Core Insights - Wang & Lee Group, Inc. has formed a strategic partnership with HK Golden, Inc. to integrate ad-driven content into Linko's AI-powered smart home devices, allowing users to earn blockchain tokens for ad engagement, thereby enhancing ESG impact and consumer value [1][2][3] Group 1: Tokenized Ad Engagement - Users of Linko's devices will earn W&L-issued blockchain tokens for every minute spent interacting with HKGolden's ads, which can be redeemed for device upgrades, premium subscriptions, or cash [2] - The partnership ensures transparent tracking of ad engagement and token distribution through W&L's blockchain ledger [2] Group 2: ESG-Driven Synergy - A portion of the ad revenue generated will fund W&L's solar crypto-mines, linking user engagement to renewable energy growth and supporting global decarbonization goals [3] - This initiative promotes sustainable behavior while rewarding users for their engagement with ads [3] Group 3: Leadership Commentary - The CEO of Wang & Lee Group emphasized the transformation of passive ad consumption into active participation in the green economy, benefiting both users and the environment [4] - Representatives from Linko and HK Golden highlighted the enhanced value of devices and the pioneering nature of the alliance in redefining media monetization [4] Group 4: Strategic Benefits - Users can earn tokens through ad engagement, energy savings, and sustainable actions, while advertisers benefit from precise AI targeting, leading to higher ROI [5] - The partnership positions Wang & Lee as a leader in combining AI smart homes, blockchain rewards, and ESG-aligned media partnerships [5] Group 5: Projected Impacts - Anticipated user growth in Linko device adoption is expected post-integration, driven by the incentive of token rewards [6] - The alliance is projected to reduce household carbon footprints among participating users [6]

Core Insights - Lee Enterprises has launched a suite of AI-powered solutions called AmplifiedDigital.AI aimed at supporting local businesses in enhancing operations and customer connections in a digital marketplace [1][2]. Group 1: AI Solutions Overview - The AI solutions are designed to provide local businesses with essential tools for success, including data-driven insights and personalized marketing capabilities [2]. - The first product, A.I. Enablement, focuses on transforming businesses through various features that address marketing inefficiencies and customer engagement challenges [3][4]. Group 2: Commitment to Local Businesses - Lee Enterprises emphasizes its mission to foster economic growth and support local entrepreneurs, highlighting the importance of local businesses as the backbone of communities [3][4]. - The company aims to create opportunities and drive results through its AI solutions, which are not solely technology-focused but also geared towards tangible business success [4]. Group 3: Features of AI Solutions - Key features of the AI solutions include enhanced visibility in AI search engines, rapid content creation, distribution through local news websites, educational resources for leveraging AI, AI-enhanced social media tools, and next-generation website optimization [5].

Core Insights - Lee Enterprises has launched a suite of AI-powered solutions called AmplifiedDigital.AI aimed at supporting local businesses in enhancing operations and customer connections in a digital marketplace [1][2][3] Group 1: AI Solutions Overview - The AI solutions are designed to provide local businesses with essential tools for success, including data-driven insights and personalized marketing capabilities [2] - The first product, A.I. Enablement, focuses on transforming businesses through various features [2][3] Group 2: Support for Local Businesses - The launch emphasizes Lee Enterprises' commitment to fostering economic growth and supporting local entrepreneurs by addressing marketing inefficiencies and customer engagement challenges [3][4] - The company aims to create opportunities and drive results for local businesses, which are considered the backbone of communities [4] Group 3: Features of AI Solutions - A.I. Visibility enhances visibility in top-performing AI search engines, ensuring content is indexed and featured prominently [5] - Content Creation allows for the generation of sponsored articles in seconds [5] - Content Distribution utilizes Lee's local news websites and other AI engines for effective outreach [5] - Education is provided through a comprehensive library to leverage AI for business growth [5] - AI Social offers AI-enhanced social media tools [5] - SmartSites.AI represents a next-generation approach to website optimization [5]

