Gannett Co., Inc. [GCI] Filings

10-Q 1 gci-20240630.htm 10-Q gci-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________

FORM 10-Q

_______________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___ to ___

Commission file number 001-36097

___________________________

GANNETT CO., INC.
(Exact name of registrant as specified in its charter)

___________________________

Delaware

38-3910250

(State or Other Jurisdiction of Incorporation or Organization)

(I.R.S. Employer Identification No.)

175 Sully's Trail, Suite 203,

Pittsford,

New York

14534-4560

(Address of principal executive offices)

(Zip Code)

Registrant's telephone number, including area code: (585) 598-0030

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Common Stock, par value $0.01 per share

GCI

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.


Large Accelerated Filer	☐	Accelerated Filer	☒
Non-Accelerated Filer	☐	Smaller Reporting Company	☐
		Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No ☒

As of July 29, 2024, 147,599,699 shares of the registrant's Common Stock were outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including "Part I, Item 2 — Management's Discussion and Analysis of Financial Condition and Results of Operations," contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect our current views regarding, among other things, our future or ongoing growth, results of operations, performance, business prospects and opportunities, stock repurchases, and our environmental, social and governance goals, and are not statements of historical fact. Words such as "anticipate(s)," "expect(s)," "intend(s)," "plan(s)," "focus," "goal," "project," "believe(s)," "will," "aim," "would," "could," "can," "may," "seek(s)," "estimate(s)" and similar expressions are intended to identify such forward-looking statements.

Forward-looking statements are based on management's current expectations and beliefs and are subject to a number of known and unknown risks, uncertainties, and other factors that could lead to actual results materially different from those described in the forward-looking statements. We can give no assurance our expectations will be attained. Our actual results, liquidity, and financial condition may differ from the anticipated results, liquidity, and financial condition indicated in the forward-looking statements. Forward-looking statements are not a guarantee of future performance and involve risks and uncertainties, and there are certain important factors that could cause our actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements, including, among others, the risks identified by us under the heading "Risk Factors" in this Quarterly Report on Form 10-Q, and under the heading "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the Securities and Exchange Commission on February 22, 2024, as well as other risks and factors identified from time to time in our subsequent filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. Except to the extent required by law, we expressly disclaim any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or change in events, conditions, or circumstances on which any statement is based.

INDEX TO GANNETT CO., INC.

Q2 2024 FORM 10-Q


Item No.		Page
	Part I. Financial Information
1	Financial Statements (unaudited)	2
2	Management's Discussion and Analysis of Financial Condition and Results of Operations	25
3	Quantitative and Qualitative Disclosures About Market Risk	46
4	Controls and Procedures	46

	Part II. Other Information
1	Legal Proceedings	48
1A	Risk Factors	48
2	Unregistered Sales of Equity Securities and Use of Proceeds	48
3	Defaults Upon Senior Securities	48
4	Mine Safety Disclosures	48
5	Other Information	48
6	Exhibits	49
	Signatures	50

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

GANNETT CO., INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


In thousands, except share data	June 30, 2024		December 31, 2023
Assets	(Unaudited)
Current assets:
Cash and cash equivalents	$	98,886	$	100,180
Accounts receivable, net of allowance of $14,514 and $16,338 as of June 30, 2024 and December 31, 2023, respectively	241,649		266,096
Inventories	22,427		26,794
Prepaid expenses	39,426		36,210
Other current assets	15,647		14,957
Total current assets	418,035		444,237
Property, plant and equipment, net of accumulated depreciation of $342,821 and $336,408 as of June 30, 2024 and December 31, 2023, respectively	233,892		239,087
Operating lease assets	157,980		221,733
Goodwill	533,687		533,876
Intangible assets, net	478,697		524,350
Deferred tax assets	40,166		37,125
Pension and other assets	191,029		180,839
Total assets	$	2,053,486	$	2,181,247
Liabilities and equity
Current liabilities:
Accounts payable and accrued liabilities	$	304,882	$	293,444
Deferred revenue	112,259		120,502
Current portion of long-term debt	60,452		63,752
Operating lease liabilities	41,694		45,763
Other current liabilities	8,361		10,052
Total current liabilities	527,648		533,513
Long-term debt	531,211		564,836
Convertible debt	423,370		416,036
Deferred tax liabilities	—		2,028
Pension and other postretirement benefit obligations	40,391		42,661
Long-term operating lease liabilities	183,137		203,871
Other long-term liabilities	98,459		100,989
Total noncurrent liabilities	1,276,568		1,330,421
Total liabilities	1,804,216		1,863,934
Commitments and contingent liabilities (See Note 11)
Equity
Preferred stock, $0.01 par value per share, 300,000 shares authorized, none of which were issued and outstanding at June 30, 2024 and December 31, 2023	—		—
Common stock, $0.01 par value per share, 2,000,000,000 shares authorized, 158,817,284 shares issued and 147,653,745 shares outstanding at June 30, 2024; 158,554,705 shares issued and 148,939,463 shares outstanding at December 31, 2023	1,588		1,586
Treasury stock, at cost, 11,163,539 shares and 9,615,242 shares at June 30, 2024 and December 31, 2023, respectively	(20,499)		(17,393)
Additional paid-in capital	1,432,682		1,426,325
Accumulated deficit	(1,098,212)		(1,027,192)
Accumulated other comprehensive loss	(65,786)		(65,541)
Total Gannett stockholders' equity	249,773		317,785
Noncontrolling interests	(503)		(472)
Total equity	249,270		317,313
Total liabilities and equity	$	2,053,486	$	2,181,247

