E.W. Scripps Stock Surges 6% on Record Political Ad Revenue
E.W Scripps Stock Surges 6% following the announcement of record third-quarter revenue driven by strong political advertising. Although the media company reported earnings below estimates, the impressive revenue growth helped boost investor confidence.
Earnings Miss, But Revenue Exceeds Expectations
For Q3, E.W. Scripps reported an adjusted earnings per share (EPS) of $0.37, which fell short of analyst projections of $0.52. However, revenue surged 14% year-over-year, reaching $646.3 million and surpassing the consensus estimate of $627.86 million.
Local Media Segment Shines with Political Ad Revenue
The company’s Local Media segment experienced a significant revenue boost, climbing 26% to $445.6 million. This growth was primarily driven by political advertising revenue, which jumped to $125.2 million compared to just $9.1 million in the same quarter last year. E.W. Scripps now anticipates full-year political ad revenue for 2024 to exceed $340 million, well above the previous guidance of $270-$290 million.
Scripps’ Local Media political advertising revenue came in nearly 30% higher than our last presidential-election year, which was also a record,” said Scripps President and CEO Adam Symson. “This 2024 level highlights the strength of local broadcast programming as an ideal platform for reaching large audiences with candidate and political messages.
Political Ads Offset Core Advertising Decline
E.W Scripps Stock Surges, core advertising saw a decline, dropping 9.2% year-over-year to $129.3 million. The decrease was attributed to the displacement of core ads by political ads. Meanwhile, the Scripps Networks segment experienced a 6.4% decline in revenue, totaling $201.7 million.
Strong Cash Flow Supports Debt Reduction
Leveraging its strong cash flow, Scripps paid down $115 million of debt in Q3, reducing its leverage ratio from 6.0x at the end of Q2 to 5.1x. The company aims to pay down approximately $300 million in debt over the course of the year, further strengthening its financial position.
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