Gannett maintained its steady digital advance in Q3, achieving a 5.2% increase in revenue YoY to $277.4 million, 45% of the company total.
These growth numbers may not be the biggest in the news industry, but they reinforce Gannett’s belief “that we have created a sustainable pathway for ongoing growth moving forward,” says CEO Mike Reed.
Reed continues, "In the third quarter, our audience surpassed 200 million average monthly unique visitors for the first time in our history, reflecting growth of over 7% compared to the prior year period."
Of the monthly average, 147 million unique users came from the USA Today Network and 56 million from Gannett’s UK digital properties.
Moreover, digital-only subscription revenues grew by 25% to $50.1 million, and digital revenue per user averaged $8.16, a 19.6% increase.
But total company revenue decreased by 6.2% to $612.4 million due, in part, to the selling or shutting down of some properties. Print and commercial revenue totaled $335,053 million versus $389,227 million in the same period in 2023.
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The overall net loss for the quarter was $19.7 million.
What’s the outlook going forward?
Gannet expects digital to generate 50% of its total revenue in 2025 and 55% in 2026. In this sense, it is on the right track, given the production costs, distribution hurdles and declining audience of print.
But are we losing something in this transition?
It may be argued the big chains like Gannett, Lee Enterprises and Alden Global Capital control too big a portion of the news business in the U.S., and that the drive toward digital profitability may result in local properties being cut. In addition, some might take issue with Gannett’s decision to not endorse a Presidential candidate across the USA Today Network. Of course, this is not breaking news.
Looking forward for the year, Gannett expects total digital revenues to grow by 6%-7% on a same store basis. Total company revenues are expected to be down in the low to mid-single digits on the same store basis.
One other hopeful sign for Gannett is the multi-year strategic partnership it signed with BetMGM, a sports betting and iGaaming operator, in the third quarter.
BetMGM will provide sports betting odds and information across the USA Today Network and BetMGM sports betting odds will be incorporated into stories and content that reports betting odds, moneylines, spreads and over/unders for games.
This is part of the trend, also seen at the New York Times, of pursuing revenue with non-news offerings. The BetMGM partnership is expected to “enhance the monetization of our content platform," Reed says.