Adam Townsend - Executive Vice President of Investor Relations Sumner M. Redstone - Founder and Executive Chairman Leslie Moonves - Chief Executive Officer, President and Director Joseph R. Ianniello - Principal Financial Officer and Chief Operating Officer

David Bank - RBC Capital Markets, LLC, Research Division Benjamin Swinburne - Morgan Stanley, Research Division Jessica Reif Cohen - BofA Merrill Lynch, Research Division Anthony J. DiClemente - Nomura Securities Co. Ltd., Research Division Michael C. Morris - Guggenheim Securities, LLC, Research Division Alexia S. Quadrani - JP Morgan Chase & Co, Research Division David W. Miller - Topeka Capital Markets Inc., Research Division Laura A. Martin - Needham & Company, LLC, Research Division David Carl Joyce - ISI Group Inc., Research Division John Janedis - Jefferies LLC, Research Division Alan S. Gould - Evercore Partners Inc., Research Division William G. Bird - FBR Capital Markets & Co., Research Division Marci Ryvicker - Wells Fargo Securities, LLC, Research Division

Good day, everyone, and welcome to the CBS Corporation's Second Quarter 2014 Earnings Release Teleconference. Today's call is being recorded. At this time, I'd like to turn the call over to the Executive Vice President of Investor Relations, Mr. Adam Townsend. Please go ahead, sir.

Thank you. Good afternoon, everyone, and welcome to our second quarter of 2014 earnings call. Joining us for today's discussion are Sumner Redstone, our Executive Chairman; Leslie Moonves, President and CEO; and Joe Ianniello, Chief Operating Officer. Sumner will have opening remarks, and we'll turn the call over to Les and Joe who will then discuss the strategic and financial results. We will then open the call to questions. Please note that statements on this conference call relating to matters which are not historical facts are forward-looking statements, which involve risks and uncertainties that could cause actual results to differ. Risks and uncertainties are disclosed in CBS Corporation's news releases and securities filings. A webcast of this call and the earnings release related to today's presentation can be found on the Investors section of our website at cbscorporation.com. Reconciliations for non-GAAP financial information related to this call can be found in our earnings release or on our website. With that, it's now my pleasure to turn the call over to Sumner.

Thank you, Adam. Good afternoon, everyone. I'm extremely proud of CBS's continued success. Our content is going extremely well. I'm confident we'll stay at the top of our game for many, many years to come. So it gives me great pleasure to turn the call over to my good friend and colleague, the man I rightfully call a super genius, Les Moonves.

Thank you, Sumner, and good afternoon, everybody, and thank you for joining us. Needless to say, these are very exciting times in the media business. When you think about all that has gone on in these last 3 months and even, in fact, these last 3 days, it is truly astonishing. The good news is through all the change and all the noise, we continue to be extremely confident about CBS's growth prospects. We remain fully focused on executing our compelling growth strategy. This includes second quarter EPS that tied our record of $0.76 and adjusted EPS that came in at $0.78, up 4% from a year ago. In the middle of all this success and excitement, there were a number of key positive developments here at CBS since the second quarter began. First, we successfully completed the separation of our Outdoor business. This accentuates that CBS is a content company, and we are fully focused on what we do best. In addition, we are now much closer to a 50-50 split of advertising and non-advertising revenue. More importantly, thanks to this transaction, we were able to retire more than $5 billion of our stock. And in a moment, I'm going to talk about the significant amounts of additional capital that we will be returning to our shareholders per our announcement today. The next key development was the landmark Supreme Court ruling against Aereo. This removes any distraction from our stated $2 billion of retrans and affiliate compensation revenue by 2020, a goal that we are well on our way to achieving. We're very pleased that the highest court in the land reaffirmed the legal rights of content owners. And as we learned subsequently, what we suspected all along, Aereo only had about 75,000 subs nationwide. So a lot of…

