Lee Enterprises Incorporated : Q2'26 Earnings Presentation

Published: 2026-05-07 09:46:10 ET LEE

Published on 05/07/2026 at 09:46 am EDT

MAY 7, 2026

Intensely local content

Serving 114 local markets across the US

Breaking news

Today, as throughout our history, in every one of the communities we serve, no competitor can match

the indispensable local news, information and advertising we deliver to huge audiences of all ages.

Total Revenue

Digital Mix of Total Revenue

Adjusted EBITDA(1)

$532M

LTM March 2026

56%

Q2 FY26

$57M(2)

LTM March 2026

Digital Subscribers

Digital Subscription Revenue

Digital Agency Revenue

591,000

March FY26

$94M

LTM March FY26

$100M

LTM March FY26

Lee is a dominant source of local news, information, and advertising in midsized markets

(1) Adjusted EBITDA and Cash Costs are non-GAAP financial measures. See appendix.

(2) LTM Adjusted EBITDA includes $6 million of business interruption insurance proceeds from the February 2025 cyber incident.

(3) Same-store revenues is a non-GAAP performance measure based on U.S. GAAP revenues for Lee for the current period, excluding exited operations. See appendix. 4

$15M

Adjusted EBITDA(1), last four quarters

$15M $15M

$15M

Adjusted EBITDA YOY %, last four quarters

95%

$13M

$12M

$8M

61%

14%

Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26

78% Adjusted EBITDA growth YOY in 1st Half FY26

(1) Adjusted EBITDA is a non-GAAP financial measure. See appendix.

(2) Q1 Adjusted EBITDA includes $2 million of business interruption insurance proceeds from the February 2025 cyber incident. Q1 YOY Adjusted EBITDA is +35% without insurance proceeds. 5

(3) Q2 Adjusted EBITDA includes $4 million of business interruption insurance proceeds from the February 2025 cyber incident. Q2 YOY Adjusted EBITDA is +45% without insurance proceeds..

Adjusted EBITDA and Adjusted EBITDA margin grew over prior year

Saw positive momentum in digital revenue mix

Improved capital structure

Adjusted EBITDA(1) grew 95% to $15 million

Adjusted EBITDA margin grew 670 basis points YOY to 12.4%

Cash Costs(1) declined $19 million, or 15%, over prior year driven by reduced compensation and legacy print costs

Significant year-over-year improvement in Digital Revenue mix - by 270 basis points

74% of total advertising revenue sourced from digital revenue streams; up 140 basis points from PY

$53 million of cash on the Balance Sheet to finish March

Interest rate reduction from 9% to 5% effective mid-Q2. Expected to provide $18 million in annual savings

New Chairman of the Board, CEO, CFO, and refreshed Board of Directors

Adjusted EBITDA

Digital Revenue as a % of Total Revenue

Interest Expense

$7.8M

$15.1M

Up 95%

from PY

52.8%

55.6%

270 bps

Down 23%

to PY

$10.0M

$7.6M

Q2 FY25 Q2 FY26

Q3 FY24 Q3 FY25

(1) Adjusted EBITDA and Cash Costs are non-GAAP financial measures. See appendix. 6

(2) Q2 Adjusted EBITDA includes $4 million of business interruption insurance proceeds from the February 2025 cyber incident. Q2 YOY Adjusted EBITDA is +45% without insurance proceeds..

Key Themes

Addressable Market

High-quality Local Audience:

Anonymous Users

13 million

Known Users

4 million

Subscribers

591,000

Market as of Q2 FY26

Shift toward high-intent users to deliver stronger engagement & monetization

Strengthen Conversion & Retention:

Use data, analytics and product improvements to improve conversion rates and maximize lifetime value

Scalable & Efficient Growth:

Leverage AI & optimized workflows to grow revenue while lowering cost to acquire users

Addressable

More valuable subscriber base drives more efficient growth

Key Themes

Recurring Revenue:

Move from transactional sales to predictable & performance-based deals

Integrated Solutions:

End-to-end marketing services that drive deeper client relationships

Data-driven Growth:

Utilize owned platforms and product innovation to create a scalable competitive advantage

Driving profitable, recurring revenue

Digital Subscription

Revenue

Digital Agency

Revenue

Total Digital

Revenue

$256M

+25%(1)

+5%(1)

$290M

+4%(1)

$94M

$100M

$48M

$86M

LTM Mar FY23 LTM Mar FY26

Scaling high-quality, recurring digital revenue streams

(1) CAGR represents the compounded annual growth rate from LTM March FY23 to LTM March FY26.