The accompanying notes are an integral part of these condensed consolidated financial statements.

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GANNETT CO., INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Unaudited)


	Three months ended June 30,				Six months ended June 30,
In thousands, except per share amounts	2024		2023		2024		2023
Digital	$	278,378	$	262,103	$	545,877	$	509,581
Print and commercial	361,462		410,254		729,724		831,693
Total revenues	639,840		672,357		1,275,601		1,341,274
Operating costs	391,474		426,096		793,873		856,284
Selling, general and administrative expenses	183,019		184,127		363,508		364,517
Depreciation and amortization	38,258		39,784		76,556		83,482
Integration and reorganization costs	19,775		7,287		37,656		19,414
Asset impairments	—		1,177		45,989		1,182

Loss (gain) on sale or disposal of assets, net	236		146		788		(17,535)
Other operating expenses	112		229		151		458
Total operating expenses	632,874		658,846		1,318,521		1,307,802
Operating income (loss)	6,966		13,511		(42,920)		33,472
Interest expense	26,270		28,559		52,835		56,889
Loss (gain) on early extinguishment of debt	87		—		(530)		(496)
Non-operating pension income	(3,137)		(2,263)		(6,283)		(4,078)
Equity income in unconsolidated investees, net	(559)		(621)		(374)		(831)
Other non-operating (income) expense, net	(2,609)		(807)		(792)		414
Non-operating expenses	20,052		24,868		44,856		51,898
Loss before income taxes	(13,086)		(11,357)		(87,776)		(18,426)
(Benefit) provision for income taxes	(26,803)		1,333		(16,725)		(15,996)
Net income (loss)	13,717		(12,690)		(71,051)		(2,430)
Net loss attributable to noncontrolling interests	(31)		(13)		(31)		(97)
Net income (loss) attributable to Gannett	$	13,748	$	(12,677)	$	(71,020)	$	(2,333)

Income (loss) per share attributable to Gannett - basic	$	0.10	$	(0.09)	$	(0.50)	$	(0.02)
Income (loss) per share attributable to Gannett - diluted	$	0.09	$	(0.09)	$	(0.50)	$	(0.02)

Other comprehensive income (loss):
Foreign currency translation adjustments	$	(223)	$	5,827	$	(912)	$	12,164
Pension and other postretirement benefit items:
Net actuarial gain (loss)	—		13,968		(538)		25,564
Amortization of net actuarial gain (loss)	232		8		469		12

Amortization of prior service cost	(125)		17		(250)		33
Equity method investments	—		—		116		610
Other	(317)		(2,631)		1,010		(5,542)
Total pension and other postretirement benefit items	(210)		11,362		807		20,677
Other comprehensive (loss) income before tax	(433)		17,189		(105)		32,841
Income tax (benefit) provision related to components of other comprehensive income (loss)	(30)		2,942		140		5,304
Other comprehensive (loss) income, net of tax	(403)		14,247		(245)		27,537
Comprehensive income (loss)	13,314		1,557		(71,296)		25,107
Comprehensive loss attributable to noncontrolling interests	(31)		(13)		(31)		(97)
Comprehensive income (loss) attributable to Gannett	$	13,345	$	1,570	$	(71,265)	$	25,204

The accompanying notes are an integral part of these condensed consolidated financial statements.