Core Insights - Lee Enterprises Inc has partnered with VeeFriends to produce original comics that will be published weekly in its publications, marking a significant content expansion strategy [1][5] - VeeFriends, created by Gary Vaynerchuk, features a universe of 251 characters aimed at connecting with audiences through storytelling and positivity [2][6] - The comics will debut on February 23 and will include characters like Brave Bison and Empathy Elephant, designed to inspire and entertain readers [3][6] Company Strategy - Lee Enterprises is enhancing reader experiences through strategic content partnerships, with this collaboration being a key example of delivering premium content [5][6] - The partnership aims to engage audiences by integrating interactive elements, such as live drawing events and a Readers' Choice feature for fan contributions [4][6] Industry Context - The collaboration reflects a growing trend in the media industry to incorporate diverse content formats, such as comics, to attract and retain subscribers [5][6] - VeeFriends' focus on community-driven experiences and storytelling aligns with current consumer preferences for engaging and relatable content [2][7]

Core Insights - Lee Enterprises Inc has partnered with VeeFriends to produce original weekly comics that will be published in Lee's publications starting February 23, 2025 [1][3] - VeeFriends is an entertainment company created by Gary Vaynerchuk, featuring a universe of 251 characters aimed at inspiring and connecting with audiences [2][7] - The partnership aims to enhance reader experiences through engaging content, leveraging the popularity of comics in both print and digital formats [5][6] Company Overview - Lee Enterprises operates in 72 markets across 25 states, focusing on local news, information, and advertising [1][7] - The company emphasizes quality journalism and digital innovation, aiming to deliver valuable content and advertising solutions [7] Partnership Details - The comics will feature characters like Brave Bison, Empathy Elephant, and Fearless Fairy, who use their superpowers to help humanity [3] - To celebrate the launch, live streaming events called "Draw Offs" will be held, allowing audiences to see the creative process and submit their own comic contributions [4] Strategic Goals - The collaboration with VeeFriends is part of Lee Enterprises' strategy to provide world-class content partnerships that enhance reader engagement [5][6] - The partnership is expected to bring positivity and inspiration to audiences, showcasing VeeFriends' creativity in cartooning [6]

Revenue Performance - Total operating revenue decreased by $11.1 million, or 7.1%, to $144.6 million in the 2025 Quarter compared to the 2024 Quarter [64]. - Digital subscription revenue increased by 10.8% to $21.6 million, while print subscription revenue decreased by 16.3% to $43.4 million [66]. - Digital-only subscribers grew by 5% to a total of 774,000, contributing to a total subscription revenue of $65.0 million, down 8.9% from the previous year [66]. - Digital advertising and marketing services revenue totaled $46.7 million, a slight increase of 0.6%, representing 70.2% of total advertising and marketing services revenue [65]. - Total digital revenue, including digital advertising, subscription, and services, reached $73.4 million, an increase of 3.5% and representing 50.8% of total operating revenue [68]. Operating Expenses and Losses - Total operating expenses were $149.0 million, a decrease of 0.2% compared to the 2024 Quarter, with compensation expenses rising by 1.0% [70]. - The company reported an operating loss of $3.4 million in the 2025 Quarter, compared to an operating income of $7.8 million in the 2024 Quarter [75]. - Net loss was $16.2 million, with diluted loss per share of $2.80, compared to net income of $1.2 million and diluted earnings per share of $0.12 in the previous year [82]. - Adjusted EBITDA for the three months ended December 29, 2024, was $7.609 million, a decrease of 59.3% from $18.649 million in the prior year [89]. - Operating expenses for the three months ended December 29, 2024, were $149.036 million, slightly down from $149.386 million in the same period of 2023 [89]. Cash Flow and Liquidity - Cash required by operating activities totaled $7.3 million in the 2025 Period, a decrease of $7.4 million compared to cash provided by operating activities of $0.1 million in the 2024 Period [92]. - Cash provided by investing activities increased to $3.9 million in the 2025 Period from $2.1 million in the 2024 Period, driven by proceeds from the sale of non-core real estate [94]. - The company expects capital expenditures to total approximately $10.0 million in 2025, funded by internally generated funds [95]. - The company's liquidity, consisting of cash on the balance sheet, totaled $6.1 million on December 29, 2024 [99]. - No cash was required for financing activities in the 2025 Period, compared to $1.4 million in the 2024 Period, primarily for debt reduction [97]. Interest and Debt Management - Interest expense increased by 1.5% to $10.3 million, with a weighted average cost of debt of 9% [77]. - The company experienced a decrease in operating results of $13.6 million, adjusted for non-working capital items, partially offset by a $6.2 million increase in working capital [92]. - The company anticipates that all interest and principal payments due in the next twelve months will be satisfied by existing cash and cash flows [99].