FY2020 Q2 FY2026

21%

56%

REVENUE MIX

% Digital

Early stages of Digital Transformation

Industry-leading digital revenue growth is transforming the mix of revenue

From print-dependent to digital-dominant

Digital Transformation

Digital Sustainability

Key Takeaways

Digital revenue replacing print revenue and growing at 9% CAGR(2)

Digital subscription revenue and gross margin

growing at a 28% CAGR(2)

Amplified Digital® Agency revenue growing at a 21% CAGR(2)

FY21 FY25 FY26E FY27E FY28E FY29E FY30E

Nearing digital sustainability: Digital gross margin(1) expected to surpass SG&A costs within the next three years.

Digital gross margin(1) SG&A

Digital transformation is nearing sustainability

(1) Digital Gross Margin is a non-GAAP performance measure calculated by Digital Revenue less Cost of Good Sold ("COGS") directly tied to digital products. Digital Gross Margin

excludes all Selling, General, and Administrative ("SG&A") costs. 11

(2) CAGR represents the compounded annual growth rate from March FY21 YTD to March FY26 YTD.

$686M

$524M

Down 14%(1)

$270M

$44M

$45M

$68M

$81M

$121M

$144M

$233M

FY21 FY22 FY23 FY24 FY25 1H FY25 1H FY26

Cost discipline driving profitability and strategic reinvestment

(1) Adjusted EBITDA and Cash Costs are non-GAAP financial measures. See appendix.

$121 million debt reduction since refinancing in March 2020

Favorable credit agreement with Berkshire Hathaway

Fixed annual interest rate reduced to 5% from 9% for five years post private placement transaction in February 2026, generating expected interest savings of approximately $18 million annually*

25-year runway with no breakage costs or prepayment penalties

No financial performance covenants and no fixed amortization

Executing strategic termination of the company's fully funded

defined benefit pension plan

Eliminating the long-term volatility tied to interest rate movement, mortality assumptions and asset performance while preserving participant benefits and improving balance sheet flexibility

Identified noncore assets with an estimated value of up to $20 million for monetization

$576M

$455M

Q2 2020 Q2 2026

$41M

$23M

2025 *Annual estimate

*Annual interest paid estimated based on 13

current outstanding debt ($455 million)

YOY growth in the mid-single digits

Adjusted EBITDA(1)

FY26 Outlook

Key Metric

(1) Adjusted EBITDA is a non-GAAP financial measure. See appendix.

The Company uses non-GAAP financial performance measures to supplement the financial information presented on a U.S. GAAP basis. These non-GAAP financial measures, which may not be comparable to similarly titled measures reported by other companies, should not be considered in isolation from or as a substitute for the related U.S. GAAP measures and should be read together with financial information presented on a U.S. GAAP basis.

The Company defines its non-GAAP measures as follows:

Adjusted EBITDA is a non-GAAP financial performance measure that enhances financial statement users overall understanding of the operating performance of the Company. The measure isolates unusual, infrequent or non-cash transactions from the operating performance of the business. This allows users to easily compare operating performance among various fiscal periods and how management measures the performance of the business. This measure also provides users with a benchmark that can be used when forecasting future operating performance of the Company that excludes unusual, nonrecurring or one-time transactions. Adjusted EBITDA is a component of the calculation used by stockholders and analysts to determine the value of our business when using the market approach, which applies a market multiple to financial metrics. It is also a measure used to calculate the leverage ratio of the Company, which is a key financial ratio monitored and used by the Company and its investors. Adjusted EBITDA is defined as net income (loss), plus non-operating expenses, income tax expense, depreciation and amortization, (gain) loss on asset sales, impairments and other, restructuring costs and other, stock compensation, and our 50% share of EBITDA from TNI and MNI, minus equity in earnings of TNI and MNI.

