The following is a summary of the Gannett Co., Inc. (GCI) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Gannett reported Q3 total operating revenues of $612.4 million, a decrease of 6.2% year-over-year, primarily due to strategic divestitures.

• Adjusted EBITDA for the quarter was $62.9 million, up 5.6% year-over-year.

• Digital-only subscription revenue hit a new high of $50.1 million, reflecting a 25% increase. Digital-only ARPU also reached a new high of $8.16, marking a 20% year-over-year growth.

• The company generated $20 million of free cash flow, a substantial increase of 168% compared to the prior year.

Business Progress:

• Gannett's digital revenues surpassed 45% of total revenues, setting a new record.

• Audience size increased to over 200 million average monthly unique visitors, a growth of over 7% year-over-year.

• The company launched a partnership with BetMGM to enhance content monetization.

• Gannett completed debt refinancing transactions which extended maturity profile and reduced potential future share dilution.

• The company is investing in AI, including a partnership with Microsoft using Copilot Daily Briefing.

Opportunities:

• Gannett's digital segment displayed strong growth with three out of four categories showing improvement, demonstrating potential in digital revenue streams.

• The BetMGM partnership and anticipated other partnerships in Q4 are expected to further drive audience engagement and content monetization.

Risks:

• Gannett experienced revenue declines due to the strategic sale and shutdown of non-strategic businesses which resulted in lower than expected total revenues.

• Sensitivity to economic uncertainty and interest rates, particularly noted in their digital marketing solutions business, reflecting potential challenges in advertising spend.

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