Gannett Co. Inc.
10/30/2025 | Press release | Distributed by Public on 10/30/2025 08:00
Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations and quantitative and qualitative disclosures should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the Securities and Exchange Commission on February 20, 2025. Management's Discussion and Analysis of Financial Condition and Results of Operations contains a number of forward-looking statements that reflect our plans, estimates, and beliefs, all of which are based on our current expectations and could be affected by certain uncertainties, risks, and other factors described under "Cautionary Note Regarding Forward-Looking Statements," "Risk Factors," and elsewhere throughout this Quarterly Report on Form 10-Q, as well as the factors described in our Annual Report on Form 10-K for the year ended December 31, 2024, and subsequent periodic reports filed with the Securities and Exchange Commission, particularly under "Risk Factors." Our actual results could differ materially from those discussed in the forward-looking statements.
OVERVIEW
We are a diversified media company with expansive reach at the national and local level dedicated to empowering and enriching communities. We seek to inspire, inform, and connect audiences as a sustainable, growth focused media and digital marketing solutions company. Through our trusted brands, including the USA TODAY NETWORK, comprised of the national publication, USA TODAY, and local media organizations, including our network of local properties, in the United States (the "U.S."), and Newsquest, a wholly-owned subsidiary operating in the United Kingdom (the "U.K."), we provide essential journalism, local content, and digital experiences to audiences and businesses. We deliver high-quality, trusted content with a commitment to balanced, unbiased journalism, where and when consumers want to engage. We prioritize a digital-first strategy, focusing on audience growth and engagement while diversifying revenue streams. Our digital marketing solutions brand, LocaliQ, supports small and medium-sized businesses ("SMBs") with innovative digital marketing products and solutions. Our mission remains to inspire, inform, and connect communities while driving sustainable growth for our customers, advertisers, partners, and shareholders.
We report in three segments: Domestic Gannett Media, Newsquest and Digital Marketing Solutions ("DMS"). We also have a Corporate category that includes activities not directly attributable to a specific reportable segment and includes expenses associated with broad corporate functions. A full description of our reportable segments is included in Note 12 - Segment reporting in the notes to the condensed consolidated financial statements.
Reclassifications
Certain reclassifications have been made to the prior periods unaudited condensed consolidated financial statements to conform to classifications used in the current periods. These reclassifications did not impact net loss, shareholders' equity or cash flows as previously reported.
Business trends
We have considered several industry trends when assessing our business strategy:
•Print advertising and Print circulation revenues have and are expected to continue to decline as our audience increasingly moves to digital platforms. We seek to optimize our print operations to efficiently manage for the declining print audience. We are focused on growing a digitally-oriented audience across multiple platforms and revenue streams.
•Our revenues and results of operations continue to be influenced by general macroeconomic conditions, including, but not limited to, trade policy, inflation, interest rates, housing demand, employment levels, and consumer confidence. We believe that these factors are contributing to uncertainty, which is resulting in lower levels of advertising performance and reduced spending.
•We rely on third-party platforms from large technology companies, particularly search engines, social media platforms, and emerging technologies. These platforms exert significant control over the visibility and ranking of our content, and their actions can adversely impact traffic, engagement, and revenues. Additionally, these companies can influence both the type of media we acquire and the associated costs. We continue to adapt by diversifying our digital strategies and optimizing content distribution to mitigate these impacts.
•The application of artificial intelligence ("AI") and the rapid rate of change within the AI ecosystem is increasing the pace of change in the media sector.
Macroeconomic environment
We are exposed to certain risks and uncertainties caused by factors beyond our control, including economic and political instability and other geopolitical events. We believe that these uncertain economic conditions have adversely impacted and may continue to have an adverse impact on our revenues, and the occurrence of these factors has resulted in a reduction in demand for our print and digital advertising, reduced the rates for our advertising, and caused marketers to shift, reduce or stop spend.
We are exposed to potential increases in interest rates associated with our $900.0 million five-year first lien term loan facility (the "2029 Term Loan Facility"), which as of September 30, 2025, accounted for approximately 75% of our outstanding debt, as well as fluctuations in foreign currency exchange rates, primarily related to our operations in the U.K. We expect continued uncertainty and volatility in the U.S. and global economies, which will continue to impact our business.
Recently enacted U.S. tax legislation
On July 4, 2025, the President signed into law H.R. 1, titled the "One Big Beautiful Bill Act" (the "Act"), which introduced significant tax law changes with varying effective dates for businesses. We have evaluated the provisions of the Act on the condensed consolidated financial statements, and its impact was included in the calculation of the tax provision for the three and nine months ended September 30, 2025. Key provisions of the Act applicable to us include the reinstatement of EBITDA, rather than EBIT, in determining adjusted taxable income under Section 163(j), the immediate expensing of domestic research and experimentation expenditures, and the extension of 100% bonus depreciation for qualified property placed in service after January 19, 2025. The legislation also makes changes to the Global Intangible Low-Taxed Income regime, including an increase in the effective tax rate and modifications to the calculation of tested income.
Seasonality
We experience seasonality in our revenues. The Domestic Gannett Media segment typically witnesses the greatest impact from seasonality in the third quarter, primarily attributed to reduced population in seasonal markets and decreased holiday related spending. The DMS segment generally experiences the greatest impact from seasonality in the first half of the fiscal year, which can be attributed to the advertising needs of specific verticals, which are generally lower in the first half of the year.
Foreign currency
Our U.K. media operations are conducted through our Newsquest subsidiary. In addition, we have foreign operations in regions such as Canada, Australia and New Zealand. Earnings from operations in foreign regions are translated into U.S. dollars at average exchange rates prevailing during the period, and assets and liabilities are translated at exchange rates in effect at the balance sheet date. Currency translation fluctuations may impact revenue, expense, and operating income results for our international operations. For example, our international revenues are favorably impacted as the U.S. dollar weakens relative to other foreign currencies, and unfavorably impacted as the U.S. dollar strengthens relative to other foreign currencies. During the three and nine months ended September 30, 2025, foreign currency exchange rate fluctuations had a favorable impact on our revenues and profitability.
Use of website to distribute material company information
Our website is www.gannett.com. Information contained on our website is not part of this Quarterly Report on Form 10-Q. We use our website as a distribution channel for material company information. Financial and other important information regarding the Company is routinely posted on and accessible on the Investor Relations and News and Events subpages of our website, which are accessible by clicking on the tab labeled "Investor Relations" and "News and Events", respectively, on the website home page. Therefore, investors should look to the Investor Relations, and News and Events subpages of the Company's website for important and time-critical information.
RESULTS OF OPERATIONS
Consolidated summary
A summary of our consolidated results is presented below. Refer to Segment results below for a discussion of results by segment.