Digital Revenue Performance - Total Digital Revenue increased by 5% year-over-year to $73 million, representing 51% of total operating revenue[4] - Digital-only subscription revenue rose by 14% year-over-year, totaling $22 million[4] - Amplified Digital Agency revenue reached $24 million, also up 14% year-over-year[1] - Digital advertising and marketing services revenue accounted for 70% of total advertising revenue, totaling $47 million[4] - The company expects full-year digital revenue growth to accelerate between 7% and 10%[2] - Total Digital Revenue includes digital advertising, marketing services, digital-only subscriptions, and digital services revenue[1] Financial Performance - The company reported a net loss of $16 million for the quarter, with Adjusted EBITDA of $8 million[4] - Operating revenue for the quarter was $145 million, a decrease of 7% compared to the prior year[4] - Adjusted EBITDA is defined as net income plus non-operating expenses, income tax, depreciation, and other adjustments, providing a clearer view of operating performance[3] - Cash Costs, which exclude non-cash expenses, are defined as compensation, newsprint, ink, and other operating expenses, aiding in understanding the company's cash-settled costs[4] Cost Management - The company has identified approximately $40 million in annualized cost reductions expected to be executed by the end of the second quarter[2] Debt and Financing - Total debt outstanding is $446 million, with favorable financing terms including a fixed annual interest rate of 9.0%[5] - The company's debt stands at $576 million under a term loan agreement with BH Finance LLC[5] Strategic Partnerships - A strategic partnership with Amazon Web Services (AWS) was announced to enhance digital transformation and optimize content delivery[1] Revenue Definitions - Same-store revenues are based on U.S. GAAP revenues, excluding exited operations such as business divestitures and discontinued print products[2] - Excess Cash Flow is defined as any cash exceeding $20 million on the balance sheet at the end of each fiscal quarter[6]

Financial Data and Key Metrics Changes - Total operating revenue for Q1 2025 was $145 million, with total digital revenue growing 5% year over year [17] - Digital subscription revenue grew 40% year over year, contributing to the overall digital revenue growth [10][17] - Digital revenue has grown more than 17% annually since FY21, translating to a 13% annual growth in digital gross margin, with a digital margin of 70% [16] Business Line Data and Key Metrics Changes - Total digital revenue was $302 million on a trailing twelve-month basis, with $102 million from Amplified Digital agency [10] - Digital subscription revenue and Amplified Digital revenue both grew 14% year over year [17] - Digital subscription units increased by 8%, totaling 774,000 [38] Market Data and Key Metrics Changes - Digital subscription revenue has nearly doubled compared to the nearest industry peer, growing 46% annually over the last three years [9] - Amplified Digital agency revenue has grown 33% annually over the past three years, significantly outpacing competitors [9] Company Strategy and Development Direction - The company is focused on leveraging AI to enhance digital transformation and improve customer engagement [7][15] - A three-pillar growth strategy aims to achieve total digital revenue of over $450 million by 2028, with current annualized digital revenue at $302 million [24] - Investments in AI are expected to drive new revenue and maintain a dominant market position, with $40 million in annual cost reductions identified [20][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year guidance for FY2025, citing growth in core digital businesses and AI initiatives [36][39] - The company anticipates digital revenue growth of 7% to 10% and adjusted EBITDA growth in the low single digits for the year [25] Other Important Information - The company has favorable credit terms with Berkshire Hathaway, allowing focus on strategic execution [21][22] - Over $5 million in asset sales were closed in Q1, with an additional $1 million deal completed since then [22] Q&A Session Summary Question: Plans to monetize AI library and value proposition for advertising customers - Management is evaluating the best opportunities to monetize their AI library and believes the AI Boost program will provide significant benefits to advertisers [32][34] Question: Information on cost initiatives and confidence in digital revenue growth - Management highlighted confidence in achieving guidance due to scale from core digital businesses, AI initiatives, and identified cost reductions of $40 million [36][39]

