Gray Media Q4 Earnings Call Highlights

Core Insights - Gray Media's Net Retransmission Revenue returned to growth in Q4 2025, indicating progress in adapting to changing subscriber trends [1][6] - The company reported total revenue of $792 million for Q4 2025, exceeding guidance, with operating expenses also below expectations [3][4] - Political advertising contributed $12 million in revenue during the quarter, surpassing expectations [2][9] Financial Performance - Total operating expenses before depreciation and amortization were $618 million, which was $5 million below the low end of guidance [3] - Adjusted EBITDA for the quarter was $179 million, while the company reported a net loss of $23 million attributable to common stockholders [2][6] - For the full year 2025, Net Retransmission Revenue was essentially flat at $547 million compared to $550 million in 2024 [7][8] Advertising Trends - Core advertising revenue increased by 3% year over year in Q4 2025, slightly above guidance, with notable growth in financial, health, and home improvement sectors [9][10] - Digital revenue grew in low double digits during Q4, while local direct business rose in low single digits [10][11] - Political advertising guidance for Q1 2026 is set at $25 million to $30 million, compared to $26 million in Q1 2022 [13] Balance Sheet and Leverage - Gray completed a $250 million add-on to its 9.625% Second Lien Notes and called $125 million of First Lien Notes, ending the quarter with over $1.1 billion in liquidity [5][14] - The company aims to reduce leverage back towards 4x, with current leverage metrics reported as 2.43x first lien, 3.65x secured, and 5.8x total [18][15] Strategic Initiatives - Gray is focusing on operational initiatives, including new local and regional sports broadcasts, and has earned 10 national Edward R. Murrow Awards [17] - The company renewed its NBC affiliation agreement for three additional years, covering 54 markets, and expanded its Telemundo portfolio to 47 markets [19] - Gray completed the acquisition of WBBJ-TV for $25 million and anticipates further transactions pending regulatory approvals [20]