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands, except per share amounts | Change | Change | |||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | ||||||||||||||||||||||||||||||||||||||||
|
Digital(a)
|
$ | 262,744 | $ | 277,386 | $ | (14,642) | (5) | % | $ | 778,573 | $ | 823,263 | $ | (44,690) | (5) | % | |||||||||||||||||||||||||||||||
|
Print and commercial(b)
|
298,052 | 335,053 | (37,001) | (11) | % | 938,657 | 1,064,777 | (126,120) | (12) | % | |||||||||||||||||||||||||||||||||||||
| Total revenues | 560,796 | 612,439 | (51,643) | (8) | % | 1,717,230 | 1,888,040 | (170,810) | (9) | % | |||||||||||||||||||||||||||||||||||||
| Operating costs | 352,306 | 375,912 | (23,606) | (6) | % | 1,068,376 | 1,169,785 | (101,409) | (9) | % | |||||||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | 153,743 | 176,456 | (22,713) | (13) | % | 485,356 | 532,776 | (47,420) | (9) | % | |||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | 43,211 | 40,398 | 2,813 | 7 | % | 128,489 | 116,954 | 11,535 | 10 | % | |||||||||||||||||||||||||||||||||||||
| Integration and reorganization costs | 15,708 | 17,307 | (1,599) | (9) | % | 37,524 | 54,963 | (17,439) | (32) | % | |||||||||||||||||||||||||||||||||||||
| Asset impairments | - | 87 | (87) | (100) | % | 2,075 | 46,076 | (44,001) | (95) | % | |||||||||||||||||||||||||||||||||||||
| (Gain) loss on sale or disposal of assets, net | (62) | 784 | (846) | *** | (22,326) | 1,572 | (23,898) | *** | |||||||||||||||||||||||||||||||||||||||
| Interest expense | 23,835 | 25,959 | (2,124) | (8) | % | 74,313 | 78,794 | (4,481) | (6) | % | |||||||||||||||||||||||||||||||||||||
| Loss (gain) on early extinguishment of debt | 24 | 176 | (152) | (86) | % | 1,481 | (354) | 1,835 | *** | ||||||||||||||||||||||||||||||||||||||
| Equity (income) loss in unconsolidated investees, net | (549) | 97 | (646) | *** | (1,583) | (277) | (1,306) | *** | |||||||||||||||||||||||||||||||||||||||
|
Other (income) expense, net(c)
|
(5,806) | 1,346 | (7,152) | *** | (11,640) | 1,610 | (13,250) | *** | |||||||||||||||||||||||||||||||||||||||
| Loss before income taxes | (21,614) | (26,083) | 4,469 | (17) | % | (44,835) | (113,859) | 69,024 | (61) | % | |||||||||||||||||||||||||||||||||||||
| Provision (benefit) for income taxes | 17,635 | (6,429) | 24,064 | *** | (76,651) | (23,154) | (53,497) | *** | |||||||||||||||||||||||||||||||||||||||
| Net (loss) income | (39,249) | (19,654) | (19,595) | 100 | % | 31,816 | (90,705) | 122,521 | *** | ||||||||||||||||||||||||||||||||||||||
| Net (loss) income attributable to noncontrolling interests | - | (1) | 1 | (100) | % | 7 | (32) | 39 | *** | ||||||||||||||||||||||||||||||||||||||
| Net (loss) income attributable to Gannett | $ | (39,249) | $ | (19,653) | $ | (19,596) | 100 | % | $ | 31,809 | $ | (90,673) | $ | 122,482 | *** | ||||||||||||||||||||||||||||||||
| (Loss) income per share attributable to Gannett - basic | $ | (0.27) | $ | (0.14) | $ | (0.13) | 93 | % | $ | 0.22 | $ | (0.64) | $ | 0.86 | *** | ||||||||||||||||||||||||||||||||
| (Loss) income per share attributable to Gannett - diluted | $ | (0.27) | $ | (0.14) | $ | (0.13) | 93 | % | $ | 0.21 | $ | (0.64) | $ | 0.85 | *** | ||||||||||||||||||||||||||||||||
*** Indicates an absolute value percentage change greater than 100.
(a)Amounts are net of intersegment eliminations of $33.2 million and $37.0 million for the three months ended September 30, 2025 and 2024, respectively, and $102.6 million and $114.2 million for the nine months ended September 30, 2025 and 2024, respectively. Intersegment eliminations represent digital marketing services revenues and expenses associated with products sold by sales teams in our Domestic Gannett Media and Newsquest segments but fulfilled by our DMS segment. When discussing segment results, these revenues and expenses are presented gross but are eliminated in consolidation.
(b) Included Commercial printing and delivery revenues of $29.2 million and $35.4 million for the three months ended September 30, 2025 and 2024, respectively, and $92.8 million and $118.3 million for the nine months ended September 30, 2025 and 2024, respectively.
(c) Other (income) expense, net primarily reflects expert fees associated with the litigation with Google, consulting fees related to a discrete initiative to reformulate our go-to-market strategy and post-sales processes, (gains) losses from the sale of investments, third-party debt costs and the components of net periodic pension and postretirement benefits other than service cost.
Revenues
Digital revenues are primarily derived from digital advertising offerings such as digital marketing services generated through multiple services, including search advertising, display advertising, search optimization, social media, website development, web presence products, customer relationship management, and software-as-a-service solutions, classified advertisements and display advertisements, which may leverage third-party providers, and digital distribution of our publications, as well as digital content syndication, affiliate and content partnerships, and licensing revenues.
Print and commercial revenues are generated from the sale of local, national, and classified print advertising products, the sale of both home delivery and single copies of our publications, as well as commercial printing and distribution arrangements, and revenues from our events business.
Operating costs
Operating costs at the Domestic Gannett Media and Newsquest segments include labor, newsprint, delivery and digital costs and at the DMS segment include the cost of online media acquired from third parties and costs to manage and operate our marketing solutions and technology infrastructure.
Selling, general and administrative expenses
Selling, general and administrative expenses include labor, payroll, outside services, benefits costs and bad debt expense.
Integration and reorganization costs
Integration and reorganization costs include severance costs as well as other reorganization costs associated with individual restructuring programs, designed primarily to right-size our employee base, consolidate facilities and improve operations.
For the three and nine months ended September 30, 2025, we incurred Integration and reorganization costs of $15.7 million and $37.5 million, respectively. Of the total costs incurred, $12.5 million and $26.9 million, respectively, were related to severance activities and $3.2 million and $10.7 million, respectively, were related to other reorganization-related costs, mainly due to costs associated with improving operations and consolidating facilities. In addition, for the nine months ended September 30, 2025, other reorganization-related costs also included $2.1 million, related to the departure of the Company's former Chief Financial Officer, partially offset by the reversal of a withdrawal liability related to a multiemployer pension plan of $1.8 million based on the settlement of the withdrawal liability.
For the three and nine months ended September 30, 2024, we incurred Integration and reorganization costs of $17.3 million and $55.0 million, respectively, including $4.4 million and $14.1 million, respectively, related to severance activities and $12.9 million and $40.9 million, respectively, related to other reorganization-related costs. For the three and nine months ended September 30, 2024, other reorganization-related costs included $10.0 million and $19.9 million, respectively, related to withdrawal liabilities which were expensed as a result of ceasing contributions to multiemployer pension plans, as well as costs for consolidating operations, and for the nine months ended September 30, 2024 also included $9.7 million expensed as of the cease-use date related to certain licensed content.
Asset impairments
For the nine months ended September 30, 2025, we recorded impairment charges of approximately $2.1 million primarily related to our continued plan to divest non-strategic assets.
For the three and nine months ended September 30, 2024, we recorded impairment charges of approximately $0.1 million and $46.1 million, respectively. For the nine months ended September 30, 2024, the asset impairment was primarily due to the impairment charge of approximately $46.0 million related to the McLean, Virginia operating lease right-of-use asset and the associated leasehold improvements.
(Gain) loss on sale or disposal of assets, net
For the three and nine months ended September 30, 2025, we recognized net gains on the sale of assets of $0.1 million and $22.3 million, respectively. For the nine months ended September 30, 2025, the gain was primarily related to a gain of $20.8 million recognized on the sale of the Austin American-Statesman (the "Statesman") to Hearst Corporation at the Domestic Gannett Media segment.