Thanks, Les, and good afternoon, everyone. In just a bit, I'll be giving you some more details about our second quarter results and I'm also going to talk about what's coming up in the back half of 2014. But first, I want to take a moment to update you on the completion of our Outdoor transaction and provide more details on our capital return plan. Last month, we split off the remaining 81% that we own in CBS Outdoor. This entire initiative was a success from start to finish. Beginning with the sale of our European operations last fall to the debt we raised at very attractive rates in the first quarter to the launch of our IPO this spring to obtaining a favorable REIT ruling from the IRS and finally, to completing the exchange offer in July on an accelerated schedule. Please note that since we continue to own CBS Outdoor through the second quarter, its results are presented as discontinued operations in our financial statements today. And because the exchange offer closed after June 30, we will record a gain on the disposition in Q3. Now that the Outdoor separation is complete, we are now focused more than ever on managing our content-centric businesses to drive shareholder returns. Our mix of revenue has become a more favorable blend of advertising, content licensing and subscription fees, including a growing base of contractually committed retransmission revenue, as well as higher payments from our station affiliates. As a result, we will benefit even more from recurring and predictable revenue streams going forward, which will in turn increase our visibility on profits and free cash flow. Clearly, CBS's transformation provides greater financial flexibility and an improved capacity to return value to our shareholders, which will always remain a top priority for us…

[Operator Instructions] We'll take our first question from David Bank with RBC Capital Markets.

Two quick ones. The first, Joe, just to follow up on your commentary on the target leverage ratio. Would -- if you're currently 1.9 and you're sort of comfortable going up to 2.5x, would the full exercise of the newly expanded program to $6 billion by year-end fiscal '15, would that kind of get you to the 2.5x range? Or is there more room? And what would you do with the dry powder, is the first question. The second one is probably more directed at Les. I don't know if you guys listened to the Time Warner call yesterday. But Jeff Bewkes commented on the fact that the original programming is kind of getting higher ratings in something like 20% of the schedule right now and the Turner nets is original moving toward 40%. And so my question -- and at the same time, you're seeing new players come in like WGN America buying some of your higher quality off-net syndication. So I was kind of curious as to your view net-net, is the demand for sort of traditional off-net syndication, is it going up? Is it staying the same? Or is it declining as you look at the way the off-net guys -- or the cable nets are programming?

Let me do the second one first. It's a little ironic that Jeff would say that when the highest-rated show on Turner is the Big Bang Theory, which is off-net, and they are running the sprockets off it. So by the way, Time Warner also owns that show. So it's a little -- that is an odd statement. I know people are doing more original programming, but the big hits are still selling very well in off-net. And there's so many other places to do it now with SVODs. So we have little concern about that. And then when you judge by what we've done with some of our other deals with Blue Bloods and Elementary and Good Wife, we've been able to syndicate them across the board in multi-platform to the maximum usage.

And David, on your first part of -- as far as the target leverage ratio, what I would say is look, we're going to be -- we're going to get there in short order. But obviously, as we grow EBITDA, it would be creating additional capacity. Again, at these stock price levels, again, we said every dollar of excess free cash flow is going back to buy back our stock. So you should expect that.

Our next question comes from Ben Swinburne with Morgan Stanley.

Joe, I'm sure you won't mind if we take another stab at that because it is a big announcement on the buyback. I guess, maybe a pointed question, which is when do you look to reach that gross leverage target? Because as you mentioned, you're at 1.9 and obviously you've got a big back half. So in our numbers, you'll be 1.7, 1.75 by the end of the year. When do you plan to raise that additional capacity to reach 2.5 gross?

Yes. Look, I think what we said, $6 billion. Just to give you a time frame of the $6 billion, we think that's, again, Ben, somewhere between 12 and 24 months. And again, we're going to look at the EBITDA and the additional capacity we'd grow over time. So we'll look at and we'll continue to revisit the 2.5. I think the 2.5, we're comfortable with given our mix of assets now. And so I think, again, just saying, if you're looking at $6 billion over 12 to 24 months compared to an underlying -- what we were doing historically of $1.2 billion, I mean you get a sense of the massive increase that is.

