TGNA - Earnings call transcript Q3 2024

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Operator

Good day, and thank you for standing by. Welcome to the TEGNA Third Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to turn the conference over to your speaker for today, Kirk von Seelen. Please go ahead.

Kirk von Seelen

you. Thank welcome Quarter and and Conference our Webcast. to morning, XXXX Third Call Good Kirk I Seelen, name von My is and am Treasurer. TEGNA's TEGNA's CEO, fourth and our Heskett, results Mike and provide third review and our and quarter full quarter outlook. Today, TEGNA's performance CFO, Steib; will year Julie After that, call for we'll questions. open the to this press had release. you've Hopefully, review the opportunity morning's

you at tegna.com. available have release, the it's not If yet of seen a copy

our includes in actual differ you Before may we that remind measures. forward-looking get statements, also and call are filings. to that and started, Factors financial presentation this webcast results to differ. certain may our I'd conference them non-GAAP includes This like cause SEC outlined

to have most the GAAP directly reconciliations comparable in those We provided measures the measures release. of press

turn call the Mike. me to over that, With let

Mike Steib

excited serve. shareholders here everybody. and hard working Kirk, our we morning, good and Thanks, communities to be the I'm for

X% been per X% election, of Since never know, And and for satellite folks a our the call have X% online. it's as viewers to to heels keep this homes the in on challenged been as the XXXX, declining declining homes democracy, advertising also year X% have declined On journalism and per pay TV want undergone our transformation, to with has week's team our in more shifted this to America. helping traditional TV more important in local informed commend communities and the I advertisers world never digital engaged has cable while teens, been has year.

not telling approximately is difficult that that strong and across hypercompetitive take their to news, the web, where reporting moment. team it particular, in U.S. TEGNA's the extremely and good strongly communities month to missing leadership in TEGNA particular, is the majority the environment, Traditional But and every destiny important and across business trusted has people opportunities XX% continue million Local audience digital broadcast streaming have vast a local to fallen behind, television. media build news of doing here. this local We people value In job. in local the is linear and brands, positions XXX reach media establish apps, history is brands, has advantage evolve an attractive markets mobile both.

Our in mean brands continue local and our to lot a the products to people communities. our

boundless stations. content Some of new continue advertising around technological sports AI audiences you on resilient products will great really moment where a massive of the Julie with devices underlying TV to for share and and offering all the and At wins shift rights appetite value of political improve productivity. where a show to our opportunities is

for build strong moment our company a foundation. like profitable future the a is more on TEGNA Now to

and taking Over leverage process advantages. our the us we're the last fresh years, has with behind lot leadership been look complete, competitive merger how at a transition a few through TEGNA our to best

hypothesize to have leadership In operating initial processes two, jobs that at fully ensure our doing leaders to structures are few away and Number this our and The moment offense possible. TEGNA we're that I X and the stations ensuring field we that are across on the is org huddle effectively across been my we're we our move set and spending with the now at efficiently exploited. reviewing enterprise from have there synergies the the urgency excellence business come focus. with into that of us. Number potential as no not accountability as on. we're across the going and the time company with team, I've first weeks stations I've the that system an key opportunities the culture, here, have to one, at

we driving but leveraging and we Number the driving are well user reach better of better our sales revenue. we're potential through to to And of path channels. doing audience, ensure a drive product. from serve nose-to-tail amount ensure to create Number underutilizing a is a and opportunities revenue the and smart AI a we every process creation we expand every believe content ultimately to we user is technology. dollar sizable efficiency scrutinizing four, expense number digital of generate online each power a our company per deepening audience we're marketing our and the Today, a users engagement and automation, and see examining I are and review our engagement in investment, to company. below of five, three, to for myriad are

This tell a seen There's so what can't and in optimistic. I've yield. first the far is to what company what exactly is a I my that ensure bright still me urgency you energy of exactly But sense to we quarter work makes for the here, is TEGNA. need going and future

Legal business Chief is Now Tolston. space. CLO a turn welcome Alex understanding to over, company want public experienced Officer, before deep of I our it an He's our going with on a high-impact Alex new nails I a be environments, and dynamic to trusted the partner negotiator fast-paced a a to team addition is and he's proven tough TEGNA. comfortable that winner. He's

at our hand I'll results. a to now detailed Julie over financial to it more provide look