For the three and nine months ended September 30, 2024, we recognized net losses on the sale of assets of $0.8 million and $1.6 million, respectively, as part of our continued plan to monetize non-strategic assets.
Interest expense
For the three and nine months ended September 30, 2025, Interest expense was $23.8 million and $74.3 million, respectively, compared to $26.0 million and $78.8 million for the three and nine months ended September 30, 2024, respectively. For the three and nine months ended September 30, 2025, interest expense decreased compared to the three and nine months ended September 30, 2024, mainly due to a lower debt balance.
Other (income) expense, net
A summary of Other (income) expense, net is presented below:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Expert fees associated with litigation with Google | $ | 413 | $ | 4,363 | $ | (3,950) | (91) | % | $ | 4,406 | $ | 7,552 | $ | (3,146) | (42) | % | |||||||||||||||||||||||||||||||
| Gain on sale of investments, net | (5,684) | (610) | (5,074) | *** | (9,799) | (617) | (9,182) | *** | |||||||||||||||||||||||||||||||||||||||
| Third-party debt costs | 825 | 20 | 805 | *** | 1,892 | 11 | 1,881 | *** | |||||||||||||||||||||||||||||||||||||||
|
Consulting fees(a)
|
758 | 2,908 | (2,150) | (74) | % | 1,065 | 6,557 | (5,492) | (84) | % | |||||||||||||||||||||||||||||||||||||
|
Other(b)
|
(2,118) | (5,335) | 3,217 | (60) | % | (9,204) | (11,893) | 2,689 | (23) | % | |||||||||||||||||||||||||||||||||||||
| Other (income) expense, net | $ | (5,806) | $ | 1,346 | $ | (7,152) | *** | $ | (11,640) | $ | 1,610 | $ | (13,250) | *** | |||||||||||||||||||||||||||||||||
*** Indicates an absolute value percentage change greater than 100.
(a) Primarily includes consulting fees related to a discrete initiative to reformulate our go-to-market strategy and post-sales processes.
(b)Primarily includes the components of net periodic pension and postretirement benefits other than service cost.
Provision (benefit) for income taxes
The following table outlines our pre-tax net loss before income taxes and income tax accounts:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||
| In thousands | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Loss before income taxes | $ | (21,614) | $ | (26,083) | $ | (44,835) | $ | (113,859) | |||||||||||||||
| Provision (benefit) for income taxes | 17,635 | (6,429) | (76,651) | (23,154) | |||||||||||||||||||
| Effective tax rate | (81.6) | % | 24.6 | % | 171.0 | % | 20.3 | % | |||||||||||||||
The (benefit) provision for income taxes is calculated by applying the projected annual effective tax rate for the year to the current period's income or loss before tax, adjusted for the tax effects of any significant or unusual items (discrete events) and changes in tax laws.
The provision for income taxes for the three months ended September 30, 2025, was primarily driven by a decrease in the estimated annual effective tax rate, resulting from a decrease in the change in valuation allowance due to U.S. tax legislation changes on the business interest expense limitation. The provision was calculated using an estimated annual effective tax rate of 172.8%. Excluding discrete items, the estimated annual effective tax rate was principally impacted by the global intangible low-taxed income inclusion and foreign tax expense, partially offset by the decrease in valuation allowances on non-deductible U.S. interest expense carryforwards and the release of valuation allowances on capital loss carryforwards associated with (i) the sale of the Statesman in the first quarter of 2025, and (ii) an investment disposition in the third quarter of 2025. The estimated annual effective tax rate reflects the projected tax expense for the full year.
The benefit for income taxes for the nine months ended September 30, 2025, was primarily driven by the pre-tax book loss, partially offset by the decrease in valuation allowances on non-deductible U.S. interest expense carryforwards and the global intangible low-taxed income inclusion.
The benefit for income taxes for the three months ended September 30, 2024, was mainly driven by the pre-tax book loss offset by the valuation allowances on non-deductible U.S. interest expense carryforwards, the global intangible low-taxed income inclusion and state tax expense. The benefit was calculated using an estimated annual effective tax rate of 0.9%.
The benefit for income taxes for the nine months ended September 30, 2024, was mainly driven by the release of uncertain tax position reserves related to an Internal Revenue Service audit, the release of foreign valuation allowances and the pre-tax book loss and was partially offset by the increase in valuation allowances on non-deductible U.S. interest expense carryforwards and other miscellaneous items.
Net (loss) income attributable to Gannett and diluted (loss) income per share attributable to Gannett
For the three months ended September 30, 2025, Net loss attributable to Gannett and diluted loss per share attributable to Gannett were $39.2 million and $0.27, respectively, compared to Net loss attributable to Gannett and diluted loss per share attributable to Gannett of $19.7 million and $0.14, respectively, for the three months ended September 30, 2024. For the nine
months ended September 30, 2025, Net income attributable to Gannett and diluted income per share attributable to Gannett were $31.8 million and $0.21, respectively, compared to Net loss attributable to Gannett and diluted loss per share attributable to Gannett of $90.7 million and $0.64, respectively, for the nine months ended September 30, 2024. The change for the three and nine months ended September 30, 2025, compared to the same periods in the prior year reflects the various items discussed above.
Segment Results
The Company evaluates the performance of its segments based on financial measures such as revenues and Segment Adjusted EBITDA (defined below). The Chief Operating Decision Maker ("CODM"), which is our Chief Executive Officer, uses Segment Adjusted EBITDA to evaluate the performance of our segments and allocate resources. Segment Adjusted EBITDA provides an assessment of controllable expenses and affords the CODM the ability to make decisions which are expected to facilitate meeting current financial goals as well as achieve optimal financial performance.
Management considers Segment Adjusted EBITDA to be an important metric to evaluate and compare the ongoing operating performance of our segments on a consistent basis across reporting periods as it eliminates the effect of items that we do not believe are indicative of each segment's core operating performance.
We define Segment Adjusted EBITDA as revenues less (1) operating costs and (2) selling, general and administrative expenses, plus (3) equity (income) loss in unconsolidated investees, net.
Segment Adjusted EBITDA also does not include: (1) Income tax expense (benefit), (2) Noncontrolling interest, (3) Interest expense, (4) Gains or losses on the early extinguishment of debt, (5) Loss on convertible notes derivative, (6) Depreciation and amortization, (7) Integration and reorganization costs, (8) Asset impairments, (9) Goodwill and intangible impairments, (10) Gains or losses on the sale or disposal of assets, (11) Share-based compensation expense, and (12) Other (income) expense, net.
Non-GAAP measure
Total Adjusted EBITDA is defined as Segment Adjusted EBITDA plus Corporate.
Total Adjusted EBITDA is a non-GAAP financial performance measure we believe offers a useful view of the overall operation of our business, and may be different than similarly-titled measures used by other companies. A non-GAAP financial measure is generally defined as one that purports to measure financial performance, financial position, or cash flows, but excludes or includes amounts that would not be so excluded or included in the most comparable U.S. generally accepted accounting principles ("U.S. GAAP") measure.
Total Adjusted EBITDA has limitations as an analytical tool. It should not be viewed in isolation or as a substitute for U.S. GAAP measures of earnings. Material limitations in making the adjustments to our earnings to calculate Total Adjusted EBITDA and using this non-GAAP financial measure as compared to U.S. GAAP net income (loss) include: the exclusion of the cash portion of interest/financing expense, income tax (benefit) provision, and charges related to asset impairments, which are items that may significantly affect our financial results.
Management believes Total Adjusted EBITDA is important in evaluating our performance, results of operations, and financial position. We use this non-GAAP financial performance measure to supplement our U.S. GAAP results in order to provide a more complete understanding of the factors and trends affecting our business.