That is very clear. And then, Les, there is certainly some concern out there around the licensing business growing over time. It's about 1/3 of your revenue. It's very high margin. It's been a tremendous story the last few years. Can you just spend some time on particularly international, what's going on there? It's a big -- probably a bigger business than maybe people realize. And then how you think about -- what you've learned on the SVOD front historically about whether there's some cannibalization of the core business as you release more and more product into the SVOD window because I think people have some concerns there as well.

Yes. Look, the international business continues to grow substantially. One of the things that has changed obviously is the great expansion internationally of both Netflix and Amazon. So it becomes a much more competitive marketplace in just about every one of the international territories. So you're seeing huge international numbers, bigger than I've ever seen before. When you announce a new fall show that's a drama, the numbers are truly extraordinary with rarely a number being below $2 million per episode for a brand-new drama and north of $3 million for some of the more established hits. So that's fairly substantial. In terms of the SVOD marketplace, once again, we are able to make deals consistently. As we said, we've expanded our Netflix library. We are extremely pleased that our current 2 summer shows have deals with Amazon and the next year show has a deal with Netflix. Plus each one of the shows that go into syndication, we devise new ways of selling it. So each one is done very differently than before, where you sell it to cable, you sell it to other -- to syndication channel, as well as doing SVOD. So the future is extremely bright in those areas. And every single piece of product we've been able to maximize, which is why we say when we announced NCIS: New Orleans with a huge international deal and already in place, so they know what it is, and sort of guaranteed deals domestically as well. That's why we confidently say we're going to be north of probably $5 million an episode before the show even goes on the air, not including advertising, which is partially why it's on the air because it's a huge profit maker from day 1. And the market -- so people who are worried about the marketplace, I think those are the cable networks who are trying to shave pricing.

Our next question comes from Jessica Reif Cohen with Bank of America Merrill Lynch.

I have 2 questions. Given the events over the last month and the hyper-focus on HBO -- you obviously have Showtime, which has turned out to be jewel. It's amazing that it almost went to Viacom. But you do have Showtime. And I'm just wondering, are you thinking about changing anything in the model to either accelerate growth from -- granted a very high pace, but accelerate growth or do anything to highlight the value of this asset? And then I'll ask my second question after.

Showtime, the great news about Showtime is truly every single year, their subs have gone up, and obviously their fees have gone up every single year. Plus, as we mentioned, we have added the syndication element to it because more and more of the programming on Showtime is owned programming. Look, Showtime Go -- Showtime Anytime was a little behind HBO GO, but we've now sort of caught up. We're in most of the country. And the SHOWTIME ON DEMAND platform is growing. So we are also looking at opportunities for Showtime to expand on different platforms. It's been a great growth story, and we plan on continuing it as long as we continue to do the kind of programs that we're doing, and I think we have more coming up in the fall.

And then on content, which -- I mean, you clearly emphasized that CBS is now or has become a content-centric company. You're clearly scaling up. You mentioned all the companies -- internal companies you sell to or it's companies that you have an interest in, and now outside companies, third parties. How tough is it to sell to other networks when everybody else is trying to sell internally to themselves?

For the first time, we sold the show to ABC. It's the first time we have done that. And I think it's about the content. Obviously, our studio looks to sell to CBS first and obviously a different kind of programming to the CW. But I think the world -- look, as soon as the new Fox team was announced, I got a call from Peter Rice saying, "We want to buy programs from you." So I think there's an openness to doing that, and our studio is selling to other cable channels. Plus, I think shortly, you're going to hear us being in business with some of the SVODs with original program. So there's still a great deal of growth. I think we have over 30 shows in production, and that's only going to grow.

Our next question comes from Anthony DiClemente with Nomura.

Les, you guys were presumably a logical candidate to acquire CNN if that would have come up for sale as part of Fox, Time Warner. My guess is that there indeed was some meaningful industrial logic there. You probably thought about it given the redundancies of news bureaus globally. So I guess the question is with Fox having withdrawn their bid, is this still possible on the CNN front? And then I have a follow-up.