Cash Costs represent a non-GAAP financial performance measure of operating expenses which are measured on an accrual basis and settled in cash. This measure is useful to investors in understanding the components of the Company's cash-settled operating costs. Periodically, the Company provides forward-looking guidance of Cash Costs, which can be used by financial statement users to assess the Company's ability to manage and control its operating cost structure. Cash Costs are defined as compensation, newsprint and ink and other operating expenses. Depreciation and amortization, assets loss (gain) on sales, impairments and other, other non-cash operating expenses and other expenses are excluded. Cash Costs also exclude restructuring costs and other, which are typically paid in cash.

Same-store revenues is a non-GAAP performance measure based on U.S. GAAP revenues for Lee for the current period, excluding exited operations. Exited operations include (1) business divestitures and (2) the elimination of stand-

alone print products discontinued within our markets.

Gross Margin is a non-GAAP financial performance measure that enhances financial statement users overall understanding of the operating performance of the Company. The measure isolates operating costs that directly support revenue. Depreciation and amortization, assets loss (gain) on sales, impairments and other, net, other non-cash operating expenses, Selling, General, and Administrative ("SG&A") compensation and SG&A other operating expenses are excluded from Gross Margin.

Comparable basis is a non-GAAP performance measure based on U.S. GAAP trends for Lee for the current period, excluding the extra week in fiscal 2024. The fourth quarter and full year of fiscal 2025 consisted of 13 weeks and 52 weeks, respectively. The fourth quarter and full year of fiscal 2024 consisted of 14 weeks and 53 weeks, respectively.

TNI and MNI - TNI refers to TNI Partners publishing operations in Tucson, AZ. MNI refers to Madison Newspapers, Inc. publishing operations in Madison, WI.

Management's Use of Non-GAAP Measures

These Non-GAAP Measures are not measurements of financial performance under U.S. GAAP and should not be considered in isolation or as an alternative to income from operations, net income (loss), revenues, or any other measure of performance or liquidity derived in accordance with U.S. GAAP. We believe these non-GAAP financial measures, as we have defined them, are helpful in identifying trends in our day-to-day performance because the items excluded have little or no significance on our day-to-day operations. These measures provide an assessment of controllable expenses and afford management the ability to make decisions which are expected to facilitate meeting current financial goals as well as achieve optimal financial performance. We use these Non-GAAP measures of our day-to-day operating performance, which is evidenced by the publishing and delivery of news and other media and excludes certain expenses that may not be indicative of our day-to-day business operating results.

Limitations of Non-GAAP Measures

Each of our non-GAAP measures have limitations as analytical tools. They should not be viewed in isolation or as a substitute for U.S. GAAP measures of earnings. Material limitations in making the adjustments to our earnings to calculate Adjusted EBITDA using these non-GAAP financial measures as compared to U.S. GAAP net income (loss) include: the cash portion of interest / financing expense, income tax (benefit) provision, and charges related to asset impairments, which may significantly affect our financial results. Management believes these items are important in evaluating our performance, results of operations, and financial position. We use non-GAAP financial measures to supplement our U.S. GAAP results in order to provide a more complete understanding of the factors and trends affecting our business.

(Millions of Dollars)

Q1 FY2025

Q2 FY2025

Q3 FY2025

Q4 FY2025

FY 2025

Q1 FY2026

Q2 FY2026

Digital Advertising and Marketing Services

46.7

43.9

49.1

44.1

183.8

42.8

40.7

YoY % (1)

1.7%

-2.5%

-1.0%

-11.0%

-3.3%

-6.6%

-4.6%

Digital Only Subscription Revenue

21.6

23.8

23.5

25.4

94.2

22.7

22.3

YoY % (1)

13.5%

19.7%

15.5%

16.4%

16.3%

5.3%

-6.3%

Digital Services Revenue

5.1

4.8

5.3

4.8

20.1

4.8

YoY % (1)

2.6%

-5.7%

3.5%

-6.5%

-1.6%

-5.1%

-0.9%

Total Digital Revenue(2)

73.4

72.6

77.9

74.3

298.1

70.3

67.8

YoY % (1)

4.9%

3.6%

3.8%

-2.9%

2.3%

-2.9%

-4.9%

% of Total Revenue

50.8%

52.8%

55.1%

53.4%

53.0%

54.1%

55.6%

Print Advertising Revenue

19.9

16.5

17.5

15.3

69.2

17.2

14.3

YoY % (1)

-15.8%

-9.1%

-5.8%

-11.5%

-10.9%

-12.1%

-5.0%

Print Subscription Revenue

43.4

41.1

38.1

41.6

164.2

35.0

32.9

YoY % (1)