Total Adjusted EBITDA is not an alternative to Net income (loss) attributable to Gannett, or any other measure of performance derived in accordance with U.S. GAAP, and as such, should not be considered or relied upon as a substitute or alternatives for any such U.S. GAAP financial measure. We strongly urge you to review the reconciliation of Total Adjusted EBITDA to Net income (loss) attributable to Gannett along with our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q. We also strongly urge you not to rely on any single financial performance measure to evaluate our business. In addition, because Total Adjusted EBITDA is not a measure of financial performance under U.S. GAAP and is susceptible to varying calculations, the Total Adjusted EBITDA measure as presented in this report may differ from and may not be comparable to similarly titled measures used by other companies.
Reconciliation of Net income (loss) attributable to Gannett to Total Adjusted EBITDA
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||
| In thousands | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| Net (loss) income attributable to Gannett | $ | (39,249) | $ | (19,653) | $ | 31,809 | $ | (90,673) | |||||||||||||||
| Provision (benefit) for income taxes | 17,635 | (6,429) | (76,651) | (23,154) | |||||||||||||||||||
| Net (loss) income attributable to noncontrolling interests | - | (1) | 7 | (32) | |||||||||||||||||||
| Interest expense | 23,835 | 25,959 | 74,313 | 78,794 | |||||||||||||||||||
| Loss (gain) on early extinguishment of debt | 24 | 176 | 1,481 | (354) | |||||||||||||||||||
| Depreciation and amortization | 43,211 | 40,398 | 128,489 | 116,954 | |||||||||||||||||||
|
Integration and reorganization costs(a)
|
15,708 | 17,307 | 37,524 | 54,963 | |||||||||||||||||||
| Asset impairments | - | 87 | 2,075 | 46,076 | |||||||||||||||||||
| (Gain) loss on sale or disposal of assets, net | (62) | 784 | (22,326) | 1,572 | |||||||||||||||||||
| Share-based compensation expense | 1,877 | 2,905 | 6,838 | 9,243 | |||||||||||||||||||
|
Other (income) expense, net(b)
|
(5,806) | 1,346 | (11,640) | 1,610 | |||||||||||||||||||
| Total Adjusted EBITDA | $ | 57,173 | $ | 62,879 | $ | 171,919 | $ | 194,999 | |||||||||||||||
(a) Integration and reorganization costs mainly reflect severance-related expenses and other reorganization-related costs, designed primarily to right-size the Company's employee base, consolidate facilities and improve operations.
(b) Other (income) expense, net primarily reflects expert fees associated with the litigation with Google, consulting fees related to a discrete initiative to reformulate our go-to-market strategy and post-sales processes, (gains) losses from the sale of investments, third-party debt costs and the components of net periodic pension and postretirement benefits other than service cost.
Domestic Gannett Media segment
A summary of our Domestic Gannett Media segment results is presented below:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Digital | $ | 158,105 | $ | 172,831 | $ | (14,726) | (9) | % | $ | 475,182 | $ | 512,521 | $ | (37,339) | (7) | % | |||||||||||||||||||||||||||||||
| Print and commercial | 258,950 | 295,680 | (36,730) | (12) | % | 821,242 | 943,618 | (122,376) | (13) | % | |||||||||||||||||||||||||||||||||||||
| Segment revenues | 417,055 | 468,511 | (51,456) | (11) | % | 1,296,424 | 1,456,139 | (159,715) | (11) | % | |||||||||||||||||||||||||||||||||||||
| Operating costs | 266,390 | 292,806 | (26,416) | (9) | % | 819,614 | 918,241 | (98,627) | (11) | % | |||||||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | 115,852 | 129,307 | (13,455) | (10) | % | 366,643 | 394,496 | (27,853) | (7) | % | |||||||||||||||||||||||||||||||||||||
| Equity (income) loss in unconsolidated investees, net | (549) | 97 | (646) | *** | (1,583) | (277) | (1,306) | *** | |||||||||||||||||||||||||||||||||||||||
| Segment Adjusted EBITDA | $ | 35,362 | $ | 46,301 | $ | (10,939) | (24) | % | $ | 111,750 | $ | 143,679 | $ | (31,929) | (22) | % | |||||||||||||||||||||||||||||||
*** Indicates an absolute value percentage change greater than 100.
Revenues
The following table provides the breakout of Revenues by category:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Digital advertising | $ | 73,014 | $ | 71,224 | $ | 1,790 | 3 | % | $ | 219,619 | $ | 213,087 | $ | 6,532 | 3 | % | |||||||||||||||||||||||||||||||
| Digital marketing services | 31,273 | 34,712 | (3,439) | (10) | % | 97,170 | 106,765 | (9,595) | (9) | % | |||||||||||||||||||||||||||||||||||||
| Digital-only subscription | 41,303 | 48,111 | (6,808) | (14) | % | 123,020 | 134,644 | (11,624) | (9) | % | |||||||||||||||||||||||||||||||||||||
|
Digital other
|
12,515 | 18,784 | (6,269) | (33) | % | 35,373 | 58,025 | (22,652) | (39) | % | |||||||||||||||||||||||||||||||||||||
| Digital | 158,105 | 172,831 | (14,726) | (9) | % | 475,182 | 512,521 | (37,339) | (7) | % | |||||||||||||||||||||||||||||||||||||
| Print advertising | 94,691 | 105,885 | (11,194) | (11) | % | 305,399 | 340,504 | (35,105) | (10) | % | |||||||||||||||||||||||||||||||||||||
| Print circulation | 121,896 | 140,436 | (18,540) | (13) | % | 382,778 | 443,372 | (60,594) | (14) | % | |||||||||||||||||||||||||||||||||||||
|
Commercial and other(a)
|
42,363 | 49,359 | (6,996) | (14) | % | 133,065 | 159,742 | (26,677) | (17) | % | |||||||||||||||||||||||||||||||||||||
| Print and commercial | 258,950 | 295,680 | (36,730) | (12) | % | 821,242 | 943,618 | (122,376) | (13) | % | |||||||||||||||||||||||||||||||||||||
| Segment revenues | $ | 417,055 | $ | 468,511 | $ | (51,456) | (11) | % | $ | 1,296,424 | $ | 1,456,139 | $ | (159,715) | (11) | % | |||||||||||||||||||||||||||||||
(a)Included Commercial printing and delivery revenues of $26.5 million and $32.9 million for the three months ended September 30, 2025 and 2024, respectively, and $85.1 million and $110.7 million for the nine months ended September 30, 2025 and 2024, respectively.
For the three and nine months ended September 30, 2025, Digital advertising revenues increased compared to the three and nine months ended September 30, 2024, primarily due to an increase in national revenues, including programmatic revenue, partially offset by lower classified advertising spend. In addition, the increase in Digital advertising revenues was offset by the absence of revenues in 2025 associated with businesses divested of $1.1 million and $2.7 million for the three and nine months ended September 30, 2025, respectively.
For the three and nine months ended September 30, 2025, Digital marketing services revenues decreased compared to the three and nine months ended September 30, 2024, primarily due to a decrease in client count as well as the absence of revenues in 2025 associated with businesses divested of $1.3 million and $3.9 million, respectively.
For the three and nine months ended September 30, 2025, Digital-only subscription revenues decreased compared to the three and nine months ended September 30, 2024, primarily driven by a decrease in digital-only paid subscriptions, partially offset by an increase in rates. In addition, the decrease in Digital-only subscription revenues for the three and nine months ended September 30, 2025 also reflected the absence of revenues in 2025 associated with businesses divested of $1.1 million and $2.8 million, respectively. Refer to "Key Performance Indicators" below for further discussion of digital-only paid subscriptions.
