	748,547		$	765,967

	Three-Month Period						Six-Month Period						Three-Month Period						Six-Month Period
	Ended June 30,						Ended June 30,						Ended June 30,						Ended June 30,
	2017			2016			2017			2016			2018			2017			2018			2017
Net revenue	$	70,509		$	64,829		$	128,019		$	122,942
Net Revenue													$	74,329		$	70,509		$	141,167		$	128,019

Expenses:
Cost of revenue - digital media		8,762			2,373			10,514			4,212
Direct operating expenses (including related parties of $2,392, $2,536, $4,712 and $4,847) (including non-cash stock-based compensation of $307, $300, $530 and $621)		29,915			28,538			57,007			56,103
Cost of revenue - digital														11,384			8,762			22,009			10,514
Direct operating expenses (including related parties of $2,208, $2,392, $4,256 and $4,712) (including non-cash stock-based compensation of $76, $307, $293 and $530)														31,117			29,915			62,150			57,007
Selling, general and administrative expenses		12,030			11,410			23,230			22,845			12,673			12,030			25,967			23,230
Corporate expenses (including non-cash stock-based compensation of $778, $644, $1,530 and $1,269)		5,619			5,293			11,486			10,897
Depreciation and amortization (includes direct operating of $2,398, $2,294, $4,604 and $4,749; selling, general and administrative of $1,849, $1,230, $2,865 and $2,429; and corporate of $329, $361, $654 and $734) (including related parties of $580, $580, $1,161 and $1,160)		4,577			3,885			8,123			7,912
Corporate expenses (including non-cash stock-based compensation of $1,100, $778, $2,133 and $1,530)														6,266			5,619			12,241			11,486
Depreciation and amortization (includes direct operating of $2,560, $2,398, $5,097 and $4,604; selling, general and administrative of $1,301, $1,849, $2,614 and $2,865; and corporate of $153, $329, $242 and $654) (including related parties of $307, $580, $614 and $1,161)														4,019			4,577			7,958			8,123
Change in fair value of contingent consideration														(913	)		-			1,187			-
Foreign currency (gain) loss		351			-			351			-			(17	)		351			196			351
		61,254			51,499			110,711			101,969			64,529			61,254			131,708			110,711
Operating income		9,255			13,330			17,308			20,973
Operating income (loss)														9,800			9,255			9,459			17,308
Interest expense		(3,683	)		(3,859	)		(7,328	)		(7,725	)		(4,001	)		(3,683	)		(7,399	)		(7,328	)
Interest income		110			118			219			125			1,039			110			1,952			219
Income before income taxes		5,682			9,589			10,199			13,373
Income tax expense		(2,119	)		(3,872	)		(4,018	)		(5,386	)
Dividend income														417			-			545			-
Other income (loss)														273			-			295			-
Income (loss) before income taxes														7,528			5,682			4,852			10,199
Income tax benefit (expense)														(2,652	)		(2,119	)		(1,721	)		(4,018	)
Income (loss) before equity in net income (loss) of nonconsolidated affiliate		3,563			5,717			6,181			7,987			4,876			3,563			3,131			6,181
Equity in net income (loss) of nonconsolidated affiliate, net of tax		(68	)		-			(68	)		-			(36	)		(68	)		(98	)		(68	)
Net income	$	3,495		$	5,717		$	6,113		$	7,987
Net income (loss)													$	4,840		$	3,495		$	3,033		$	6,113

Basic and diluted earnings per share:
Net income per share, basic and diluted	$	0.04		$	0.06		$	0.07		$	0.09
Net income (loss) per share, basic and diluted													$	0.05		$	0.04		$	0.03		$	0.07

Cash dividends declared per common share	$	0.03		$	0.03		$	0.06		$	0.06		$	0.05		$	0.03		$	0.05		$	0.06

Weighted average common shares outstanding, basic		90,354,982			89,134,412			90,296,057			89,015,934			88,959,935			90,354,982			89,635,759			90,296,057
Weighted average common shares outstanding, diluted		92,033,111			91,140,596			91,897,150			91,036,353			90,021,949			92,033,111			90,805,086			91,897,150

	Three-Month Period				Six-Month Period					Three-Month Period					Six-Month Period
	Ended June 30,				Ended June 30,					Ended June 30,					Ended June 30,
	2017		2016		2017		2016			2018			2017		2018			2017
Net income	$	3,495	$	5,717	$	6,113	$	7,987
Net income (loss)										$	4,840		$	3,495	$	3,033		$	6,113
Other comprehensive income (loss), net of tax:
Change in foreign currency translation		61		-		61		-			(550	)		61		(260	)		61
Change in fair value of available for sale securities											(3	)		-		(1,242	)		-
Change in fair value of interest rate swap agreements		283		86		836		(546	)		-			283		-			836
Total other comprehensive income (loss)		344		86		897		(546	)		(553	)		344		(1,502	)		897
Comprehensive income	$	3,839	$	5,803	$	7,010	$	7,441
Comprehensive income (loss)										$	4,287		$	3,839	$	1,531		$	7,010

	Six-Month Period						Six-Month Period
	Ended June 30,						Ended June 30,
	2017			2016			2018			2017
Cash flows from operating activities:
Net income	$	6,113		$	7,987
Adjustments to reconcile net income to net cash provided by operating activities:
Net income (loss)							$	3,033		$	6,113
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		8,123			7,912			7,958			8,123
Deferred income taxes		3,428			4,922			1,029			3,428
Amortization of debt issue costs		369			384
Non-cash interest expense								538			369
Amortization of syndication contracts		218			190			352			218
Payments on syndication contracts		(215	)		(183	)		(360	)		(215	)
Equity in net income (loss) of nonconsolidated affiliate		68			-
Equity in net (income) loss of nonconsolidated affiliate								98			68
Non-cash stock-based compensation		2,060			1,890			2,425			2,060
Changes in assets and liabilities:
(Increase) decrease in accounts receivable		13,581			5,583			9,170			13,581
(Increase) decrease in prepaid expenses and other assets		(1,447	)		(383	)		(6,547	)		(1,447	)
Increase (decrease) in accounts payable, accrued expenses and other liabilities		(8,992	)		(3,876	)		(780	)		(8,992	)
Net cash provided by operating activities		23,306			24,426			16,916			23,306
Cash flows from investing activities:
Purchases of short-term investments		-			(30,000	)
Purchases of property and equipment and intangibles		(7,296	)		(4,745	)
Proceeds from sale of property and equipment and intangible assets								33			-
Purchases of property and equipment								(5,710	)		(7,296	)
Purchases of intangible assets								(3,153	)		-
Purchases of businesses, net of cash acquired								(3,563	)		(7,489	)
Purchases of marketable securities								(159,403	)		-
Proceeds from marketable securities								25,000			-
Purchases of investments		(2,200	)		-			(35	)		(2,200	)
Deposits on acquisitions		(190	)		-			-			(190	)
Purchase of a business, net of cash acquired		(7,489	)		-
Net cash used in investing activities		(17,175	)		(34,745	)		(146,831	)		(17,175	)
Cash flows from financing activities:
Proceeds from stock option exercises		526			1,270			106			526
Tax payments related to shares withheld for share-based compensation plans								(2,239	)		-
Payments on long-term debt		(1,875	)		(1,875	)		(1,500	)		(1,875	)
Dividends paid		(5,647	)		(5,569	)		(8,960	)		(5,647	)
Repurchase of Class A common stock								(7,660	)		-
Payment of contingent consideration								(2,015	)		-
Net cash used in financing activities		(6,996	)		(6,174	)		(22,268	)		(6,996	)
Effect of exchange rates on cash and cash equivalents		(18	)		-
Net increase (decrease) in cash and cash equivalents		(883	)		(16,493	)
Cash and cash equivalents:
Effect of exchange rates on cash, cash equivalents and restricted cash								(10	)		(18	)
Net increase (decrease) in cash, cash equivalents and restricted cash								(152,193	)		(883	)
Cash, cash equivalents and restricted cash:
Beginning		61,520			47,924			261,854			61,520
Ending		60,637			31,431		$	109,661		$	60,637

Supplemental disclosures of cash flow information:
Cash payments for:
Interest		6,959			7,341		$	6,861		$	6,959
Income taxes		590			464		$	692		$	590

Supplemental disclosures of non-cash operating, investing and financing activities:
Supplemental disclosures of non-cash investing and financing activities:
Capital expenditures financed through accounts payable, accrued expenses and other liabilities	$	579		$	654		$	400		$	579
Contingent consideration included in accounts payable, accrued expenses and other liabilities	$	18,300		$	-		$	15,096		$	18,300

The consolidated financial statements included herein have been prepared by Entravision Communications Corporation (the “Company”), pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted pursuant to such rules and regulations. These consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, ~~2016~~2017 included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017. The unaudited information contained herein has been prepared on the same basis as the Company’s audited consolidated financial statements and, in the opinion of the Company’s management, includes all adjustments (consisting of only normal recurring adjustments) necessary for a fair presentation of the information for the periods presented. The interim results presented herein are not necessarily indicative of the results of operations that may be expected for the full fiscal year ending December 31, ~~2017~~2018 or any other future period.

Certain amounts in the Company’s prior year period consolidated financial statements and notes to the financial statements have been reclassified to conform to current period presentation.

The Company is a leading global media company that, through its television and radio segments, reaches and engages U.S. Hispanics across acculturation levels and media ~~channels as well as consumers~~channels. Additionally, the Company’s digital segment, whose operations are located primarily in Spain, Mexico, Argentina and other ~~markets~~countries in Latin ~~America.~~America, reaches a global market. The Company’s ~~expansive~~ portfolio encompasses integrated marketing and media solutions, comprised of television, radio, and digital properties ~~and~~(including data analytics ~~services.~~services). The Company’s management has determined that the Company operates in three reportable segments as of June 30, ~~2017,~~2018, based upon the type of advertising medium, which segments are television, radio, and digital. As of June 30, 2018, the Company owns and/or operates 55 primary television stations located primarily in California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Nevada, New Mexico, Texas and Washington, D.C. The Company’s television operations comprise the largest affiliate group of both the top-ranked primary television network of Univision and Univision’s UniMás network. The television broadcasting ~~radio broadcasting, and digital media.~~

~~Television and radio~~segment includes revenue ~~related to the sale of~~generated from advertising, is recognized at the time of broadcast. Revenue for contracts with advertising agencies is recorded at an amount that is net of the commission retained by the agency. Revenue from contracts directly with the advertisers is recorded as gross revenueretransmission consent agreements and the related commission or national representation fee is recorded in operating expense. Cash payments received prior to services rendered result in deferred revenue, which is then recognized as revenue when the advertising time or space is actually provided. Digital revenue is recognized when display or other digital advertisements record impressions on the websitesmonetization of the Company’s ~~third-party publishers or as the advertiser’s performance goals are delivered.~~

~~The Company generates revenue under arrangements that are sold on a stand-alone basis within a specific segment,~~spectrum assets. Radio operations consist of 49 operational radio stations, 38 FM and ~~those that are sold on a combined basis across multiple segments. The Company has determined that~~11 AM, in ~~such revenue arrangements which contain multiple products~~16 markets located in Arizona, California, Colorado, Florida, Nevada, New Mexico and services, revenues are allocated based on the relative fair value of each delivered item and recognized in accordance with the applicable revenue recognition criteria for the specific unit of accounting.

In August 2008, the Company entered into a proxy agreement with Univision pursuant to which the Company granted Univision the right to negotiate retransmission consent agreements for its Univision- and UniMás-affiliated television station signals. Advertising related to carriage of the Company’s Univision- and UniMás-affiliated television station signals is recognized at the time of broadcast. See more details under “Related Party” below.

Texas. The Company also ~~generates revenue from agreements associated with television~~operates Entravision Solutions as its national sales representation division, through which it sells advertisements and syndicate radio programming to more than 300 stations across the United States. The Company operates a proprietary technology and data platform that delivers digital advertising in ~~order~~various advertising formats that allows advertisers to ~~accommodate~~reach audiences across a wide range of Internet-connected devices on its owned and operated digital media sites, the ~~operations~~digital media sites of ~~telecommunications operators. Revenue from such agreements is recognized when~~its publisher partners, and on other digital media sites it can access through third-party platforms and exchanges.

As of June 30, 2018, the Company’s balance sheet includes $0.8 million in restricted cash, which was deposited into a separate account as temporary collateral for the Company’s letters of credit. As of December 31, 2017, the Company’s balance sheet includes $222.3 million in restricted cash of which $221.5 million relates to proceeds received by the Company ~~has relinquished all rights~~for its participation in the Federal Communications Commission (“FCC”) auction for broadcast spectrum which were deposited into the account of a qualified intermediary to ~~operate~~comply with Internal Revenue Code Section 1031 requirements to execute a like-kind exchange. The remaining $0.8 million in restricted cash was used as temporary collateral for the ~~station on the existing channel free from interference to the telecommunications operators.~~ Company’s letters of credit.

Substantially all of the Company’s stations are Univision- or UniMás-affiliated television stations. The Company’s network affiliation ~~agreements, as amended,~~agreement with Univision provide certain of its owned stations the exclusive right to broadcast Univision’s primary network and UniMás network programming in their respective markets. ~~These long-term affiliation agreements each expire in 2021, and can be renewed for multiple, successive two-year terms at Univision’s option, subject to the Company’s consent.~~ Under the ~~Univision~~ network affiliation agreement, the Company retains the right to sell ~~approximately six~~no less than four minutes per hour of the available advertising time on ~~Univision’s primary~~stations that broadcast Univision network ~~subject to adjustment from time to time by Univision, but in no event less than four minutes. Under the UniMás network affiliation agreement, the Company retains~~programming, and the right to sell approximately four and a half minutes per hour of the available advertising time on ~~the~~stations that broadcast UniMás network programming, subject to adjustment from time to time by Univision.

Under the network affiliation ~~agreements,~~agreement, Univision acts as the Company’s exclusive third-party sales representative for the sale of certain national advertising on the Company’s Univision- and UniMás-affiliate television stations, and ~~the Company~~it pays certain sales representation fees to Univision relating to sales of all advertising for broadcast on the Company’s Univision- and UniMás-affiliate television stations. During the three-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, the amount the Company paid Univision in this capacity was ~~$2.4~~$2.2 million and ~~$2.5~~$2.4 million, respectively. During the six-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, the amount the Company paid Univision in this capacity was ~~$4.7~~$4.3 million and ~~$4.8~~$4.7 million, respectively.

The Company also generates revenue under two marketing and sales agreements with Univision, which ~~give~~gives the Company the right ~~through 2021~~ to manage the marketing and sales operations of Univision-owned ~~UniMás and~~ Univision affiliates in six markets – Albuquerque, Boston, Denver, Orlando, Tampa and Washington, D.C.

~~In August 2008,~~Under the ~~Company entered into a~~Company’s proxy agreement with Univision, ~~pursuant to which~~ the Company ~~granted~~grants Univision the right to negotiate the terms of retransmission consent agreements for its Univision- and UniMás-affiliated television ~~stations for a term of six years, expiring in December 2014, which Univision and the Company have extended through August 31, 2017.~~station signals. Among other things, the proxy agreement provides terms relating to compensation to be paid to the Company by Univision with respect to retransmission consent agreements entered into with ~~Multichannel Video Programming Distributors~~multichannel video programming distributors (“MVPDs”). The term of the proxy agreement extends with respect to any MVPD for the length of the term of any retransmission consent agreement in effect before the expiration of the proxy agreement. The Company has entered into multiple short-term extensions of the proxy agreement since its December 2014 expiration, and it is the Company’s current intention to negotiate with Univision one or more further extensions of the current proxy agreement or a new proxy agreement; however, no assurance can be given regarding the terms of any such extension or new agreement or that any such extension or new agreement will be entered into. As of June 30, ~~2017,~~2018, the amount due to the Company from Univision was ~~$2.7~~$5.4 million related to the agreements for the carriage of its Univision and UniMás-affiliated television station signals. During the three-month periods ended June 30, 2018 and 2017, retransmission consent revenue accounted for approximately $9.1 million and $7.5 million, respectively, of which $7.5 million and $7.2 million, respectively, relate to the Univision proxy agreement. During the six-month periods ended June 30, 2018 and 2017, retransmission consent revenue accounted for approximately $18.0 million and $15.4 million, respectively, of which $15.1 million and $14.6 million, respectively, relate to the Univision proxy agreement. The term of the proxy agreement extends with respect to any MVPD for the length of the term of any retransmission consent agreement in effect before the expiration of the proxy agreement.

Univision currently owns approximately 10% of the Company’s common stock on a fully-converted basis. The Class U common stock held by Univision has limited voting rights and does not include the right to elect directors. As the holder of all of the Company’s issued and outstanding Class U common stock, so long as Univision holds a certain number of shares, the Company will not, without the consent of Univision, merge, consolidate or enter into another business combination, dissolve or liquidate the Company or dispose of any interest in any Federal Communications Commission, ~~or FCC,~~ license for any of its Univision-affiliated television stations, among other things. Each share of Class U common stock is automatically convertible into one share of Class A common stock (subject to adjustment for stock splits, dividends or combinations) in connection with any transfer to a third party that is not an affiliate of Univision.

The Company measures all stock-based awards using a fair value method and recognizes the related stock-based compensation expense in the consolidated financial statements over the requisite service period. As stock-based compensation expense recognized in the Company’s consolidated financial statements is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures.

Stock-based compensation expense related to grants of stock options and restricted stock units was ~~$1.1~~$1.2 million and ~~$0.9~~$1.1 million for the three-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. Stock-based compensation expense related to grants of stock options and restricted stock units was ~~$2.1~~$2.4 million and ~~$1.9~~$2.1 million for the six-month periods ended June 30, 2018 and 2017, ~~and 2016,~~ respectively.

Stock-based compensation expense related to stock options is based on the fair value on the date of grant using the Black-Scholes option pricing model and is amortized over the vesting period, generally between 1 to 4 years.

As of June 30, ~~2017,~~2018, there was ~~approximately~~less than $0.1 million of total unrecognized compensation expense related to grants of stock options that is expected to be recognized over a weighted-average period of ~~1.2~~0.7 years.

Stock-based compensation expense related to restricted stock units is based on the fair value of the Company’s stock price on the date of grant and is amortized over the vesting period, generally between 1 to 4 years.

The following is a summary of non-vested restricted stock units granted (in thousands, except grant date fair value data):

As of June 30, ~~2017,~~2018, there was approximately ~~$3.9~~$4.9 million of total unrecognized compensation expense related to grants of restricted stock units that is expected to be recognized over a weighted-average period of 1.4 years.

Certain of the Company’s management-level employees were granted performance stock units that are contingent upon achievement of specified pre-established performance goals over the performance period, which is fiscal year 2017, and vesting over a period of three years, subject to the recipient's continued service with the Company. The performance goals are based on achievement of net revenue and/or EBITDA goals. Depending on the outcome of the performance goals, the recipient may ultimately earn performance restricted stock units between 0% and 200% of the number of performance restricted stock units granted. For the three- and six-month periods ended June 30, 2017, there was no share-based compensation expense related to performance restricted stock units.

The following table illustrates the reconciliation of the basic and diluted income (loss) per share computations required by Accounting Standards Codification ~~(ASC)~~(“ASC”) Topic 260-10, “Earnings per Share” (in thousands, except share and per share data):

	Three-Month Period				Six-Month Period				Three-Month Period				Six-Month Period
	Ended June 30,				Ended June 30,				Ended June 30,				Ended June 30,
	2017		2016		2017		2016		2018		2017		2018		2017
Basic earnings per share:
Numerator:
Net income	$	3,495	$	5,717	$	6,113	$	7,987
Net income (loss)									$	4,840	$	3,495	$	3,033	$	6,113

Denominator:
Weighted average common shares outstanding		90,354,982		89,134,412		90,296,057		89,015,934		88,959,935		90,354,982		89,635,759		90,296,057

Per share:
Net income per share	$	0.04	$	0.06	$	0.07	$	0.09
Net income (loss) per share									$	0.05	$	0.04	$	0.03	$	0.07

Diluted earnings per share:
Numerator:
Net income	$	3,495	$	5,717	$	6,113	$	7,987
Net income (loss)									$	4,840	$	3,495	$	3,033	$	6,113

Denominator:
Weighted average common shares outstanding		90,354,982		89,134,412		90,296,057		89,015,934		88,959,935		90,354,982		89,635,759		90,296,057
Dilutive securities:
Stock options and restricted stock units		1,678,129		2,006,184		1,601,093		2,020,419		1,062,014		1,678,129		1,169,327		1,601,093
Diluted shares outstanding		92,033,111		91,140,596		91,897,150		91,036,353		90,021,949		92,033,111		90,805,086		91,897,150

Per share:
Net income per share	$	0.04	$	0.06	$	0.07	$	0.09
Net income (loss) per share									$	0.05	$	0.04	$	0.03	$	0.07

Basic income (loss) per share is computed as net income (loss) divided by the weighted average number of shares outstanding for the period. Diluted income (loss) per share reflects the potential dilution, if any, that could occur from shares issuable through stock options and restricted stock awards.

For the three- and six-month periods ended June 30, 2018, a total of 242,735 and 139,468 shares of dilutive securities, respectively, were not included in the computation of diluted income per share because the exercise prices of the dilutive securities were greater than the average market price of the common shares.

For the three- and six-month period ended June 30, 2017, a total of 30,584 and 16,880 shares of dilutive securities, respectively, were not included in the computation of diluted income per share because the exercise prices of the dilutive securities were greater than the average market price of the common shares. For the three- and six-month period ended June 30, 2016, a total of 28,997 and 42,486 shares of dilutive securities, respectively, were not included in the computation of diluted income per share because the exercise prices of the dilutive securities were greater than the average market price of the common shares.

Treasury stock is included as a deduction from equity in the Stockholders’ Equity section of the ~~Consolidated Balance Sheets.~~consolidated balance sheets.

