Financial Data and Key Metrics Changes - Total revenue for fiscal 2025 was $562 million, with 53% derived from digital sources, indicating a significant shift towards digital reliance over legacy print business [4][11] - Digital-only subscription revenue reached $94 million, with a year-over-year growth of 16% on a same-store basis, despite challenges from a cyber incident [4][11] - Adjusted EBITDA showed growth for the second consecutive quarter, reflecting effective cost management and operational execution [6][15] Business Line Data and Key Metrics Changes - The digital marketing services business, Amplified Digital Agency, surpassed $100 million in revenue with a 5% growth on a same-store basis [5][10] - Digital subscription revenue growth was 32% annually over the last three years, significantly outpacing industry peers [8][12] - Total digital revenue for fiscal 2025 was $298 million, representing 53% of total company revenue, highlighting the successful transition to a digital-first model [11][12] Market Data and Key Metrics Changes - Digital revenue growth was 2% on a same-store basis, indicating solid momentum in the digital transformation strategy [10] - The company nearly doubled the number of clients valued at over $1 million annually, showcasing the effectiveness of its innovative solutions [10] - The digital advertising revenue from Amplified Digital Agency contributed $103 million to the total digital advertising revenue of $184 million [10][11] Company Strategy and Development Direction - The company aims to achieve $450 million in digital revenue by fiscal 2030, supported by a three-pillar digital growth strategy [5][8] - There is a focus on diversifying and expanding offerings for advertisers, with a goal of over $250 million in digital advertising revenue by 2030 [19][20] - The company is transitioning towards a predominantly digital model, with a target of 90% digital revenue by fiscal 2030 [12][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to drive sustainable growth and deliver long-term value to shareholders, despite challenges faced in fiscal 2025 [7][15] - The company anticipates a positive lift in digital revenue and margin in 2026 as transformational projects come to fruition [15][17] - The upcoming $50 million common stock rights offering is expected to support digital transformation and deleveraging efforts [21] Other Important Information - The company executed a strategic termination of its fully funded defined benefit pension plan, enhancing balance sheet flexibility [17] - Cash costs decreased by 5% compared to the previous year, finishing at $524 million, reflecting disciplined cost management [16] - The company has identified $25 million of non-core assets for future monetization, which will improve liquidity [17] Q&A Session Summary Question: What was the total debt reduction in the fourth fiscal quarter and the full fiscal year? - The company reduced debt by $121 million since the credit agreement was launched in 2020. In fiscal 2025, excluding increases due to the cyber incident, debt was reduced by approximately $3.5 million [25] Question: No further questions were asked, and the call concluded with closing remarks from management [26]

Core Insights - Lee Enterprises reported a total operating revenue of $137 million for the second quarter of fiscal 2025, with digital revenue accounting for 53% of this total at $73 million, reflecting a 3% increase year-over-year [2][9] - Digital-only subscription revenue grew by 20% year-over-year, reaching $24 million, with a total of 728,000 digital-only subscribers [2][9] - The company faced challenges due to a cyber security incident in February, incurring $2 million in restoration costs and impacting advertising revenue [4][9] Financial Performance - Total operating revenue was $137 million, down from $146.55 million in the same quarter last year [9][16] - Operating expenses totaled $143 million, which included $2 million related to cyber restoration costs, marking a 6% decrease compared to the prior year [9][16] - The net loss for the quarter was $12 million, with an Adjusted EBITDA of $8 million [9][18] Digital Transformation - Digital subscription revenue increased by 20% on a same-store basis, indicating strong growth in the digital segment [3][9] - Amplified Digital Agency revenue reached $25 million, up 9% year-over-year, showcasing the effectiveness of the company's digital marketing services [2][3] - The company launched an AI solution aimed at supporting local businesses in adapting to the evolving advertising landscape [5] Cost Management - Lee Enterprises executed $40 million in annualized cost reductions during the second quarter to address near-term challenges [6] - The company anticipates improving year-over-year trends in Total Digital Revenue for the third and fourth fiscal quarters of FY25 [6] Debt and Cash Flow - The company has $453 million in outstanding debt under a favorable credit agreement with BH Finance, which includes a fixed annual interest rate of 9.0% [8][14] - Cash on the balance sheet totaled $5 million, with debt net of cash amounting to $448 million [14]