For the three and nine months ended September 30, 2025, Digital other revenues decreased compared to the three and nine months ended September 30, 2024, primarily due to the absence of revenues in 2025 associated with businesses divested of $3.4 million and $13.3 million, respectively, as well as a decrease in affiliate and partnership revenues, mainly due to the termination and amendment of various affiliate agreements.
For the three and nine months ended September 30, 2025, Print advertising revenues decreased compared to the three and nine months ended September 30, 2024, primarily due to a decrease in local print display advertisements, a decrease in advertiser inserts, and lower spend on classified advertisements, partially offset by an increase in national print display advertisements. In addition, the decrease in Print advertising revenues for the three and nine months ended September 30, 2025 reflected the absence of revenues in 2025 associated with businesses divested of $4.1 million and $8.0 million, respectively.
For the three and nine months ended September 30, 2025, Print circulation revenues decreased compared to the three and nine months ended September 30, 2024, primarily due to a decline in home delivery, and to a lesser extent single copy revenues, as a result of a reduction in the volume of subscribers, partially offset by an increase in rates. In addition, the decrease in Print circulation revenues for the three and nine months ended September 30, 2025 reflected the absence of revenues in 2025 associated with businesses divested of $2.4 million and $6.1 million, respectively.
For the three and nine months ended September 30, 2025, Commercial and other revenues decreased compared to the three and nine months ended September 30, 2024, primarily due to a decrease in commercial print and delivery revenues, mainly driven by the decline in production volume. In addition, the decrease in Commercial and other revenues for the three and nine months ended September 30, 2025 reflected the absence of revenues in 2025 associated with businesses divested of $2.7 million and $16.1 million, respectively, of which $1.6 million and $10.3 million, respectively, related to commercial print and delivery revenues.
Operating costs
The following table provides the breakout of Operating costs for the three and nine months ended September 30, 2025 and 2024:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Newsprint and ink | $ | 12,081 | $ | 16,566 | $ | (4,485) | (27) | % | $ | 39,867 | $ | 51,985 | $ | (12,118) | (23) | % | |||||||||||||||||||||||||||||||
| Distribution | 60,133 | 66,660 | (6,527) | (10) | % | 186,595 | 210,426 | (23,831) | (11) | % | |||||||||||||||||||||||||||||||||||||
| Compensation and benefits | 85,178 | 93,436 | (8,258) | (9) | % | 260,064 | 282,996 | (22,932) | (8) | % | |||||||||||||||||||||||||||||||||||||
| Outside services | 70,397 | 70,458 | (61) | - | % | 213,266 | 230,517 | (17,251) | (7) | % | |||||||||||||||||||||||||||||||||||||
| Other | 38,601 | 45,686 | (7,085) | (16) | % | 119,822 | 142,317 | (22,495) | (16) | % | |||||||||||||||||||||||||||||||||||||
| Total operating costs | $ | 266,390 | $ | 292,806 | $ | (26,416) | (9) | % | $ | 819,614 | $ | 918,241 | $ | (98,627) | (11) | % | |||||||||||||||||||||||||||||||
For the three and nine months ended September 30, 2025, Newsprint and ink costs decreased compared to the three and nine months ended September 30, 2024, primarily due to lower volume driven by the decline in revenues, as well as lower costs related to the absence of revenues in 2025 associated with businesses divested.
For the three and nine months ended September 30, 2025, Distribution costs decreased compared to the three and nine months ended September 30, 2024, primarily due to a decrease of $5.1 million and $20.7 million, respectively, associated with lower home delivery and single copy revenues, the conversion to mail and route optimization in multiple markets, including the impact of businesses divested of $2.0 million and $4.0 million, respectively, as well as a decrease in postage costs of $1.5 million and $3.2 million, respectively, mainly driven by the volume declines, including the impact of businesses divested of $0.4 million and $2.5 million, respectively.
For the three and nine months ended September 30, 2025, Compensation and benefits costs decreased compared to the three and nine months ended September 30, 2024, primarily due to a decrease in headcount tied to ongoing cost control initiatives, the impact of businesses divested of $2.9 million and $10.2 million, respectively, downsizing our facilities footprint and the conversion to mail delivery in multiple markets.
For the nine months ended September 30, 2025, Outside services costs, which includes professional services fulfilled by third parties, media fees and other digital costs, and paid search and ad serving services, decreased compared to the nine months ended September 30, 2024, primarily due to a decrease in news and editorial expenses of $8.4 million, mainly due to the cease-use of certain licensed content and the impact of businesses divested, a decrease in outside printing costs of $4.1 million, a decrease in third-party media fees of $2.2 million, and a decrease in event related expenses of $1.9 million, mainly due to the impact of businesses divested.
For the three and nine months ended September 30, 2025, Other costs decreased compared to the three and nine months ended September 30, 2024, primarily due to lower facility related expenses of $4.8 million and $14.7 million, respectively, mainly associated with facility closures, and lower promotion costs of $0.8 million and $4.7 million, respectively.
Selling, general and administrative expenses
The following table provides the breakout of Selling, general and administrative expenses for the three and nine months ended September 30, 2025 and 2024:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Compensation and benefits | $ | 58,288 | $ | 62,935 | $ | (4,647) | (7) | % | $ | 176,896 | $ | 189,738 | $ | (12,842) | (7) | % | |||||||||||||||||||||||||||||||
| Outside services and other | 57,564 | 66,372 | (8,808) | (13) | % | 189,747 | 204,758 | (15,011) | (7) | % | |||||||||||||||||||||||||||||||||||||
| Total selling, general and administrative expenses | $ | 115,852 | $ | 129,307 | $ | (13,455) | (10) | % | $ | 366,643 | $ | 394,496 | $ | (27,853) | (7) | % | |||||||||||||||||||||||||||||||
For the three and nine months ended September 30, 2025, Compensation and benefits costs decreased compared to the three and nine months ended September 30, 2024, primarily due to a decline in payroll expenses, mainly due to a decrease in headcount tied to ongoing cost control initiatives and lower commissions as well as the impact of businesses divested of $1.5 million and $4.5 million, respectively.
For the three and nine months ended September 30, 2025, Outside services and other costs, which include services fulfilled by third parties, decreased compared to the three and nine months ended September 30, 2024, primarily due to lower expenses, including promotion and technology costs.