~~During the period ended June 30,~~On July 13, 2017, the ~~Company had a stock repurchase program, authorized by the~~ Board of Directors toapproved a share repurchase of up to ~~$20~~$15.0 million of the Company’s outstanding common stock. On April 11, 2018, the Board of Directors approved the repurchase of up to an additional $15.0 million of the Company’s Class A common stock, for a total repurchase authorization of up to $30.0 million. Under the share repurchase program, the Company is authorized to purchase shares from time to time through open market purchases or negotiated purchases, subject to market conditions and other factors. The share repurchase program may be suspended or discontinued at any time without prior notice.

The Company ~~did not repurchase any~~repurchased 1.1 million shares of Class A common stock at an average price of $4.81, for an aggregate purchase price of approximately $5.3 million, during the three-month period ended June 30, ~~2017.~~2018. As of June 30, ~~2017,~~2018, the Company repurchased ~~to date~~ a total of approximately 2.5 million shares of Class A common stock ~~at an average price of $5.08,~~ for an aggregate purchase price of approximately ~~$12.5~~$13.0 million, or an average price per share of $5.08, since the beginning of ~~that~~the share repurchase program. All such repurchased shares were retired as of ~~December 31, 2014. See Note 6 to the Notes to the Consolidated Financial Statements.~~June 30, 2018.

On November 30, 2017 (the “Closing Date”), the Company entered into an agreement with a financial institution to purchase a six-month certificate of deposit (the “CD”) for $30.0 million, which was recorded in “Short-term investments” on the consolidated balance sheets during the term of the CD. The CD matured during the third quarter of 2016 and the funds returned to “Cash and cash equivalents” on the consolidated balance sheet.

The Company made an investment in Chanclazo Studios, Inc. (“Chanclazo”), a digital production studio that creates and distributes short and long form 3D animation, virtual reality and augmented reality content for Hispanic audiences. The net investment in Chanclazo totals $1.0 million for a 12.5% ownership interest, as of June 30, 2017. The investment was recorded in “Other assets” on the consolidated balance sheet and is accounted for using the cost method.

The Company made an investment in Cocina Vista, LLC (“Cocina”), a digital media company focused on Spanish and Latin American food and cooking in the United States, Spain and Latin America, during the second quarter ofits 2017. The net investment in Cocina totaled $1.7 million for a 34.35% ownership interest. The Company is required to make a second investment of $1.5 million, for a total ownership interest of 51%, if Cocina achieves certain EBITDA goals. The investment was recorded in "Other assets" on the consolidated balance sheet and is accounted for using the equity method.

~~On May 31, 2013, the Company entered into the 2013~~ Credit Facility pursuant to the ~~2013~~2017 Credit Agreement. The ~~2013~~2017 Credit Facility consists of a ~~$20.0 million senior secured Term Loan A Facility (the “Term Loan A Facility”), a $375.0~~$300.0 million senior secured Term Loan B Facility (the “Term Loan B Facility”~~; and together with the Term Loan A Facility, the “Term Loan Facilities”~~), which was drawn in full on ~~August 1, 2013 (the “Term Loan B Borrowing Date”), and a $30.0 million senior secured Revolving Credit Facility (the “Revolving Credit Facility”).~~the Closing Date. In addition, the ~~2013~~2017 Credit Facility provides that the Company may increase the aggregate principal amount of the ~~2013~~2017 Credit Facility by up to an additional $100.0 million plus the amount that would result in its first lien net leverage ratio (as such term is used in the 2017 Credit Agreement) not exceeding 4.0 to 1.0, subject to ~~the Company~~ satisfying certain conditions.

Borrowings under the Term Loan AB Facility were used on the ~~closing date of the 2013 Credit Facility (the “Closing Date”) (together with cash on hand)~~Closing Date to (a) repay in full all of the Company’s and its subsidiaries’ outstanding obligations ~~of the Company and its subsidiaries~~ under the ~~then outstanding~~Company’s previous credit facility ~~(the “2012~~(“2013 Credit ~~Agreement”~~Facility”) and to terminate the ~~2012~~agreement governing the 2013 Credit ~~Agreement, and~~Facility (“2013 Credit Agreement”), (b) pay fees and expenses in connection with the ~~2013~~2017 Credit ~~Facility. As discussed in more detail below, on August 1, 2013, the Company drew on the Company’s Term Loan B Facility to (a) repay in full all of the outstanding loans under the Term Loan A~~ Facility, and ~~(b) redeem in full all of the then outstanding notes (the “Notes”). The Company intends to use any future borrowings under the Revolving Credit Facility to provide~~(c) for ~~working capital, capital expenditures and other~~ general corporate ~~purposes of the Company and from time to time fund a portion of certain acquisitions, in each case subject to the terms and conditions set forth in the 2013 Credit Agreement.~~purposes.

The ~~2013~~2017 Credit Facility is guaranteed on a senior secured basis by ~~all~~certain of ~~the Company’s~~its existing and future wholly-owned domestic subsidiaries, ~~(the “Credit Parties”). The 2013 Credit Facility~~and is secured on a first priority basis by the Company’s and ~~the Credit Parties’~~those subsidiaries’ assets. Upon the redemption of the Notes, the security interests and guaranties of the Company and its Credit Parties under the indenture governing the Notes (the “Indenture”) and the Notes were terminated and released.

The Company’s borrowings under the ~~2013~~2017 Credit Facility bear interest on the outstanding principal amount thereof from the date when made at a rate per annum equal to either: (i) the Eurodollar Rate (as defined in the 2017 Credit Agreement) plus 2.75%; or (ii) the Base Rate (as defined in the ~~2013~~2017 Credit Agreement) plus ~~the Applicable Margin (as defined in the 2013 Credit Agreement); or (ii) LIBOR (as defined in the 2013 Credit Agreement) plus the Applicable Margin (as defined in the 2013 Credit Agreement)~~1.75%. ~~As of June 30, 2017, the Company’s effective interest rate was 3.5%. The Term Loan A Facility expired on the Term Loan B Borrowing Date, which was August 1, 2013.~~ The Term Loan B Facility expires on ~~May 31, 2020~~November 30, 2024 (the ~~“Term Loan B Maturity~~“Maturity Date”) ~~and the Revolving Credit Facility expires on May 31, 2018 (the “Revolving Loan Maturity Date”)~~.

~~(a) with respect to the Term Loans (i) if a Base Rate Loan, one and one half percent (1.50%) per annum and (ii) if a LIBOR Rate Loan, two and one half percent (2.50%) per annum; and~~

(i) for the period commencing on the Closing Date through the last day of the calendar month during which financial statements for the fiscal quarter ending September 30, 2013 are delivered: (A) if a Base Rate Loan, one and one half percent (1.50%) per annum and (B) if a LIBOR Rate Loan, two and one half percent (2.50%) per annum; and

(ii) thereafter, the Applicable Margin for the Revolving Loans shall equal the applicable LIBOR margin or Base Rate margin in effect from time to time determined as set forth below based upon the applicable First Lien Net Leverage Ratio then in effect pursuant to the appropriate column under the table below:

In the event the Company engages in a transaction that has the effect of reducing the yield of any loans outstanding under the Term Loan B Facility within six months of the Term Loan B Borrowing Date, the Company will owe 1% of the amount of the loans so repriced or replaced to the Lenders thereof (such fee, the “Repricing Fee”). Other than the Repricing Fee, theThe amounts outstanding under the ~~2013~~2017 Credit Facility may be prepaid at the Company’s option ~~of the Company~~ without premium or penalty, provided that certain limitations are observed, and subject to customary breakage fees in connection with the prepayment of a ~~LIBOR~~Eurodollar rate loan. The principal amount of the ~~(i) Term Loan A Facility shall be paid in full on the Term Loan B Borrowing Date, (ii)~~ Term Loan B Facility shall be paid in installments on the dates and in the respective amounts set forth in the ~~2013~~2017 Credit Agreement, with the final balance due on the ~~Term Loan B Maturity Date and (iii) Revolving Credit Facility shall be due on the Revolving Loan~~ Maturity Date.

Subject to certain exceptions, the ~~2013~~2017 Credit ~~Agreement~~Facility contains covenants that limit the ability of the Company and ~~the Credit Parties~~its restricted subsidiaries to, among other things:

The ~~2013~~2017 Credit Agreement also requires compliance with a financial covenant related to total net leverage ratio (calculated as set forth in the 2013 Credit Agreement) in the event that the revolving credit facility is drawn.

~~The 2013 Credit Agreement~~Facility also provides for certain customary events of default, including the following:

The Term Loan B Facility does not contain any financial covenants. In connection with the Company entering into the ~~2013~~2017 Credit Agreement, the Company and ~~the Credit Parties~~its restricted subsidiaries also entered into ~~an Amended and Restated~~a Security Agreement, pursuant to which the Company and the Credit Parties each granted a first priority security interest in the collateral securing the ~~2013~~2017 Credit Facility for the benefit of the lenders under the ~~2013~~2017 Credit Facility.

~~On August 1, 2013,~~Additionally, the ~~Company drew on borrowings~~2017 Credit Agreement contains a definition of “Consolidated EBITDA” that excludes revenue related to the Company’s participation in the FCC auction for broadcast spectrum and related expenses, as compared to the definition of “Consolidated Adjusted EBITDA” under the Company’s Term Loan B Facility. The borrowings were used to (i) repay in full all of the outstanding loans under the Company’s Term Loan A Facility; (ii) redeem in full and terminate all of its outstanding obligations (the “Redemption”) on August 2, 2013 (the “Redemption Date”) under the Indenture, in an aggregate principal amount of approximately $324 million, and (iii) pay any fees and expenses in connection therewith. The redemption price for the redeemed Notes was 106.563% of the principal amount, plus accrued and unpaid interest thereon to the Redemption Date.Credit Agreement which included such items.

The Redemption constituted a complete redemption of the Notes, such that no amount remained outstanding following the Redemption. Accordingly, the Indenture has been satisfied and discharged in accordance with its terms and the Notes have been cancelled, effective as of the Redemption Date.

~~In each of December 2014, 2015 and 2016, the Company made a prepayment of $20.0 million, to reduce the amount of loans outstanding under the Term Loan B Facility.~~

The carrying amount of the Term Loan B Facility as of June 30, ~~2017~~ 2018 was $~~288.9~~294.2 million, net of ~~$2.0~~$3.5 million of unamortized debt issuance ~~costs.~~costs and original issue discount. The estimated fair value of the Term Loan B Facility as of June 30, ~~2017~~ 2018 was $~~290.9~~294.8 million. The estimated fair value is ~~calculated using an income approach which projects expected future cash flows and discounts them using a rate~~ based on ~~industry and market yields.~~quoted prices in markets where trading occurs infrequently.

~~The~~Prior to November 28, 2017, the Company ~~uses~~used derivatives in the management of ~~its~~ interest rate risk with respect to ~~its~~interest expense on variable rate debt. The ~~Company‘s strategy is~~Company was party to ~~eliminate~~interest rate swap agreements with financial institutions that fixed the ~~cash flow risk~~variable benchmark component (LIBOR) of its interest rate on a portion of its ~~variable rate debt caused by changes in the benchmark interest rate (LIBOR). Derivative instruments are not entered into for speculative purposes.~~

As required by the terms of the Company’s 2013 Credit Agreement, on December 16, 2013, the Company entered into three forward-starting interest rate swap agreements with an aggregate notional amount of $186.0 million at a fixed rate of 2.73%, resulting in an all-in fixed rate of 5.23%. The interest rate swap agreements took effect onterm loan beginning December 31, 2015 with a maturity date on December 31, 2018. Under these interest rate swap agreements, the Company pays at a fixed rate and receives payments at a variable rate based on three-month LIBOR. The interest rate swap agreements effectively fix the floating LIBOR-based interest of $186.0 million outstanding LIBOR-based debt. The interest rate swap agreements were designated and qualified as a cash flow hedge; therefore, the effective portion of the changes in fair value is recorded in accumulated other comprehensive income. Any ineffective portions of the changes in fair value of the interest rate swap agreements will be immediately recognized directly to interest expense in the consolidated statement of operations. The change in fair value of the interest rate swap agreements for the three-month periods ended June 30, 2017 and 2016 was a gain of $0.3 million and $0.1 million, net of tax, respectively, and was included in other comprehensive income (loss). The change in fair value of the interest rate swap agreements for the six-month periods ended June 30, 2017 and 2016 was a gain of $0.8 million and a loss of $0.5 million, net of tax, respectively, and was included in other comprehensive income (loss). The Company paid $0.7 million of interest related to the interest rate swap agreements ~~for the three-month period ended~~ ~~June 30, 2017~~. ~~The Company paid $1.6 million of interest related to the interest rate swap agreements~~ ~~for the six-month period ended~~ ~~June 30, 2017~~. ~~As of June 30,~~2015. On November 28, 2017, the Company ~~estimates that none of the unrealized gains or losses included in accumulated other comprehensive income or loss related to~~terminated these ~~interest rate~~ swap agreements ~~will be realized and reported~~ in ~~earnings within~~conjunction with the ~~next twelve months.~~refinancing of its debt. The Company’s current policy prohibits entering into derivative instruments for speculation or trading purposes.

The carrying amount of the Company’s interest rate swap agreements iswere recorded at fair value, including consideration of non-performance risk, when material. The fair value of each interest rate swap agreement iswas determined by using multiple broker quotes, adjusted for non-performance risk, when material, which estimate the future discounted cash flows of any future payments that may be made under such agreements.

The Company measures certain financial assets and liabilities at fair value ofon a recurring basis. Fair value is the ~~interest rate swap~~price the Company would receive to sell an asset or pay to transfer a liability ~~as of June 30, 2017 was $3.4 million and was recorded~~ in ~~"Other long-term liabilities" on~~an orderly transaction with a market participant at the ~~consolidated balance sheets.~~

ASC 820, “Fair Value Measurements and Disclosures”, defines and establishes a framework for measuring fair value and expands disclosures about fair value measurements. In accordance with ASC 820, the Company has categorized its financial assets and liabilities, based on the priority of the inputs to the valuation technique, into a three-level fair value hierarchy as set forth below.

Level 1 – Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the company has the ability to access at the measurement date.

Level 2 – Assets and liabilities whose values are based on quoted prices for similar attributes in active markets; quoted prices in markets where trading occurs infrequently; and inputs other than quoted prices that are observable, either directly or indirectly, for substantially the full term of the asset or liability.

Level 3 – Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.

If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis in the consolidated balance sheets (in millions):

	June 30, 2017								June 30, 2018
	Total Fair Value and Carrying Value on Balance Sheet		Fair Value Measurement Category						Total Fair Value and Carrying Value on Balance		Fair Value Measurement Category
			Level 1		Level 2		Level 3		Sheet		Level 1		Level 2				Level 3
Assets:
Money market account									$	86.9	$	-	$		86.9		$		-
Certificates of deposit									$	8.2	$	-	$		8.2		$		-
Corporate bonds									$	124.2	$	-	$		124.2		$		-

Liabilities:
Interest rate swap	$	3.4	$	-	$	3.4	$	-
Contingent consideration									$	15.1	$	-	$	-		$		15.1


	December 31, 2016								December 31, 2017
	Total Fair Value and Carrying Value on Balance Sheet		Fair Value Measurement Category						Total Fair Value and Carrying Value on Balance		Fair Value Measurement Category
			Level 1		Level 2		Level 3		Sheet		Level 1		Level 2				Level 3
Liabilities:
Interest rate swap	$	4.8	$	-	$	4.8	$	-
Contingent consideration									$	15.9	$	-	$	-		$		15.9

As of June 30, 2018, the Company held investments in a money market fund, certificates of deposit, and corporate bonds. All certificates of deposit are within the current Federal Deposit Insurance Corporation insurance limits and all corporate bonds are investment grade.

The Company’s available for sale securities are comprised of certificates of deposit and bonds. These securities are valued using quoted prices for similar attributes in active markets (Level 2). Since these investments are classified as available for sale, they are recorded at their fair market value within “Cash and cash equivalents” and “Marketable securities” in the consolidated balance sheet and their unrealized gains or losses are included in “Accumulated other comprehensive income (loss)”.

As of June 30, 2018, the following table summarizes the amortized cost and the unrealized (gains) losses of the available for sale securities (in thousands):

The Company periodically reviews its available for sale securities for other-than-temporary impairment. For the three- and six-month periods ended June 30, 2018, the Company did not consider any of its securities to be other-than-temporarily impaired and, accordingly, did not recognize any impairment losses.

Included in interest income for the three- and six-month periods ended June 30, 2018 was interest income related to the Company’s available-for-sale securities of $1.0 and $1.8 million, respectively.

Accumulated other comprehensive income (loss) includes ~~foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency and~~ the cumulative gains and losses of derivative instruments that qualify as cash flow ~~hedges.~~hedges, foreign currency translation adjustments and changes in the fair value of available for sale securities. The following table provides a roll-forward of accumulated other comprehensive income (loss) for the six-month periods ended June 30, ~~2017~~2018 and ~~2016~~2017 (in millions):

	2017			2016			2018			2017
Accumulated other comprehensive loss as of January 1,	$	(3.0	)	$	(4.1	)
Accumulated other comprehensive income (loss) as of January 1,							$	(0.1	)	$	(3.0	)
Foreign currency translation (gain) loss		0.1			-			(0.3	)		0.1
Change in fair value of interest rate swap agreements		1.4			(0.9	)		(1.6	)		1.4
Income tax (expense) benefit		(0.6	)		0.3
Income tax benefit (expense)								0.4			(0.6	)
Other comprehensive income (loss), net of tax		0.9			(0.6	)		(1.5	)		0.9
Accumulated other comprehensive loss as of June 30,	$	(2.1	)	$	(4.7	)
Accumulated other comprehensive income (loss) as of June 30,							$	(1.6	)	$	(2.1	)

The Company’s reporting currency is the ~~U.S.~~United States dollar. All transactions initiated in foreign currencies are translated into U.S. dollars in accordance with ASC Topic 830, “Foreign Currency Matters” and the related rate fluctuation on transactions is included in “Foreign currency gain (loss)” in the consolidated statements of operations.

For foreign operations with the local currency as the functional currency, assets and liabilities are translated from the local currencies into U.S. dollars at the exchange rate prevailing at the balance sheet date and equity is translated at historical rates. Revenues and expenses are translated at the average exchange rate for the period. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining other comprehensive (income) loss.

~~The company incurs cost~~Cost of revenue related to the Company’s television segment consists primarily of the carrying value of spectrum usage rights that were surrendered in ~~its~~the FCC auction for broadcast spectrum. Cost of revenue related to the Company’s digital segment ~~which~~ consists primarily of the costs of online media acquired from third-party publishers. ~~Media cost is~~

Assets are classified as ~~cost~~held for sale when the carrying value is expected to be recovered through a sale rather than through their continued use and all of ~~revenue~~the necessary classification criteria have been met. Assets held for sale are recorded at the lower of their carrying value or estimated fair value less selling costs and classified as current assets. Depreciation is not recorded on assets classified as held for sale.

During the second quarter, the Company relocated the operations of two of its television stations in the ~~period~~Palm Springs market and management approved the sale of the vacated building. The building and related improvements met the criteria for classification as assets held for sale and their carrying value is presented separately in ~~which~~ the ~~corresponding revenue is recognized.~~consolidated balance sheet. Assets held for sale are classified as current assets as management believes the sale will be completed within one year.

In ~~May 2014,~~July 2018, the Financial Accounting Standards Board ~~(the “FASB”~~(“FASB”) issued Accounting Standards Update (“ASU”) ~~2014-09,~~2018-10, ~~Revenue from Contracts with Customers (Topic 606)~~ which amended the existing accounting standards for revenue recognition. ASU 2014-09 establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. Subsequently, the FASB has issued the following standards related to ASU 2014-09: ASU No. 2016-08, ~~Revenue from Contracts with Customers (Topic 606): Principal versus Agent~~

~~Considerations~~ ~~; ASU No. 2016-10,~~ ~~Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing~~ ~~; ASU No. 2016-12,~~ ~~Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients~~ ~~; and ASU No. 2016-20,~~ ~~Technical Corrections and~~Codification Improvements to Topic ~~606, Revenue from Contracts with Customers~~842, Leases which addresses several issues related to the application of the new guidance in ASC 842, Leases. The ~~Company must adopt~~guidance clarifies, among other issues, the rate implicit in the lease, impairment of the net investment in the lease, lessee reassessment of lease classification, lessor reassessment of lease term and purchase options, variable payments that depend on an index or rate and certain transition adjustments. The amendments in ASU ~~2016-08,~~2018-10 affect the amendments in ASU ~~2016-10, ASU~~ ~~2016-12 and ASU 2016-20 with ASU 2014-09 (collectively,~~2016-02, which are not yet effective, but for which early adoption upon issuance is permitted. For entities that early adopted Topic 842, the ~~“new~~ ~~revenue standards”). The new revenue standards~~amendments are effective ~~for public companies for annual reporting periods,~~upon issuance of ASU 2018-10, and ~~interim periods within~~the transition requirements are the same as those ~~years beginning after December 15, 2017. The Company currently expects to adopt~~in Topic 842. For entities that have not adopted Topic 842, the ~~new revenue standards~~effective date and transition requirements will be the same as the effective date and transition requirements in ~~its first quarter of 2018. The new revenue standards are not expected to have a material impact on the amount and timing of revenue recognized in the Company's consolidated financial statements.~~

~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases (Topic 842)~~ which specifies the accounting for leases. For operating leases, ASU 2016-02 requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. ASU 2016-02 is effective for public companies for annual reporting periods, and interim periods within those years beginning after December 15, 2018. Early adoption is permitted.Topic 842. The Company is currently in the process of evaluating the impact of ~~adoption of the ASU~~this guidance on its consolidated financial statements.

