Miller's Q2 2025 Deep Value Strategy: Gannett Leads Contributors

Miller Deep Value Select Strategy Q2 2025 Letter highlights Gannett (GCI) as the largest contributor, up 24% and recovering from a Q1 drawdown. Gannett remains significantly mispriced in the market. Other stocks that shaped the strategy include [insert other stocks]. The strategy aims to identify undervalued companies with strong fundamentals.

Gannett (NYSE:GCI), the largest U.S. local news publisher and owner of USA TODAY, reported its second quarter 2025 earnings on July 31, 2025. The results revealed a strong bottom-line beat, with earnings per share (EPS) of $0.42 (GAAP) compared to consensus GAAP EPS estimates of a $(0.06) loss [1]. However, revenue (GAAP) fell to $584.9 million, missing GAAP revenue expectations of $593.1 million and marking an 8.6% year-over-year decline.

The period saw sharp profit growth and margin expansion, even as top-line pressure persisted. Net income attributable to Gannett (GAAP) grew to $78.4 million, rising substantially from $13.7 million a year earlier. Adjusted net income also jumped, reaching $84.5 million, up from $29.1 million for the same quarter in 2024 [1].

Despite falling sales, profitability improved. Adjusted EBITDA margin expanded to 11%, up from 8.8% in the prior quarter. Management attributed these gains to targeted expense reductions and a more flexible cost structure [1]. The company also reported 181 million average monthly unique digital visitors, split between 129 million in the U.S. and 52 million in the U.K. [1].

However, the company continues to face challenges. Digital-only paid subscriptions dropped 15% year over year to 1.723 million, and digital revenue as a whole dipped 4.6% year over year [1]. The company is focusing on four core innovation areas, including the launch of Studio IX, a women’s sports digital content vertical, and fresh efforts to monetize content via AI licensing and partnerships [1].

For the rest of fiscal 2025, management expects digital revenue trends to improve, forecasting same store digital revenue growth of 3% to 5% in the second half of 2025. However, total company-wide revenue is projected to continue declining at a low single-digit rate on a same store basis for the full year [1].

References:
[1] https://www.nasdaq.com/articles/gannett-gci-q2-eps-jumps-367
[2] https://www.ainvest.com/news/remitly-reports-q2-2025-earnings-27-28-fy25-revenue-growth-target-launch-remitly-business-expansion-2508/