• by Ray Schultz , Columnist, December 7, 2023

Lee Enterprises, the news platform active in 75 markets, reported a continuing decline in print revenue in its Q4 and an increase in digital that does not quite make up the difference. But CEO Kevin Mowbray says, “We are on a clear path to becoming sustainable solely from the revenue and cash flow from our digital products.”

Digital revenue hit $73 million in Q4, a 14% increase YoY, making up 44% of Lee’s total operating revenue of $164 million (a lower number than forecast, investment analysts say). Revenue for the year fell by 11.5% to $691 million, according to the outlook, but digital grew to $273 million, up from $239 million in 2022. 

Digital-only subscription revenue increased 68% in the fourth quarter YoY due to a 36% increase in digital-only subscribers, which totaled 721,000 at the end of the period. Mowbray adds that this “best-in-class performance increases our long-term outlook on digital-only subscribers by one-third to 1.2 million and digital subscription revenue by approximately 50% to more than $150 million.”

There was a $1 million net loss for the quarter. 

Print advertising fell by 32% to $125.8 million for the 12-month period, the guidance states, while digital grew by 6.5% to $193,000 million. The print ad decline was even more pronounced in Q4, dropping by 41.6% to $23.3 million. 

Similarly, print subscription revenue plummeted to $252.5 million, down from $313.5 million in 2022, the preliminary guidance states, and from $78.5 million to $58.7 million during the fourth quarter. 

In contrast, digital subscription revenue jumped from $11 million to $18.6 million for the quarter and, the company anticipates, from $40 million to $60.7 million for the year. 

Overall, there was an 11.4% falloff in subscription revenue to $313,291 million. 

But costs were cut — for instance, there were no pension contributions during the fiscal year. 

"Our aggressive cost actions in FY23, as well as the strong performance of our digital revenue streams, will have a favorable impact on FY24 operating results,” Mowbray continues.