In ~~June 2016,~~July 2018, the FASB issued ASU ~~2016-13,~~2018-09, ~~Financial Instruments - Credit Losses (Topic 326): Measurement~~Codification Improvements which does not prescribe any new accounting guidance but instead makes minor improvements and clarifications across nine subtopics of ~~Credit Losses on Financial Instruments~~ ~~which requires entities to use a current expected credit loss ("CECL") model which is a new impairment model~~the FASB Accounting Standards Codification based on ~~expected losses rather than incurred losses. Under this model an entity would recognize an impairment allowance equal~~comments from various stakeholders. The transition and effective date guidance are based on the facts and circumstances of each amendment. Some of the amendments in ASU 2018-09 do not require transition guidance and will be effective upon issuance while others provide for a transition period to ~~its current estimate~~adopt as part of ~~all contractual cash flows that~~ the entity does not expect to collect from financial assets measured at amortized cost. The entity's estimate would consider relevant information about past events, current conditions, and reasonable and supportable forecasts, which will result in recognition of life-time expected credit losses upon loan origination. ASU 2016-13 is effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted for annual reporting periodsnext fiscal year beginning after December 15, 2018. The Company is currently in the process of evaluating the impact of ~~adoption of the ASU~~this guidance on its consolidated financial statements.

In ~~August 2016,~~June 2018, the FASB issued ASU ~~2016-15,~~2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Non-employee Share-based Payment Accounting, which supersedes Subtopic 505-50, Equity—Equity-Based Payments to Non-Employees and expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods and services. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide financing to the issuer or awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606, Revenue from Contracts with Customers. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted, but no earlier than a company’s adoption date of Topic 606. The Company is currently in the process of evaluating the impact of this guidance on its consolidated financial statements.

In March 2018, the FASB issued ASU 2018-04, Investments – Debt Securities (Topic 320) and Regulated Operations (Topic 980), amendments to SEC Paragraphs pursuant to SEC Staff Accounting Bulletin No. 117 and SEC Release No. 33-9273. The amendments in this update provide guidance about certain amendments made to SEC materials and staff guidance relating to Investments – Debt Securities (Topic 320) and Regulated Operations (Topic 980). The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and related disclosures.

In February 2018, the FASB issued ASU 2018-02, Income Statement ~~of Cash Flows~~- Reporting Comprehensive Income (Topic ~~230)~~220): ~~Classification~~Reclassification of Certain ~~Cash Receipts~~Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the 2017 Tax Act and ~~Cash Payments (a consensus~~also requires entities to disclose their accounting policy for releasing income tax effects from accumulated other comprehensive income. This update is effective in fiscal years, including interim periods, beginning after December 15, 2018, and early adoption is permitted. This guidance should be applied either in the period of adoption or retrospectively to each period in which the effects of the ~~Emerging Issues Task Force)~~ ~~which provides specific~~change in the U.S. federal income tax rate in the 2017 Tax Act is recognized. The Company is currently in the process of evaluating the impact of this guidance on ~~eight cash flow classification issues arising from~~its consolidated financial statements.

In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities, which shortens the amortization period for certain ~~cash receipts and cash payments. Currently, GAAP either is unclear or does not include specific guidance on~~callable debt

securities held at a premium. Specifically, the ~~eight cash flow classification issues addressed in this topic.~~amendments require the premium to be amortized to the earliest call date. The ~~objective is to reduce current and potential future diversity in practice. ASU 2016-15~~update is effective for annual reporting periods and interim ~~and~~periods within those annual reporting periods beginning after December 15, ~~2017.~~2018. Early adoption is permitted ~~including adoption in an interim period.~~and the modified retrospective transition method should be applied through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company does not expect the adoption of the ASU to have a material impact on its consolidated financial statements.

In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory which allows entities to recognize the income tax consequences on an intra-entity transfer of an asset other than inventory when the transfer occurs. Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. In addition, there has been diversity in the application of the current guidance for transfers of certain intangible and tangible assets. The objective is to reduce complexity in accounting standards. ASU 2016-16 is effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted, including adoption in an interim period. The Company is currently in the process of evaluating the impact of adoption of the ASU on its consolidated financial statements.

In ~~November~~June 2016, the FASB issued ASU ~~2016-18,~~2016-13, ~~Statement~~Financial Instruments – Credit Losses (Topic 326) that amends current guidance on other-than-temporary impairments of ~~Cash Flows (Topic 230): Restricted Cash a Consensus~~available-for-sale debt securities. This amended standard requires the use of an allowance to record estimated credit losses on these assets when the fair value is below the amortized cost of the ~~FASB Emerging Issues Task Force~~asset. This standard also removes the evaluation of the length of time that a security has been in a loss position to enhance and clarify the guidance on the classification and presentation of restricted cash in the statement of cash flows. A mounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows.avoid recording a credit loss. The ~~objective is to reduce diversity in practice. ASU 2016-18~~update is effective for ~~interim and annual reporting periods~~fiscal years beginning after December 15, ~~2017. Early adoption is permitted,~~2019, including ~~adoption in an~~ interim ~~period.~~periods within those fiscal years. The Company ~~does not expect~~is still assessing the ~~adoption of the ASU to~~impact this standard will have ~~a material impact~~ on its consolidated financial ~~statements.~~statements and related disclosures.

In ~~January 2017,~~February 2016, the FASB issued ASU ~~2017-01~~2016-02, ~~, Business Combinations~~Leases (Topic ~~805) - Clarifying~~842, and subsequent ASU 2018-01) which specifies the ~~Definition~~accounting for leases. For operating leases, ASU 2016-02 requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a ~~Business~~lessee to ~~provide~~recognize a ~~more robust framework to use in determining when~~single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a set of assets and activities is considered a business. The objective is to add guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.generally straight-line basis. ASU ~~2017-01~~2016-02 is effective for ~~interim and~~public companies for annual reporting periods, and interim periods within those years beginning after December 15, ~~2017.~~2018. Early adoption is ~~permitted only~~permitted. This standard requires adoption based upon a modified retrospective transition approach for ~~certain transactions.~~leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with optional practical expedients. Based on a preliminary assessment, the Company expects that most of its operating lease commitments will be subject to the new guidance and recognized as operating lease liabilities and right–of-use assets upon adoption, resulting in a significant increase in the assets and liabilities on our consolidated balance sheet. The Company ~~does not expect the adoption of the ASU to~~is continuing its assessment, which may identify additional impacts this standard will have ~~a material impact~~ on its consolidated financial ~~statements.~~statements and related disclosures.

In ~~January 2017,~~March 2018, the FASB issued ASU ~~2017-04,~~ 2018-05, Income Taxes (Topic 740), Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. The ASU adds various SEC paragraphs pursuant to the issuance of the December 2017 SEC Staff Accounting Bulletin No. 118, ~~Intangibles—Goodwill~~Income Tax Accounting Implications of the Tax Cuts and ~~Other (Topic 350): Simplifying~~Jobs Act (“SAB 118”), which was effective immediately. The SEC issued SAB 118 to address concerns about reporting entities’ ability to timely comply with the ~~Test for Goodwill Impairment,~~ ~~which removes Step 2~~accounting requirements to recognize all of the effects of the 2017 Tax Act in the period of enactment. SAB 118 allows disclosure that timely determination of some or all of the income tax effects from the ~~goodwill impairment test. An entity no longer will determine goodwill impairment~~2017 Tax Act are incomplete by ~~calculating~~ the ~~implied fair value~~due date of ~~goodwill by assigning~~ the ~~fair value of~~financial statements and if possible to provide a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination. The objective is to reduce the cost and complexity of evaluating goodwill for impairment. ASU 2017-04 is effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017.reasonable estimate. The Company ~~does not expect~~has accounted for the ~~adoption~~tax effects of the ~~ASU to have~~2017 Tax Act under the guidance of SAB 118, on a ~~material impact on~~provisional basis. The Company’s accounting for certain income tax effects is incomplete, but it has determined reasonable estimates for those effects and has recorded provisional amounts in its consolidated financial ~~statements.~~statements as of June 30, 2018 and December 31, 2017.

In May 2017, the FASB issued ~~Accounting Standards Update~~ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting ~~(“ASU 2017-09”)~~, to clarify and reduce both (i) diversity in practice and (ii) cost and complexity when applying the guidance in Topic 718, to change the terms and conditions of a share-based payment award. Specifically, an entity would not apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. ASU 2017-09 is effective for interim and annual reporting periods beginning after December 15, 2017. ~~Early adoption is permitted.~~ The Company ~~is currently~~adopted ASU 2017-09 on January 1, 2018. The adoption of ASU 2017-09 did not have a material impact on its financial condition or results of operations, as the Company has not had any modifications to share-based payment awards. However, if the Company does have a modification to an award in the ~~process of evaluating~~future, it will follow the ~~impact of adoption of the~~guidance in ASU ~~on its consolidated financial statements~~.

In ~~March~~January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business to provide a more robust framework to use in determining when a set of assets and activities is considered a business. ASU 2017-01 is effective for interim and annual reporting periods beginning after December 15, 2017. The Company adopted this standard prospectively on January 1, 2018.

In August 2016, the FASB issued ASU ~~2016-09,~~ 2016-15, ~~Compensation – Stock Compensation~~Statement of Cash Flows (Topic ~~718)~~230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force) which provides specific guidance on eight cash flow classification issues arising from certain cash receipts and cash payments. The Company adopted this guidance on January 1, 2018 and is required to apply it on a retrospective basis. There was no material impact on the Company’s consolidated statements of cash flows.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) which amended the existing accounting standards for revenue recognition. ASU 2014-09 establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. Subsequently, the FASB has issued the following standards related to ASU 2014-09: ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations; ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing; ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients; and ASU 2016-20, Technical Corrections and Improvements to ~~Employee Share-Based Payment Accounting~~Topic 606, Revenue from Contracts with Customers ~~which is intended to simplify several aspects of~~.

On January 1, 2018, the ~~accounting for share-based payment transactions, including~~Company adopted ASC Topic 606 using the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 requires companies to record excess tax benefits and tax deficiencies as a component of the provision for income taxes in the period in which they occur. The Company has adopted the provisions of ASU 2016-09 on a modified retrospective ~~basis~~method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting under Topic 605.

Opening retained earnings as of January 1, 2018 were not affected as there was no cumulative impact of adopting Topic 606.

On December 22, 2017, the President signed the 2017 Tax Act. The 2017 Tax Act makes broad and complex changes to the United States tax code that affected the Company’s financial results for the year ended December 31, 2017 and may affect financial results for the year ending December 31, 2018 and future years, including, but not limited to, some or all of the following: (1) a reduction of the U.S. federal corporate tax rate from 35% to 21%; (2) a general elimination of U.S. federal income taxes on dividends from foreign subsidiaries; (3) a new provision designed to tax global intangible low-taxed income (“GILTI”); (4) limitations on the deductibility of certain executive compensation; and (5) limitations on the use of Federal Tax Credits to reduce the U.S. income tax liability.

The staff of the SEC issued SAB 118, which ~~resulted~~provides guidance on accounting for the tax effects of the 2017 Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the 2017 Tax Act enactment date for the Company to complete the accounting under ASC 740. In accordance with SAB 118, the Company must reflect the income tax effects of those aspects of the Act for which the accounting under ASC 740 is complete. To the extent that accounting for certain income tax effects of the 2017 Tax Act is incomplete but the Company is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. The Company was able to make a reasonable estimate of the impact of the reduction in the corporate tax rate and no significant provisional items were identified that could result in a ~~cumulative-effect adjustment of $2.4 million~~material impact to ~~“Deferred income taxes” and “Total stockholders’ equity”~~the estimate upon finalization in 2018.

Effective January 1, 2018, the 2017 Tax Act subjects a U.S. corporation to tax on its GILTI. The Company has elected an accounting policy to treat taxes due on the ~~consolidated balance sheets. Additionally, during~~GILTI inclusion as a current period expense. The impact on the ~~three-month~~effective tax rate for the period ended June 30, ~~2017,~~2018 was not significant.

Revenues are recognized when control of the promised services is transferred to the Company’s customers, in an amount that reflects the consideration the Company ~~recorded a benefit~~expects to be entitled to in ~~income tax expense of $0.1 million due~~exchange for those services.

Broadcast Advertising. Television and radio revenue related to the ~~adoption~~sale of advertising is recognized at the time of broadcast. Broadcast advertising rates are fixed based on each medium’s ability to attract audiences in demographic groups targeted by advertisers and rates can vary based on the time of day and ratings of the programming airing in that day part.

Digital Advertising. Revenue from digital advertising primarily consists of two types: (1) Display advertisements on websites and mobile applications that are sold based on a cost-per-thousand impressions delivered (typically referred to as “CPM”). These impressions are delivered through the Company’s websites and through third party publishers either through direct relationships with the publishers or through digital advertising exchanges. (2) Performance driven advertising whereby the customer engages the Company to drive consumers to perform an action such as the download of a mobile application, the installation of an application, or the first use of an application (typically referred to cost per action “CPA” or cost per installation “CPI”).

Broadcast and digital advertising revenue is recognized over time in a series as a single performance obligation as the ad, impression or performance advertising is delivered per the insertion order. The Company applies the practical expedient to recognize

revenue for each distinct advertising service delivered at the amount the Company has the right to invoice, which corresponds directly to the value a customer has received relative to the Company’s performance. Contracts with customers are short term in nature and billing occurs on a monthly basis with payment due in 30 days. Value added taxes collected concurrent with advertising revenue producing activities are excluded from revenue. Cash payments received prior to services rendered result in deferred revenue, which is then recognized as revenue when the advertising time or space is actually provided.

Retransmission Consent. The Company generates revenue from retransmission consent agreements that are entered into with multichannel video programming distributors, or MVPDs. The Company grants the MVPDs access to its television station signals so that they may rebroadcast the signals and charge their subscribers for this ~~new standard. During~~programming. Payments are received on a monthly basis based on the number of monthly subscribers.

Retransmission revenues are considered licenses of functional intellectual property and are recognized over time utilizing the sale-based or usage-based royalty exception. The Company’s performance obligation is to provide the licensee access to our intellectual property. MVPD subscribers receive and consume the content monthly as the television signal is delivered.

Spectrum Usage Rights. The Company generates revenue from agreements associated with its television stations’ spectrum usage rights from a variety of sources, including but not limited to agreements with third parties to utilize excess spectrum for the broadcast of their multicast networks; charging fees to accommodate the operations of third parties, including moving channel positions or accepting interference with broadcasting operations; and modifying and/or relinquishing spectrum usage rights while continuing to broadcast through channel sharing or other arrangements.

Revenue generated by spectrum usage rights agreements are recognized over the period of the lease or when we have relinquished all or a portion of our spectrum usage rights for a station or have relinquished our rights to operate a station on the existing channel free from interference.

Other Revenue. The Company generates other revenues that are related to its broadcast operations which primarily consist of representation fees earned by the Company’s radio national representation firm, talent fees for the Company’s on air personalities, ticket and concession sales for radio events, rent from tenants of the Company’s owned facilities, barter revenue, and revenue generated under joint sales agreements.

In the case of representation fees, the Company does not control the distinct service, the commercial advertisement, prior to delivery and therefore recognizes revenue on a net basis. Similarly for joint service agreements, the Company does not own the station providing the airtime and therefore recognizes revenue on a net basis. In the case of talent fees, the on air personality is an employee of the Company and therefore the Company controls the service provided and recognizes revenue gross with an expense for fees paid to the employee.

The Company does not disclose the value of unsatisfied performance obligations when (i) contracts have an original expected length of one year or less, which applies to effectively all advertising contracts, and (ii) variable consideration is a sales-based or usage-based royalty promised in exchange for a license of intellectual property, which applies to retransmission consent revenue.

The Company applies the practical expedient to expense contract acquisition costs, such as sales commissions generated either by internal direct sales employees or through third party advertising agency intermediaries, when incurred because the amortization period is one year or less. These costs are recorded within direct operating expenses.

The following table presents our revenues disaggregated by major source for the three- and six-month periods ended (in thousands):

Contracts are entered into directly with customers or through an advertising agency that represents the customer. Sales of advertising to customers or agencies within a station’s designated market area (“DMA”) are referred to as local revenue, whereas sales from outside the DMA are referred to as national revenue. The following table further disaggregates the Company’s broadcast advertising revenue by sales channel for the three- and six-month periods ended (in thousands):

The Company records deferred revenues when cash payments are received or due in advance of its performance, including amounts which are refundable. The increase in the deferred revenue balance for the six-month period ended June 30, ~~2017,~~2018 is primarily driven by cash payments received or due in advance of satisfying the Company’s performance obligations, offset by revenues recognized that were included in the deferred revenue balance as of December 31, 2017.

The Company’s payment terms vary by the type and location of customer and the products or services offered. The term between invoicing and when payment is due is not significant, typically 30 days. For certain customer types, the Company ~~recorded a benefit in income tax expense of $0.2 million due~~requires payment before the services are delivered to the ~~adoption of this new standard.~~customer.

The Company’s management has determined that the Company operates in three reportable segments as of June 30, 2018, based upon the type of advertising ~~medium:~~medium, which segments are television, ~~broadcasting,~~ radio, ~~broadcasting~~ and ~~digital media.~~digital. The Company’s segments results reflect information presented on the same basis that is used for internal management reporting and it is also how the chief operating decision maker evaluates the business.

The Company owns and/or operates 5455 primary television stations located primarily in California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Nevada, New Mexico, Texas and Washington, D.C.

The Company owns and operates 49 radio stations (38 FM and 11 AM) located primarily in Arizona, California, Colorado, Florida, Nevada, New Mexico and Texas.

The Company owns and operates a national sales representation division, Entravision Solutions, through which the Company sells advertisements and syndicates radio programming to more than 300 stations across the United States.

The Company owns and operates certain digital ~~media operations,~~assets, offering mobile, digital and other interactive media platforms and services on Internet-connected devices, including local websites and social media, ~~that~~which provide users with news, information and other content.

On April 4, 2017, the Company completed the acquisition of 100% of the stock of several entities collectively doing business as Headway (“Headway”), a provider of mobile, programmatic, data and performance digital marketing solutions primarily in the United States, Mexico and other markets in Latin America. See Note 5 to the Notes to the Consolidated Financial Statements.

Separate financial data for each of the Company’s operating segments are provided below. Segment operating profit (loss) is defined as operating profit (loss) before corporate expenses and foreign currency (gain) loss. The Company generated ~~15%~~20% and 8%15% of its revenue outside the United States during the ~~three-~~three-month periods ended June 30, 2018 and 2017, respectively. The Company generated 19% and 15% of its revenue outside the United States during the six-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. The Company evaluates the performance of its operating segments based on the following (in thousands):

	Three-Month Period									Six-Month Period									Three-Month Period									Six-Month Period
	Ended June 30,						%			Ended June 30,						%			Ended June 30,						%			Ended June 30,						%
	2017			2016			Change			2017			2016			Change			2018			2017			Change			2018			2017			Change
Net revenue
Television	$	37,764		$	39,215			(4	)%	$	75,474		$	75,780			(0	)%	$	36,531		$	37,764			(3	)%	$	71,022		$	75,474			(6	)%
Radio		17,163			19,552			(12	)%		32,882			36,436			(10	)%		17,240			17,163			0	%		31,343			32,882			(5	)%
Digital		15,582			6,062			157	%		19,663			10,726			83	%		20,558			15,582			32	%		38,802			19,663			97	%
Consolidated		70,509			64,829			9	%		128,019			122,942			4	%		74,329			70,509			5	%		141,167			128,019			10	%

Cost of revenue - digital media		8,762			2,373			269	%		10,514			4,212			150	%
Cost of revenue - digital																				11,384			8,762			30	%		22,009			10,514			109	%

Direct operating expenses
Television		14,873			15,475			(4	)%		29,627			30,509			(3	)%		15,038			14,873			1	%		30,588			29,627			3	%
Radio		11,039			11,285			(2	)%		22,056			22,226			(1	)%		10,935			11,039			(1	)%		21,609			22,056			(2	)%
Digital		4,003			1,778			125	%		5,324			3,368			58	%		5,144			4,003			29	%		9,953			5,324			87	%
Consolidated		29,915			28,538			5	%		57,007			56,103			2	%		31,117			29,915			4	%		62,150			57,007			9	%

Selling, general and administrative expenses
Television		5,277			5,193			2	%		10,728			10,639			1	%		5,551			5,277			5	%		11,523			10,728			7	%
Radio		4,581			4,950			(7	)%		9,285			9,838			(6	)%		4,502			4,581			(2	)%		9,108			9,285			(2	)%
Digital		2,172			1,267			71	%		3,217			2,368			36	%		2,620			2,172			21	%		5,336			3,217			66	%
Consolidated		12,030			11,410			5	%		23,230			22,845			2	%		12,673			12,030			5	%		25,967			23,230			12	%

Depreciation and amortization
Television		2,500			2,705			(8	)%		4,963			5,572			(11	)%		2,277			2,500			(9	)%		4,481			4,963			(10	)%
Radio		662			842			(21	)%		1,388			1,632			(15	)%		621			662			(6	)%		1,240			1,388			(11	)%
Digital		1,415			338			319	%		1,772			708			150	%		1,121			1,415			(21	)%		2,237			1,772			26	%
Consolidated		4,577			3,885			18	%		8,123			7,912			3	%		4,019			4,577			(12	)%		7,958			8,123			(2	)%

Segment operating profit (loss)
Television		15,114			15,842			(5	)%		30,156			29,060			4	%		13,665			15,114			(10	)%		24,430			30,156			(19	)%
Radio		881			2,475			(64	)%		153			2,740			(94	)%		1,182			881			34	%		(614	)		153			(501	)%
Digital		(770	)		306		*				(1,164	)		70		*				289			(770	)		(138	)%		(733	)		(1,164	)		-37	%
Consolidated		15,225			18,623			(18	)%		29,145			31,870			(9	)%		15,136			15,225			(1	)%		23,083			29,145			(21	)%

Corporate expenses		5,619			5,293			6	%		11,486			10,897			5	%		6,266			5,619			12	%		12,241			11,486			7	%
Foreign currency transaction (gain) loss		351			-		*				351			-		*
Change in fair value of contingent consideration																				(913	)		-		*				1,187			-		*
Foreign currency (gain) loss																				(17	)		351		*				196			351			(44	)%
Operating income (loss)		9,255			13,330			(31	)%		17,308			20,973			(17	)%		9,800			9,255			6	%		9,459			17,308			(45	)%

Interest expense	$	(3,683	)	$	(3,859	)		(5	)%	$	(7,328	)	$	(7,725	)		(5	)%	$	(4,001	)	$	(3,683	)		9	%	$	(7,399	)	$	(7,328	)		1	%
Interest income		110			118			(7	)%		219			125			75	%		1,039			110			845	%		1,952			219			791	%
Income before income taxes		5,682			9,589			(41	)%		10,199			13,373			(24	)%
Dividend income																				417			-		*				545			-		*
Other income (loss)																				273			-		*				295			-		*
Income (loss) before income taxes																				7,528			5,682			32	%		4,852			10,199			(52	)%

Capital expenditures
Television	$	4,985		$	1,138					$	5,952		$	2,558					$	1,942		$	4,985					$	4,023		$	5,952
Radio		575			1,061						843			1,832						81			575						162			843
Digital		4			147						13			196						181			4						247			13
Consolidated	$	5,564		$	2,346					$	6,808		$	4,586					$	2,204		$	5,564					$	4,432		$	6,808

	June 30,			December 31,															June 30,			December 31,
Total assets	2017			2016															2018			2017
Television		349,140			363,852															535,660			556,942
Radio		126,177			129,825															123,901			126,248
Digital		77,727			24,244															88,986			82,777
Consolidated	$	553,044		$	517,921														$	748,547		$	765,967

The Company is subject to various outstanding claims and other legal proceedings that may arise in the ordinary course of business. In the opinion of management, any liability of the Company that may arise out of or with respect to these matters will not materially adversely affect the financial position, results of operations or cash flows of the Company.