Yes. Obviously, when the Fox announced, was they said, "Oh, they'd have to sell CNN." We would be a logical place since we don't have a cable news network. We thought about it. We talked about it. It's obviously something that's not going to happen. So it becomes irrelevant. The numbers they were throwing around were sort of silly, and we wouldn't have looked at it on that basis. And so it never became a very serious conversation because until Fox was going through with this deal, and it absolutely became available, would we have looked at it. But once again, as Joe mentioned, we're pretty happy with our assets right now, and I doubt we would look to do anything with something like that.

Okay. And then for Joe. Joe, could you just remind us of the cadence of your reverse comp renewals and how they come up over the next couple of years? Wondering if you can just update us on kind of the nature of complexion of your conversations with the independent affiliates, particularly now in a post-Aereo, potentially stronger retransmission content ecosystem?

Yes. We have a few major ones coming up at the end of this year, Anthony, with LIN and Gray. But a majority come up, really, in '15 and '16. So we'll get a shot to reset to fair market value on the station affiliate side. And on the retrans side, obviously we have DISH up this year and we have another 2 major deals up next year for about 13% of our footprint. So I think, again, we're going to have a nice shot to really adjust some pretty old deals to fair market value.

Our next question comes from Michael Morris with Guggenheim Securities.

Two questions. The first one, obviously, you've been very committed to returning capital. It's a big part of your use of cash flow. I think it does raise some concern about reinvestment in the business. So you talked about programming. Can you help quantify a bit what the investment in programming looks like? How -- does that grow? What's the gating factor to that growth? As an investment, is it just the appetite out there from your partners? How do you push that? So I guess, what does the trajectory of growth in programming look like versus growth and your return of capital? And then secondly, just with respect to Aereo, the numbers were somewhat surprisingly low, given all the hype that there was around it. And I'm curious to your take on the mobile demand for your products. You made some investments, but is it -- are we still just well too early for that to become a revenue driver, and Aereo was kind of evidence of that? Or is it something that you can push now that, that's behind you?

Yes. Mike, it's Joe. As far as the growth in programming, look, first and foremost, the best ROI we can deliver to shareholders is create another hit. And so that by far is where the dollars go. You've seen an NCIS spinoff, a CSI spinoff. We're going to try to continue to create billion-dollar franchises. So we never starve investing in our business. You're seeing that with our costs. It's demonstrated with the NFL Thursday Night package. So rest assured, reinvestment in the business is ahead of our excess returns. I think the reinvestment is what drives the excess returns, quite frankly. And obviously, the summer programming, you can see many more original hours in which we own that content. So I think, again, it's really across the board. It's a core part of our strategy we've been very consistent with. As far as Aereo, look, the demand for our content, I think speaks for itself. I think we see that. And as consumers evolve and want it in different forms or shapes, we're going to make sure our content's there. And so -- but we own those intellectual property rights. And if we want to do that with a partner, they have to negotiate with us for those rights to do that. So we're very open to those types of conversations, but we need to be paid fair market value.

Do you think a move for more mobile has to come from the MVPD side? Or is it something that you can start pushing a bit given some of the investments that you make?

No, I don't think it needs to come from the MVPD side. If history tells us anything, they move actually kind of slow. So I think it may be coming from other technology companies or others that push that. But I think it's really driven by the consumer. And I think the consumer demand is saying that when we look at broadband only homes, et cetera, around this country. So again, very exciting for us for owning all of this content. And now that it's evolved, I think more and more of it should come back to the people who create it.

Next question comes from Alexia Quadrani with JPMorgan. Alexia S. Quadrani - JP Morgan Chase & Co, Research Division: Just circling back to your commentary about the C7 deals and the upfront. Could you give us a sense about how substantial they were? And do you think that they may have depressed sort of the headline CPM increases in getting some of those deals done?

Yes. You know what? It's hard to quantify how many of them, and we're not going to say how many of them. But once again, it is moving that way. I expect by next year's upfront, it to be 70% -- more than 75% of the deals will be C7s. So we are well on our way to that a year from now. And once again, it's the right way to be. Advertising agencies want it because it's a more accurate way of counting people who are watching our shows. And you saw the lift. I mean, the lift in certain shows is more than 50%. So it's pretty substantial. As I said, we as programmers, have to look at the world in an entirely different way. Nobody should even be looking at overnights anymore. The C7 number is really the number that matters, and it is a substantial amount of money that's gone into it. That's all I could say.