Julie Heskett

Mike. everyone. you, Thank Good morning,

initiatives with on by performance. covering allocation I'll before on TEGNA's quarter, begin clear provide a a bringing third capital today immediate forward. review for the he sense results financial has with time, closing guidance. our cost just our have to update fresh team made team, energizing a urgency our In execution perspective execution our and impact Mike an of then short a to of our drive focus thrilled accelerating are our and already We a control leading an

will non-GAAP and drivers on TEGNA's basis performance a operational to visibility you trends into today consolidated focus provide with primarily results. of comments on My business financial our the

reported can our prior data in You press comparatives release. period and our find all

marketing X% political and guidance XX% uptick offset This some from softness are AMS in primarily advertising as by our to increased third AMS. quarter national performance company Total in well growth. million, Olympic slightly customers up of referred as year-over-year Here to continued headlines. displacement. services $XXX strength and an to advertising as was by revenue year-over-year was exceeding as for Games political the revenue Summer revenue XX% was driven

important third note NBC Olympic and Tokyo. group, our total watched XX% quarter, driven emphasize games An advertising NBC up affiliate largest linear the summer for was last portfolio across by a TEGNA experienced to games hours the in the in our versus sales growth in core station. is Paris our

our education are including categories, advertising several health services, finance, performance travel and encouraged We and entertainment, tourism. by across care, local banking,

categories home and retail be automotive, However, improvement continue soft. to

subscription our at look let's Now revenue.

to our quarter, revenue X% year-over-year $XXX For million. decreased subscription third the

renew traditional end subscribers approximately traditional will our and approximately of at XX% XX% XXXX. of We the year MVPD of in subscribers this

revenue political to third advertising. in Turning the We political delivered quarter. record

X Our matched to is political the political XXXX, $XXX excluding election date having despite Senate million and day runoff. year-to-date through advertising approximately fewer nearly competitive advertising races, XXXX House Georgia Senate

cycles the While not broadcast. footprint of created strategic all durability states political in of battleground results advertising equal, further political across are and emphasize key importance the our

structural Now let legacy we expenses quarter. me reductions make turn to operations. for cost third continue our across the to

from cost trend to to initial the year-over-year. In we quarter, improving management X% were flat has second improved throughout first reductions. benefit expense the quarter, our year. up In we Our been as expenses started

when business. we the focusing our such excluding initiatives, note believe on includes in we discuss a of we Now and in rights cost areas this core Premion. reduction We year-over-year. as growth traditional efforts are quarter, third which our of areas picture X% It's operations, legacy a our achieved cost important sports that provides programming, to clearer reduction

when Looking we we generate ahead, million remain million track XXXX. annualized exit $XXX on to core to savings $XX in

We to core goal. these we in cost I XXXX. balance that meet to we invest organically business a are our overall management $XX of continue to To focused annualized this approximately This achieve position other discussion, or XX% us end to on the we million puts expect strong in of operations, in areas want our savings business. emphasize core while as

Specifically, while engagement. important agreements audience grow local are our programming recent sports expenses strong impacting to our rights

is the quarter. Premion has momentum Additionally, experienced into heading fourth

Turning allocation. to capital

at adjusted us Cash quarter, quarter. million annual of XX% XXXX. capital million shareholders keeping commitment dividends in to an $XX shareholders, X.X below returning of share finished average cash XXXX XXXX million returned million representing shares track price and on leverage at Net repurchases, to X.Xx, XX% to the $XX return of equivalents comprised million in guidance. we of we Xx the third meet totaled make the We have our of at in over million progress and $XX.XX. continue returned $XXX the to In and to period. end flow commitment $XXX $XX the on million our of our third between Year-to-date, and approximately quarter approximately free $XXX cash to shareholders

our to turning outlook. Now

flow one year $X.X combined full guidance XXXX as our out million of guidance XXXX, all to guidance. $XXX call improvement free to We adjusted rate are reaffirming as is There well key tax cash regarding metrics our XXXX billion.