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GANNETT CO., INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Six months ended June 30,
In thousands	2024		2023
Operating activities
Net loss	$	(71,051)	$	(2,430)
Adjustments to reconcile net loss to operating cash flows:
Depreciation and amortization	76,556		83,482
Share-based compensation expense	6,338		8,783
Non-cash interest expense	10,513		10,567
Loss (gain) on sale or disposal of assets, net	788		(17,535)

Gain on early extinguishment of debt	(530)		(496)

Asset impairments	45,989		1,182

Pension and other postretirement benefit obligations	(15,399)		(6,792)
Equity income in unconsolidated investees, net	(374)		(831)
Change in other assets and liabilities, net	4,746		(23,144)







Cash provided by operating activities	57,576		52,786
Investing activities

Purchase of property, plant and equipment	(22,725)		(16,448)
Proceeds from sale of real estate and other assets	6,073		31,465
Change in other investing activities	386		(12)
Cash (used for) provided by investing activities	(16,266)		15,005
Financing activities




Repayments of long-term debt	(39,575)		(51,291)



Treasury stock	(3,103)		(2,622)


Changes in other financing activities	(846)		(647)
Cash used for financing activities	(43,524)		(54,560)
Effect of currency exchange rate change on cash	396		98
(Decrease) increase in cash, cash equivalents and restricted cash	(1,818)		13,329
Cash, cash equivalents and restricted cash at beginning of period	110,612		104,804
Cash, cash equivalents and restricted cash at end of period	$	108,794	$	118,133

The accompanying notes are an integral part of these condensed consolidated financial statements.

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GANNETT CO., INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)


	Three months ended June 30, 2024
	Common stock			Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit		Treasury stock			Non-controlling interest
In thousands	Shares	Amount								Shares	Amount				Total
Balance at March 31, 2024	158,565	$	1,586	$	1,429,137	$	(65,383)	$	(1,111,960)	10,979	$	(19,927)	$	(472)	$	232,981
Net income (loss) attributable to Gannett	—	—		—		—		13,748		—	—		(31)		13,717




Other comprehensive loss, net(a)	—	—		—		(403)		—		—	—		—		(403)
Share-based compensation expense	—	—		3,512		—		—		—	—		—		3,512
Issuance of common stock	252	2		22		—		—		—	—		—		24
Treasury stock	—	—		—		—		—		130	(571)		—		(571)
Restricted share forfeiture	—	—		—		—		—		54	(1)		—		(1)
Other activity	—	—		11		—		—		—	—		—		11
Balance at June 30, 2024	158,817	$	1,588	$	1,432,682	$	(65,786)	$	(1,098,212)	11,163	$	(20,499)	$	(503)	$	249,270


	Three months ended June 30, 2023
	Common stock			Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit		Treasury stock			Non-controlling interest
In thousands	Shares	Amount								Shares	Amount				Total
Balance at March 31, 2023	157,981	$	1,580	$	1,413,397	$	(87,941)	$	(989,057)	8,760	$	(16,883)	$	(453)	$	320,643
Net loss attributable to Gannett	—	—		—		—		(12,677)		—	—		(13)		(12,690)



Other comprehensive income, net(a)	—	—		—		14,247		—		—	—		—		14,247
Share-based compensation expense	—	—		5,047		—		—		—	—		—		5,047
Issuance of common stock	455	4		21		—		—		—	—		—		25

Treasury stock	—	—		—		—		—		167	(483)		—		(483)
Restricted share forfeiture	—	—		—		—		—		384	(4)		—		(4)
Other activity	—	—		112		—		—		—	—		—		112
Balance at June 30, 2023	158,436	$	1,584	$	1,418,577	$	(73,694)	$	(1,001,734)	9,311	$	(17,370)	$	(466)	$	326,897

(a) For the three months ended June 30, 2024 and 2023, Other comprehensive (loss) income is net of an income tax benefit of $30 thousand and an income tax provision of $2.9 million, respectively.

