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]

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 transition from 21% digital revenue in 2020 to 53% in 2025 marks a critical revenue inflection point for the company [12] Company Strategy and Development Direction - The three-pillar digital growth strategy aims for $450 million in digital revenue by 2030, focusing on digital subscriptions and advertising [5][12] - The company is committed to achieving 90% digital revenue by fiscal year 2030, reducing reliance on print products [12][21] - Investments in content, branding, and consumer marketing are expected to drive digital subscription revenue to $175 million by fiscal 2030 [18][19] 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 adjusted EBITDA growth in mid-single digits for fiscal 2026, supported by ongoing digital transformation efforts [17] - The upcoming $50 million common stock rights offering is expected to enhance balance sheet flexibility and support digital transformation [21] Other Important Information - The company executed a strategic termination of its defined benefit pension plan, improving balance sheet flexibility and eliminating long-term cost uncertainty [17] - The company identified $25 million in additional non-core assets for future monetization, enhancing liquidity [17][21] - The CFO, Tim Millage, will depart in early 2026, with management expressing gratitude for his contributions [22] 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, with a reduction of approximately $3.5 million in fiscal 2025, excluding increases related to a cyber incident [25] Question: No further questions were asked, and the call concluded. - The call ended with management reiterating their focus on long-term transformation for the benefit of shareholders and stakeholders [26][27]

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][14] 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][11] - Digital advertising revenue contributed $184 million, with Amplified Digital Agency accounting for $103 million of this total [10][11] Market Data and Key Metrics Changes - Digital revenue constituted 53% of total company revenue, a notable increase from 21% in 2020, marking a critical revenue inflection point [12][21] - The company aims for $450 million in digital revenue by fiscal 2030, with a long-term goal of achieving 90% digital revenue [12][21] Company Strategy and Development Direction - The company is focused on a three-pillar digital growth strategy, which is expected to drive sustainable growth and long-term shareholder value [5][12] - Investments in local journalism, branding, and consumer marketing are anticipated to enhance digital subscription revenue, targeting $175 million by fiscal 2030 [18][19] - The company plans to leverage advanced data-driven advertising technology and expand its digital audience to boost high-margin digital advertising revenue [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving mid-single-digit adjusted EBITDA growth in fiscal 2026, despite challenges faced in 2025 [17] - The company anticipates a positive lift in digital revenue and margins in 2026 as transformational projects come to fruition [14][17] - The upcoming $50 million common stock rights offering is expected to support digital transformation and deleveraging efforts [21][22] Other Important Information - The company executed $40 million in annualized cost reductions and an additional $10 million entering fiscal 2026, focusing on non-core print operations [16][17] - A strategic termination of the fully funded defined benefit pension plan was announced, enhancing balance sheet flexibility [17] - The company is identifying opportunities to monetize non-core assets, with $9 million in asset sales completed in fiscal 2025 and an additional $25 million identified for future monetization [17] Q&A Session Summary Question: What was the total debt reduction in the fourth fiscal quarter and the full fiscal year? - Since the credit agreement was launched in 2020, the company has reduced debt by $121 million. In fiscal 2025, excluding increases due to the cyber incident, debt was reduced by approximately $3.5 million through operations and asset sales [26]

Core Insights - Lee Enterprises reported a significant growth in Adjusted EBITDA of 92% over Q2, indicating strong operational performance and effective cost management [1][2] - Total Digital Revenue reached $78 million, accounting for 55% of total revenue, reflecting the company's successful transition to a digital-first model [1][6] - Digital-only subscription revenue increased by 16% year-over-year, showcasing the growing demand for digital content among consumers [1][6] Financial Performance - Total operating revenue for the quarter was $141 million, with a net loss of $2 million and Adjusted EBITDA of $15 million, a 1% increase compared to the previous year [6][15] - Operating expenses decreased by 6% to $137 million, while cash costs fell by 7% to $128 million, demonstrating effective cost control measures [6][17] - The company achieved organic free cash flow growth, fulfilling all mandatory principal and interest payments through cash from operations since May 2025 [2][10] Digital Growth - Digital advertising and marketing services revenue totaled $49 million, representing 74% of total advertising revenue [6][16] - Amplified Digital Agency revenue grew by 10% year-over-year, highlighting the company's competitive position in the digital marketing space [1][2] - The number of digital-only subscribers reached 670,000, contributing $23 million in revenue, a 13% increase over the prior year [6][16] Debt and Cash Flow - The company has $455 million in outstanding debt with favorable terms, including a fixed annual interest rate of 9.0% and no fixed principal payments [5][10] - Cash on the balance sheet totaled $14 million, resulting in a net debt of $441 million after accounting for cash [10][20] - Capital expenditures for the quarter were $1 million, with expectations of up to $5 million for FY25 [10][20]

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]