Financial Data and Key Metrics Changes - Total operating revenue for the first quarter was $145 million, with total digital revenue growing 5% year over year, driven by a 14% increase in both digital subscription revenue and Amplify Digital revenue [14][18] - Digital revenue has grown more than 17% annually since FY 2021, translating to a 13% annual growth in digital gross margin, with a digital margin of 70% [14][15] - Digital subscription units increased by 8%, totaling 774,000 [26] Business Line Data and Key Metrics Changes - Digital subscription revenue grew 14% year over year, continuing to lead the company's growth [8][14] - Amplify Digital Agency revenue has significantly outpaced industry peers, growing 33% annually for the past three years [7] Market Data and Key Metrics Changes - Total digital revenue reached $320 million on a trailing twelve-month basis, including $102 million from Amplify Digital Agency [7] - The company is well-positioned to leverage AI partnerships to enhance digital revenue growth in the upcoming quarters [15][17] Company Strategy and Development Direction - The company is focused on digital transformation, leveraging AI to enhance customer engagement and advertising opportunities [6][10] - The three-pillar growth strategy aims to achieve total digital revenue of over $450 million by 2028, with continued growth in digital subscription revenue and new AI revenue opportunities [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year guidance for FY 2025, citing cost management initiatives and growth from core digital businesses [25][27] - The company expects total digital revenue growth in the range of 7% to 10% and adjusted EBITDA to grow in the low single digits [18] Other Important Information - The company has identified $40 million in annual cost reductions to be executed by the end of the second quarter [16][27] - Over $5 million in asset sales were closed in the first quarter, with an additional $25 million of non-core assets identified for monetization [17] Q&A Session Summary Question: Plans to monetize AI library and value proposition for advertising customers - Management is evaluating the best return for their content library and is focused on the AI Boost program to provide advertisers with enhanced visibility in the digital marketplace [22][23] Question: Information on cost initiatives and confidence in digital revenue growth - Management highlighted three factors for confidence: growth from core digital businesses, acceleration from AI initiatives, and identified cost reductions [25][27]

Financial Performance - Lee Enterprises reported a quarterly loss of $2.80 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.40, and compared to earnings of $0.12 per share a year ago, indicating an earnings surprise of -600% [1] - The company posted revenues of $144.56 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 3.98%, and down from $155.68 million year-over-year [2] - The current consensus EPS estimate for the upcoming quarter is -$1.48 on revenues of $142.59 million, and for the current fiscal year, it is -$2.77 on revenues of $593.43 million [7] Market Performance - Lee Enterprises shares have declined approximately 9.5% since the beginning of the year, while the S&P 500 has gained 3.1% [3] - The company has not surpassed consensus EPS estimates over the last four quarters, indicating a consistent underperformance [2][6] Industry Outlook - The Publishing - Newspapers industry, to which Lee Enterprises belongs, is currently ranked in the bottom 16% of over 250 Zacks industries, suggesting a challenging environment [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment [5]