On ~~April 4, 2017,~~January 16, 2018, the Company completed the acquisition of television station KMCC-TV, which serves the Las Vegas, Nevada area, for an aggregate $3.6 million. The transaction was treated as an asset acquisition with the majority of the purchase price recorded in “Intangible assets not subject to amortization” on the Company’s consolidated balance sheet.

On June 11, 2018, the Company completed the acquisition of 100% of the stock of ~~several entities collectively doing business as Headway,~~Smadex, S.L. (“Smadex”), a ~~provider of~~leading mobile programmatic solutions provider and demand-side platform that delivers performance-based solutions and data ~~and performance digital marketing solutions primarily in the United States, Mexico and other markets in Latin America.~~insights for marketers. The Company acquired ~~Headway in order~~Smadex to ~~acquire additional~~gain unique technology expertise, broaden its digital ~~media platforms that the Company believes will~~solutions offering, enhance its ~~offerings to the U.S. Hispanic marketplace as well as expand the Company’s international footprint.~~execution of performance campaigns and drive incremental revenues. The transaction was funded from ~~the Company’s~~ cash on hand for an aggregate cash consideration of ~~$7.5~~$3.6 million, net of ~~$4.5~~$1.2 million of cash ~~acquired, and contingent consideration with a fair value of $18.3 million as of the acquisition date.~~acquired.

The following is a summary of the initial purchase price allocation for the Company’s acquisition of ~~Headway~~Smadex (unaudited; in millions):

Accounts receivable	$	18.9	$	1.0
Other current assets				0.2
Intangible assets subject to amortization		17.1		2.0
Goodwill		19.2		3.0
Current liabilities		(22.8)		(1.8	)
Long-term liabilities				(0.4	)
Deferred Tax		(6.6)		(0.4	)

The acquisition of Headway includes a contingent consideration arrangement that requires additional consideration to be paid by the Company to Headway based upon the achievement of certain annual performance benchmarks over a three-year period. The range of the total undiscounted amounts the Company could pay under the contingent consideration agreement over the three-year period is between $0 and $31.5 million. The fair value of the contingent consideration recognized on the acquisition date of $18.3 million was estimated by applying the real options approach. The agreement also includes a payment of approximately $2.0 million to certain key employees if they remain with the Company for a period of 18 months, which will be treated as post acquisition compensation expense and accrued as earned.

The fair value of ~~the~~ assets acquired includes trade receivables of ~~$18.9~~$1.0 million. The gross amount due under contract is ~~$20.0~~$1.0 million, all of which ~~$1.1 million~~ is expected to be ~~uncollectable.~~collectible.

During the three- and six-month periods ended June 30, ~~2017, Headway~~2018, Smadex generated net revenue and expenses of ~~$11.0 million and a net loss of $0.5~~$0.4 million, which are included in the ~~Consolidated Statements~~consolidated statements of ~~Operations.~~ operations.

The goodwill, which is not expected to be deductible for tax purposes, is assigned to the digital ~~media~~ segment and is attributable to ~~Headway’s~~Smadex workforce and expected synergies from combining ~~Headway’s~~their operations with those of the Company. The changes in the carrying amount of goodwill for each of the Company’s operating segments for the six-month period ended June 30, ~~2017~~2018 are as follows (in thousands):

		December 31,				June 30,		December 31,				June 30,
		2016		Acquisition		2017		2017		Acquisition		2018
Television	$	35,912	$	-	$	35,912	$	40,549	$	-	$	40,549
Digital		14,169		19,235		33,404		30,008		3,009		33,017
Consolidated	$	50,081	$	19,235	$	69,316	$	70,557	$	3,009	$	73,566

The fair value of the acquired intangible assets ~~and contingent consideration~~ is provisional pending receipt of the final valuations for those assets.

The following unaudited pro forma information for the three- and six-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, has been prepared to give effect to the acquisition of ~~Headway~~Smadex as if the acquisition had occurred on January 1, ~~2016.~~2017. This pro forma information does not purport to represent what the actual results of operations of the Company would have been had this acquisition occurred on such date, nor does it purport to predict the results of operations for future periods.

	Three-Month Period				Six-Month Period				Three-Month Period						Six-Month Period
	Ended June 30,				Ended June 30,				Ended June 30,						Ended June 30,
	2017		2016		2017		2016		2018			2017			2018			2017
Pro Forma:
Total revenue	$	70,509	$	64,829	$	128,019	$	122,942	$	76,213		$	71,787		$	145,085		$	130,314
Net income (loss)	$	3,499	$	5,717	$	6,113	$	7,987	$	5,234		$	3,538		$	3,320		$	6,112

Basic and diluted earnings per share:
Net income per share, basic and diluted	$	0.04	$	0.06	$	0.07	$	0.09		$	0.06		$	0.04		$	0.04		$	0.07

Weighted average common shares outstanding, basic		90,354,982		89,134,412		90,296,057		89,015,934		88,959,935			90,354,982			89,635,759			90,296,057
Weighted average common shares outstanding, diluted		92,033,111		91,140,596		91,897,150		91,036,353		90,021,949			92,033,111			90,805,086			91,897,150

The unaudited pro forma information for the six-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, was adjusted to exclude acquisition fees and costs of ~~$0.5~~$0.4 million in ~~2017 and $0~~2018.

On ~~July 21,~~April 4, 2017, the Company ~~received proceeds~~completed the acquisition of ~~$263.6 million related to its participation~~100% of the stock of several entities collectively doing business as Headway (“Headway”), a provider of mobile, programmatic, data and performance digital marketing solutions primarily in the ~~FCC auction for broadcast spectrum.~~United States, Mexico and other markets in Latin America. The ~~proceeds~~acquisition of ~~the auction reflect the FCC’s acceptance of one or more bids placed~~Headway includes a contingent consideration arrangement that requires additional consideration to be paid by the Company ~~during~~to Headway based upon the ~~auction~~achievement of certain annual performance benchmarks over a three-year period. As of June 30, 2018, the Company adjusted the fair value of contingent consideration to ~~modify and/or relinquish spectrum usage rights~~$15.1 million, resulting in income of $0.9 million and a loss of $1.2 million for ~~certain~~the three- and six-month periods ended June 30, 2018, respectively. These amounts were recorded in “Change in Fair Value of Contingent Consideration” in the Company’s ~~television stations. The Company does not expect that the modification and/or relinquishment~~consolidated statement of the spectrum usage rights will result in material changes in the operations or results of the Company. The proceeds of the auction were deposited into the account of a “qualified intermediary” to comply with Internal Revenue Code Section 1031 requirements to execute a like kind exchange.operations.

In July 2017, the Company used a portion of the proceeds to make an initial payment of $16.3 million in conjunction with the relocation of the Company’s television station, WJAL-TV, from Hagerstown, Maryland to Washington, D.C. An additional $16.3 million will be paid upon completion of the relocation, which is subject to FCC approval.

On July 20, 2017, the Company entered into an agreement with OTA Broadcasting (PSP), LLC to acquire television stations KMIR-TV, the local NBC affiliate, and KPSE-LD, the local MyNetworkTV affiliate, serving the Palm Springs, California area, for an aggregate of $21 million. The transaction, which is subject to customary closing conditions, including the prior consent of the FCC, is currently expected to close in the fourth quarter of 2017.

~~On July 13, 2017, the~~ Board of Directors approved the repurchase of up to $15 million of the Company’s common stock. Under the new share repurchase program, the Company is authorized to purchase shares from time to time through open market purchases or negotiated purchases, subject to market conditions and other factors~~. On the same date, the Board terminated the Company’s previous share repurchase program of up to $20 million of the Company’s common stock.~~

The Company entered into the First Amendment dated as of August 1, 2017 (the “Amendment”) to the 2013 Credit Agreement. Pursuant to this Amendment, among other things, the Company is allowed to make certain restricted payments in an amount not to exceed $40,000,000, plus, for each anniversary of the effective date of the Amendment, an additional $20,000,000 so long as, in the case of restricted payments made in reliance on any such additional amounts, the total net leverage ratio would not exceed 5.5 to 1 after giving effect to the restricted payment.

The Amendment also makes certain technical and conforming changes to the terms of the 2013 Credit Agreement. All other provisions of the 2013 Credit Agreement remain in full force and effect unless expressly amended or modified pursuant to the Amendment.

We are a leading global media company that, through our television and radio segments, reaches and engages U.S. Hispanics across acculturation levels and media ~~channels as well as consumers~~channels. Additionally, our digital segment, whose operations are located primarily in Spain, Mexico, Argentina and other ~~markets~~countries in Latin ~~America.~~America, reaches a global market. Our ~~expansive~~ portfolio encompasses integrated marketing and media solutions, comprised of television, radio and digital properties ~~and~~(including data analytics ~~services.~~

~~We operate~~services). For financial reporting purposes, we report in three ~~reportable~~ segments, based upon the type of advertising medium: television, ~~broadcasting,~~ radio ~~broadcasting~~ and ~~digital media.~~digital. Our net revenue for the three-month period ended June 30, ~~2017~~2018 was ~~$70.5~~$74.3 million. Of that amount, revenue attributed to our television segment accounted for approximately ~~54%~~49%, revenue attributed to our digital segment accounted for approximately 28% and revenue attributed to our radio segment accounted for approximately ~~24% and revenue attributed to our digital segment accounted for approximately 22%~~23%.

As of the date of filing this report, we own and/or operate 5455 primary television stations located primarily in California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Nevada, New Mexico, Texas and Washington, D.C. We own and operate 49 radio stations in 1816 U.S. markets. Our radio stations consist of 38 FM and 11 AM stations located in Arizona, California, Colorado, Florida, Nevada, New Mexico and Texas. We also operate Entravision Solutions as our national sales representation division, through which we sell advertisements and syndicate radio programming to more than 300 stations across the United States. We ~~also~~ own and operate ancertain digital assets, offering mobile, digital and other interactive media platforms and services on Internet-connected devices, including local websites and social media, which provide users with news, information and other content. We provide digital advertising solutions that allow advertisers to reach primarily online ~~advertising~~Hispanic audiences worldwide. We operate a proprietary technology and data platform that delivers digital advertising in ~~a variety of~~various advertising formats that allows advertisers to reach ~~Hispanic~~ audiences across a wide range of Internet-connected devices on ~~Internet-connected devices.~~our owned and operated digital media sites; the digital media sites of our publisher partners; and on other digital media sites we access through third-party platforms and exchanges.

We generate revenue primarily from sales of national and local advertising time on television stations, radio stations and digital media platforms, and from retransmission consent agreements that are entered into with MVPDs. Advertising rates are, in large part, based on each medium’s ability to attract audiences in demographic groups targeted by advertisers. We recognize advertising revenue when commercials are broadcast and when display or other digital advertisements record impressions on the websites of our ~~third-party~~third party publishers or as the advertiser’s previously agreed-upon performance ~~goals~~criteria are ~~delivered.~~satisfied. We do not obtain long-term commitments from our advertisers and, consequently, they may cancel, reduce or postpone orders without penalties. We pay commissions to agencies for local, regional and national advertising. For contracts directly with agencies, we record net revenue from these agencies. Seasonal revenue fluctuations are common in our industry and are due primarily to variations in advertising expenditures by both local and national advertisers. Our first fiscal quarter generally produces the lowest net revenue for the year. In addition, advertising revenue is generally higher during presidential election years (2016, 2020, etc.), resulting from significant political advertising and, to a lesser degree, Congressional off-year ~~elections~~election years (2018, 2022, etc.), resulting from increased political advertising, compared to other years.

We refer to the revenue generated by agreements with MVPDs as retransmission consent revenue, which represents payments from MVPDs for access to our television station signals so that they may rebroadcast our signals and charge their subscribers for this programming. We recognize retransmission consent revenue ~~when it~~earned as the television signal is ~~accrued pursuant~~delivered to the ~~agreements~~MVPD.

Our FCC licenses grant us spectrum usage rights within each of the television markets in which we operate. We regard these rights as a valuable asset. With the proliferation of mobile devices and advances in technology that have ~~entered into with respect to such revenue.~~

freed up excess spectrum capacity, the monetization of our spectrum usage rights has become a significant part of our business in recent years. We ~~also~~ generate revenue from agreements associated with these television ~~stations in order~~stations’ spectrum usage rights from a variety of sources, including but not limited to agreements with third parties to utilize excess spectrum for the broadcast of their multicast networks; charging fees to accommodate the operations of ~~telecommunications operators.~~third parties, including moving channel positions or accepting interference with broadcasting operations; and modifying and/or relinquishing spectrum usage rights while continuing to broadcast through channel sharing or other arrangements. Revenue ~~from~~generated by such agreements is recognized over the period of the lease or when we have relinquished all or a portion of our spectrum usage rights for a station or have relinquished our rights to operate ~~the~~a station on the existing channel free from ~~interference~~interference. In addition, we will consider strategic acquisitions of television stations to further this strategy from time to time, as well as additional monetization opportunities expected to arise as the ~~telecommunications operators.~~television broadcast industry anticipates advances in ATSC 3.0.

Our primary expenses are employee compensation, including commissions paid to our sales staff and amounts paid to our national representative firms, as well as expenses for ~~marketing,~~general and administrative functions, promotion and selling, ~~technical,~~engineering, marketing, and local ~~programming, engineering and general and administrative functions.~~programming. Our local programming costs for television consist primarily of costs related to producing a local newscast in most of our markets. Cost of revenue related to our television segment consists primarily of the carrying value of spectrum usage rights that were surrendered in the FCC auction for broadcast spectrum. In addition, cost of revenue related to our digital ~~media~~ segment consists primarily of the costs of online media acquired from third-party ~~publishers.~~publishers and third party server costs. Direct operating expenses include salaries and commissions of sales staff, amounts paid to national representation firms, production and programming expenses, fees for ratings services, and engineering costs. Corporate expenses consist primarily of salaries related to

corporate officers and back office functions, third party legal and accounting services, and fees incurred as a result of being a publicly traded company.

During the second quarter of ~~2017, we completed the acquisition of the business of Headway, a provider of mobile, programmatic, data and performance digital marketing solutions primarily~~2018, our consolidated revenue increased to $74.3 million from $70.5 million in the ~~United States, Mexico~~prior year period, primarily due to growth in the digital segment and ~~other parts of Latin America. We acquired Headway~~retransmission consent revenue in ~~order to acquire additional digital media platforms that we believe will enhance~~ our ~~offerings to~~television segment. Our audience shares remained strong in the ~~U.S.~~nation’s most densely populated Hispanic ~~marketplace as well as expand our international footprint.~~markets.

Net revenue in our television segment decreased to $36.5 million in the second quarter of 2018 from $37.8 million ~~for~~in the ~~three-month period ended June 30, 2017 from $39.2 million for the three-month period ended June 30, 2016, a~~second quarter of 2017. This decrease of ~~$1.4 million. The decrease~~approximately $1.3 million, or 3%, in net revenue was primarily due to ~~a decrease~~decreases in national and local advertising revenue, partially offset by an increase in retransmission consent revenue and ~~a decrease~~an increase in political advertising revenue, which was not material in 2017. We generated a total of ~~$7.5~~$9.1 million inof retransmission consent revenue in the second quarter of 2018. We anticipate that retransmission consent revenue for the full year 2018 will be greater than it was for the full year 2017 and will continue to be a significant source of net revenues in future periods.

Net revenue in our radio segment remained constant at $17.2 million for each of the three-month periods ended June 30, ~~2017~~2018 and ~~2016.~~

Net revenue in our radio segment decreased to $17.2 million for the three-month period ended June 30, 2017 from $19.6 million for the three-month period ended June 30, 2016, a decrease of $2.4 million. The decrease was primarily due to decreases in local and national advertising revenue, and a decrease in political advertising revenue, which was not material in 2017.

Net revenue in our digital segment increased to $20.6 million in the second quarter of 2018 from $15.6 million ~~for~~in the ~~three-month period ended June 30, 2017 from $6.1 million for the three-month period ended June 30, 2016, an~~second quarter of 2017. This increase of ~~$9.5 million. The increase~~approximately $5.0 million, or 32%, in net revenue was primarily due to growth in the ~~acquisition of~~ Headway ~~during~~business which was acquired in the second quarter of 2017, which did not contribute to net revenue in prior periods. This increase was partially offset by a decrease in national revenue in our preexisting digital business driven by shifts in the digital advertising industry toward video advertising and the increased use of automated buying platforms, referred to in our industry as programmatic revenue. 2017.

Substantially all of our television stations are Univision- or UniMás-affiliated television stations. Our network affiliation ~~agreements~~agreement with Univision ~~provide~~provides certain of our owned stations the exclusive right to broadcast Univision’s primary network and UniMás network programming in their respective markets. ~~These long-term affiliation agreements each expire in 2021, and can be renewed for multiple, successive two-year terms at Univision’s option, subject to our consent.~~ Under ~~our Univision~~the network affiliation agreement, we retain the right to sell ~~approximately six~~no less than four minutes per hour of the available advertising time on ~~Univision’s primary~~stations that broadcast Univision network ~~subject to adjustment from time to time by Univision, but in no event less than four minutes. Under our UniMás network affiliation agreement, we retain~~programming, and the right to sell approximately four and a half minutes per hour of the available advertising time on ~~the~~stations that broadcast UniMás network programming, subject to adjustment from time to time by Univision.

Under the network affiliation ~~agreements,~~agreement, Univision acts as our exclusive third-party sales representative for the sale of certain national advertising on our Univision- and UniMás-affiliate television stations, and we pay certain sales representation fees to Univision relating to sales of all advertising for broadcast on our Univision- and UniMás-affiliate television stations. During the three-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, the amount we paid Univision in this capacity was ~~$2.4~~$2.2 million and ~~$2.5~~$2.4 million, respectively. During the six-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, the amount we paid Univision in this capacity was ~~$4.7~~$4.3 million and ~~$4.8~~$4.7 million, respectively.

We also generate revenue under two marketing and sales agreements with Univision, which give us the right ~~through 2021~~ to manage the marketing and sales operations of Univision-owned ~~UniMás and~~ Univision affiliates in six markets – Albuquerque, Boston, Denver, Orlando, Tampa and Washington, D.C.

~~In August 2008, we entered into a~~Under our proxy agreement with Univision, ~~pursuant to which~~ we ~~granted~~grant Univision the right to negotiate the terms of retransmission consent agreements for our Univision- and UniMás-affiliated television station ~~signals for a term of six years, expiring in December 2014, which Univision and we have extended through August 31, 2017.~~signals. Among other things, the proxy agreement provides terms relating to compensation to be paid to us by Univision with respect to retransmission consent agreements entered into with MVPDs. During the three-month periods ended June 30, 2018 and 2017, retransmission consent revenue accounted for approximately $9.1 million and $7.5 million, respectively, of which $7.5 million and $7.2 million, respectively, relate to the Univision proxy agreement. During the six-month periods ended June 30, 2018 and 2017, retransmission consent revenue accounted for approximately $18.0 million and $15.4 million, respectively, of which $15.1 million and $14.6 million, respectively, relate to the Univision proxy agreement. The term of the proxy agreement extends with respect to any MVPD for the length of the term of any retransmission consent agreement in effect before the expiration of the proxy ~~agreement. We have entered into multiple short-term extensions of the proxy~~ agreement since its December 2014 expiration, and it is our current intention to negotiate with Univision one or more further extensions of the current proxy agreement or a new proxy agreement; however, no assurance can be given regarding the terms of any such extension or new agreement or that any such extension or new agreement will be entered into. As of June 30, 2017, the amount due to us from Univision was $2.7 million related to the agreements for the carriage of our Univision and UniMás-affiliated television station signals. The term of the proxy agreement extends with respect to any MVPD for the length of the term of any retransmission consent agreement in effect before the expiration of the proxy agreement.

