Tegna 1Q Revenue Drops 4%

Tegna this morning released first quarter 2023 results that included total revenue of $740 million, down 4% year-over-year, due to cyclical even-year events, primarily driven by the absence of political revenue and Winter Olympics on NBC, the company’s largest Big 4 affiliate portfolio, as well as the Super Bowl airing on NBC last year compared to Fox stations this year. Fox is Tegna’s smallest station portfolio.

Subscription revenue was a 1Q record $414 million, up 6% year-over-year, driven by contractual rate increases, a favorable comparison against the partial quarter interruption experienced with Dish last year, and partially offset by subscriber declines.

Advertising and marketing services (AMS) revenue was $308 million, down 13% year-over-year due to the absence of the Winter Olympics and Super Bowl last year on Tegna’s strong portfolio of NBC stations, as well as continued macroeconomic headwinds. Automotive advertising revenue continued to show strong year-over-year growth for the third consecutive quarter adjusting for Winter Olympics and Super Bowl.

Political revenue was $179 million up 9% from 2018, the last nonpresidential election year, on a pro forma basis.

Net income was $104 million on a GAAP basis, or $107 million on a non-GAAP basis.

Total company adjusted EBITDA was $205 million, representing a decrease of 18% compared to the same quarter of 2022.

GAAP operating expenses were $567 million, flat year-over-year, driven by increases in programming costs offset by lower stock-based compensation and lower M&A related costs. NonGAAP operating expenses were $564 million, up two percent year-over-year, with the increase driven entirely by programming costs, partially offset by lower stock-based compensation expense.

Free cash flow was $133 million for the quarter.

Total cash at the end of the quarter was $683 million.

On Feb. 22, 2022, Tegna and Standard General announced that Tegna will be acquired by an affiliate of Standard General for $24 per share in cash. Tegna stockholders voted to approve the transaction at the special meeting of stockholders held on May 17. On Feb. 24, 2023, the FCC issued a hearing designation order (HDO) with respect to the transaction. On March 27, 2023, certain of the parties to the merger agreement filed a notice of appeal of the HDO and a petition for a writ of mandamus with the United States Court of Appeals for the District of Columbia. On April 3, 2023, the D.C. Court of Appeals dismissed the appeal of the HDO. On April 21, 2023, the D.C. Court of Appeals denied the petition for a writ of mandamus. TEGNA is currently evaluating its options.

Read the company’s report here.

Also, Tegna declared a regular quarterly dividend of 9.5 cents per share, payable on July 3 to stockholders of record as of the close of business on June 9.