Gray Television Posts Mixed Q3 Earnings: Will Q4 Revenue Come In Below Consensus?

Gray Television Inc GTN reported third-quarter (Q3) FY23 sales fell 12% Y/Y to $803 million, beating the analyst consensus of $796.1 million.

Core Advertising Revenue in the quarter was $363 million, an increase of 1% Y/Y. 

Television stations' core advertising revenue increased 1% Y/Y, and the automobile advertising category rose 18% Y/Y in Q3. 

Total broadcasting expenses increased 4% Y/Y to $557 million.

Operating income decreased to $84 million from $245 million a year ago.

EPS loss of 57 cents missed the consensus estimate of 32 cents.

Operating cash flow for six months was $565 million. As of Sept. 30, 2023, cash stood at $21 million.

In September, GTN inked a deal with the CW Network to extend the network affiliation agreements at most of its legacy stations and to start an affiliation with PeachtreeTV, the independent television station in the Atlanta market. 

Dividend: The Atlanta-based company declared a quarterly dividend per share of 8 cents, payable on Dec. 29, 2023, to shareholders of record as of Dec. 15, 2023.

Outlook: GTN sees Q4 revenue of $854 million - $864 million versus the consensus of $883.46 million. 

The company projects core advertising revenue of $410 million to $414 million and broadcasting expenses of $605 million to $610 million in Q4.

The company expects television station operations to grow advertising revenues during the remainder of 2023, led by its strong positions in local markets and the efforts of local station staff.

Price Action: GTN shares are trading lower by 7.26% at $6.90 premarket on the last check Wednesday.