And Alexia, it's Joe. I'd just add that even if a certain amount of advertising is only paid for C3, we have now dynamic ad insertion that we can insert new advertisers to generate more money. So we're going to monetize the consumption one way or another. Alexia S. Quadrani - JP Morgan Chase & Co, Research Division: And I guess to that point, looking at the world in a whole new way and monetizing this consumption one way or the other, I guess if you fast-forward a couple of years from now and the viewership patterns have really evolved even further, do you think you guys come out in the same place or ahead than you did maybe 10 years ago when everything was more traditional, standard day ratings and CPMs on that?

Alexia, at the end of the day, it's all about content. And clearly, we're heading towards the universe where people are going to watch it when they want it, how they want it. As long as they're counted, as long as we keep being sort of dominant in being the premier supplier of network programming, we're always going to win, we're always going to be fine monetarily. So we're very excited about the future. We're very excited how technology is changing what we're doing. But it still depends on if -- people won't watch bad shows on good devices. It still depends on having a good show.

Next question comes from David Miller with Topeka Capital Markets.

Joe, one question for you. I just want to make sure I have this straight in my head. So I've always thought of CBS's return of capital program as being kind of 3 levels of buyback, okay? There was the $6 billion organic buyback that you guys announced in your second quarter call last year, okay, May of last year. Then there's the $2 billion ASR, which you announced in, I believe, February of this year. You did that very quickly. That's done. Then there's the share exchange, which you did all in one tranche, which is pretty incredible, if I might add that. The $6 billion today, I just want to make sure I understand, is that just absolutely purely organic again? Or does that include a portion of the first level that wasn't as of yet completed as of today?

Yes. Look, the way -- it's a timing thing, David. I think you've got to look at the $6 billion as a fresh $6 billion, $6 billion kind of from today over the next 12 to 24 months. And as necessary, along the way, if we need to reload, we'll reload again and again and look at the ratio. So I think, again, you've got to look at more in actual than what we did over the last 7 months. That's done. The amount we bought back the year before is done. And we're going to execute. So yes, it's a little bit fungible in the authorization. But I think we were clear in that the pace in the buyback is going to increase significantly again because we have the capacity.

Got it. And then, Les, on this whole C3 versus C7 sort of vernacular that's going on, we had thought just going into the upfront process that maybe you guys would sacrifice price and then sell more volume on the lower price. And it looks like what happened was you did sacrifice price, but volume just didn't come up to the level we thought because you guys sacrificed price. So what gives you the -- it sounds like you're very confident about the second half in terms of a lot of dynamic soaking up that scatter inventory. Is it all football? Is it football soaking up that inventory? Is it higher ratings? Is it the economy? Well, just what gives you that level of confidence that you talked about in your prepared remarks?

All right, number one, David, I respectfully disagree. I don't think we sacrificed price, particularly. I was very happy with our CPM growth, which was fairly substantial. And in terms of volume, I think we went from selling 78% or 79% of our inventory to approximately 74%. So all it means is I have 5% more of my inventory to sell in scatter. Now that could be football at very high pricing or other programming. Once again, we are not worried because I think in 10 of the last 11 years, scatter pricing has been up and, in most cases, substantially from upfront pricing. So we view that only as a positive thing. And going into the fall, especially with Thursday Night Football and more original programming on the air because of that, we're going to have no trouble selling our scatter pricing when you compare the amount that we have and what we have to our competitors.

Next question comes from Laura Martin with Needham & Company. Laura A. Martin - Needham & Company, LLC, Research Division: I love that these numbers you gave on Elementary, Under the Dome and Extant, talking about this 35% to 50% audience lift within the 7-day window. My question is, as we think about economics, the legacy [ph] trends to digital platforms are higher than the network CPM because the audience is younger, but I also understand that the digital platforms are much less [indiscernible] because the monetization generally is weaker. So I'm interested in whether this lift punches above its body weight. Is it actually more additive to economics in the audience lift? Or is your gut feel that today it's less additive [ph] because of the immaturity of the nascence of the platforms?