Univision currently owns approximately 10% of our common stock on a fully-converted basis. Our Class U common stock held by Univision has limited voting rights and does not include the right to elect directors. As the holder of all of our issued and outstanding Class U common stock, so long as Univision holds a certain number of shares, ~~the Company will~~we may not, without the consent of Univision, merge, consolidate or enter into another business combination, dissolve or liquidate ~~the Company~~our company or dispose of any interest in any FCC, license for any of our Univision-affiliated television stations, among other things. Each share of Class U common stock is

automatically convertible into one share of ~~our~~ Class A common stock (subject to adjustment for stock splits, dividends or combinations) in connection with any transfer to a third party that is not an affiliate of Univision.

For a description of our critical accounting policies, please refer to “Application of Critical Accounting Policies and Accounting Estimates” in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2016,~~2017, filed with the SEC on March ~~10, 2017.~~

Television and radio revenue related to the sale of advertising is recognized at the time of broadcast. Revenue for contracts with advertising agencies is recorded at an amount that is net of the commission retained by the agency. Revenue from contracts directly with the advertisers is recorded at gross revenue and the related commission or national representation fee is recorded in operating expense. Cash payments received prior to services rendered result in deferred revenue, which is then recognized as revenue when the advertising time or space is actually provided. Digital revenue is recognized when display or other digital advertisements record impressions on the websites of our third-party publishers or as the advertiser’s performance goals are delivered.

We generate revenue under arrangements that are sold on a stand-alone basis within a specific segment, and those that are sold on a combined basis across multiple segments. We have determined that in such revenue arrangements which contain multiple products and services, revenues are allocated based on the relative fair value of each delivered item and recognized in accordance with the applicable revenue recognition criteria for the specific unit of accounting.

In August 2008, we entered into a proxy agreement with Univision pursuant to which we granted Univision the right to negotiate retransmission consent agreements for its Univision- and UniMás-affiliated television station signals. Advertising related to carriage of our Univision- and UniMás-affiliated television station signals is recognized at the time of broadcast. See more details in Note 2 to the Notes to the Consolidated Financial Statements under “Related Party”.

We also generate revenue from agreements associated with television stations in order to accommodate the operations of telecommunications operators. Revenue from such agreements is recognized when we have relinquished all rights to operate the station on the existing channel free from interference to the telecommunications operators.30, 2018.

In ~~May 2014,~~July 2018, the ~~Financial~~FASB issued ASU 2018-10, Codification Improvements to Topic 842, Leases which addresses several issues related to the application of the new guidance in ASC 842, Leases. The guidance clarifies, among other issues, the rate implicit in the lease, impairment of the net investment in the lease, lessee reassessment of lease classification, lessor reassessment of lease term and purchase options, variable payments that depend on an index or rate and certain transition adjustments. The amendments in ASU 2018-10 affect the amendments in ASU 2016-02, which are not yet effective, but for which early adoption upon issuance is permitted. For entities that early adopted Topic 842, the amendments are effective upon issuance of ASU 2018-10, and the transition requirements are the same as those in Topic 842. For entities that have not adopted Topic 842, the effective date and transition requirements will be the same as the effective date and transition requirements in Topic 842. The Company is currently in the process of evaluating the impact of this guidance on its consolidated financial statements.

In July 2018, the FASB issued ASU 2018-09, Codification Improvements which does not prescribe any new accounting guidance but instead makes minor improvements and clarifications across nine subtopics of the FASB Accounting Standards ~~Board (the “FASB”)~~Codification based on comments from various stakeholders. The transition and effective date guidance are based on the facts and circumstances of each amendment. Some of the amendments in ASU 2018-09 do not require transition guidance and will be effective upon issuance while others provide for a transition period to adopt as part of the next fiscal year beginning after December 15, 2018. The Company is currently in the process of evaluating the impact of this guidance on its consolidated financial statements.

In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Non-employee Share-based Payment Accounting ~~Standards Update (“ASU”) 2014-09,~~, which supersedes ~~Revenue from Contracts~~Subtopic 505-50, Equity—Equity-Based Payments to Non-Employees and expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods and services. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide financing to the issuer or awards granted in conjunction with ~~Customers (Topic 606)~~ ~~which amended the existing accounting standards for revenue recognition. ASU 2014-09 establishes principles for recognizing revenue upon the transfer of promised~~selling goods or services to customers ~~in an amount that reflects the expected consideration received in exchange~~as part of a contract accounted for ~~those goods or services. Subsequently, the FASB has issued the following standards related to ASU 2014-09: ASU No. 2016-08,~~ ~~Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations~~ ~~; ASU No. 2016-10,~~ ~~Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing~~ ~~; ASU No. 2016-12,~~ ~~Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients~~ ~~; and ASU No. 2016-20,~~ ~~Technical Corrections and Improvements to~~under Topic 606, Revenue from Contracts with ~~Customers~~ ~~. We must adopt~~Customers. The amendments in this ASU ~~2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 with ASU 2014-09 (collectively, the “new revenue standards”). The new revenue standards~~ are effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted, but no earlier than a company’s adoption date of Topic 606. The Company is currently in the process of evaluating the impact of this guidance on its consolidated financial statements.

In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the 2017 Tax Act, which was signed into law on December 22, 2017, and also requires entities to disclose their accounting policy for releasing income tax effects from accumulated other comprehensive income. This update is effective in fiscal years, including interim periods, beginning after December 15, 2018, and early adoption is permitted. This guidance should be applied either in the period of adoption or retrospectively to each period in which the effects of the change in the U.S. federal income tax rate in the 2017 Tax Act is recognized. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and related disclosures.

In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities, which shortens the amortization period for certain callable debt securities held at a premium. Specifically, the amendments require the premium to be amortized to the earliest call date. The update is effective for annual reporting periods and interim periods within those years beginning after December 15, 2017. We currently expect to adopt the new revenue standards in the first quarter of 2018. The new revenue standards are not expected to have a material impact on the amount and timing of revenue recognized in our consolidated financial statements.

~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases (Topic 842)~~ which specifies the accounting for leases. For operating leases, ASU 2016-02 requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. ASU 2016-02 is effective for public companies for annual reporting periods ~~and interim periods within those years~~ beginning after December 15, 2018. Early adoption is ~~permitted. We are currently in~~permitted and the ~~process of evaluating the impact of adoption~~modified retrospective transition method should be applied through a cumulative-effect adjustment

directly to retained earnings as of the ~~ASU on our consolidated financial statements.~~

~~In June 2016, the FASB issued ASU 2016-13,~~ ~~Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments~~ which requires entities to use a current expected credit loss ("CECL") model which is a new impairment model based on expected losses rather than incurred losses. Under this model an entity would recognize an impairment allowance equal to its current estimate of all contractual cash flows that the entity does not expect to collect from financial assets measured at amortized cost. The entity's estimate would consider relevant information about past events, current conditions, and reasonable and supportable forecasts, which will result in recognition of life-time expected credit losses upon loan origination. ASU 2016-13 is effective for interim and annual reporting periods beginning ~~after December 15, 2019. Early adoption is permitted for annual reporting periods beginning after December 15, 2018. We are currently in the process of evaluating the impact of adoption~~ of the ~~ASU on our consolidated financial statements.~~

~~In August 2016, the FASB issued ASU 2016-15,~~ ~~Statement~~period of ~~Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force)~~ ~~which provides specific guidance on eight cash flow classification issues arising from certain cash receipts and cash payments. Currently, GAAP either is unclear or~~adoption. The Company does not include specific guidance on the eight cash flow classification issues addressed in this topic. The objective is to reduce current and potential future diversity in practice. ASU 2016-15 is effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. We do not expect the adoption of the ASU to have a material impact on ~~our~~its consolidated financial statements.

In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory which allows entities to recognize the income tax consequences on an intra-entity transfer of an asset other than inventory when the transfer occurs. Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. In addition, there has been diversity in the application of the current guidance for transfers of certain intangible and tangible assets. The objective is to reduce complexity in accounting standards. ASU 2016-16 is effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted, including adoption in an interim period. ~~We are currently in the process of evaluating the impact of adoption of the ASU on our consolidated financial statements.~~

~~In November 2016, the FASB issued ASU 2016-18,~~ ~~Statement of Cash Flows (Topic 230): Restricted Cash a Consensus of the FASB Emerging Issues Task Force~~ to enhance and clarify the guidance on the classification and presentation of restricted cash in the statement of cash flows. A mounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The objective is to reduce diversity in practice. ASU 2016-18 is effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. We do not expect the adoption of the ASU to have a material impact on our consolidated financial statements.

~~In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business~~ to provide a more robust framework to use in determining when a set of assets and activities is considered a business. The objective is to add guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. ASU 2017-01 is effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted only for certain transactions. We do not expect the adoption of the ASU to have a material impact on our consolidated financial statements.

~~In January 2017, the FASB issued ASU 2017-04,~~ ~~Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,~~ which removes Step 2 from the goodwill impairment test. An entity no longer will determine goodwill impairment by calculating the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination. The objective is to reduce the cost and complexity of evaluating goodwill for impairment. ASU 2017-04 is effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company does not expect the adoption of the ASU to have a material impact on its consolidated financial statements.

~~In May 2017, the FASB issued Accounting Standards Update 2017-09,~~ ~~Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting~~ (“ASU 2017-09”), to clarify and reduce both (i) diversity in practice and (ii) cost and complexity when applying the guidance in Topic 718, to change the terms and conditions of a share-based payment award. Specifically, an entity would not apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. ASU 2017-09 is ~~effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted.~~ The Company is currently in the process of evaluating the impact of adoption of the ASU on its consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326) that amends current guidance on other-than-temporary impairments of available-for-sale debt securities. This amended standard requires the use of an allowance to record estimated credit losses on these assets when the fair value is below the amortized cost of the asset. This standard also removes the evaluation of the length of time that a security has been in a loss position to avoid recording a credit loss. The update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company is still assessing the impact this standard will have on its consolidated financial statements and related disclosures.

In February 2016, the FASB issued ASU 2016-02, .Leases (Topic 842, and subsequent ASU 2018-01) which specifies the accounting for leases. For operating leases, ASU 2016-02 requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. ASU 2016-02 is effective for public companies for annual reporting periods, and interim periods within those years beginning after December 15, 2018. Early adoption is permitted. This standard requires adoption based upon a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with optional practical expedients. Based on a preliminary assessment, the Company expects that most of its operating lease commitments will be subject to the new guidance and recognized as operating lease liabilities and right–of-use assets upon adoption, resulting in a significant increase in the assets and liabilities on our consolidated balance sheet. The Company is continuing its assessment, which may identify additional impacts this standard will have on its consolidated financial statements and related disclosures.

The following table sets forth selected data from our operating results for the three- and six-month periods ended June 30, ~~2017~~2018 and ~~2016~~2017 (in thousands):

	Three-Month Period									Six-Month Period									Three-Month Period									Six-Month Period
	Ended June 30,						%			Ended June 30,						%			Ended June 30,						%			Ended June 30,						%
	2017			2016			Change			2017			2016			Change			2018			2017			Change			2018			2017			Change
Statements of Operations Data:
Net revenue	$	70,509		$	64,829			9	%	$	128,019		$	122,942			4	%
Cost of revenue - digital media		8,762			2,373			269	%		10,514			4,212			150	%
Net Revenue																			$	74,329		$	70,509			5	%		141,167			128,019			10	%

Cost of revenue - digital																				11,384			8,762			30	%		22,009			10,514			109	%
Direct operating expenses		29,915			28,538			5	%		57,007			56,103			2	%		31,117			29,915			4	%		62,150			57,007			9	%
Selling, general and administrative expenses		12,030			11,410			5	%		23,230			22,845			2	%		12,673			12,030			5	%		25,967			23,230			12	%
Corporate expenses		5,619			5,293			6	%		11,486			10,897			5	%		6,266			5,619			12	%		12,241			11,486			7	%
Depreciation and amortization		4,577			3,885			18	%		8,123			7,912			3	%		4,019			4,577			(12	)%		7,958			8,123			(2	)%
Change in fair value of contingent consideration																				(913	)		-		*				1,187			-		*
Foreign currency (gain) loss		351			-		*				351			-		*				(17	)		351		*				196			351			(44	)%
		61,254			51,499			19	%		110,711			101,969			9	%		64,529			61,254			5	%		131,708			110,711			19	%
Operating income		9,255			13,330			(31	)%		17,308			20,973			(17	)%
Operating income (loss)																				9,800			9,255			6	%		9,459			17,308			(45	)%
Interest expense		(3,683	)		(3,859	)		(5	)%		(7,328	)		(7,725	)		(5	)%		(4,001	)		(3,683	)		9	%		(7,399	)		(7,328	)		1	%
Interest income		110			118			(7	)%		219			125			75	%		1,039			110			845	%		1,952			219			791	%
Income before income taxes		5,682			9,589			(41	)%		10,199			13,373			(24	)%
Income tax expense		(2,119	)		(3,872	)		(45	)%		(4,018	)		(5,386	)		(25	)%
Income (loss) before equity in net income (loss) of nonconsolidated affiliate		3,563			5,717			(38	)%		6,181			7,987			(23	)%
Dividend income																				417			-		*				545			-		*
Other income (loss)																				273			-		*				295			-		*
Income before income (loss) taxes																				7,528			5,682			32	%		4,852			10,199			(52	)%
Income tax benefit (expense)																				(2,652	)		(2,119	)		25	%		(1,721	)		(4,018	)		(57	)%
Income (loss) before equity in net income (loss) of
nonconsolidated affiliate																				4,876			3,563			37	%		3,131			6,181			(49	)%
Equity in net income (loss) of nonconsolidated affiliate, net of tax		(68	)		-		*				(68	)		-		*				(36	)		(68	)		(47	)%		(98	)		(68	)		44	%
Net income	$	3,495		$	5,717			(39	)%	$	6,113		$	7,987			(23	)%
Net income (loss)																			$	4,840		$	3,495			38	%	$	3,033		$	6,113			(50	)%

Other Data:
Capital expenditures		5,564			2,346						6,808			4,586						2,204			5,564						4,432			6,808
Consolidated adjusted EBITDA (adjusted for non-cash stock-based compensation) (1)											27,494			30,782															21,803			27,494
Net cash provided by operating activities											23,306			24,426															16,916			23,306
Net cash used in investing activities											(17,175	)		(34,745	)														(146,831	)		(17,175	)
Net cash used in financing activities											(6,996	)		(6,174	)														(22,268	)		(6,996	)

adjusted EBITDA, ~~affects both our ability to borrow from our 2013 Credit Facility and our applicable margin for~~not exceeding 4.0. In addition, beginning December 31, 2018, at the ~~interest rate calculation. Under our 2013 Credit Facility, our maximum total leverage ratio may not exceed 6.25 to 1~~end of every calendar year, in the event ~~that~~our total net leverage ratio is within certain ranges, we must make a debt prepayment equal to a certain percentage of our Excess Cash Flow, which is defined as consolidated adjusted EBITDA, less consolidated interest expense, less debt principal payments, less taxes paid, less other amounts set forth in the ~~revolving credit facility is drawn.~~definition of Excess Cash Flow in the 2017 Credit Agreement. The total leverage ratio was as follows (in each case as of June 30): ~~2017, 4.1~~2018, 4.9 to 1; ~~2016, 4.0~~2017, 3.3 to 1. ~~Therefore, we were in compliance with this covenant at each of those dates.~~

While many in the financial community and we consider consolidated adjusted EBITDA to be important, it should be considered in addition to, but not as a substitute for or superior to, other measures of liquidity and financial performance prepared in accordance with ~~GAAP,~~accounting principles generally accepted in the United States of America, such as cash flows from operating activities, operating income and net income. As consolidated adjusted EBITDA excludes non-cash gain (loss) on sale of assets, non-cash depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation expense, net interest expense, other income (loss), non-recurring cash expenses, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses, ~~and~~ syndication programming amortization ~~and includes~~less syndication programming payments, revenue from FCC spectrum incentive auction less related expenses, expenses associated with investments, acquisitions and dispositions and certain pro-forma cost savings, consolidated adjusted EBITDA has certain limitations because it excludes and includes several important ~~non-cash~~ financial line items. Therefore, we consider both non-GAAP and GAAP measures when evaluating our business. Consolidated adjusted EBITDA is also used to make executive compensation decisions.

Consolidated adjusted EBITDA is a non-GAAP measure. The most directly comparable GAAP financial measure to consolidated adjusted EBITDA is cash flows from operating activities. A reconciliation of this non-GAAP measure to cash flows from operating activities follows (in thousands):

	Six-Month Period						Six-Month Period
	Ended June 30,						Ended June 30,
		2017			2016			2018			2017
Consolidated adjusted EBITDA ~~(1)~~	$	27,494		$	30,782		$	21,803		$	27,494

Interest expense		(7,328	)		(7,725	)		(7,399	)		(7,328	)
Interest income		219			125			1,952			219
Income tax expense		(4,018	)		(5,386	)
Dividend income								545			-
Income tax benefit (expense)								(1,721	)		(4,018	)
Equity in net loss of nonconsolidated affiliates								(98	)		(68	)
Amortization of syndication contracts		(218	)		(190	)		(352	)		(218	)
Payments on syndication contracts		215			183			360			215
Equity in net income (loss) of nonconsolidated affiliate		(68	)		-
Non-cash stock-based compensation included in direct operating expenses		(530	)		(621	)		(292	)		(530	)
Non-cash stock-based compensation included in corporate expenses		(1,530	)		(1,269	)		(2,133	)		(1,530	)
Depreciation and amortization		(8,123	)		(7,912	)		(7,958	)		(8,123	)
Net income		6,113			7,987
Change in fair value of contingent consideration								(1,187	)		-
Non-recurring cash severance charge								(782	)		-
Other income (loss)								295			-
Net income (loss)								3,033			6,113

Depreciation and amortization		8,123			7,912			7,958			8,123
Deferred income taxes		3,428			4,922			1,029			3,428
Amortization of debt issue costs		369			384
Non-cash interest expense								538			369
Amortization of syndication contracts		218			190			352			218
Payments on syndication contracts		(215	)		(183	)		(360	)		(215	)
Equity in net income (loss) of nonconsolidated affiliate		68			-
Equity in net (income) loss of nonconsolidated affiliate								98			68
Non-cash stock-based compensation		2,060			1,890			2,425			2,060
Changes in assets and liabilities:
(Increase) decrease in accounts receivable		13,581			5,583			9,170			13,581
(Increase) decrease in prepaid expenses and other assets		(1,447	)		(383	)		(6,547	)		(1,447	)
Increase (decrease) in accounts payable, accrued expenses and other liabilities		(8,992	)		(3,876	)		(780	)		(8,992	)
Cash flows from operating activities	$	23,306		$	24,426		$	16,916		$	23,306

Net Revenue. Net revenue increased to $74.3 million for the three-month period ended June 30, 2018 from $70.5 million for the three-month period ended June 30, 2017, ~~from $64.8 million for the three-month period ended June 30, 2016,~~ an increase of ~~$5.7~~$3.8 million. Of the overall increase, ~~$9.5~~approximately $5.0 million was attributable to our digital segment and was primarily due to growth in the Headway business which was acquired during the second quarter of 2017. The overall increase was partially offset by a decrease in our television segment of approximately $1.3 million primarily due to decreases in national and local advertising revenue, partially offset by an increase in retransmission consent revenue and an increase in political advertising revenue, the latter of which was not material in 2017.

Net revenue increased to $141.2 million for the six-month period ended June 30, 2018 from $128.0 million for the six-month period ended June 30, 2017, an increase of $13.2 million. Of the overall increase, approximately $19.1 million was attributable to our digital segment and was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations for the full six-month period in 2017. The overall increase was partially offset by a decrease in our television segment of approximately $4.5 million primarily due to decreases in national and local advertising revenue, partially offset by an increase in retransmission consent revenue and an increase in political advertising revenue, the latter of which was not material in 2017. Additionally, the overall increase was partially offset by a decrease in our radio segment of approximately $1.6 million primarily due to decreases in local and national advertising revenue, partially offset by an increase in net revenue from the 2018 FIFA World Cup.

We currently anticipate that for the full year 2018 net revenue will increase from the digital segment, political advertising revenue in all our segments, and retransmission consent revenue in our television segment, compared to 2017. In general, we have seen a decline in advertising in traditional media, including television and radio, as advertising moves increasingly to new media, such as digital media. We anticipate that this trend will continue for at least the foreseeable future.

Cost of revenue-Digital. Cost of revenue in our digital segment increased to $11.4 million for the three-month period ended June 30, 2018 from $8.8 million for the three-month period ended June 30, 2017, an increase of $2.6 million, primarily due to the increased revenue in our digital segment.

Direct Operating Expenses. Direct operating expenses increased to $31.1 million for the three-month period ended June 30, 2018 from $29.9 million for the three-month period ended June 30, 2017, an increase of $1.2 million. Of the overall increase, approximately $1.1 million was attributable to our digital segment and was primarily driven by expenses associated with the increase in revenue and an increase in salary expense. Additionally, approximately $0.2 million of the overall increase was attributable to our television segment and was primarily due to the acquisition of station KMIR-TV in the fourth quarter of 2017, which did not contribute to direct operating expenses in the prior ~~periods.~~year period, partially offset by a decrease in expenses associated with the decrease in advertising revenue and a decrease in salary expense. The overall increase was partially offset by a decrease in our radio segment of ~~$2.4~~approximately $0.1 million ~~due~~ primarily ~~to decreases in local and national advertising revenue, and a decrease in political advertising revenue, which was not material in 2017, and a decrease in our television segment of $1.4 million~~ due ~~primarily~~ to a decrease in ~~local~~salary expense. As a percentage of net revenue, direct operating expenses remained constant at 42% for each of the three-month periods ended June 30, 2018 and ~~a decrease in political advertising revenue, which was not material in~~ 2017.