Newsquest segment
A summary of our Newsquest segment results is presented below:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Digital | $ | 21,921 | $ | 20,175 | $ | 1,746 | 9 | % | $ | 60,774 | $ | 59,839 | $ | 935 | 2 | % | |||||||||||||||||||||||||||||||
| Print and commercial | 39,102 | 39,373 | (271) | (1) | % | 117,415 | 121,159 | (3,744) | (3) | % | |||||||||||||||||||||||||||||||||||||
| Segment revenues | 61,023 | 59,548 | 1,475 | 2 | % | 178,189 | 180,998 | (2,809) | (2) | % | |||||||||||||||||||||||||||||||||||||
| Operating costs | 30,863 | 30,026 | 837 | 3 | % | 89,584 | 92,136 | (2,552) | (3) | % | |||||||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | 15,605 | 15,605 | - | - | % | 45,222 | 46,644 | (1,422) | (3) | % | |||||||||||||||||||||||||||||||||||||
| Segment Adjusted EBITDA | $ | 14,555 | $ | 13,917 | $ | 638 | 5 | % | $ | 43,383 | $ | 42,218 | $ | 1,165 | 3 | % | |||||||||||||||||||||||||||||||
Revenues
The following table provides the breakout of Revenues by category:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Digital advertising | $ | 14,162 | $ | 13,518 | $ | 644 | 5 | % | $ | 38,809 | $ | 40,586 | $ | (1,777) | (4) | % | |||||||||||||||||||||||||||||||
| Digital marketing services | 2,326 | 1,915 | 411 | 21 | % | 6,264 | 5,928 | 336 | 6 | % | |||||||||||||||||||||||||||||||||||||
| Digital-only subscription | 2,410 | 1,944 | 466 | 24 | % | 6,625 | 5,172 | 1,453 | 28 | % | |||||||||||||||||||||||||||||||||||||
|
Digital other
|
3,023 | 2,798 | 225 | 8 | % | 9,076 | 8,153 | 923 | 11 | % | |||||||||||||||||||||||||||||||||||||
| Digital | 21,921 | 20,175 | 1,746 | 9 | % | 60,774 | 59,839 | 935 | 2 | % | |||||||||||||||||||||||||||||||||||||
| Print advertising | 17,830 | 18,044 | (214) | (1) | % | 54,590 | 57,005 | (2,415) | (4) | % | |||||||||||||||||||||||||||||||||||||
| Print circulation | 16,577 | 16,859 | (282) | (2) | % | 48,884 | 50,569 | (1,685) | (3) | % | |||||||||||||||||||||||||||||||||||||
|
Commercial and other(a)
|
4,695 | 4,470 | 225 | 5 | % | 13,941 | 13,585 | 356 | 3 | % | |||||||||||||||||||||||||||||||||||||
| Print and commercial | 39,102 | 39,373 | (271) | (1) | % | 117,415 | 121,159 | (3,744) | (3) | % | |||||||||||||||||||||||||||||||||||||
| Segment revenues | $ | 61,023 | $ | 59,548 | $ | 1,475 | 2 | % | $ | 178,189 | $ | 180,998 | $ | (2,809) | (2) | % | |||||||||||||||||||||||||||||||
(a)Included Commercial printing and delivery revenues of $2.7 million and $2.6 million for each of the three months ended September 30, 2025 and 2024,
respectively, and $7.7 million and $7.6 million for the nine months ended September 30, 2025 and 2024, respectively.
For the three months ended September 30, 2025, Digital advertising revenues increased compared to the three months ended September 30, 2024, primarily due to an increase in national display revenues, partially offset by a decrease in local display revenues as well as lower spend on classified advertisements. For the nine months ended September 30, 2025, Digital advertising revenues decreased compared to the nine months ended September 30, 2024, primarily due to a decrease in local display revenues as well as lower spend on classified advertisements.
For the three and nine months ended September 30, 2025, Digital-only subscription revenues increased compared to the three and nine months ended September 30, 2024, primarily driven by an increase in digital-only paid subscriptions. Refer to "Key Performance Indicators" below for further discussion of digital-only paid subscriptions.
For the nine months ended September 30, 2025, Digital other revenues increased compared to the nine months ended September 30, 2024, primarily due to an increase in syndication revenues.
For the nine months ended September 30, 2025, Print advertising revenues decreased compared to the nine months ended September 30, 2024, primarily due to a decrease in national and local print display advertisements, partially offset by higher spend on classified advertisements.
For the nine months ended September 30, 2025, Print circulation revenues decreased compared to the nine months ended September 30, 2024, primarily due to a decline in single copy volume, partially offset by an increase in rates.
Operating costs
The following table provides the breakout of Operating costs for the three and nine months ended September 30, 2025 and 2024:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Newsprint and ink | $ | 2,400 | $ | 2,605 | $ | (205) | (8) | % | $ | 7,116 | $ | 7,690 | $ | (574) | (7) | % | |||||||||||||||||||||||||||||||
| Distribution | 3,204 | 3,292 | (88) | (3) | % | 9,400 | 9,615 | (215) | (2) | % | |||||||||||||||||||||||||||||||||||||
| Compensation and benefits | 14,723 | 13,477 | 1,246 | 9 | % | 42,500 | 39,386 | 3,114 | 8 | % | |||||||||||||||||||||||||||||||||||||
| Outside services | 3,899 | 3,908 | (9) | - | % | 10,882 | 11,497 | (615) | (5) | % | |||||||||||||||||||||||||||||||||||||
| Other | 6,637 | 6,744 | (107) | (2) | % | 19,686 | 23,948 | (4,262) | (18) | % | |||||||||||||||||||||||||||||||||||||
| Total operating costs | $ | 30,863 | $ | 30,026 | $ | 837 | 3 | % | $ | 89,584 | $ | 92,136 | $ | (2,552) | (3) | % | |||||||||||||||||||||||||||||||
For the three and nine months ended September 30, 2025, Compensation and benefits costs increased compared to the three and nine months ended September 30, 2024, primarily driven by an increase in payroll expenses due to a higher minimum wage and employer taxes.
For the nine months ended September 30, 2025, Other costs decreased compared to the nine months ended September 30, 2024, primarily associated with the decrease in both digital advertising and print advertising revenues.
Selling, general and administrative expenses
The following table provides the breakout of Selling, general and administrative expenses for the three and nine months ended September 30, 2025 and 2024:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Compensation and benefits | $ | 12,100 | $ | 11,893 | $ | 207 | 2 | % | $ | 35,669 | $ | 35,555 | $ | 114 | - | % | |||||||||||||||||||||||||||||||
| Outside services and other | 3,505 | 3,712 | (207) | (6) | % | 9,553 | 11,089 | (1,536) | (14) | % | |||||||||||||||||||||||||||||||||||||
| Total selling, general and administrative expenses | $ | 15,605 | $ | 15,605 | $ | - | - | % | $ | 45,222 | $ | 46,644 | $ | (1,422) | (3) | % | |||||||||||||||||||||||||||||||
For the nine months ended September 30, 2025, Outside services and other costs decreased compared to the nine months ended September 30, 2024, mainly due to various lower miscellaneous expenses.
Digital Marketing Solutions segment
A summary of our DMS segment results is presented below:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
|
Digital(a)
|
$ | 114,418 | $ | 119,929 | $ | (5,511) | (5) | % | $ | 340,605 | $ | 360,772 | $ | (20,167) | (6) | % | |||||||||||||||||||||||||||||||
| Segment revenues | 114,418 | 119,929 | (5,511) | (5) | % | 340,605 | 360,772 | (20,167) | (6) | % | |||||||||||||||||||||||||||||||||||||
| Operating costs | 84,345 | 85,749 | (1,404) | (2) | % | 247,964 | 260,038 | (12,074) | (5) | % | |||||||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | 20,293 | 22,437 | (2,144) | (10) | % | 62,894 | 68,439 | (5,545) | (8) | % | |||||||||||||||||||||||||||||||||||||
| Segment Adjusted EBITDA | $ | 9,780 | $ | 11,743 | $ | (1,963) | (17) | % | $ | 29,747 | $ | 32,295 | $ | (2,548) | (8) | % | |||||||||||||||||||||||||||||||
(a)Digital revenues are solely generated by digital marketing services revenues.
Revenues
For the three and nine months ended September 30, 2025, Digital revenues decreased compared to the three and nine months ended September 30, 2024, primarily due to a decline in the core direct business, mainly driven by a decline in customer count. Core platform average monthly revenues divided by average monthly customer count within the period ("Core platform ARPU") increased three months ended September 30, 2025 and decreased for the nine months ended September 30, 2025. Refer to "Key Performance Indicators" below for further discussion of Core platform ARPU.
