Gannett(US:GCI)2025-12-09 15:47Summary of USA TODAY Co. Conference Call Company Overview - Company: USA TODAY Co. - Industry: Media and Communications - Key Operations: Operates over 200 local, regional, and national newspapers in the U.S., Newsquest in the U.K., and LOCALiQ, a digital marketing services business [1][3] Core Strategies and Priorities - Mission: To inform, inspire, and connect communities through unbiased journalism [3] - Digital Audience: Achieves 187 million unique digital visitors monthly, the largest among local and national media providers [3] - Revenue Focus: Aiming for over 50% of revenue to come from digital sources by 2026, currently at 47% in Q3 [6][49] Revenue Streams and Monetization - Digital Revenue Growth: Emphasis on monetizing through digital advertising, subscriptions, e-commerce, and licensing [4][6] - LOCALiQ: A $500 million digital marketing solutions business aimed at helping small and medium-sized businesses grow [4] - AI Licensing: Engaged in significant AI licensing deals, including partnerships with Perplexity, Meta, Microsoft, and Amazon [15][16] - Advertising Strategy: Focus on leveraging the large digital audience for advertising revenue, with a strong programmatic channel [24][25] AI and Content Licensing - AI Impact: Acknowledges potential disruption from AI but sees growth in audience engagement [10] - Content Protection: Actively blocking AI scraping bots, with 75 million attempts blocked monthly [11][12] - Licensing Opportunities: Exploring monetization of archives and real-time content licensing for AI companies [16] Financial Performance and Cost Management - Cost Savings: Implemented a $100 million cost savings program, focusing on efficiencies in print operations and technology automation [45][46] - Debt Reduction: Prioritizing debt paydown, with plans to reduce debt by over $135 million in 2025 [52][53] - EBITDA Growth: Anticipates year-over-year EBITDA growth in Q4 and a strong outlook for 2026 [47][49] New Initiatives and Market Expansion - Play Launch: Introduced a new gaming hub, "Play," to enhance engagement and offer new monetization avenues [35][39] - Vertical Expansion: Plans to expand into new content verticals such as sports, entertainment, and finance, focusing on video-first content [41][42][43] - Newsquest Performance: Newsquest, the second-largest publisher in the U.K., is performing well and contributes to overall growth [57] Market Outlook and Investor Confidence - Digital Transition: Transitioning to a predominantly digital business model by 2026, with expectations of revenue growth and improved EBITDA [58][59] - Shareholder Value: Anticipates significant opportunities for shareholder value through digital advertising and AI licensing [59] Conclusion - Pivotal Moment: USA TODAY Co. is at a critical juncture with a strong digital audience, diverse revenue streams, and a focus on innovation and efficiency, positioning itself for future growth and profitability [58][59]