We through available Reduction reflecting our tax the guidance of XXXX inflation tax discount to made purchase year are lowering XX%, rate a full XX% at to credits effective a Act XXXX. of

we quarter, political company driven advertising. by in total GAAP fourth XX% strength to up be expect the For to year-over-year, revenue XX%

quarter non-GAAP part X% are growth reduction from by Premion core operating cost we In cost performance. programming by expenses total fourth also realized closing, in offset compared quarter be with savings up to X% third in our to driven of We but XXXX, expect pleased and our to initiatives.

let's With that, questions. call open the operator, for

Operator

question [Operator our Cahall from Wells today will coming Fargo. of first Instructions] And for be Steven

Steven Cahall

acquired, morning. due for possibly the was going apart early a your to sure be looks under get we're It like deal wasn't It that to and year. an more the actions So FCC next ago long favorable much this then that really agreement Mike, of TEGNA fell starting comments FCC. to thanks so

flow opportunities do leverage you how within on more repurchases, there or maybe how that of that And cash So how about the knowing just kind about balance allocation think of reducing you free for opportunities stock between be some that? affect cash building sheet the ahead. does or could TEGNA think here

through in there. cost have having that the duly ahead, you'll not in going reduction 'XX due costs just probably seems revenue showed then the And to It like in QX? political really lower

we as organic to some but about talked investments. expense year, also growth think is about maybe it it logical next the So you about down being in year-on-year, think

trying put how So that all just think together. about to we

Mike Steib

you. with forward to needs personal be working opinion to I be Thank that you, regulatory am I'm Steve. looking and regime the the here reevaluated. -- certainly to excited

markets. makes the any Fox share advertising station you that by broadcaster markets, at any in look our than foreign by If our XXx news audiences yet we're broadcaster not owned any does allowed single of Waco, viewing and a is Google in Texas. greater buy And adversary. a young today, And has TikTok revenue to of

a ensure long local So I'm prosperous certainly what at be hopeful future that the right for and news. will to local looking regime regulators and regulatory the broadcast is

for particular, mind, to there believers that synergies are -- are the the either leadership certainly we through or a In shareholders acquirer the us basis in the Whether are most With across what we board down unlocks markets unlock in and where team a opportunities value we board. to shareholders is to big value for here the for an that our and be or operate. seller on combinations. from market-by-market

you until know know don't You prices.

capital allocation is job right forever. decisions good making be really be capital really to going allocators and be Our we're and and we're focused focused going on to on now to the

me, forgive nonanswer. of it's bit little -- So a it's a

to should of know to you weigh and opportunities you're position in think right. whatever a to value to that whatever that instinct want shareholders lot is unlock having be in with for a we're these I going And themselves. going we're conversations present be

Steven Cahall

expenses? on Julie, And

Julie Heskett

Yes.

on working which and returning sports programming and both you So XXXX. which focusing the which really as expense. quarter the is you'll happening see is fourth with on you're right. in cost top in growth, exactly businesses, we've Octillion with and X underlying have here the integration preparing We're comes of invested we the line here Steven, in rights, hard of legacy as first are trends, our seen takeout to quarters successfully well What of that expenses, Premion with

specific in that going XXXX. realistic XXXX rate be probably details now, fourth will are on to growth you're coming forward the more that something not we guidance. going as of So quarter any see is with right But into

Operator

be our Company. line The question of next the And will Benchmark from Kurnos Dan of coming

Daniel Kurnos

of your appreciate aggressive Glad here. it sounds Maybe these looking of all I'm to any any more the level, you way how differences? to these in you're breadth, thoughts a on before, no mean outlook a lot things you sizing things of way that oriented. us. or were initial Great. guessing high Yes. of things Is two, you get least your philosophical sort just gave between any and expense like talking number have us and pieces way to at. one. of few the Mike, Number of opportunities. or vision I directional were at there things of

to Just but growing great. of be -- said would any trajectory there should QX. How specifically wasn't we growth Julie, that you in don't kind acceleration you help kind Premion assume returning quantify need there? QX? to view it And directional of in means the then, I

Mike Steib

On lot one, Dan, a busted with through comparison. give useful can the the can is, for and tell not I merger few a the a first But has I been you I'm a what transition. question. the thank years philosophical you sort last company you of over CEO sure

but we're as there looking put part, and talking front product a we're re-energization about, talent, how looking is operating on in was And one out we're us us execution. help of is at that nose-to-tail our and a best platforms. And do what and review think was about importantly, side, revenue product in absolute ensures my at don't invest that our in also I content not our focus there to create across where share to helps the to that cost, to heard real the to the but rundown best to talking the our -- better -- investing a but system, just a audience in all in we certainly I what so to what and of is on serves have put more different markets, of is AI monetize software here And important you and us automation dollar win the and processes it. we're also market better win that going helps leveraging we