Laura, it's Joe. I'll take that. It obviously helps it because obviously the younger viewers that are watching it on these other devices and in mediums is obviously going to be very attractive to advertisers. So I think once you count it -- you count that in, I think you're going to see the broadcast rating skew younger and larger. And the gap between broadcasting cable will be further demonstrated. So I think that's a -- it's going to be a nice point for advertisers to really get behind as that audience grows.

And you made a very valid point. As those numbers are up 35% to 50%, a large chunk of them are in the younger demographic. A bigger chunk that watches it live. So it will be, by definition, more valuable viewers. Laura A. Martin - Needham & Company, LLC, Research Division: Okay. And then, Joe, just on the back half, like you say, you are very confident on the back half. Can you give us any margin guidance for the second half versus the first half?

Yes. Look, we don't give margin guidance, Laura. I think we've demonstrated that we're able to manage our margin. I think, again, as I said, we are investing in our product. Obviously, the new Thursday Night NFL contract wasn't cheap. But again, we think it was the right thing to do. So look, we're going to continue to manage our margins and grow the top line and be focused on that. But again, I think overall, you've seen margins be accretive as these new incremental revenue streams become more and more meaningful.

Our next question comes from Vijay Jayant with the ISI Group.

It's David Joyce here. Just had a couple follow-ons to a couple other questions. One on the reverse comp. We had kind of the earlier working assumption that you would get half or a little more than half of the retrans fees from the non-owned TV stations. Is that going to be creeping up given the investments in the programming now? And where do you see that getting to by mid-2020? Secondly, on the dynamic ad insertion, I was just wondering how widely distributed is that at this point for you. And when do you think that capability for CBS will be fully distributed?

I'll take the first one, and then Joe can take the second. In terms of reverse comp, initially when reverse comp came into play, everybody sort of said, "Well, it should be 50-50." And that was sort of the rule of thumb. It's changed quite a bit since then. Obviously, the retrans numbers have gotten higher that some of our affiliates have gotten. And obviously, our programming is stronger. So we don't use that as a basis. We actually are now calling it a program fee, which is a more appropriate term to acknowledge that. And that 50-50 no longer is even a base that we use. We decide what we think is fair. It generally is higher than the 50% number. And we negotiate on that basis. And once again, we're looking at the station groups. They're all doing very well. And they're doing well primarily because of network programming, both in prime time and in sports. So we feel it's a fair proposition for both sides.

And for DAI, we have deals with all of the major players now. And so you're going to see that kind of roll out and scale up with the new season.

Next question comes from John Janedis with Jefferies.

Les, how bifurcated is the ad market? You talked about some softness. But I mean, on properties like the NFL on Thursday and I assume many others of yours are selling well. So is the impact on you more so that there's some big categories that are weak and affecting sell-out and pricing across the market? And is the pickup in the third quarter broad across categories?

It's -- the pickup is across all the categories. And the pacing, as I said, nationally and locally is going up quite a bit. The second quarter was a softer quarter, which happens from time to time. It also involved a lot less live programming and events like that. So yes, the NFL is selling something like -- on Sunday, the package is up 30% to 40%, and the Thursday Night package is up substantially. In addition, because of Thursday Night, we're going to have more live programming and that goes on in the third quarter and the fourth quarter. And that's going to help us quite a bit. So I wouldn't call it bifurcated. I'd just say, look, occasionally there's a soft quarter. The important thing for us is that picking up substantially in the third and the fourth would be better than the third.

Next question comes from Alan Gould with Evercore.

I've got 2 questions. First, Les, in this new on-demand world, it seems like the repeats aren't playing as well as it used to unless it's a megahit, like a Big Bang Theory. Does this mean that you, besides the summer season, will have to have program -- more original programming and less repeats?

