Lee Enterprises reports Q2 EPS ($2.07) vs. ($2.06) last year

Reports Q2 revenue $137M vs. $146.6M last year “Our second quarter results demonstrate the continued progression of our digital transformation. Digital subscription revenue continues to grow rapidly, up 20% on a same-store basis in the quarter, as we yield higher average digital subscription rates for our 728,000 digital only subscribers. Amplified Digital Agency, our full-service digital marketing agency, continues to have strong revenue growth, up an industry-leading 9% on a same-store basis over the prior year,” said Kevin Mowbray, CEO. “Our company experienced a cyber security incident in February that had a significant impact on our quarterly operating results. We incurred $2 million in restoration costs in the quarter related to the cyber incident, and second quarter advertising revenue was impacted as our product portfolio was limited for a period of time. On the subscription side, our normal process for activating new digital subscribers was hampered, significantly impacting units in the quarter. I’m proud of how our team navigated the challenges as we are now recovered from the cyber incident and focused on executing our strategy. In March, we launched an AI solution designed to provide local businesses with the tools they need to thrive in a competitive environment, from data-driven insights to personalized marketing capabilities. The first offering in our AI suite of products, AI Enablement, is aimed to prepare local businesses for the AI transformation of the advertising model. We also took significant action on the cost side to address near-term challenges. We executed $40 million in annualized cost reductions in the second quarter, and trimmed capital and other spending to drive significant back-half free cash flow. As a result of our execution focus, we now expect our third and fourth fiscal quarters of FY25 to demonstrate improving year-over-year trends in Total Digital Revenue, and we expect year-over-year growth in Adjusted EBITDA. The updated outlook for FY25 represents the impacts from the current environment and the cyber incident but does not change our long-term expectations,” Mowbray added.