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GANNETT CO., INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)


	Six months ended June 30, 2024
	Common stock			Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit		Treasury stock			Non-controlling interest
In thousands	Shares	Amount								Shares	Amount				Total
Balance at December 31, 2023	158,555	$	1,586	$	1,426,325	$	(65,541)	$	(1,027,192)	9,615	$	(17,393)	$	(472)	$	317,313
Net loss attributable to Gannett	—	—		—		—		(71,020)		—	—		(31)		(71,051)




Other comprehensive loss, net(a)	—	—		—		(245)		—		—	—		—		(245)
Share-based compensation expense	—	—		6,338		—		—		—	—		—		6,338
Issuance of common stock	262	2		47		—		—		—	—		—		49

Treasury stock	—	—		—		—		—		1,281	(3,103)		—		(3,103)
Restricted share forfeiture	—	—		—		—		—		267	(3)		—		(3)
Other activity	—	—		(28)		—		—		—	—		—		(28)
Balance at June 30, 2024	158,817	$	1,588	$	1,432,682	$	(65,786)	$	(1,098,212)	11,163	$	(20,499)	$	(503)	$	249,270


	Six months ended June 30, 2023
	Common stock			Additional paid-in capital		Accumulated other comprehensive loss		Accumulated deficit		Treasury stock			Non-controlling interest
In thousands	Shares	Amount								Shares	Amount				Total
Balance at December 31, 2022	153,286	$	1,533	$	1,409,578	$	(101,231)	$	(999,401)	7,063	$	(14,737)	$	(369)	$	295,373
Net loss attributable to Gannett	—	—		—		—		(2,333)		—	—		(97)		(2,430)


Restricted share grants	4,682	47		(47)		—		—		—	—		—		—

Other comprehensive income, net(a)	—	—		—		27,537		—		—	—		—		27,537
Share-based compensation expense	—	—		8,783		—		—		—	—		—		8,783
Issuance of common stock	468	4		46		—		—		—	—		—		50

Treasury stock	—	—		—		—		—		1,124	(2,622)		—		(2,622)
Restricted share forfeiture	—	—		—		—		—		1,124	(11)		—		(11)
Other activity	—	—		217		—		—		—	—		—		217
Balance at June 30, 2023	158,436	$	1,584	$	1,418,577	$	(73,694)	$	(1,001,734)	9,311	$	(17,370)	$	(466)	$	326,897

(a) For the six months ended June 30, 2024 and 2023, Other comprehensive (loss) income is net of an income tax provision of $0.1 million and $5.3 million, respectively.

The accompanying notes are an integral part of these condensed consolidated financial statements.

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — Description of business and basis of presentation

Description of business

Gannett Co., Inc. ("Gannett", "we", "us", "our", or the "Company") is a diversified media company with expansive reach at the national and local level dedicated to empowering and enriching communities. We seek to inspire, inform, and connect audiences as a sustainable, growth focused media and digital marketing solutions company. We endeavor to deliver essential content, marketing solutions, and experiences for curated audiences, advertisers, consumers, and stakeholders by leveraging our diverse teams and suite of products to enrich the local communities and businesses we serve.

Our current portfolio of trusted media brands includes the USA TODAY NETWORK, comprised of the national publication, USA TODAY, and local media organizations in the United States (the "U.S."), and Newsquest, a wholly-owned subsidiary operating in the United Kingdom (the "U.K."). Our digital marketing solutions brand, LocaliQ, uses innovation and software to enable small and medium-sized businesses ("SMBs") to grow, and USA TODAY NETWORK Ventures, our events division, creates impactful consumer engagements, promotions, and races.

Through USA TODAY, our network of local properties, and Newsquest, we deliver high-quality, trusted content with a commitment to balanced, unbiased journalism, where and when consumers want to engage. We have strong relationships with hundreds of thousands of local and national businesses in both our U.S. and U.K. markets due to our large local and national sales forces and a robust advertising and digital marketing solutions product suite. Our strategy prioritizes maximizing the monetization of our audience through the growth of increasingly diverse and highly recurring digital businesses. We deliver value to our customers, advertisers, partners and shareholders with essential content, joyful experiences, and relevant digital solutions.

The Company reports in three segments: Domestic Gannett Media, Newsquest and Digital Marketing Solutions ("DMS"). We also have a Corporate and other category that includes activities not directly attributable to a specific reportable segment and includes broad corporate functions, such as legal, human resources, accounting, analytics, finance, marketing and technology, as well as other general business costs. A full description of our reportable segments is included in Note 12 — Segment reporting.

Basis of presentation

The unaudited condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. As permitted under those rules, certain notes or other financial information that are normally required by U.S. GAAP have been condensed or omitted from these interim financial statements. The unaudited condensed consolidated financial statements should therefore be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.

