Tegna Q1 Revenue Dips 4%

Tegna this morning released first quarter 2024 results that included total revenue of $714 million, down 4% year-over-year, primarily due to lower subscription revenue, which was adversely impacted by a temporary disruption of service with a distribution partner, partially offset by higher political advertising dollars.

Subscription revenue was $375 million in the first quarter, down 9% year-over-year, primarily due to subscriber declines, the temporary disruption of service with a distribution partner in January, and a year-end adjustment that benefited first quarter 2023 results, partially offset by contractual rate increases. The underlying subscription revenue trend is down mid-single digits percent year-over-year.

Advertising and marketing services (AMS) revenue was $299 million in the first quarter, down 3% year-over-year. While national advertising showed softness, local advertising trends in the first quarter showed positive growth reflected in strong performance in automotive, services, entertainment, restaurants, banking and finance categories.

Dave Lougee, president-CEO, said: “Tegna remains focused on maximizing long-term value for our shareholders and delivering on our key priorities. We returned more than $100 million of capital to shareholders during the quarter and announced today that we are increasing our quarterly dividend by 10%.”

“We met our quarterly guidance metrics, with local advertising trends continuing to improve with positive performance in automotive and services, our two largest advertising categories as well as entertainment and restaurants. Our capabilities in local advertising are bolstered by Premion and deliver results for our clients in the converged linear and streaming television marketplace. The addition of Octillion further enhances Premion’s growth and margin potential by creating an even more attractive platform for advertisers, and we are already seeing early signs of success with our customers.

“In this new era of sports distribution, we are the first broadcast group with local television deals with teams across the NBA, WNBA, NHL and National Women’s Soccer League, including newly announced deals with the WNBA’s Indiana Fever, featuring first round pick Caitlin Clark, the NHL’s Seattle Kraken and National Women Soccer League’s Seattle Reign. These are win-win opportunities to marry local sports teams and their passionate fans with our strong station brands and our unparalleled distribution.

“We expect our previously announced business transformation initiatives to drive increased efficiency and generate annualized cost savings of $90-$100 million as we exit 2025. Several initiatives are already underway. In the quarter, we deployed a new, regional go-to-market strategy for digital advertising sales that reduces costs while better positioning Tegna to capture and fulfill digital campaigns. Our business transformation initiatives and industry-leading balance sheet position us well to take advantage of accretive opportunities to expand and diversify our business while keeping net leverage under 3.0x.

“Looking ahead, 2024 is shaping up to be another robust political cycle and we’re in a good position to take our fair share driven by our favorable portfolio of stations in key competitive markets.”

Read the company’s report here.