~~Net revenue~~Direct operating expenses increased to ~~$128.0~~$62.1 million for the six-month period ended June 30, 2018 from $57.0 million for the six-month period ended June 30, 2017, ~~from $122.9 million for the six-month period ended June 30, 2016,~~ an increase of $5.1 million. Of the overall increase, ~~$9.0~~approximately $4.6 million was attributable to our digital segment and was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to ~~net~~cost of revenue for the full six-month period in 2017. Additionally, approximately $1.0 million of the overall increase was attributable to our television segment and was primarily due to the acquisition of station KMIR-TV in the fourth quarter of 2017, which did not contribute to direct operating expenses in the prior ~~periods.~~year period, partially offset by a decrease in expenses associated with the decrease in advertising revenue and a decrease in salary expense. The overall increase was partially offset by a decrease in ~~our~~ radio segment of ~~$3.5~~approximately $0.5 million primarily due ~~primarily~~ to ~~decreases~~a decrease in ~~local and national~~expenses associated with the decrease in advertising revenue and a decrease in ~~political advertising~~salary expense. As a percentage of net revenue, ~~which was not material in 2017, and a decrease~~

~~in our television segment of $0.3 million due primarily~~direct operating expenses decreased to a decrease in local revenue and a decrease in political advertising revenue, which was not material in 2017, partially offset by an increase in national advertising revenue and an increase in retransmission consent revenue.44% for the six-month period ended June 30, 2018 from 45% for the six-month period ended June 30, 2017.

We currently anticipate that for the full year ~~2017, net revenue~~2018, direct operating expenses will increase ~~from digital media~~as a result of acquiring station KMIR-TV in the fourth quarter of 2017 and ~~retransmission consent revenue, whereas political advertising revenue will decrease~~operating Headway for a full year in 2018 compared to ~~2016. We will also benefit from~~nine months in 2017, partially offset by decreases associated with a previously announced reduction in personnel and other discretionary expense cuts, both of which were implemented during the ~~receipt in July 2017 of proceeds of approximately $263.6 million related to the FCC auction for broadcast spectrum.~~three-month period ended June 30, 2018.

~~Cost of revenue.~~Selling, General and Administrative Expenses. ~~Cost of revenue, which we recognize in our digital media segment,~~Selling, general and administrative expenses increased to ~~$8.8~~$12.7 million for the three-month period ended June 30, 2018 from $12.0 million for the three-month period ended June 30, 2017, ~~from $2.4 million for the three-month period ended June 30, 2016,~~ an increase of ~~$6.4~~$0.7 million. Of the overall increase, $0.4 million was attributable to our digital segment and was primarily due to an increase in salary expense. Additionally, approximately $0.3 million of the increase was attributable to our television segment primarily due to the acquisition of ~~Headway during~~station KMIR-TV in the ~~second~~fourth quarter of 2017, which did not contribute to ~~cost~~selling, general and administrative expenses in the prior year period, an increase in salary expense and an increase in bad debt expense. The overall increase was partially offset by a decrease in the radio segment of approximately $0.1 million and was primarily due to a decrease in salary expense. As a percentage of net revenue, ~~in prior periods.~~selling, general and administrative expenses remained constant at 17% for each of the three-month periods ended June 30, 2018 and 2017.

~~Cost of revenue, which we recognize in our digital media segment,~~Selling, general and administrative expenses increased to ~~$10.5~~$26.0 million for the six-month period ended June 30, 2018 from $23.2 million for the six-month period ended June 30, 2017, ~~from $4.2 million for the six-month period ended June 30, 2016,~~ an increase of ~~$6.3 million, primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to cost of revenue in prior periods.~~

~~Direct Operating Expenses.~~ ~~Direct operating expenses increased to $29.9 million for the three-month period ended June 30, 2017 from $28.5 million for the three-month period ended June 30, 2016, an increase of $1.4~~$2.8 million. Of the overall increase, ~~$2.2~~$2.1 million was attributable to our digital segment and was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to ~~direct operating expenses in prior periods. The overall increase was partially offset by a decrease in~~ our ~~television segment~~results of $0.6 million due to a decrease in expenses associated with the decrease in advertising revenue and a decrease in expense for ratings services, and a decrease in our radio segment of $0.3 million due to a decrease in expenses associated with the decrease in advertising revenue. As a percentage of net revenue, direct operating expenses decreased to 42%operations for the ~~three-month period ended June 30, 2017 from 44% for the three-month period ended June 30, 2016.~~

~~Direct operating expenses increased to $57.0 million for the~~full six-month period ~~ended June 30, 2017 from $56.1~~in 2017. Additionally, approximately $0.8 million ~~for~~of the ~~six-month period ended June 30, 2016, an~~ increase ~~of $0.9 million. Of the overall increase, $1.9 million~~ was attributable to our ~~digital~~television segment ~~and was primarily~~ due to the acquisition of ~~Headway during~~station KMIR-TV in the second quarter of 2017, which did not contribute to direct operating expenses in prior periods. The overall increase was partially offset by a decrease in our television segment of $0.9 million due to a decrease in expenses associated with the decrease in advertising revenue and a decrease in expense for ratings services, and a decrease in our radio segment of $0.1 million due to a decrease in expenses associated with the decrease in advertising revenue, partially offset by an increase in salary expense. As a percentage of net revenue, direct operating expenses decreased to 45% for the six-month period ended June 30, 2017 from 46% for the six-month period ended June 30, 2016.

~~We believe that direct operating expenses will increase during 2017 primarily as a result of the operations of Headway, which we acquired in April 2017.~~

~~Selling, General and Administrative Expenses.~~ Selling, general and administrative expenses increased to $12.0 million for the three-month period ended June 30, 2017 from $11.4 million for the three-month period ended June 30, 2016, an increase of $0.6 million. Of the overall increase, approximately $0.9 million was attributable to our digital segment and was primarily due to the acquisition of Headway during the secondfourth quarter of 2017, which did not contribute to selling, general and administrative expenses in the prior ~~periods. Additionally, $0.1 million of the overall increase was attributable to our television segment and was primarily due to~~year period, an increase in salary expense and an increase in bad debt expense. The overall increase was partially offset by a decrease ~~of $0.3 million~~ in ~~our~~ radio segment of approximately $0.2 million and was primarily due to ~~decreases~~a decrease in ~~event expense and bad debt expense.~~promotional expenses. As a percentage of net revenue, selling, general and administrative expenses ~~decreased~~remained constant at 18% for each of the six-month periods ended June 30, 2018 and 2017.

We currently anticipate that for the full year 2018, selling, general and administrative expenses will increase as a result of acquiring station KMIR-TV in the fourth quarter of 2017 and operating Headway for a full year in 2018 compared to ~~17%~~nine months in 2017, partially offset by decreases associated with a previously announced reduction in personnel and other discretionary expense cuts, both of which were implemented during the six-month period ended June 30, 2018.

Corporate Expenses. Corporate expenses increased to $6.3 million for the three-month period ended June 30, ~~2017~~2018 from ~~18% for the three-month period ended June 30, 2016.~~

Selling, general and administrative expenses increased to $23.2 million for the six-month period ended June 30, 2017 from $22.8 million for the six-month period ended June 30, 2016, an increase of $0.4 million. Of the overall increase, $0.8 million was attributable to our digital segment and was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to selling, general and administrative expenses in prior periods. Additionally, approximately $0.1 million of the overall increase was attributable to our television segment and was primarily due to an increase in salary expense. The overall increase was partially offset by a decrease of $0.5 million in our radio segment due to decreases in event expense and bad debt expense. As a percentage of net revenue, selling, general and administrative expenses decreased to 17% for the six-month period ended June 30, 2017 from 19% for the six-month period ended June 30, 2016.

~~We believe that selling, general and administrative expenses will increase during 2017 primarily as a result of the operations of Headway, which we acquired in April 2017.~~

~~Corporate Expenses.~~ ~~Corporate expenses increased to~~ $5.6 million for the three-month period ended June 30, 2017, ~~from $5.3 million for the three-month period ended June 30, 2016,~~ an increase of ~~$0.3~~$0.7 million. The increase was primarily due to legal and financial due diligence costs related to the Smadex acquisition and an increase in ~~salary expense and~~ non-cash stock-based compensation expense. As a percentage of net revenue, corporate expenses remained constant at 8% for each of the three-month periods ended June 30, ~~2017~~2018 and ~~2016.~~2017.

Corporate expenses increased to $12.2 million for the six-month period ended June 30, 2018 from $11.5 million for the six-month period ended June 30, 2017, ~~from $10.9 million for the six-month period ended June 30, 2016,~~ an increase of ~~$0.6~~$0.7 million. The increase was primarily due to legal and financial due diligence costs related to the ~~Headway~~Smadex acquisition and an increase in non-cash stock-based compensation ~~expense.~~expense, partially offset by a decrease in due diligence costs incurred in prior year related to the Headway acquisition. As a percentage of net revenue, corporate expenses remained constant at 9% for each of the six-month periods ended June 30, ~~2017~~2018 and ~~2016.~~2017.

We ~~believe~~currently anticipate that corporate expenses will ~~be constant during 2017~~decrease for the full year 2018 compared to ~~2016.~~2017 as a result of expenses in 2017 related to the FCC auction for broadcast spectrum and the acquisition of Headway.

Depreciation and Amortization. Depreciation and amortization ~~increased~~decreased to $4.0 million for the three-month period ended June 30, 2018 from $4.6 million for the three-month period ended June 30, 2017, ~~from $3.9 million for the three-month period ended June 30, 2016, an increase~~a decrease of ~~$0.7~~$0.6 million. The ~~increase~~decrease was primarily due to ~~amortization on the intangible assets from the Headway acquisition partially offset by a decrease in depreciation as~~ certain assets ~~are now~~becoming fully depreciated.

Depreciation and amortization ~~increased~~decreased to $8.0 million for the six-month period ended June 30, 2018 from $8.1 million for the six-month period ended June 30, 2017, ~~from $7.9~~a decrease of $0.1 million. The decrease was primarily due to certain assets becoming fully depreciated, partially offset by increased amortization related to intangible assets acquired in the Headway and Smadex acquisitions.

Change in fair value of contingent consideration. As a result of the change in fair value of the contingent consideration related to the Headway acquisition, we recognized income of $0.9 million for the three-month period ended June 30, 2018.

As a result of the change in fair value of the contingent consideration related to the Headway acquisition, we recognized an expense of $1.2 million for the six-month period ended June 30, 2016, an increase of $0.2 million. The increase was primarily due to amortization on the intangible assets from the Headway acquisition partially offset by a decrease in depreciation as certain assets are now fully depreciated.2018.

Operating Income.As a result of the above factors, operating income was $9.8 million for the three-month period ended June 30, 2018, compared to operating income of $9.3 million for the three-month period ended June 30, ~~2017, compared to $13.3 million for the three-month period ended June 30, 2016.~~2017. As a result of the above factors, operating income was $9.5 million for the six-month period ended June 30, 2018, compared to operating income of $17.3 million for the six-month period ended June 30, ~~2017, compared to $21.0 million for the six-month period ended June 30, 2016.~~2017.

Interest Expense, net. Interest expense, net decreased to $3.0 million for the three-month period ended June 30, 2018 from $3.6 million for the three-month period ended June 30, 2017, ~~from $3.7 million for the three-month period ended June 30, 2016,~~ a decrease of ~~$0.1~~$0.6 million. This decrease was primarily due to ~~the loan principal prepayment during the fourth quarter of 2016.~~interest income earned on available-for-sale securities.

Interest expense, net decreased to $5.4 million for the six-month period ended June 30, 2018 from $7.1 million for the six-month period ended June 30, 2017, ~~from $7.6 million~~a decrease of $1.7 million. This decrease was primarily due to interest income earned on available-for-sale securities.

Income Tax Expense. Income tax expense for the six-month period ended June 30, ~~2016, a decrease~~2018 was $1.7 million, or 35% of ~~$0.5 million. This decrease was primarily due to the loan principal prepayment during the fourth quarter of 2016.~~

~~Income Tax Expense.~~ our pre-tax income. Income tax expense for the six-month period ended June 30, 2017 was $4.0 million, or 39% of our pre-tax income. ~~Income~~The effective tax ~~expense~~rate for the six-month period ended June 30, ~~2016~~2018 differed from the statutory rate of 21% primarily because of foreign and state taxes, and nondeductible expenses. The effective tax rate differs from prior quarters as a result of the change in the US federal statutory tax rate from 35% to 21% due to the enactment of the 2017 Tax Act. The company computes its interim tax expense by projecting its effective tax rate for the year and applying the projected annual effective tax rate to the year to date pre-tax income from continuing operations for the reporting quarter. Additional discrete items (such as excess tax benefits from share based compensation) may adjust the year to date tax expense in the quarter in which such items occur.

Our management periodically evaluates the realizability of the deferred tax assets and, if it is determined that it is more likely than not that the deferred tax assets are realizable, adjusts the valuation allowance accordingly. Valuation allowances are established and maintained for deferred tax assets on a “more likely than not” threshold. The process of evaluating the need to maintain a valuation allowance for deferred tax assets and the amount maintained in any such allowance is highly subjective and is based on many factors, several of which are subject to significant judgment calls.

Based on our analysis we determined that it was ~~$5.4 million, or 40% of~~more likely than not that our ~~pre-tax income.~~ deferred tax assets would be realized.

Net Revenue.Net revenue in our television segment decreased to $36.5 million for the three-month period ended June 30, 2018 from $37.8 million for the three-month period ended June 30, 2017, ~~from $39.2 million for the three-month period ended June 30, 2016,~~ a decrease of ~~$1.4~~approximately $1.3 million. The decrease was primarily due to decreases in national and local advertising revenue, as part of a trend for advertising to move increasingly from traditional media, such as television, to new media, such as digital media. The decrease was partially offset by an increase in ~~local~~retransmission consent revenue and ~~a decrease~~an increase in political advertising revenue, the latter of which was not material in 2017. We generated a total of $9.1 million and $7.5 million in retransmission consent revenue for ~~each of~~ the three-month periods ended June 30, 2018 and 2017, ~~and 2016.~~respectively.

Net revenue in our television segment decreased to $71.0 million for the six-month period ended June 30, 2018 from $75.5 million for the six-month period ended June 30, 2017, ~~from $75.8 million for the six-month period ended June 30, 2016,~~ a decrease of ~~$0.3~~approximately $4.5 million. The decrease was primarily due to ~~a decrease~~decreases in ~~local revenue~~national and ~~a decrease in political~~local advertising revenue, ~~which~~as part of a trend for advertising to move increasingly from traditional media, such as television, to new media, such as digital media. The decrease was ~~not material in 2017,~~ partially offset by an increase in ~~national advertising~~retransmission consent revenue and an increase in ~~retransmission consent revenue.~~political advertising revenue, the latter of which was not material in 2017. We generated a total of ~~$15.4~~$18.0 million and ~~$14.9~~$15.4 million in retransmission consent revenue for the six-month periods ended June 30, ~~2017~~2018 and ~~2016,~~2017, respectively.

Direct Operating Expenses. Direct operating expenses in our television segment ~~decreased~~increased to $15.0 million for the three-month period ended June 30, 2018 from $14.9 million for the three-month period ended June 30, 2017, ~~from $15.5 million for the three-month period ended June 30, 2016, a decrease~~an increase of ~~$0.6~~approximately $0.1 million. The ~~decrease~~increase was primarily ~~attributable~~due to the acquisition of station KMIR-TV in the fourth quarter of 2017, which did not contribute to direct operating expenses in the prior year period, partially offset by a decrease in expenses associated with the decrease in advertising revenue and a decrease in salary expense ~~for ratings services.~~resulting from the previously announced reduction in personnel.

Direct operating expenses in our television segment ~~decreased~~increased to $30.6 million for the six-month period ended June 30, 2018 from $29.6 million for the six-month period ended June 30, 2017, ~~from $30.5 million for the six-month period ended June 30, 2016, a decrease~~an increase of ~~$0.9~~approximately $1.0 million. The ~~decrease~~increase was primarily ~~attributable~~due to the acquisition of station KMIR-TV in the fourth quarter of 2017, which did not contribute to direct operating expenses in the prior year period, partially offset by a decrease in expenses associated with the decrease in advertising revenue and a decrease in salary expense ~~for ratings services.~~resulting from the previously announced reduction in personnel.

Selling, General and Administrative Expenses. Selling, general and administrative expenses in our television segment increased to ~~$5.3 million for the three-month period endedJune 30, 2017 from $5.2~~$5.6 million for the three-month period ended June 30, ~~2016,~~2018 from $5.3 million for the three-month period ended June 30, 2017, an increase of ~~$0.1~~approximately $0.3 million. The increase was primarily due to ~~an increase~~the acquisition of station KMIR-TV in the fourth quarter of

2017, which did not contribute to selling, general and administrative expenses in the prior year period, and increases in salary expense and bad debt expense.

Selling, general and administrative expenses in our television segment increased to $11.5 million for the six-month period ended June 30, 2018 from $10.7 million for the six-month period ended June 30, 2017, ~~from $10.6 million for the six-month period ended June 30, 2016,~~ an increase of ~~$0.1~~approximately $0.8 million. The increase was primarily due to ~~an increase~~the acquisition of station KMIR-TV in the fourth quarter of 2017, which did not contribute to selling, general and administrative expenses in the prior year period, and increases in salary expense and bad debt expense.

Net Revenue. Net revenue in our radio segment ~~decreased to~~remained constant at $17.2 million for each of the three-month periods ended June 30, 2018 and 2017. There was an increase in net revenue from 2018 FIFA World Cup, offset by decreases in local and national advertising revenue, as part of the trend for advertising to move increasingly from traditional media, such as radio, to new media, such as digital media.

Net revenue in our radio segment decreased to $31.3 million for the six-month period ended June 30, 2018 from $32.9 million for the six-month period ended June 30, 2017, ~~from $19.6 million for the three-month period ended June 30, 2016,~~ a decrease of ~~$2.4~~$1.6 million. The decrease was primarily due to decreases in local and national advertising revenue, ~~and~~as part of a ~~decrease~~trend for advertising to move increasingly from traditional media, such as radio, to new media, such as digital media. These decreases were partially offset by an increase in ~~political advertising~~net revenue ~~which was not material in 2017.~~

~~Net revenue in our radio segment decreased to $32.9 million for~~from the six-month period ended June 30, 2017 from $36.4 million for the six-month period ended June 30, 2016, a decrease of $3.5 million. The decrease was primarily due to decreases in local and national advertising revenue, and a decrease in political advertising revenue, which was not material in 2017.2018 FIFA World Cup.

Direct Operating Expenses. Direct operating expenses in our radio segment decreased to $10.9 million for the three-month period ended June 30, 2018 from $11.0 million for the three-month period ended June 30, 2017, ~~from $11.3 million for the three-month period ended June 30, 2016,~~ a decrease of ~~$0.3~~$0.1 million. The decrease was primarily due to a decrease in ~~expenses associated with~~salary expense resulting from the ~~decrease~~previously announced reduction in ~~advertising revenue.~~personnel.

Direct operating expenses in our radio segment decreased to $21.6 million for the six-month period ended June 30, 2018 from $22.1 million for the six-month period ended June 30, 2017, ~~from $22.2 million for the six-month period ended June 30, 2016,~~ a decrease of ~~$0.1~~$0.5 million. The decrease was primarily due to a decrease in expenses associated with the decrease in advertising revenue ~~partially offset by an increase~~and a decrease in salary ~~expense.~~expense resulting from the previously announced reduction in personnel.

Selling, General and Administrative Expenses. Selling, general and administrative expenses in our radio segment decreased to $4.5 million for the three-month period ended June 30, 2018 from $4.6 million for the three-month period ended June 30, 2017, ~~from $5.0 million for the three-month period ended June 30, 2016,~~ a decrease of ~~$0.4~~$0.1 million. The decrease was primarily due to ~~decreases~~a decrease in ~~event~~salary expense ~~and bad debt expense.~~resulting from the previously announced reduction in personnel.

Selling, general and administrative expenses in our radio segment decreased to $9.1 million for the six-month period ended June 30, 2018 from $9.3 million for the six-month period ended June 30, 2017, ~~from $9.8 million for the six-month period ended June 30, 2016,~~ a decrease of ~~$0.5~~$0.2 million. The decrease was primarily due to ~~decreases~~a decrease in ~~event expense and bad debt~~promotional expense.

Net Revenue. Net revenue in our digital segment increased to $20.6 million for the three-month period ended June 30, 2018 from $15.6 million for the three-month period ended June 30, 2017, ~~from $6.1 million for the three-month period ended June 30, 2016,~~ an increase of ~~$9.5~~$5.0 million. The increase was primarily due togrowth in the ~~acquisition of~~ Headway business that was acquired during the second quarter of ~~2017, which did not contribute to our results of operations in prior periods.~~2017. This increase was partially offset by a decrease in national revenue in our preexisting digital business, driven by continued shifts in the digital advertising industry toward video advertising and the increased use of automated buying platforms, referred to in our industry as programmatic revenue. The digital advertising industry is dynamic and undergoing rapid change, which includes the ~~current~~ shift ~~toward~~towards programmatic revenue. We anticipate that this trend will continue in the digital advertising industry, and we are responding by continuing to emphasize our programmatic revenue offerings within our digital segment. We also anticipate that other trends may emerge, ~~requiring~~which will require us to respond to those changing consumer ~~demands.~~demands as, when and how they occur.

Net revenue in our digital segment increased to $38.8 million for the six-month period ended June 30, 2018 from $19.7 million for the six-month period ended June 30, 2017, ~~from $10.7 million for the six-month period ended June 30, 2016,~~ an increase of ~~$9.0~~$19.1 million. The increase was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations for the full six-month period in ~~prior periods.~~2017. This increase was partially offset by a decrease in national revenue in our preexisting digital business, driven by continued shifts in the digital advertising industry toward video advertising and the increased use of automated buying platforms, referred to in our industry as programmatic revenue. The digital advertising industry is dynamic and undergoing rapid change, which includes the ~~current~~ shift ~~toward~~towards programmatic revenue. We anticipate that this trend will continue in the digital advertising industry, and we are responding by continuing to emphasize our programmatic revenue offerings within our digital segment. We also anticipate that other trends may emerge, ~~requiring~~which will require us to respond to those changing consumer ~~demands.~~demands as, when and how they occur.

