Gannett Shares Rise After Digital Customers Reach New Milestone
(Bloomberg) -- Gannett Co. shares soared as much as 26%, the most since June, after the local-newspaper company posted a smaller quarterly loss than expected, fueled by an increase in digital subscribers.
The McLean, Virginia-based publisher said Tuesday that it posted a loss of 24 cents a share, narrower than Wall Street’s estimate of a 44-cent loss. Revenue beat analysts’ expectations, though it was down 20% from a year ago on a pro forma basis. As with its peers, Gannett’s advertising business has seen sharp declines during the pandemic as marketers pulled back spending.
Last fall, New Media Investment Group Inc., which is managed and controlled by private equity firm Fortress Investment Group, closed its acquisition of Gannett and assumed the Gannett name. The new company owns more than one-sixth of all daily newspapers in the country, including USA Today.
Since then, the company has been selling off its real estate and other assets to pay down debt while trying to sign up digital subscribers as advertising sales decline. During the quarter, Gannett surpassed 1 million digital subscribers, up 31% from a year ago.
Gannett shares were up 17% to $1.34 at 11:05 a.m. in New York, but the stock has a long way to go before it climbs out of its 2020 hole. It’s down 78% so far this year, while the S&P 500 is up 4%.
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