Julie Heskett

take I'll Premion Dan, the question, on one. And that

services, to It overall in trends performed saw were advertising Premion quarter continues was up positive, QX. the release, linear comp another business. up did which low the tough be and have that So here national of in marketing our QX, In year. Core slightly. you actually the digits. QX. local growth single returning local to But foresee remind third was And Premion Premion I double up want quarter has we well that you, digits. area is do Premion in Premion continuously to the down. And of that brought throughout

accelerate we that go We continue to into as see QX.

Operator

Research. from Huber coming of be will question next our And Craig Huber

Craig Huber

a Premion time the quarter like Can in Great. Julie, Premion. just a up follow-up mid-single what in the of wise? there you're on growth this terms at for looking us year-over-year? you of . for, give sense or thinking fourth Are digits you

Julie Heskett

Yes.

going So of revenue. line we're not our guide to specific to items, Craig,

total digits. specifically I'll political saw driven grow QX, challenged in But I of local, that in the continues growth be said, going XX% in Premion, just mostly which to project QX, as to XX% we driven revenue because double AMS political heavy quarter to plus is to just do to by by rearticulate return You displacement. fourth

Craig Huber

next having for months? you're better any where at there changes least a first you up sensing out next on could out the Premion, think you year, as end year X there year And is

Julie Heskett

not XXXX for any time. this We're providing at guidance

continues have We and opportunities continue local to to be Premion growth challenged. national

Craig Huber

Can me Okay. you... you if understand help

Mike Steib

Premion quick add we a strategic about let also on sure guys -- wondering think because A are just I'm how note that me generally. quick you one

TV. connected to that sets had And of we and have that not reach the serve the run advertisers helping across ability did television. and the local moved especially those our the with same they we markets linear relationships expand them in have has The audience the really business, Over audience lot to as in decade, their better a to local by and television digital. last advertisers to sales markets up that them serve us brands and ads nicely in teams that the

It is execution is, -- we part, story. think it So it's opportunity. real a an in

that been We sells exceptional a our have have to connecting to, in company historically, television. even markets, platforms, at we be though advertisers' our those across advertisers audiences

these So earlier, opportunity through better channels a of is a lot digital point the growth the sort that about. it we've I of excitement the thinking on it's something component got going a fourth of was about have for in execution to touched --

Craig Huber

separate Mike, And little then, note a just here.

and seen think I doing the know, so here and mean the you've of acquisitions digital As far what going risky forward company landscape, and I terms you that there very, and media forth, very you contemplating digital think as mean with in acquisitions XX over is the you're so And about strategies stuff. potentially underperforming be have I done littered last and years stuff. the can here.

company work make in mess is digital come will do what the and I'm your and X a or occasional just stuff. and for stuff CEOs some of And like appetite and like really at different some pretty revamp quo a TEGNA, acquisitions you while? status to totally need contented direction? do try you in company feel this degree are Or you to to for X

Mike Steib

try and I'll then vaguely answer answer to specifically.

capability revenue to made time. did acquisition companies of can back fully the it and in they everyone and costs, they understand. or space others, that or some had when started that lost and opportunity my Universal. didn't inevitably then gotten bunch to development saw there, if vaguely, ago time always kind other I value. brought NBC, a of different of as strategic savings I revenue So in at acquisition of And One synergies like acquisitions real media and lot unlocked kinds was NBC shirts. feel We and years corporate of And my acquirer it but those in you a the village became A cost unlock which acquisitions. some referred two didn't through their a a my harken media at and -- space kind

when synergy. that cost brings the or mind, together, two success have with for of it revenue career through see get meet it in we your about, that There we probably description. were If assets excited acquisitions savings a seen you lot reason. be are first put real where it to that acquisitions in my that acquisitions camp, I not would digital unlocks

in old we'll the for can't only to we the months landscape. about as sense But in the I we're this quarter opportunities be an on coming the answer think way first here you. and that to a get I'm So all way my better M&A. getting fashioned over

Premion both You're together. risk. execution and pay And pays as for supposed out flow the well, well result, a takeover assets as to two more you well cash as acquisition have put the comes to that