Cost of revenue. Cost of revenue in our digital segment increased to $11.4 million for the three-month period ended June 30, 2018 from $8.8 million for the three-month period ended June 30, 2017, ~~from $2.4 million~~an increase of $2.6 million. This increase was due to the increase in revenue in the quarter. Because of third party media costs, our margins tend to be smaller in our digital segment than in our other segments. As a percentage of digital net revenue, cost of revenue decreased to 55% for the ~~three month~~three-month period ended June 30, ~~2016,~~2018 from 56% for the three-month period ended June 30, 2017.

Cost of revenue in our digital segment increased to $22.0 million for the six-month period ended June 30, 2018 from $10.5 million for the six-month period ended June 30, 2017, an increase of ~~$6.4~~$11.5 million. This increase was due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations for the full six-month period in ~~prior periods. Cost of revenue in our preexisting digital business was constant.~~2017. Because of third party media costs, our margins tend to be smaller in our digital ~~media~~ segment than in our other ~~broadcast~~ segments. As a percentage of digital net revenue, cost of revenue increased to ~~56% for the~~

three-month period ended June 30, 2017 from 39% for the three-month period ended June 30, 2016. The increase in cost of revenue as a percentage of digital revenue was primarily due to the acquisition of Headway and a higher percentage of programmatic revenue in our preexisting digital business. Because of the high volume and relative efficiencies of these programmatic platforms, the margins tend to be lower.

~~Cost of revenue in our digital segment increased to $10.5 million~~57% for the six-month period ended June 30, ~~2017~~2018 from $4.2 million for the six-month period ended June 30, 2016, an increase of $6.3 million. This increase was due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations in prior periods. Cost of revenue in our preexisting digital business was constant. Because of third party media costs, our margins tend to be smaller in our digital media segment than in our other broadcast segments. As a percentage of net revenue, cost of revenue increased to 53% for the six-month period ended June 30, ~~2017 from 39% for the six-month period ended June 30, 2016.~~2017. The increase in cost of revenue as a percentage of digital revenue was primarily due to the acquisition of Headway and a higher percentage of programmatic revenue in our preexisting digital business. Because of the high volume and relative efficiencies of these programmatic platforms, the margins tend to be lower.

Direct operating expenses. Direct operating expenses in our digital segment increased to $5.1 million for the three-month period ended June 30, 2018 from $4.0 million for the three-month period ended June 30, 2017, ~~from $1.8~~an increase of $1.1 million. The increase was primarily due to expenses associated with the increase in revenue and an increase in salary expense.

Direct operating expenses in our digital segment increased to $9.9 million for the ~~three~~six-month period ended June 30, 2018 from $5.3 million for the six- month period ended June 30, ~~2016,~~2017, an increase of ~~$2.2~~$4.6 million. The increase was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations ~~in prior periods, partially offset by a decrease in our preexisting digital business due to a decrease in expenses associated with the decrease in advertising revenue and a decrease in salary expense.~~

~~Direct operating expenses in our digital segment increased to $5.3 million~~ for the full six-month period ~~ended June 30, 2017 from $3.4 million for the six month period ended June 30, 2016, an increase of $1.9 million.~~in 2017. The increase was ~~primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations in prior periods,~~ partially offset by a decrease in our preexisting digital business due to a decrease in expenses associated with the decrease in advertising revenue and a decrease in salary expense.

Selling, general and administrative expenses. Selling, general and administrative expenses in our digital segment increased to $2.6 million for the three-month period ended June 30, 2018 from $2.2 million for the three-month period ended June 30, 2017, ~~from $1.3~~an increase of $0.4 million. The increase was primarily due to an increase in salary expense.

Selling, general and administrative expenses in our digital segment increased to $5.3 million for the ~~three-month~~six-month period ended June 30, ~~2016,~~2018 from $3.2 million for the six-month period ended June 30, 2017, an increase of ~~$0.9~~$2.1 million. The increase was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations ~~in prior periods, partially offset by a decrease in our preexisting digital business due to a decrease in salary expense.~~

~~Selling, general and administrative expenses in our digital segment increased to $3.2 million~~ for the full six-month period ended June 30, 2017 from $2.4 million for the six-month period ended June 30, 2016, an increase of $0.8 million. The increase was primarily due to the acquisition of Headway during the second quarter of 2017, which did not contribute to our results of operations in ~~prior periods, partially offset by a decrease in our preexisting digital business due to a decrease in salary expense.~~

We had net income of ~~approximately~~$176.3 million, $20.4 million, ~~$25.6 million,~~ and ~~$27.1~~$25.6 million for the years ended December 31, 2017, 2016 ~~2015~~ and ~~2014,~~2015, respectively. We had positive cash flow from operations of $301.5 million, $57.3 million ~~$62.3 million~~ and ~~$54.4~~$62.3 million for the years ended December 31, 2017, 2016 ~~2015~~ and ~~2014,~~2015, respectively. We generated cash ~~flow~~flows from operations of ~~$23.3~~$16.9 million for the six-month period ended June 30, ~~2017 and we expect to have positive cash flow from operations for the full 2017 fiscal year.~~2018. We expect to fund our working capital requirements, capital expenditures and payments of principal and interest on outstanding indebtedness, with cash on hand and cash flows from operations. We currently anticipate that ~~cash flows~~funds generated from operations, cash on hand and available borrowings under our ~~2013~~2017 Credit Facility will be sufficient to meet our anticipated cash requirements for at least the next twelve ~~months~~months. At June 30, 2018, we held cash and ~~for~~cash equivalents of $10.3 million in accounts outside the ~~foreseeable future.~~United States. Our liquidity is not materially impacted by the amount held in accounts outside the United States as our operating cash flows are driven primarily by U.S. sources.

On ~~May 31, 2013,~~November 30, 2017 (the “Closing Date”), we entered into our ~~2013~~2017 Credit Facility pursuant to the ~~2013~~2017 Credit Agreement. The ~~2013~~2017 Credit Facility consists of a ~~$20.0 million senior secured Term Loan A Facility, a $375.0~~$300.0 million senior secured Term Loan B Facility (the “Term Loan B Facility”), which was drawn in full on the ~~Term Loan B Borrowing Date, and a $30.0 million senior secured Revolving Credit Facility.~~Closing Date. In addition, the ~~2013~~2017 Credit Facility provides that we may increase the aggregate principal amount of the ~~2013~~2017 Credit Facility by up to an additional $100.0 million plus the amount that would result in our first lien net leverage ratio (as such term is used in the 2017 Credit Agreement) not exceeding 4.0 to 1.0, subject to us satisfying certain conditions.

Borrowings under the Term Loan AB Facility were used on the Closing Date ~~(together with cash on hand)~~ to (a) repay in full all of our and our subsidiaries’ outstanding obligations under the ~~2012~~2013 Credit ~~Agreement~~Facility and to terminate the ~~2012~~2013 Credit Agreement, ~~and~~ (b) pay fees and expenses in connection with the ~~2013~~2017 Credit ~~Facility. As discussed in more detail below, on August 1, 2013, we drew on borrowings under our Term Loan B Facility to (a) repay in full all of the outstanding loans under the Term Loan A~~ Facility, and ~~(b) redeem in full all of the Notes. We intend to use any future borrowings under the Revolving Credit Facility to provide~~(c) for ~~working capital, capital expenditures and other~~ general corporate ~~purposes and from time to time fund a portion of any acquisitions in which we may engage, in each case subject to the terms and conditions set forth in the 2013 Credit Agreement.~~purposes.

The ~~2013~~2017 Credit Facility is guaranteed on a senior secured basis by ~~the Credit Parties. The 2013 Credit Facility~~certain of our existing and future wholly-owned domestic subsidiaries, and is secured on a first priority basis by our and ~~the Credit Parties’~~those subsidiaries’ assets. ~~Upon the redemption of the Notes, the security interests and guaranties of us and the Credit Parties under the Indenture and the Notes were terminated and released.~~

Our borrowings under the ~~2013~~2017 Credit Facility bear interest on the outstanding principal amount thereof from the date when made at a rate per annum equal to either: (i) the Eurodollar Rate (as defined in the 2017 Credit Agreement) plus 2.75%; or (ii) the Base Rate (as defined in the ~~2013~~2017 Credit Agreement) plus ~~the Applicable Margin (as defined in the 2013 Credit Agreement); or (ii) LIBOR (as defined in the 2013 Credit Agreement) plus the Applicable Margin (as defined in the 2013 Credit Agreement)~~1.75%. ~~As of June 30, 2017, our effective interest rate was 3.5%. The Term Loan A Facility expired on the Term Loan B Borrowing Date, which was August 1, 2013.~~ The Term Loan B Facility expires on ~~the Term Loan B Maturity Date, which is May 31, 2020 and the Revolving Credit Facility expires on the Revolving Loan Maturity Date, which is May 31, 2018.~~November 30, 2024 (the “Maturity Date”).

~~(a) with respect to the Term Loans (i) if a Base Rate Loan, one and one half percent (1.50%) per annum and (ii) if a LIBOR Rate Loan, two and one half percent (2.50%) per annum; and~~

In the event we engage in a transaction that has the effect of reducing the yield of any loans outstanding under the Term Loan B Facility within six months of the Term Loan B Borrowing Date, we will owe 1% of the amount of the loans so repriced or replaced to the Lenders thereof (such fee, the “Repricing Fee”). Other than the Repricing Fee, theThe amounts outstanding under the ~~2013~~2017 Credit Facility may be prepaid at our option without premium or penalty, provided that certain limitations are observed, and subject to customary breakage fees in connection with the prepayment of a ~~LIBOR~~Eurodollar rate loan. The principal amount of the ~~(i) Term Loan A Facility shall be paid in full on the Term Loan B Borrowing Date, (ii)~~ Term Loan B Facility shall be paid in installments on the dates and in the respective amounts set forth in the ~~2013~~2017 Credit Agreement, with the final balance due on the ~~Term Loan B Maturity Date and (iii) Revolving Credit Facility shall be due on the Revolving Loan~~ Maturity Date.

Subject to certain exceptions, the ~~2013~~2017 Credit Facility contains covenants that limit the ability of us and ~~the Credit Parties~~our restricted subsidiaries to, among other things:

The 2013 Credit Facility also requires compliance with a financial covenant related to total net leverage ratio (calculated as set forth in the 2013 Credit Agreement) in the event that the revolving credit facility is drawn.

~~The 2013~~2017 Credit Facility also provides for certain customary events of default, including the following:

In connection with our entering into the ~~2013~~2017 Credit Agreement, we and ~~the Credit Parties~~our restricted subsidiaries also entered into ~~an Amended and Restated~~a Security Agreement, pursuant to which we and the Credit Parties each granted a first priority security interest in the collateral securing the ~~2013~~2017 Credit Facility for the benefit of the lenders under the ~~2013~~2017 Credit Facility.

~~On August 1, 2013, we drew on borrowings under~~Additionally, the 2017 Credit Agreement contains a definition of “Consolidated EBITDA” that excludes revenue related to our ~~Term Loan B Facility. The borrowings were used to (i) repay~~participation in ~~full all of~~ the ~~outstanding loans under our Term Loan A Facility; (ii) satisfy the Redemption on the Redemption Date under the Indenture, in an aggregate principal amount of approximately $324 million,~~FCC auction for broadcast spectrum and ~~(iii) pay any fees and~~related expenses, ~~in connection therewith. The redemption price for the redeemed Notes was 106.563% of the principal amount, plus accrued and unpaid interest thereon~~as compared to the ~~Redemption Date.~~

~~The Redemption constituted a complete redemption~~definition of the Notes, such that no amount remained outstanding following the Redemption. Accordingly, the Indenture has been satisfied and discharged in accordance with its terms and the Notes have been cancelled, effective as of the Redemption Date.

~~In each of December 2014, 2015 and 2016, we made a prepayment of $20.0 million, to reduce the amount of loans then outstanding~~“Consolidated Adjusted EBITDA” under ~~our Term Loan B Facility.~~

Effective August 1, 2017, we entered into the First Amendment dated as of August 1, 2017 (the “Amendment”) to the 2013 Credit Agreement. Pursuant to this Amendment, among other things, we are allowed to make certain restricted payments in an amount not to exceed $40,000,000, plus, for each anniversary of the effective date of the Amendment, an additional $20,000,000 so long as, in the case of restricted payments made in reliance on any such additional amounts, the total net leverage ratio would not exceed 5.5 to 1 after giving effect to the restricted payment.

~~The Amendment also makes certain technical and conforming changes to the terms of the 2013 Credit Agreement. All other provisions of~~ the 2013 Credit Agreement ~~remain~~which included such items.

The carrying amount of the Term Loan B Facility as of June 30, 2018 was $294.2 million, net of $3.5 million of unamortized debt issuance costs and original issue discount. The estimated fair value of the Term Loan B Facility as of June 30, 2018 was $294.8 million. The estimated fair value is based on quoted prices in ~~full force and effect unless expressly amended or modified pursuant to the Amendment.~~markets where trading occurs infrequently.

~~We use~~Prior to November 28, 2017, we used derivatives in the management of interest rate risk with respect to interest expense on variable rate debt. ~~Our current policy prohibits entering into derivative instruments for speculation or trading purposes.~~ We ~~are~~were party to interest rate swap agreements with financial institutions that ~~fix~~fixed the variable benchmark component (LIBOR) of our interest rate on a portion of our term ~~loan.~~loan beginning December 31, 2015. On November 28, 2017, we terminated these swap agreements in conjunction with the refinancing of our debt under our 2017 Credit Facility, as discussed above. Our current policy prohibits entering into derivative instruments for speculation or trading purposes.

~~ASC 820,~~ ~~“Fair Value Measurements and Disclosures”, requires us to~~We recognize all of our derivative instruments as either assets or liabilities in the consolidated balance sheet at fair value. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship, and further, on the type of hedging relationship. The interest rate swap agreements were designated and qualified as a cash flow hedge; therefore, the effective portion of the changes in fair value iswas a component of other comprehensive income. Any ineffective portions of the changes in fair value of the interest rate swap agreements ~~will~~would be immediately recognized directly to interest expense in the consolidated statement of operations.

The carrying amount of our interest rate swap agreements iswere recorded at fair value, including consideration of non-performance risk, when material. The fair value of each interest rate swap agreement iswas determined by using multiple broker quotes, adjusted for non-performance risk, when material, which estimate the future discounted cash flows of any future payments that may be made under such ~~agreements.~~

~~As required by the terms of our 2013 Credit Agreement, on December 16, 2013, we entered into three forward-starting interest rate swap~~ agreements with an aggregated notional amount of $186.0 million at a fixed rate of 2.73%, resulting in an all-in fixed rate of 5.23%. The interest rate swap agreements took effect on December 31, 2015 with a maturity date on December 31, 2018. Under these interest rate swap agreements, we pay at a fixed rate and receive payments at a variable rate based on three-month LIBOR. The interest rate swap agreements effectively fix the floating LIBOR-based interest of $186.0 million outstanding LIBOR-based debt. The interest rate swap agreements were designated and qualified as a cash flow hedge; therefore, the effective portion of the changes in fair value is recorded in accumulated other comprehensive income. Any ineffective portions of the changes in fair value of the interest rate swap agreements will be recognized directly to interest expense in the consolidated statement of operations. The change in fair value of the interest rate swap agreements for the three-month period ended June 30, 2017 was a gain of $0.3 million, net of tax, and was included in other comprehensive income (loss). The change in fair value of the interest rate swap agreements for the six-month period ended June 30, 2017 was a gain of $0.8 million, net of tax, and was included in other comprehensive income (loss). We paid $0.7 million of interest related to the interest rate swap agreements ~~for the three-month period ended~~ ~~June 30, 2017. We paid $1.6 million of interest related to the interest rate swap agreements~~ ~~for the six-month period ended~~ June 30, 2017. As of June 30, 2017, we estimate that none of the unrealized gains or losses included in accumulated other comprehensive income or loss related to these interest rate swap agreements will be realized and reported in earnings within the next twelve months.

On July 13, 2017, our Board of Directors approved a share repurchase program of up to ~~$15~~$15.0 million of our outstanding common stock. On April 11, 2018, our Board of Directors approved the repurchase of up to an additional $15.0 million of our outstanding common stock, for a total repurchase authorization of up to $30.0 million. Under the ~~new~~ share repurchase program we are authorized to purchase shares from time to time through open market purchases or negotiated purchases, subject to market conditions and other ~~factors. On the same date, the Board terminated our previous share repurchase program of up to $20 million of our Company’s common stock. Under the previous program, we did not repurchase any shares during~~factors.

In the three-month period ended June 30, ~~2017.~~2018, we repurchased 1.1 million shares of our Class A common stock for an aggregate purchase price of $5.3 million, or an average price per share of $4.81. As of June 30, 2018, we repurchased a total of approximately 2.5 million shares of our Class A common stock for aggregate purchase price of approximately $13.0 million, or an average price per share of $5.08, since the beginning of share repurchase program. All such repurchased shares were retired as of June 30, 2018.

Consolidated adjusted EBITDA (as defined below) decreased to $21.8 million for the six-month period ended June 30, 2018 compared to $27.5 million for the six-month period ended June 30, ~~2017 compared~~2017. As a percentage of net revenue, consolidated adjusted EBITDA decreased to ~~$30.8 million~~15% for the six-month period ended June 30, ~~2016. As a percentage of net revenue, consolidated adjusted~~

~~EBITDA decreased~~2018 compared to 21% for the six-month period ended ~~June 30, 2017 compared to 25% for the six-month period ended~~ June 30, ~~2016.~~2017. The decrease as a percentage of net revenue is primarily due to our digital segment generating a larger percentage of our net revenue in the current year. Because of third party media costs, our margins tend to be smaller in our digital segment than in our other segments.

Consolidated adjusted EBITDA, as defined in our 2017 Credit Agreement, means net income (loss) plus gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation included in operating and corporate expenses, net interest expense, other income (loss), non-recurring cash expenses, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses, ~~and~~ syndication programming amortization less syndication programming ~~payments.~~payments, revenue from FCC spectrum incentive auction less related expenses, expenses associated with investments, acquisitions and dispositions and certain pro-forma cost savings. We use the term consolidated adjusted EBITDA because that measure is defined in our ~~2013~~2017 Credit ~~Facility~~Agreement and does not include gain (loss) on sale of assets, depreciation and amortization, non-cash impairment charge, non-cash stock-based compensation, net interest expense, other income (loss), non-recurring cash expenses, gain (loss) on debt extinguishment, income tax (expense) benefit, equity in net income (loss) of nonconsolidated affiliate, non-cash losses, ~~and~~ syndication programming amortization ~~and does include~~less syndication programming ~~payments.~~payments, revenue from FCC spectrum incentive auction less related expenses, expenses associated with investments, acquisitions and dispositions and certain pro-forma cost savings.

Since ~~our ability to borrow from our 2013 Credit Facility is based on a~~ consolidated adjusted EBITDA ~~financial covenant,~~is a measure governing several critical aspects of our 2017 Credit Facility, we believe that it is important to disclose consolidated adjusted EBITDA to our investors. ~~Our 2013 Credit Facility contains a total net leverage ratio financial covenant. The~~We may increase the aggregate principal amount outstanding by an additional amount equal to $100.0 million plus the amount that would result in our total net leverage ratio, or the ratio of consolidated total senior debt (net of up to ~~$20~~$75.0 million of unrestricted cash) to trailing-twelve-month consolidated adjusted EBITDA, ~~affects both our ability to borrow from our 2013 Credit Facility and our applicable margin for~~not exceeding 4.0. In addition, beginning December 31, 2018, at the ~~interest rate calculation. Under our 2013 Credit Facility, our maximum total leverage ratio may not exceed 6.25 to 1~~end of every calendar year, in the event ~~that~~our total net leverage ratio is within certain ranges, we must make a debt prepayment equal to a certain percentage of our Excess Cash Flow, which is defined as consolidated adjusted EBITDA, less consolidated interest expense, less debt principal payments, less taxes paid, less other amounts set forth in the ~~revolving credit facility is drawn.~~definition of Excess Cash Flow in the 2017 Credit Agreement. The total leverage ratio was as follows (in each case as of June 30): ~~2017, 4.1~~2018, 4.9 to 1; ~~2016, 4.0~~2017, 3.3 to 1. ~~Therefore, we were in compliance with this covenant at each of those dates.~~

Consolidated adjusted EBITDA is a non-GAAP measure. For a reconciliation of consolidated adjusted EBITDA to cash flows from operating activities, its most directly comparable GAAP financial measure, please see page ~~26.~~28.

Net cash flow provided by operating activities was ~~$23.3~~$16.9 million for the six-month period ended June 30, ~~2017~~2018, compared to net cash flow provided by operating activities of ~~$24.4~~$23.3 million for the six-month period ended June 30, ~~2016~~2017. We had net income of $3.0 million for the six-month period ended June 30, 2018, which was partially reduced by non-cash items such as depreciation and amortization expense of $8.0 million and non-cash stock-based compensation of $2.4 million. We had net income of $6.1 million for the six-month period ended June 30, 2017, which was partially reduced by non-cash items, including depreciation and amortization expense of $8.1 million, deferred income taxes of $3.4 million, and non-cash stock-based compensation of $2.1 million. We ~~had net income of $8.0 million for the six-month period ended~~ ~~June 30, 2016, which was partially reduced~~ ~~by non-cash items, including depreciation and amortization expense of $7.9 million, deferred income taxes of $4.9 million, and non-cash stock-based compensation of $1.9 million. We~~ expect to have positive cash flow from operating activities for the full year ~~2017.~~2018.