Operating costs
The following table provides the breakout of Operating costs for the three and nine months ended September 30, 2025 and 2024:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Outside services | $ | 75,298 | $ | 74,905 | $ | 393 | 1 | % | $ | 219,250 | $ | 227,453 | $ | (8,203) | (4) | % | |||||||||||||||||||||||||||||||
| Compensation and benefits | 8,130 | 9,336 | (1,206) | (13) | % | 25,247 | 27,340 | (2,093) | (8) | % | |||||||||||||||||||||||||||||||||||||
| Other | 917 | 1,508 | (591) | (39) | % | 3,467 | 5,245 | (1,778) | (34) | % | |||||||||||||||||||||||||||||||||||||
| Total operating costs | $ | 84,345 | $ | 85,749 | $ | (1,404) | (2) | % | $ | 247,964 | $ | 260,038 | $ | (12,074) | (5) | % | |||||||||||||||||||||||||||||||
For the nine months ended September 30, 2025, Outside services costs decreased compared to the nine months ended September 30, 2024, due to a decrease of $14.2 million of expenses associated with third-party media fees driven by a corresponding decrease in revenues, partially offset by an increase in costs, mainly outsourcing and professional services.
For the three and nine months ended September 30, 2025, Compensation and benefits costs decreased compared to the three and nine months ended September 30, 2024, primarily due to a decline in payroll expenses driven by headcount reductions.
For the three and nine months ended September 30, 2025, Other costs decreased compared to the three and nine months ended September 30, 2024, primarily due to a reduction in lease expense mainly associated with downsizing our facilities footprint.
Selling, general and administrative expenses
The following table provides the breakout of Selling, general and administrative expenses for the three and nine months ended September 30, 2025 and 2024:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| Change | Change | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands | 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||||||||||||||
| Compensation and benefits | $ | 18,305 | $ | 19,935 | $ | (1,630) | (8) | % | $ | 56,484 | $ | 59,366 | $ | (2,882) | (5) | % | |||||||||||||||||||||||||||||||
| Outside services and other | 1,988 | 2,502 | (514) | (21) | % | 6,410 | 9,073 | (2,663) | (29) | % | |||||||||||||||||||||||||||||||||||||
| Total selling, general and administrative expenses | $ | 20,293 | $ | 22,437 | $ | (2,144) | (10) | % | $ | 62,894 | $ | 68,439 | $ | (5,545) | (8) | % | |||||||||||||||||||||||||||||||
For the three and nine months ended September 30, 2025, Compensation and benefits costs decreased compared to the three and nine months ended September 30, 2024, primarily due to a decline in payroll expense driven by headcount reductions.
For the three and nine months ended September 30, 2025, Outside services and other costs decreased compared to the three and nine months ended September 30, 2024, primarily due to lower promotion costs, partially offset by higher bad debt expense of $0.2 million and $1.0 million, respectively.
Key performance indicators
A key performance indicator ("KPI") is generally defined as a quantifiable measurement or metric used to gauge performance, specifically to help determine strategic, financial, and operational achievements, especially compared to those of similar businesses.
We define Digital-only ARPU as digital-only subscription average monthly revenues divided by the average digital-only paid subscriptions within the respective period. We define Core platform ARPU as core platform average monthly revenues divided by average monthly customer count within the period. We define Core platform revenues as revenue derived from customers utilizing our proprietary digital marketing services platform that are sold by either our direct or local market teams.
Management believes Digital-only ARPU, Core platform ARPU, digital-only paid subscriptions, Core platform revenues and core platform average customer count are KPIs that offer useful information in understanding consumer behavior, trends in our business, and our overall operating results. Management utilizes these KPIs to track and analyze trends across our segments.
The following tables provide information regarding certain KPIs for the Domestic Gannett Media, Newsquest and DMS segments:
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
| In thousands, except ARPU | 2025 | 2024 | Change | % Change | 2025 | 2024 | Change | % Change | |||||||||||||||||||||||||||||||||||||||
| Domestic Gannett Media | |||||||||||||||||||||||||||||||||||||||||||||||
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Digital-only ARPU
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$ | 9.03 | $ | 8.24 | $ | 0.79 | 10 | % | $ | 8.03 | $ | 7.74 | $ | 0.29 | 4 | % | |||||||||||||||||||||||||||||||
| Newsquest | |||||||||||||||||||||||||||||||||||||||||||||||
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Digital-only ARPU
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$ | 6.08 | $ | 6.49 | $ | (0.41) | (6) | % | $ | 5.93 | $ | 6.15 | $ | (0.22) | (4) | % | |||||||||||||||||||||||||||||||
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Total Gannett
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Digital-only ARPU
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$ | 8.80 | $ | 8.16 | $ | 0.64 | 8 | % | $ | 7.88 | $ | 7.67 | $ | 0.21 | 3 | % | |||||||||||||||||||||||||||||||
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DMS
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| Core platform revenues | $ | 113,959 | $ | 119,158 | $ | (5,199) | (4) | % | $ | 339,052 | $ | 358,051 | $ | (18,999) | (5) | % | |||||||||||||||||||||||||||||||
| Core platform ARPU | $ | 2,828 | $ | 2,777 | $ | 51 | 2 | % | $ | 2,672 | $ | 2,751 | $ | (79) | (3) | % | |||||||||||||||||||||||||||||||
| Core platform average customer count | 13.4 | 14.3 | (0.9) | (6) | % | 14.1 | 14.5 | (0.4) | (3) | % | |||||||||||||||||||||||||||||||||||||
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As of September 30,
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| In thousands | 2025 | 2024 | % Change | ||||||||||||||
| Digital-only paid subscriptions | |||||||||||||||||
| Domestic Gannett Media | 1,452 | 1,953 | (26) | % | |||||||||||||
| Newsquest | 139 | 103 | 35 | % | |||||||||||||
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Total Gannett
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1,591 | 2,056 | (23) | % | |||||||||||||
LIQUIDITY AND CAPITAL RESOURCES
Our primary cash requirements are for working capital, debt obligations, and capital expenditures.
We expect to fund our operations and debt service requirements through cash provided by our operating activities. We expect we will have adequate capital resources and liquidity to meet our ongoing working capital needs, borrowing obligations, and all required capital expenditures for at least the next twelve months and beyond. However, a further economic downturn or an increased rate of revenue declines would negatively impact our revenue, cash provided by operating activities and liquidity. We continue to implement cost reduction initiatives to reduce our ongoing level of operating expense. We believe our ability to realize benefits from our cost reduction initiatives will be necessary to offset the continued secular decline in our legacy print business revenue streams. We believe that these measures are important in response to the overall challenging macroeconomic environment that we are facing. Refer to "Overview - Macroeconomic Environment" above for further discussion.
Details of our cash flows are included in the table below:
| Nine months ended September 30, | |||||||||||
| In thousands | 2025 | 2024 | |||||||||
| Cash provided by operating activities | $ | 71,026 | $ | 91,321 | |||||||
| Cash provided by (used for) investing activities | 17,619 | (17,065) | |||||||||
| Cash used for financing activities | (120,706) | (72,508) | |||||||||
| Effect of currency exchange rate change on cash | (1,302) | (681) | |||||||||
| (Decrease) increase in cash, cash equivalents and restricted cash | $ | (33,363) | $ | 1,067 | |||||||
Cash flows provided by operating activities: Our largest source of cash provided by operating activities is generated by advertising and marketing services, primarily from local and national print advertising, as well as retail, classified, and online revenues. Additionally, we generate cash through circulation subscribers, commercial printing and delivery services to third parties, and events. Our primary uses of cash from our operating activities include compensation, newsprint, delivery, and outside services.
