Lee Enterprises (LEE) Q3 2024 earnings summary

Executive summary

• Digital revenue surpassed print for the first time in Q3 2024, now representing 50% of total revenue and marking a key inflection point in the digital transformation strategy.

• Digital-only subscription revenue grew 34% year-over-year to $20.7 million, with digital subscribers up 23% to 748,000.

• Digital advertising and agency revenues posted double-digit growth, with Amplified Digital Agency revenue up 12% year-over-year to $26 million.

• Net loss for Q3 FY2024 was $3.7 million, compared to net income of $2.1 million in the prior year quarter.

• Ongoing business transformation includes investments in digital talent, technology, and internal controls.

Financial highlights

• Total operating revenue for Q3 2024 was $151 million, with digital revenue at $76 million, up 9% year-over-year.

• Digital advertising and marketing services revenue was $49.9 million, representing 72% of total advertising revenue.

• Adjusted EBITDA for the quarter was $15 million, with cash costs down 8% to $138 million.

• Print revenue declined 22% year-over-year to $75 million, with print advertising revenue at $18.9 million and print subscription revenue at $47.6 million.

• Operating expenses decreased 8% year-over-year to $147 million.

Outlook and guidance

• FY2024 total digital revenue expected between $310 million and $330 million, up 13% to 21% year-over-year.

• Digital-only subscribers projected to reach 771,000, a 7% increase from 2023.

• Cash costs forecasted at $550 million–$560 million, a $20 million improvement on the low end.

• Adjusted EBITDA outlook updated to $73 million–$78 million, reflecting lagging print business.

• Capital expenditures expected to total $10 million in FY24.