Net cash flow used in investing activities was ~~$17.2~~$146.8 million for the six-month period ended June 30, ~~2017~~2018, compared to net cash flow used in investing activities of ~~$34.7~~$17.2 million for the six-month period ended June 30, ~~2016~~2017. During the six-month period ended June 30, 2018, we spent $159.4 million on the purchase of marketable securities, $3.6 million on the acquisition of Smadex, $5.7 million on net capital expenditures and $3.2 million on the purchase of intangible assets offset by $25.0 million in proceeds from

the maturity of marketable securities. During the six-month period ended June 30, 2017, we purchased the business of Headway for $7.5 million, net of cash acquired, spent $7.3 million on net capital expenditures, spent $2.2 million on investments and made a deposit on a potential future acquisition of $0.2 million. ~~During the six-month period ended~~ ~~June 30, 2016, we spent $4.8 million on net capital expenditures and we purchased a six-month certificate of deposit for $30.0 million.~~ We anticipate that our capital expenditures will be approximately $13.0 million ~~for~~during the full year ~~2017.~~2018. Of this amount, we expect that approximately $4.0 million will be expended in connection with the required relocation of certain of our television stations to a different channel as part of the broadcast television repack following the FCC auction for broadcast spectrum, which amount we expect to be reimbursed to us by the FCC. The amount of our anticipated capital expenditures may change based on future changes in business plans, our financial condition and general economic ~~conditions.~~conditions, and the amount of net capital expenditures may change depending upon FCC reimbursement policy for broadcast television repack. We expect to fund capital expenditures with cash on hand and net cash flow from operations.

Net cash flow used in financing activities was ~~$7.0~~$22.3 million for the six-month period ended June 30, ~~2017,~~2018, compared to net cash flow used in financing activities of ~~$6.2~~$7.0 million for the six-month period ended June 30, ~~2016~~2017. During the six-month period ended June 30, 2018, we made dividend payments of $9.0 million, payments of $7.7 million for the repurchase of Class A common stock under our stock repurchase program, payments of $2.2 million for taxes related to shares withheld for share-based compensation plans, contingent consideration payments of $2.0 million and debt payments of $1.5 million,. During the six-month period ended June 30, 2017, we made dividend payments of $5.6 million, debt repayments of principal in the amount of $1.9 million and received proceeds of $0.5 million related to the issuance of common stock upon the exercise of stock options. ~~During the six-month period ended~~ ~~June 30, 2016~~, we made dividend payments of $5.6 million, debt repayments of principal in the amount of $1.9 million and received proceeds of $1.3 million related to the issuance of common stock upon the exercise of stock options.

Market risk represents the potential loss that may impact our financial position, results of operations or cash flows due to adverse changes in the financial markets. We are exposed to market risk from changes in the base rates on our Term Loan B Facility. Under our 2013 Credit Facility, within two years from its commencement, we were required to enter into derivative financial instrument transactions, such as swaps or interest rate caps, for at least half of the principal balance, in order to manage or reduce our exposure to risk from changes in interest rates. We do not enter into derivatives or other financial instrument transactions for speculative purposes. We are also exposed to market risk related to currency fluctuations in our international operations.B.

As of June 30, ~~2017~~,2018, we had ~~$290.9~~$297.8 million of variable rate bank debt outstanding under our ~~2013~~2017 Credit Facility. The debt bears interest at ~~LIBOR~~the three-month Eurodollar rate plus a margin of ~~2.5%. The LIBOR rate was 1.15%, higher than the 1.0% floor, resulting in an effective interest rate of 3.65% for the three-month period ended~~ ~~June 30, 2017~~. In the event LIBOR is below the floor rate we will still have to pay the floor rate plus the margin. If LIBOR rises above the floor rate, we have to pay the prevailing LIBOR rate plus the margin (for the portion of the debt that is not hedged. See further discussion below)2.75%.

Because our debt is subject to interest at a variable rate, our earnings will be affected in future periods by changes in interest rates. ~~Hypothetically, if LIBOR~~If the three-month Eurodollar rate were to increase by 100 basis points, or one percentage point, from its June 30, ~~2017~~2018 level, our annual interest expense ~~under our term loan~~ would increase and cash flow from operations would decrease by approximately ~~$1.1~~$3.0 million based on the outstanding balance of our term loan as of June 30, ~~2017~~.2018.

AsPrior to November 28, 2017, we used derivative instruments in the management of interest rate risk with respect to interest expense on variable debt as required by the terms of our previous 2013 Credit ~~Agreement, on~~Agreement. On December 16, 2013, we entered into three forward-starting interest rate swap agreements with an ~~aggregated~~aggregate notional amount of $186.0 million at a fixed rate of 2.73%, resulting in an all-in fixed rate of 5.23%. The interest rate swap agreements took effect on December 31, 2015 with a maturity date on December 31, 2018. Under these interest rate swap agreements, we ~~pay~~paid at a fixed rate and ~~receive~~received payments at a variable rate based on three-month ~~LIBOR.~~Eurodollar rate. The interest rate swap agreements effectively ~~fix~~fixed the floating ~~LIBOR-based~~Eurodollar rate-based interest of $186.0 million outstanding ~~LIBOR-based~~Eurodollar rate-based debt. The interest rate swap agreements were designated and qualified as a cash flow hedge; therefore, the effective portion of the changes in fair value iswas recorded in accumulated other comprehensive income. Any ineffective portions of the changes in fair value of the interest rate swap agreements ~~will be~~were immediately recognized directly to interest expense in the consolidated statement of operations. ~~The change in fair value of the interest rate~~On November 28, 2017, we terminated these swap agreements in conjunction with the refinancing of our debt under our 2017 Credit Facility, as discussed above. Our current policy prohibits entering into derivative instruments for ~~the three-month period ended~~ ~~June 30, 2017, was a gain of $0.3 million, net of tax, and was included in other comprehensive income (loss). The change in fair value of the interest rate swap agreements for the six-month period ended~~ ~~June 30, 2017, was a gain of $0.8 million, net of tax, and was included in other comprehensive income (loss). We paid $0.7 million of interest related to the interest rate swap agreements~~ ~~for the three-month period ended June 30, 2017.~~ ~~We paid $1.6 million of interest related to the interest rate swap agreements~~ ~~for the six-month period ended June 30, 2017.As of~~ ~~June 30, 2017, we estimate that none of the unrealized gains~~speculation or ~~losses included in accumulated other comprehensive income or loss related to these interest rate swap agreements will be realized and reported in earnings within the next twelve months.~~trading purposes.

We have foreign currency risks related to our revenue and operating expenses denominated in currencies other than the U.S. dollar. Our historical revenues have primarily been denominated in U.S. dollars, and the majority of our current revenues continue to be, and are expected to remain, denominated in U.S. dollars. However, we expect an increasing portion of our future revenues to be denominated in currencies other than the U.S. dollar, primarily the Mexican peso, Argentine peso and various other Latin American currencies. Recently, the Argentine peso has experienced significant devaluation relative to the U.S. dollar. The effect of an immediate and arbitrary 10% adverse change in foreign exchange rates on foreign-denominated accounts receivable at June 30, ~~2017~~2018 would not be material to our overall financial condition or consolidated results of operations. Our operating expenses are generally denominated in the currencies of the countries in which our operations are located, primarily the United States and, to a much lesser extent, Spain, Mexico, Argentina and other Latin American countries. Increases and decreases in our foreign-denominated revenue from movements in foreign exchange rates are partially offset by the corresponding decreases or increases in our foreign-denominated operating expenses.

As our operations grow, our risks associated with fluctuation in currency rates will become greater, and we will continue to reassess our approach to managing this risk. In addition, currency fluctuations or a weakening U.S. dollar can increase the costs of our

international operations. To date, we have not entered into any foreign currency hedging contracts, since exchange rate fluctuations historically have not had a material impact on our operating results and cash flows.

We conducted an evaluation, under the supervision and with the participation of management, including our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this quarterly report. Based on this evaluation, our chief executive officer and chief financial officer concluded that, as of the evaluation date, our disclosure controls and procedures were ~~effective.~~not effective due to a material weakness in our internal control over financial reporting identified in our Annual Report on Form 10-K for the year ended December 31, 2017, as described below.

~~Our~~Notwithstanding the conclusion that our disclosure controls and procedures ~~are designed~~were not effective as of the end of the period covered by this report, we believe that our consolidated financial statements and other information contained in this quarterly report present fairly, in all material respects, our business, financial condition and results of operations for the interim periods presented.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim financial statements will not be prevented or detected on a timely basis.

A material weakness in our internal controls existed as of December 31, 2017 due to insufficient accounting resources and personnel to ensure proper application of U.S. GAAP and to effectively design and execute process level controls around certain complex or non-recurring transactions. Although the control weakness did not result in any material misstatement of our consolidated financial statements, it could lead to a material misstatement of account balances or disclosures. Accordingly, management has concluded that this control weakness constitutes a material weakness.

We are continuing to implement a remediation plan to address the ~~information relating~~material weakness previously identified in our Annual Report on Form 10-K for the year ended December 31, 2017. As part of this plan, we have implemented a new enterprise reporting software to provide additional system controls to free up accounting resources, hired additional accounting personnel in certain of our foreign operations to strengthen our accounting resources in these locations and further free up corporate accounting resources, and hired additional accounting personnel to address complex accounting matters primarily related to the expanding geographic scope of our business operations, primarily our digital operations.

We believe that these changes will strengthen our internal control over financial reporting and remediate the material weakness we have identified. However, these changes have not been operating long enough to evaluate their operating effectiveness and are subject to continued management review supported by confirmation and testing, as well as Audit Committee oversight. As we continue to implement the remediation plan outlined above, we may also identify additional measures to address the material weakness or modify certain of the remediation procedures described above. We also may implement additional changes to our ~~company, including~~internal control over financial reporting as may be appropriate in the course of remediating the material weakness. Management, with the oversight of the Audit Committee, will continue to take steps to remedy the material weakness as expeditiously as possible to reinforce the overall design and capability of our consolidated subsidiaries, required to be disclosed in our SEC reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow for timely decisions regarding required disclosure.control environment.

Our management, including our chief executive officer and chief financial officer, does not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

In addition to the changes noted above to remediate the previously-identified material weakness, during the three-month period ended June 30, 2018, we finished integrating policies, processes, personnel, technology and operations in connection with our acquisition of Headway in April 2017. Management’s most recent assessment of internal control over financial reporting ~~during~~as of December 31, 2017 did not include the ~~period covered~~internal controls related to Headway, which is permitted by ~~this quarterly report that have materially affected, or are reasonably likely to materially affect, our~~applicable rules and regulations,

but will include Headway as a part of management’s next assessment of internal control over financial ~~reporting.~~

We currently and from time to time are involved in litigation incidental to the conduct of our business, but we are not currently a party to any lawsuit or proceeding which, in the opinion of management, is likely to have a material adverse effect on us or our business.

On May 1, 2017, we received a letter submitted by a stockholder asserting that one of the members of the Compensation Committee of the Board of Directors does not qualify as an “outside director” under Section 162(m) of the Internal Revenue Code. The letter requests that we take certain actions to remedy the alleged noncompliance with Section 162(m). The Nominating and Corporate Governance Committee (“NCG”), with the assistance of independent counsel, conducted a thorough review of the issues raised by the stockholder and concluded that the Company had complied in all respects with Section 162(m) and recommended that the Board of Directors not pursue a claim. The Board of Directors accepted the recommendation of the NCG.

~~We expect to experience certain risk factors in our overseas operations, which risks may increase if and as our overseas operations expand.~~

Our digital media segment engages in business operations in Mexico and other Latin American countries. We are subject to certain risks inherent in business operations outside the United States. These risks include but are not limited to geopolitical concerns, local politics, governmental instability, socioeconomic disparities, high inflation and hyper-inflation currency fluctuations, currency exchange controls, restrictions on repatriating foreign-derived profits to the United States, inflation, local regulatory compliance, punitive tariffs, unstable local tax policies, trade embargoes, import and export license requirements, trade restrictions, greater difficulty collecting accounts receivable, unfamiliarity with local laws and regulations, differing legal standards in enforcing or defending our rights in courts or otherwise, the possibility of less favorable intellectual property protection than is provided in the United States, changes in labor conditions, difficulties in staffing and managing international operations, difficulties in finding personnel locally who are capable of complying with the requirements of reporting by a U.S. reporting company, and other cultural differences. Foreign economies may differ favorably or unfavorably from the United States economy in growth of gross domestic product, rate of inflation, market development, rate of savings, capital investment, resource self-sufficiency and balance of payments positions, and in many other respects.

~~We expect to experience fluctuations in foreign exchange rates in our overseas operations, which may increase if and as our overseas operations expand.~~

~~Our digital media segment engages in business operations involving a wide range of currencies.~~

Our consolidated financial statements of our operations outside the United States will be translated into U.S. Dollars at the average exchange rates in each applicable period. To the extent that the U.S. Dollar strengthens against foreign currencies, the translation of these foreign currencies denominated transactions will result in reduced revenue, operating expenses and net income for our international operations. Similarly, to the extent that the U.S. Dollar weakens against foreign currencies, the translation of these foreign currency denominated transactions will result in increased revenue, operating expenses and net income for our international operations.

We are also exposed to foreign exchange rate fluctuations as we convert the financial statements of our foreign operations into U.S. Dollars in consolidation. If there is a change in foreign currency exchange rates, the conversion of financial statements into U.S. Dollars will lead to a translation gain or loss which is recorded as a component of other comprehensive income. In addition, we may have certain assets and liabilities that are denominated in currencies other than the relevant entity’s functional currency. Changes in the functional currency value of these assets and liabilities create fluctuations that will lead to a transaction gain or loss.

Some of the countries in which our digital media segment operates, including Mexico, Argentina and Brazil, have experienced significant and sometimes sudden devaluations of their currency over time, which could magnify these fluctuations, should they happen again in the future. Some of the countries in which our digital media segment operates, including Mexico, Argentina and Brazil, have experienced hyper-inflation in the past, which could magnify socioeconomic, geopolitical or financial uncertainties that could affect our operations in such countries.

Additionally, our digital media assets, liabilities, income and costs can change significantly by showing our foreign currency denominated assets and debts converted to amounts in U.S. Dollars, the currency in which we report, and these can also change when financial statements in foreign currencies from our overseas operations are converted to and presented in U.S. Dollars.

We have not entered into agreements or purchased instruments to hedge our exchange rate risks, and it is therefore possible for our consolidated results of operations, including our sales volume in foreign currencies, our cost of revenue in foreign currencies and other items, to be influenced if exchange rates change significantly in one or more of these currencies. While it is possible that we may engage in some exchange rate risk hedging in the future, the availability and effectiveness of any hedging transaction may be limited and we may not be able to successfully hedge our exchange rate risks.

We are required to comply with the United States Foreign Corrupt Practices Act, which prohibits U.S. companies from engaging in bribery or other prohibited payments to foreign officials for the purpose of obtaining or retaining business. Corruption, extortion, bribery, pay-offs, theft and other fraudulent practices occur from time-to-time in certain countries, including some of the countries in which we operate. If our competitors engage in these practices, they may receive preferential treatment from personnel of some companies, giving our competitors an advantage in securing business or from government officials who might give them priority in obtaining new business, which would put us at a disadvantage. Although we intend to inform our personnel that such practices are illegal, we cannot assure you that our employees or other agents will not engage in such conduct for which we might be held responsible. If our employees or other agents are found to have engaged in such practices, we could suffer severe penalties.

We may have difficulty establishing adequate management, legal and financial controls in some of the countries in which we operate, which difficulties may increase if and as our overseas operations expand.

Certain of the countries in which we operate historically have been deficient in U.S.-style local management and internal financial reporting concepts and practices, as well as in modern banking and other control systems. We may have difficulty in hiring and retaining a sufficient number of locally-qualified employees to work in such countries who are capable of satisfying the obligations of a U.S. public reporting company. As a result of these factors, we may experience difficulty in establishing adequate management, legal and financial controls (including internal controls over financial reporting), collecting financial data and preparing financial statements, books of account and corporate records and instituting business practices in such countries that meet U.S. standards as in effect from time to time.

~~We may be exposed to certain risks enforcing our legal rights generally in some of the countries in which we operate.~~

Unlike the United States, most of the countries in which we operate have a civil law system based on written statutes in which judicial decisions have limited precedential value. While we believe that all the countries in which we operate have enacted laws and regulations to deal with economic matters such as corporate organization and governance, foreign investment, intellectual property, commerce, taxation and trade, our experience in interpreting and enforcing our rights under these laws and regulations is limited, and our future ability to enforce commercial claims or to resolve commercial disputes in any of these countries is therefore unpredictable. These matters may be subject to the exercise of considerable discretion by national, provincial or municipal governments, agencies and/or courts, and forces and factors unrelated to the legal merits of a particular matter or dispute may influence their determination.No material change.

On July 13, 2017, our Board of Directors approved a share repurchase program of up to ~~$15~~$15.0 million of our outstanding common stock. On April 11, 2018, our Board of Directors approved the repurchase of up to an additional $15.0 million of our outstanding common stock, for a total repurchase authorization of up to $30.0 million. Under the ~~new~~ share repurchase program we are authorized to purchase shares from time to time through open market purchases or negotiated purchases, subject to market conditions and other ~~factors~~. One the same date, the Board terminated our previous share repurchase program of up to $20 million of our Company’s common stock. Under the previous program, we did not repurchase any shares duringfactors.

In the three-month period ended June 30, ~~2017.~~2018, we repurchased 1.1 million shares of our Class A common stock for an aggregate purchase price of $5.3 million, or an average price per share of $4.81. As of June 30, 2018, we repurchased a total of approximately 2.5 million shares of our Class A common stock for an aggregate purchase price of approximately $13.0 million , or an average price per share of $5.08, since the beginning of share repurchase program. All such repurchased shares were retired as of June 30, 2018.

~~Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.~~

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Page Number
	PART I. FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS	34
	CONSOLIDATED BALANCE SHEETS (UNAUDITED) AS OF JUNE 30, ~~2017~~2018 AND DECEMBER 31, ~~2016~~2017	34
	CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE THREE- AND SIX-MONTH PERIODS ENDED JUNE 30, ~~2017~~2018 AND JUNE 30, ~~2016~~2017	45
	CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) FOR THE THREE- AND SIX-MONTH PERIODS ENDED JUNE 30, ~~2017~~2018 AND JUNE 30, ~~2016~~2017	56
	CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE SIX-MONTH PERIODS ENDED JUNE 30, ~~2017~~2018 AND JUNE 30, ~~2016~~2017	67
	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)	78
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	2123
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	3537
ITEM 4.	CONTROLS AND PROCEDURES	3638
	PART II. OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	3740
ITEM 1A.	RISK FACTORS	3740
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	3840
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	3840
ITEM 4.	MINE SAFETY DISCLOSURES	3840
ITEM 5.	OTHER INFORMATION	3840
ITEM 6.	EXHIBITS	3941

	Six-Month Period
	Ended June 30, 2017
	Number Granted		Weighted-Average Fair Value
Restricted stock units		61	$	5.75

	Six-Month Period
	Ended June 30, 2018
	Number Granted		Weighted-Average Fair Value
Restricted stock units		120	$	4.00

First Lien Net Leverage Ratio	LIBOR Margin			Base Rate Margin
≥ 4.50 to 1.00		2.50	%		1.50	%
< 4.50 to 1.00		2.25	%		1.25	%


~~Smaller reporting~~Emerging growth company		☐

~~Emerging growth company~~		☐

	Certificates of Deposit					Corporate Bonds
	Amortized Cost		Unrealized (gains) losses			Amortized Cost		Unrealized (gains) losses
Due within a year	$	-	$	-		$	10,012	$	(33	)
Due after one year through five years		8,282		(64	)		115,797		(1,558	)
Total	$	8,282	$	(64	)	$	125,809	$	(1,591	)

(in thousands)	December 31, 2017			Increase		Decrease *		June 30, 2018
Deferred revenue	$	1,959		3,386		(1,959)		$	3,386

31.1*		~~Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rules 13a-14 and 15d-14 under the Securities Exchange Act of 1934.~~

31.2*		~~Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rules 13a-14 and 15d-14 under the Securities Exchange Act of 1934.~~

32*		~~Certification of Periodic Financial Report by the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.~~

101.INS*		~~XBRL Instance Document.~~

101.SCH*		~~XBRL Taxonomy Extension Schema Document.~~

101.CAL*		~~XBRL Taxonomy Extension Calculation Linkbase Document.~~

101.LAB*		~~XBRL Taxonomy Extension Label Linkbase Document.~~

101.PRE*		~~XBRL Taxonomy Extension Presentation Linkbase Document.~~

101.DEF*		~~XBRL Taxonomy Extension Definition Linkbase.~~

~~ENTRAVISION COMMUNICATIONS CORPORATION~~

~~By:~~		~~/s/ Christopher T. Young~~
		~~Christopher T. Young~~ ~~Executive Vice President, Treasurer~~ ~~and Chief Financial Officer~~

~~Exhibit~~ ~~Number~~		~~Description of Exhibit~~

31.1*		Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rules 13a-14 and 15d-14 under the Securities Exchange Act of 1934.

31.2*		Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rules 13a-14 and 15d-14 under the Securities Exchange Act of 1934.

32*		Certification of Periodic Financial Report by the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*		XBRL Instance Document.

101.SCH*		XBRL Taxonomy Extension Schema Document.

101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*		~~XBRL Taxonomy Extension Definition Linkbase.~~

101.LAB*		XBRL Taxonomy Extension Label Linkbase Document.

101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document.

ENTRAVISION COMMUNICATIONS CORPORATION

By:		/s/ Christopher T. Young
		Christopher T. Young Executive Vice President, Treasurer and Chief Financial Officer

	Three-Month Period				Six-Month Period
	Ended June 30,				Ended June 30,
	2018		2017		2018		2017
Local direct	$	15,315	$	17,041	$	29,908	$	33,544
Local agency		7,265		7,540		14,181		14,943
National agency		18,953		19,445		35,153		38,327
Total revenue	$	41,533	$	44,026	$	79,242	$	86,814

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company