Lee Enterprises 2025 Q3 Earnings Strong Performance as Net Income Surges 54.6%

Lee Enterprises (LEE) reported its fiscal 2025 Q3 earnings on August 8, 2025, showcasing significant improvements in net income and strategic progress. The company narrowed its net loss to $-1.68 million, a 54.6% reduction from $-3.69 million in the same period in 2024. This marked progress aligns with the company’s transformation strategy, demonstrating disciplined execution and long-term profitability focus.

Revenue
Lee Enterprises' total revenue for Q3 2025 declined by 6.6% to $128.13 million, compared to $137.15 million in Q3 2024. This overall decline was driven by a softness in traditional segments, although the company highlighted strong performance in digital growth. Specific segment performance showed that advertising and marketing services contributed $66.57 million, while the subscription segment brought in $61.56 million. Other revenue sources totaled $13.16 million, with total operating revenue reaching $141.29 million.

Earnings/Net Income
Lee Enterprises successfully reduced its losses, with the net loss narrowing to $-1.68 million for Q3 2025, representing a 54.6% improvement compared to $-3.69 million in Q3 2024. On a per-share basis, the company narrowed its losses to $0.31 per share, compared to a loss of $0.73 per share in the prior-year period. This represents a 57.5% improvement in earnings per share, demonstrating significant progress in financial performance.

Price Action
The stock price of Lee Enterprises has experienced a decline in recent trading sessions, with a 2.37% drop during the latest trading day and a 5.95% decrease during the most recent full trading week. Over the past month, the stock has plummeted by 30.73%, indicating a sharp downturn in investor sentiment.

Post-Earnings Price Action Review
The strategy of buying Lee Enterprises shares after a revenue increase in a quarter-over-quarter financial report and holding for 30 days has historically underperformed. Over the past three years, the strategy yielded a return of -62.85%, lagging the benchmark by 113.03%. The Sharpe ratio of -0.46 indicates a negative risk-adjusted return, and the maximum drawdown was 0%, suggesting that the strategy had no room for loss during the backtest period.

CEO Commentary
Kevin Mowbray, President and CEO, emphasized strong third-quarter performance driven by digital growth and cost discipline, noting a 92% Adjusted EBITDA growth quarter-over-quarter and 16% year-over-year digital-only subscription revenue growth. The CEO highlighted progress in the company’s transformation strategy, including print expense reduction, corporate overhead cuts, and reinvestment in digital areas. He noted that organic free cash flow funded all mandatory debt payments post-cyber recovery, signaling disciplined execution and long-term profitability focus.

Guidance
The company expects second-half growth in Total Digital Revenue and Adjusted EBITDA year-over-year. It anticipates cash paid for income taxes to range between $3 million and $9 million in FY25, with up to $5 million in capital expenditures and no material pension contributions due to fully funded plans.

Additional News
Recent news in the financial and technology sectors highlights continued global economic challenges and strategic shifts in several key industries. Notably, in the financial space, discussions around free preschool education and AI-driven market innovations continue to shape investor sentiment. In the technology sector, companies are focusing on cost optimization and digital transformation, similar to Lee Enterprises' own strategy. Additionally, geopolitical tensions and policy changes are influencing investor behavior, with markets reacting to developments in trade and regulatory environments. These trends underscore the broader economic and market dynamics shaping the investment landscape in the weeks following Lee Enterprises' Q3 earnings release.