In the opinion of management, the unaudited condensed consolidated financial statements as of June 30, 2024 include all the assets, liabilities, revenues, expenses, and cash flows of entities which Gannett controls due to ownership of a majority voting interest ("subsidiaries"). In addition, in the opinion of management, the unaudited condensed consolidated financial statements as of June 30, 2024 reflect all necessary adjustments for a fair statement of the results for the interim period. All significant intercompany accounts and transactions have been eliminated in consolidation, and the Company consolidates its subsidiaries.

Use of estimates

The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and footnotes thereto. Actual results could differ materially from those estimates.

Significant estimates inherent in the preparation of the unaudited condensed consolidated financial statements include pension and postretirement benefit obligation assumptions, income taxes, goodwill and intangible asset impairment analysis,

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valuation of property, plant, and equipment and the mark to market of the conversion feature associated with the convertible debt.

Reclassifications

Certain reclassifications have been made to the prior year unaudited condensed consolidated financial statements to conform to classifications used in the current year. Beginning in the first quarter of 2024, the Company updated the presentation of its revenues to reflect the disaggregation between Digital revenues and Print and commercial revenues. These reclassifications had no impact on net income (loss), stockholders' equity or cash flows as previously reported.

Recent accounting pronouncements not yet adopted

Disclosure improvements

In November 2023, the FASB issued guidance, ASU 2023-07, which will improve reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 applies to all public entities that are required to report segment information in accordance with ASC 280, "Segment Reporting." The Company will be required to report these enhanced segment disclosures starting in annual periods beginning after December 15, 2023 and requires retrospective application to all prior periods presented in the financial statements. The Company does not expect the adoption of this guidance will have a material impact on the condensed consolidated financial statements and disclosures.

In November 2023, the FASB issued guidance, ASU 2023-09, which enhances annual income tax disclosures. ASU 2023-09 requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 will be effective for annual periods beginning after December 15, 2024. The Company is currently evaluating the provisions of the updated guidance and assessing the impact on the condensed consolidated financial statements and disclosures.

NOTE 2 — Revenues

Revenues are recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

The Company's condensed consolidated statements of operations and comprehensive income (loss) present revenues disaggregated by revenue type. Sales taxes and other usage-based taxes are excluded from revenues.

The following tables present our revenues disaggregated by segment and revenue type:


	Three months ended June 30, 2024
In thousands	Domestic Gannett Media		Newsquest		Digital Marketing Solutions		Corporate and other		Intersegment eliminations		Consolidated
Digital advertising	$	70,922	$	13,543	$	—	$	—	$	—	$	84,465
Digital marketing services	35,967		1,925		123,798		—		(38,377)		123,313
Digital-only subscription	44,622		1,660		—		—		—		46,282
Digital other	20,444		2,616		—		1,258		—		24,318
Digital	171,955		19,744		123,798		1,258		(38,377)		278,378

Print advertising	119,000		19,904		—		—		—		138,904
Print circulation	146,690		16,633		—		—		—		163,323
Commercial and other(a)	54,264		4,971		—		—		—		59,235
Print and commercial	319,954		41,508		—		—		—		361,462

Total revenues(b)	$	491,909	$	61,252	$	123,798	$	1,258	$	(38,377)	$	639,840

(a) For the three months ended June 30, 2024, included in Commercial and other revenues was Commercial printing and delivery revenues of $37.3 million and $2.6 million at the Domestic Gannett Media and Newsquest segments, respectively.

(b) Revenues generated from international operations comprised 11.1% of total revenues for the three months ended June 30, 2024.

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	Three months ended June 30, 2023
In thousands	Domestic Gannett Media		Newsquest		Digital Marketing Solutions		Corporate and other		Intersegment eliminations		Consolidated
Digital advertising	$	69,175	$	12,321	$	—	$	—	$	—	$	81,496
Digital marketing services	35,357		2,301		122,789		—		(37,908)		122,539
Digital-only subscription	36,601		1,255		—		—		—		37,856
Digital other	15,898		2,641		—		1,673		—		20,212
Digital	157,031		18,518		122,789		1,673		(37,908)		262,103

Print advertising	131,311		17,964		—		—		—		149,275
Print circulation	178,264		17,492		—		—		—		195,756
Commercial and other(a)	61,588		3,635		—		—		—		65,223
Print and commercial	371,163		39,091		—		—		—		410,254

Total revenues(b)	$	528,194	$	57,609	$	122,789	$	1,673	$	(37,908)	$	672,357

(a) For the three months ended June 30, 2023, included in Commercial and other revenues was Commercial printing and delivery revenues of $45.0 million and $1.9 million at the Domestic Gannett Media and Newsquest segments, respectively.