Craig Huber

could if for looking TV question, are Mike, can they election, tell I is Julie have post ask any Final your far? Okay. basis? pacings a year-over-year election trend so the best you the bookings or basis And the post the the advertising how on year-over-year a here better on you

Julie Heskett

I'll that take Yes, Craig, one.

to So what know, as same where with are and and consumers signs you mixed that have resiliency seem throughout signals. displacement we signs seen, economic also you in that saw we of been QX, XXXX what is then continued, political have had very and also challenge see Obviously, but of pattern. QX. There there's their spending cautious advertisers QX,

in Olympics we June, it's in in saw because with would specifically at than what challenged, really October it's and you of range. if will seen But hindered that is and go QX back displacement. still kind But November. of April, both and political May, I you've say, To of same December and similar look sluggish It So what to quarter the October, looks similar QX, be and better fourth kind displacement, better. sequentially point, your November. political QX, dirty is

Operator

Instructions] Sholl of Research. is from [Operator Barrington next Our Patrick coming question

Patrick Sholl

little Premion share maybe you're bit shifted if broadcast contributing talking growth any in if the of And rebound could I nonpolitical is Or kind the wondering it's it political a on that if of and you all -- between in Premion? was how about? to has QX? just and is if and political talk that

Julie Heskett

I'll take Patrick. that,

political of that is CTV take a of programmatic U.S. Premion nationwide. So on. the perspective, broadcast political that those is share that a from shift equation, some and of on the a focused shift spending political. advertising, is to not clear takes to those there's political of which product political national I day the yes, Yes, are of think dollars. still spent And majority the side a in From able But spending. Premion is digital overall most Premion it benefactory is wins of

would So Premion Yes, call I not it material some got political. a number.

TV on driven isolated heavy QX With very Our said, on say political, just to by not I Premion we that in returning can Premion's QX local. growth growth political linear side. is see do that the again but to is a nonpolitical

Operator

David next And will of from our JPMorgan. question coming Karnovsky be

David Karnovsky

I wanted to to Do ownership expand either independently? possible see maneuver for substantial the market on to you congressional require if the action? kind think piece, of on has room rules of the press is you or Maybe could in easing terms what just regulatory Or think will in changes you FCC cap?

to a their you on be of as about then sports, local look terms at anything expand you Are Can team And I aiming kind to we or broadly of could available. want kind Mike, retrans? deals of question, structured you high on if say how even games at second the adjacencies a ads in the or alone see benefit are come might deals should if more profitable especially to more level?

Mike Steib

has opportunity cap and expert in But this. hired the duopoly the the rules, view on here the fairness, I in FCC our wasn't leading UHF world's that I'm drive the change to the David, because national discount. is and

more I think informed of on opinions inform among the -- folks were all call, sort on you this that.

are been question matter reach. mean, right drive as with to in the coming that in sales the to they secondly, rights also have But not that to they the to sports, all as to the to years large available many economics increasingly an possible the have for these deliver sales them. need One, ticket dollars things on Secondly, as you these Jersey teams, the I audience door. want really two able reach come. love know, we become of And there sports and us. RSNs

important out linear you live these sports content seems local keeping be open more these television. is advertiser if All embedded is, it of you'll opportunities also run suited said, some lose hoping up emerging gave with think other the as make money, that back deals accounts. a bunch in way. and because sort I rights you of I do of I'd refer your an and framework on to like a that the to will M&A. Anything flow whose question rights. It do of returns cash lot broadcast We in an is audience reemerging returns and to shareholders company would, we the your in investment is perfectly engagement clear the job component for our flow And doors at to cash do capital. cost so deliver and our company's

at these to we are ways these we money. rights, when So rights to looking make at sports look get

Operator

And call now to for back conclude Q&A the remarks. I Please like turn go Mike ahead. this today's session. would to closing does

Mike Steib

important with Well, for of this support team. and here excited for how fantastic of working questions with collection I thanks, special It's assets. And to your everyone, this the am the tell I you be very mission company. can't

So to at questions, quarter have look working I'll today, together. we'll to if Thanks, you here back folks everybody. next and talk be we'll and talk forward you to all and

Operator

for you today's in call. Thank conference participating

now may disconnect. You

TEGNA (TGNA) 7 Nov 242024 Q3 Earnings call transcript