Cash flows provided by operating activities were $71.0 million for the nine months ended September 30, 2025, compared to $91.3 million for the nine months ended September 30, 2024. The decrease in cash flows provided by operating activities was primarily due to lower cash receipts related to deferred revenues, an increase in cash paid for interest and an increase in severance payments, partially offset by decreases in contributions to our pension and other postretirement benefit plans and cash paid for taxes.
Cash flows provided by (used for) investing activities: Cash flows provided by investing activities were $17.6 million for the nine months ended September 30, 2025, compared to cash used for investing activities of $17.1 million for the nine months ended September 30, 2024. The change in cash flows provided by (used for) investing activities was primarily due to the increase in proceeds from the sale of real estate and other non-strategic assets of $37.7 million, partially offset by an increase in purchases of property, plant and equipment of $2.2 million.
Cash flows used for financing activities:Cash flows used for financing activities were $120.7 million for the nine months ended September 30, 2025, compared to $72.5 million for the nine months ended September 30, 2024. The increase in cash flows used for financing activities was primarily due to the increase in repayments of long-term debt of $48.3 million, the 2027 Notes repurchase of $14.6 million in April 2025 and a $1.0 million increase in payments of deferred financing costs, partially offset by $15.0 million in borrowings of long-term debt, drawn under the 2029 Delayed Draw Facility.
Debt
As of September 30, 2025, the carrying value of our outstanding debt totaled $971.8 million, which consisted of $733.2 million related to the 2029 Term Loan Facility, $216.6 million related to the 2031 Notes (defined below), and $22.0 million related to the 6.000% Senior Secured Convertible Notes due 2027 (the "2027 Notes").
In April 2025, we received a waiver from certain lenders of our 2029 Term Loan Facility and certain holders of our 2031 Notes (as defined below) and entered into a privately negotiated agreement with a holder of our 2027 Notes to repurchase $14.0 million principal amount of our outstanding 2027 Notes at 105% of par value, plus accrued and unpaid interest, for $15.0 million in cash. This transaction was financed using proceeds from our 2029 Delayed Draw Facility, and as a result as of September 30, 2025, $15.0 million had been drawn under the 2029 Delayed Draw Facility. As a result of this transaction, we
recognized an immaterial loss on the early extinguishment of debt during the nine months ended September 30, 2025.
The 2029 Term Loan Facility bears interest at an annual rate equal, at the Borrower's option, to either (i) an alternate base rate (which shall not be less than 2.50% per annum) plus a margin equal to 4.00% per annum or (ii) Adjusted Term SOFR (which shall not be less than 1.50%) plus a margin equal to 5.00% per annum. The 2029 Term Loan Facility will mature on October 15, 2029 and is freely prepayable without penalty.
The 2029 Term Loan Facility is amortized at a rate of $17.3 million per quarter. In addition, we are required to repay the 2029 Term Loan Facility from time to time with (i) the proceeds of non-ordinary course asset sales and casualty and condemnation events, (ii) the proceeds of indebtedness that is not otherwise permitted under the 2029 Term Loan Facility and (iii) the aggregate amount of cash and cash equivalents on hand at the Company and our restricted subsidiaries in excess of $100.0 million as of the last day of any fiscal year of the Company (beginning with the fiscal year ended December 31, 2024).
For the nine months ended September 30, 2025, the Company prepaid $116.4 million under the 2029 Term Loan Facility, including quarterly amortization payments, which were classified as financing activities in the Consolidated statements of cash flows.
Interest on the 2027 Notes and our 6.000% Senior Secured Convertible Notes due 2031 (the "2031 Notes") is payable semi-annually in arrears, and the 2027 Notes and 2031 Notes mature on December 1, 2027, and December 1, 2031, respectively, unless earlier repurchased or converted. The 2027 Notes and 2031 Notes may be converted at any time by the Holders into cash, shares of the Company's common stock, par value $0.01 per share (the "Common Stock") or any combination of cash and Common Stock, at the Company's election. The initial conversion rate for both the 2027 Notes and the 2031 Notes is 200 shares of Common Stock per $1,000 principal amount of the 2027 Notes, which is equal to a conversion price of $5.00 per share of Common Stock (the "Conversion Price"). For the nine months ended September 30, 2025, no shares of Common Stock were issued upon conversion, exercise, or satisfaction of the required conditions of the 2027 Notes or the 2031 Notes.
Our 2029 Term Loan Facility, 2031 Notes and 2027 Notes all contain usual and customary covenants and events of default. As of September 30, 2025, we were in compliance with all such covenants and obligations.
Refer to Note 6 - Debt in the notes to the condensed consolidated financial statements for additional discussion regarding our debt.
Additional information
We continue to evaluate our results of operations, liquidity and cash flows, and as part of these measures, we have taken steps to manage cash outflow by rationalizing expenses and implementing various cost management initiatives. We do not presently pay a quarterly dividend and there can be no assurance that we will pay dividends in the future. In addition, the terms of our indebtedness, including the 2029 Term Loan Facility and the 2031 Notes Indenture have terms that restrict our ability to pay dividends.
Our Board of Directors has authorized the repurchase of up to $100 million (the "Stock Repurchase Program") of our Common Stock. Repurchases may be made from time to time through open market purchases or privately negotiated transactions, pursuant to one or more plans established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, or by means of one or more tender offers, in each case, as permitted by securities laws and other legal requirements. The amount and timing of the purchases, if any, will depend on a number of factors, including, but not limited to, the price and availability of our shares, trading volume, capital availability, our performance and general economic and market conditions. The Stock Repurchase Program may be suspended or discontinued at any time. Further, future repurchases under our Stock Repurchase Program may be subject to various conditions under the terms of our various debt instruments and agreements, unless an exception is available or we obtain a waiver or similar relief.
During the three and nine months ended September 30, 2025, we did not repurchase any shares of Common Stock under the Stock Repurchase Program. As of September 30, 2025, the remaining authorized amount under the Stock Repurchase Program was approximately $96.9 million. We do not currently anticipate repurchasing any shares of Common Stock pursuant to the Stock Repurchase Program in the fourth quarter of 2025.
We expect our capital expenditures for the remainder of 2025 to total approximately $20 million. These capital expenditures are anticipated to be primarily comprised of projects related to digital product development, costs associated with our print and technology systems, and system upgrades.
Our leverage may adversely affect our business and financial performance and restricts our operating flexibility. The level of our indebtedness and our ongoing cash flow requirements may expose us to a risk that a substantial decrease in operating cash flows due to, among other things, continued or additional adverse economic conditions or adverse developments in our business, could make it difficult for us to meet the financial and operating covenants contained in our 2029 Term Loan Facility, the 2031 Notes, and the 2027 Notes. In addition, our leverage may limit cash flow available for general corporate purposes such as capital expenditures as well as share repurchases and acquisitions and our flexibility to react to competitive, technological, and other changes in our industry and economic conditions generally. We continue to closely monitor economic factors, including, but not limited to, the current inflationary market, changing interest rates, and trade policies, and we expect to continue to take the steps necessary to appropriately manage liquidity.
CRITICAL ACCOUNTING ESTIMATES
See our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2024 for a discussion of our critical accounting policies and use of estimates. There have been no material changes to our critical accounting policies and use of estimates discussed in such report.
Gannett Co. Inc. published this content on October 30, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on October 30, 2025 at 14:01 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]