(b) Revenues generated from international operations comprised 10.0% of total revenues for the three months ended June 30, 2023.


	Six months ended June 30, 2024
In thousands	Domestic Gannett Media		Newsquest		Digital Marketing Solutions		Corporate and other		Intersegment eliminations		Consolidated
Digital advertising	$	141,863	$	27,068	$	—	$	—	$	—	$	168,931
Digital marketing services	72,053		4,013		240,843		—		(77,182)		239,727
Digital-only subscription	86,533		3,228		—		—		—		89,761
Digital other	39,241		5,355		—		2,862		—		47,458
Digital	339,690		39,664		240,843		2,862		(77,182)		545,877

Print advertising	234,619		38,961		—		—		—		273,580
Print circulation	302,936		33,710		—		—		—		336,646
Commercial and other(a)	110,383		9,115		—		—		—		119,498
Print and commercial	647,938		81,786		—		—		—		729,724

Total revenues(b)	$	987,628	$	121,450	$	240,843	$	2,862	$	(77,182)	$	1,275,601

(a) For the six months ended June 30, 2024, included in Commercial and other revenues was Commercial printing and delivery revenues of $77.8 million and $5.1 million at the Domestic Gannett Media and Newsquest segments, respectively.

(b) Revenues generated from international operations comprised 11.1% of total revenues for the six months ended June 30, 2024.

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	Six months ended June 30, 2023
In thousands	Domestic Gannett Media		Newsquest		Digital Marketing Solutions		Corporate and other		Intersegment eliminations		Consolidated
Digital advertising	$	136,849	$	24,857	$	—	$	—	$	—	$	161,706
Digital marketing services	67,422		4,495		235,606		—		(72,301)		235,222
Digital-only subscription	71,279		2,408		—		—		—		73,687
Digital other	30,789		5,106		—		3,071		—		38,966
Digital	306,339		36,866		235,606		3,071		(72,301)		509,581

Print advertising	259,488		37,741		—		—		—		297,229
Print circulation	366,767		34,443		—		—		—		401,210
Commercial and other(a)	125,537		7,717		—		—		—		133,254
Print and commercial	751,792		79,901		—		—		—		831,693

Total revenues(b)	$	1,058,131	$	116,767	$	235,606	$	3,071	$	(72,301)	$	1,341,274

(a) For the six months ended June 30, 2023, included in Commercial and other revenues was Commercial printing and delivery revenues of $94.1 million and $3.9 million at the Domestic Gannett Media and Newsquest segments, respectively.

(b) Revenues generated from international operations comprised 10.1% of total revenues for the six months ended June 30, 2023.

Deferred revenues

The Company records deferred revenues when cash payments are received in advance of the Company's performance obligation. The Company's primary source of deferred revenues is from circulation subscriptions paid in advance of the service provided, which represents future delivery of publications (the performance obligation) to subscription customers. The Company expects to recognize the revenue related to unsatisfied performance obligations over the next one to twelve months in accordance with the terms of the subscriptions.

The Company's payment terms vary by the type and location of the customer and the products or services offered. The period between invoicing and when payment is due is not significant. For certain products or services and customer types, the Company requires payment before the products or services are delivered to the customer. The majority of our subscription customers are billed and pay on monthly terms.

The following table presents the change in the deferred revenues balance:


	Six months ended June 30,
In thousands	2024		2023
Beginning balance	$	120,502	$	153,648

Receipts, net of refunds	544,626		546,494
Revenue recognized	(552,869)		(562,664)
Ending balance	$	112,259	$	137,478

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NOTE 3 — Accounts receivable, net

Receivables are presented net of allowances, which reflect the Company's expected credit losses based on historical experience as well as current and expected economic conditions. The following table presents changes in the allowance for doubtful accounts:


	Six months ended June 30,
In thousands	2024		2023
Beginning balance	$	16,338	$	16,697
Current period provision	1,619		3,305
Write-offs charged against the allowance	(5,503)		(8,993)
Recoveries of amounts previously written-off	2,024		2,045
Other	36		116

Ending balance	$	14,514	$	13,170

For the three and six months ended June 30, 2024, the Company recorded $1.0 million and $1.6 million in bad debt expense, respectively. For the three and six months ended June 30, 2023, the Company recorded $1.9 million and $3.3 million in bad debt expense, respectively. Bad debt expense is included in Selling, general and administrative expenses on the condensed consolidated statements of operations and comprehensive income (loss).