Yes. I'm mean, we're already doing that. Yes, there's no question, the repeats aren't doing quite as well as they used to. So we are definitely trying to pack in our schedule with as many original programming. That's what's sort of launched our summer programming idea when the repeats are in the summer weren't doing very well and we were able to get such good pricing both internationally and SVOD. So that will go on throughout the year that you get a better ROI on original programming, especially when you have ownership, and you can cash in on the back end. So you're seeing that. One of the advantages of Sunday night football, Thursday Night Football once again, you're talking about 24 hours of original programming that can be pushed back into the rest of the year, which will lead us to have more original programming throughout the year and less repeats and more live programming. So it's definitely changed somewhat, but we've taken advantage of it.

And if I could follow up with a second question. The Netflix extension, can you give us some idea how this -- or the new Netflix deal, I should say, as opposed to extension, how this compares with your original deal from 3 years ago?

Alan, it's Joe. Yes, I would just say, look, it's not as large in terms of the number of titles. But I think -- again, I think it's critical to emphasize how Netflix -- we continue to extend our relationship with Netflix and broaden it, again, domestically and internationally. So again, I think they -- if they want some less product, we're happy to do that. But they still have to go through CBS because of the amount of volume we do have and our shows are working on their platform.

Now is this just U.S.? Or does this include also the 6 new countries they're going into?

This was just U.S.

We'll take our next question from William Bird with FBR. William G. Bird - FBR Capital Markets & Co., Research Division: First, I was wondering if you could talk about Nielsen's move to multiscreen currency and whether or not that changes your windowing strategy. And then separately, x Thursday Night Football, could you talk about how network is pacing in the September quarter?

Obviously, everything Nielsen does is a positive for us. They have been a little behind in their ability to account for C3, C7, online, other areas. They are doing a full court press to improve that, and a lot of the advances that they're doing clearly are beneficial to us. So we're very pleased with that. In terms of the pacing, without football, it's very good. It's much higher than it had been, and we're pleased with it.

And that question comes from Marci Ryvicker with Wells Fargo.

Joe, I have 2 for you. And I'm sorry, I'm going to ask another share repurchase question. I think... So I just -- are you going to have a more opportunistic pace per quarter instead of just a flat pace per quarter? I think we're just trying to figure that out.

Yes. I think the answer is yes. I mean, I think that's why in our prepared remarks, we didn't want to just kind of buy just if the sun comes up. So I think we're going to be smart about this and look for opportunity. But again, that being said, is we are going to be aggressive because we do have the capacity. So I don't think you should look for an even quarter each and every quarter to doing that. Obviously, in this third quarter, the first 45 days here -- the first whatever days that's gone, we were out of the market with the Outdoor exchange and earnings. So by definition, we're going -- it's going to be a little bit spread differently over the quarters. But if there's an opportunity, we're going to go in heavy.

And we're going to restart immediately.

Okay. And then a question on the TV side. The stations I think were down 6% in the quarter. And I know you mentioned some tough comps. Do you have an apples-to-apples growth number?

For Q2?

Yes.

Yes. Underlying, Marci, was probably down low single digits.

Okay. Can you remind us how much exposure you have to national versus local?

Yes. I think our stations skew a little bit more national. I think local did perform a little bit better. I think one category, in particular on auto, probably shifted money to live events, maybe the World Cup or other things in Q2. I think the good news is we're seeing that come back in Q3 with all of the live events and originals we talked about. So it is our largest category, auto, for local. So we're excited that it's -- we see it accelerating.

And I have one last small one. With the consolidation of the affiliate groups, is that going to have any impact on what you can get from them from reverse comp?

No, we don't see it have any impact of what we ask for or what we get. We hope it gives them more strength to go get higher retrans dollars on that end. But we have a view of what fair market value is for our content, and we get those same fees in markets where we own stations. So we're feeling really good about our position in those negotiations. And obviously, they're doing that to get some more financial strength and wherewithal. So that means it's -- they have the ability to pay. So that's got to be a good thing.

And this concludes today's call. Thank you, everyone, for joining us. Have a great evening.

Ladies and gentlemen, this does conclude today's conference. We appreciate your participation. You may now disconnect.