Gannett (GCI) Q3 Earnings call transcript Oct 31, 2024
Gannett Co., Inc. (Gannett) recently held its third quarter 2024 earnings call, highlighting a solid performance across key financial metrics and a positive outlook for the future. The company reported an adjusted EBITDA of $63 million, marking a 5.6% increase year-over-year. Furthermore, Gannett generated $20 million of free cash flow, a significant increase of 168% compared to the prior year.
Strong Digital Performance
Digital revenues surpassed 45% of total revenues, marking an all-time high for the company. Three out of four digital revenue categories showed strong growth and improvement year-over-year. Notably, digital-only subscription revenue surpassed $50 million, with digital-only ARPU climbing above $8. This growth is a testament to Gannett's successful digital transformation and its ability to monetize its highly engaged audience.
Audience Growth and Engagement
Gannett's audience growth has been a significant driver of its success. In Q3, the company surpassed 200 million average monthly unique visitors for the first time in its history, reflecting an increase of over 7% compared to the prior year. This milestone highlights Gannett's ability to stay closely aligned with its audience's preferences and create content that is both relevant and essential.
Strategic Partnerships and Initiatives
Gannett has been proactive in forging strategic partnerships to enhance its market presence and monetization capabilities. For instance, the company's partnership with BetMGM is expected to provide additional content to sports enthusiasts and enhance the monetization of its content platform. Additionally, Gannett's focus on AI and its partnership with Microsoft's Copilot Daily Briefing underscores its commitment to leveraging technology to enhance operational efficiency and increase the monetization of both current and archived content.
Financial Performance and Outlook
Despite some challenges in Q3, including the sale and unwind of non-strategic businesses and softer trends in certain segments, Gannett remains optimistic about its future. The company expects to drive improvement in total revenue trends as well as digital revenue trends in Q4, bringing it closer to its expected revenue inflection point. Gannett's strategic initiatives, coupled with its strong audience engagement and monetization capabilities, position it well for sustainable revenue, adjusted EBITDA, and free cash flow growth.
Conclusion
Gannett Co., Inc.'s third quarter 2024 earnings call painted a picture of a company on the right track for sustainable growth. With a strong focus on digital transformation, audience engagement, strategic partnerships, and financial performance, Gannett is well-positioned to capitalize on the opportunities in the digital media landscape. The company's optimism for the future and its ability to navigate challenges are promising indicators of its resilience and commitment to creating value for its shareholders.