NOTE 4 — Goodwill and intangible assets

Goodwill and intangible assets consisted of the following:


	June 30, 2024						December 31, 2023
In thousands	Gross carrying amount		Accumulated amortization		Net carrying amount		Gross carrying amount		Accumulated amortization		Net carrying amount
Finite-lived intangible assets:
Advertiser relationships	$	445,841	$	257,536	$	188,305	$	446,609	$	236,168	$	210,441
Other customer relationships	100,980		61,573		39,407		101,819		56,601		45,218
Subscriber relationships	250,822		169,549		81,273		251,099		155,528		95,571
Other intangible assets	66,870		63,944		2,926		68,780		62,536		6,244
Sub-total	$	864,513	$	552,602	$	311,911	$	868,307	$	510,833	$	357,474
Indefinite-lived intangible assets:
Mastheads					166,786						166,876
Total intangible assets					$	478,697					$	524,350

Goodwill					$	533,687					$	533,876

The Company performs its annual goodwill and indefinite-lived intangible impairment assessments as of November 30. In addition to the annual impairment test, the Company is required to regularly assess whether a triggering event has occurred under both ASC 350 "Intangibles - Goodwill and Other" ("ASC 350"), and ASC 360 "Property, Plant and Equipment" ("ASC 360"), which would require interim impairment testing.

As of June 30, 2024, the Company performed a review of potential impairment indicators under both ASC 350 and ASC 360, and it was determined that no indicators of impairment were present.

NOTE 5 — Integration and reorganization costs, and asset impairments

Integration and reorganization costs

Integration and reorganization costs include severance costs as well as other reorganization costs associated with individual restructuring programs, designed primarily to right-size the Company's employee base, consolidate facilities and improve operations. These initiatives impact all the Company's operations and can be influenced by the terms of union contracts. Costs related to these programs, which primarily include severance and other reorganization-related expenses, are accrued when probable and reasonably estimable or at the time of program announcement.

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Severance-related expenses

The Company recorded severance-related expenses by segment as follows:


	Three months ended June 30,				Six months ended June 30,
In thousands	2024		2023		2024		2023
Domestic Gannett Media	$	4,116	$	1,332	$	8,193	$	6,844
Newsquest	243		376		412		976
Digital Marketing Solutions	84		(48)		109		(28)
Corporate and other	(14)		891		969		5,012
Total	$	4,429	$	2,551	$	9,683

Gannett Co., Inc. [GCI] Filings
10-Q	[2024-08-01]
10-Q	[2024-05-02]
10-K	[2024-02-22]
10-Q	[2023-11-02]
10-Q	[2023-08-03]
10-Q	[2023-05-04]
10-K	[2023-02-23]
10-Q	[2022-11-03]
10-Q	[2022-08-04]
10-Q	[2022-05-05]
10-K	[2022-02-24]
10-Q	[2021-11-05]
10-Q	[2021-08-06]
10-Q	[2021-05-07]
10-K	[2021-02-26]
10-Q	[2020-11-03]
10-Q	[2020-08-06]
10-Q	[2020-05-07]
10-K	[2020-03-02]
10-Q	[2019-10-31]
10-Q	[2019-08-07]
10-Q	[2019-05-02]
10-K	[2019-02-28]
10-Q	[2018-10-31]
10-Q	[2018-08-02]
10-Q	[2018-05-03]
10-K	[2018-02-28]
10-Q	[2017-10-26]
10-Q	[2017-07-27]
10-Q	[2017-04-27]
10-K	[2017-02-21]
10-Q	[2016-10-27]
10-Q	[2016-07-28]
10-Q	[2016-04-28]
10-K	[2016-02-25]
10-Q	[2015-10-29]
10-Q	[2015-07-30]
10-Q	[2015-04-30]
10-K	[2015-03-06]
S-1	[2014-12-19]
10-Q	[2014-10-30]
10-Q	[2014-07-31]
10-Q	[2014-05-05]
10-K	[2014-03-19]
S-1	[2014-02-12]
S-1	[2013-12-10]