Gray Media (GTN) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached $950 million, up 18% year-over-year, driven by political advertising and major events like the Olympics and Super Bowl.

• Net income for Q3 2024 was $83 million, reversing a $53 million loss in Q3 2023; nine-month net income was $167 million, up from a $106 million loss in 2023.

• Adjusted EBITDA rose 61% to $338 million in Q3 2024, driven by a 565% surge in political ad revenue.

• Significant refinancing and cost containment initiatives are projected to reduce net debt by $500 million and annualized expenses by $60 million in 2024.

• Political ad revenue was $173 million in Q3 2024 and is expected to reach $500 million for the year.

Financial highlights

• Core ad revenue in Q3 2024 was $365 million, up 1% year-over-year, while retransmission consent revenue fell 2% to $369 million.

• Digital ad sales saw double-digit growth, with 22 markets exceeding $1 million in sales.

• Operating income for Q3 2024 was $250 million, up from $84 million in Q3 2023.

• Interest expense increased 17% year-over-year in Q3 to $130 million due to higher floating-rate debt.

• Miscellaneous income included a $110 million gain from the sale of the BMI investment.

Outlook and guidance

• Full-year 2024 core ad revenue is expected to be down about 2% from 2023, typical for a political year.

• Q4 2024 core ad revenue is anticipated to decline about 10–11% year-over-year due to political crowd out and network changes.

• Full-year 2024 political ad revenue is expected at $495–$500 million; retransmission consent revenue guided at $1.476–$1.481 billion.

• Full-year 2024 capital expenditures are expected at $135 million, including $35 million for Assembly Atlanta.

• Management anticipates sufficient liquidity to meet obligations for the next twelve months.