How did SSP's Q4 earnings surprise investors?

The E.W. Scripps Company (SSP) Q4 2024 earnings report revealed a few surprises for investors, primarily centered around the company's financial performance and market reactions.

1. **Revenue Beat and Political Advertising Impact**: Despite missing EPS expectations, The E.W. Scripps Company (SSP) exceeded revenue forecasts, reporting $728.38 million for Q4 2024, surpassing the estimated $719.96 million. This revenue outperformance was notably driven by record political advertising revenue, which reached $343 million for the full year 2024, with $174 million in Q4 alone. This surge in political ad spending significantly bolstered the company's financial results.
2. **Stock Market Reaction**: Following the earnings release, the company's stock reacted positively, with a significant surge. The stock price jumped by 27.98% to $1.83, reflecting investor optimism about the company's performance, especially considering the revenue beat and the potential for future political advertising revenue. This positive market reaction suggests that investors may be anticipating continued benefits from political advertising and other growth initiatives.
3. **Debt Reduction and Financial Stability**: The company's efforts to reduce debt and improve financial stability were notable. The leverage ratio was reduced to 4.8 times by the end of 2024, a significant improvement from the previous year's ratio. This reduction in debt and improvement in leverage ratio indicates stronger financial health, which could positively influence investor sentiment.

In conclusion, while The E.W. Scripps Company (SSP) missed EPS expectations with an EPS of $0.92 compared to the forecasted $1.01, the company's strong revenue performance, especially in political advertising, along with strategic debt reduction efforts, likely contributed to the positive market reaction and may have surprised investors in a predominantly positive light.