-15.5%

-15.6%

-19.6%

-8.4%

-14.9%

-19.3%

-19.8%

Other Print Revenue

7.9

7.2

7.8

7.9

30.9

7.5

7.0

YoY % (1)

-7.0%

-10.3%

-5.3%

-0.1%

-5.7%

-4.3%

-2.5%

Total Print Revenue

71.2

64.8

63.4

64.8

264.2

59.7

54.2

YoY % (1)

-14.8%

-13.5%

-14.5%

-8.2%

-12.9%

-15.8%

-14.4%

Total Revenue

144.6

137.4

141.3

139.1

562.3

130.1 122.0

YoY % (1)

-5.8%

-5.2%

-5.3%

-5.4%

-9.2% -9.4%

(1) Same-store revenues is a non-GAAP performance measure based on U.S. GAAP revenues for Lee for the current period, excluding exited operations and the extra week in FY24. Exited operations include (1) business divestitures and (2) the elimination of stand-alone print products discontinued within our markets.

(2)Total Digital Revenue is defined as digital advertising and marketing services revenue (including Amplified), digital-only subscription revenue and digital services revenue.

Rounding - Items may not foot due to rounding. 17

(12.0)

(1.7)

Net loss

Q2 FY26 Q2 FY25

(Millions of Dollars)

Income tax expense (benefit)

3.4

(1.8)

Non-operating expenses, net

6.8

9.3

Equity in earnings of TNI and MNI

(1.0)

(1.2)

Depreciation and amortization

3.5

5.2

Restructuring costs and other

3.6

6.5

Adjusted to exclude

(Gain) loss on asset sales, impairments and other,

net

(0.9) 0.1

Adjusted EBITDA is a non-GAAP financial performance measure that enhances financial statement users' overall understanding of the operating performance of the Company. The measure isolates unusual, infrequent or non-cash transactions from the operating performance of the business. This allows users to easily compare operating performance among various fiscal periods and how management measures the performance of the business. This measure also provides users with a benchmark that can be used when forecasting future operating performance of the Company that excludes unusual, nonrecurring or one-time transactions. Adjusted EBITDA is a component of the calculation used by stockholders and analysts to determine the value of our business when using the market approach, which applies a market multiple to financial metrics. It is also a measure used to calculate the leverage ratio of the Company, which is a key financial ratio monitored and used by the Company and its investors. Adjusted EBITDA is defined as net income (loss), plus non-operating expenses, income tax expense, depreciation and amortization, assets

Stock compensation and other 0.2 0.4

loss (gain) on sales, impairments and other, restructuring costs and other, stock compensation and our 50% share of EBITDA from TNI and MNI, minus equity in earnings of TNI and MNI.

Add

Ownership share of TNI and MNI EBITDA (50%)

1.1

1.3

Adjusted EBITDA

15.1

7.8

TNI and MNI - TNI refers to TNI Partners publishing operations in Tucson, AZ. MNI refers to Madison Newspapers, Inc. publishing operations in Madison, WI.

Rounding - Items may not visually foot due to rounding.

(28.2)

(6.8)

Net loss

1H FY25

1H FY26

(Millions of Dollars)

Income tax expense (benefit)

4.4

1.5

Non-operating expenses, net

16.2

18.9

Equity in earnings of TNI and MNI

(2.1)

(2.3)

Depreciation and amortization

7.1

11.4

Restructuring costs and other

6.8

11.7

Adjusted to exclude

(Gain) loss on asset sales, impairments and other,

net

(0.9) (0.8)

Stock compensation and other 0.5 0.8

loss (gain) on sales, impairments and other, restructuring costs and other, stock compensation and our 50% share of EBITDA from TNI and MNI, minus equity in earnings of TNI and MNI.

Add

Ownership share of TNI and MNI EBITDA (50%)

2.2

2.4

Adjusted EBITDA

27.4

15.4

TNI and MNI - TNI refers to TNI Partners publishing operations in Tucson, AZ. MNI refers to Madison Newspapers, Inc. publishing operations in Madison, WI.

Rounding - Items may not visually foot due to rounding.

Depreciation and amortization 3.5 5.2

(Gain) loss on asset sales, (0.9) 0.1

impairments and other, net

Restructuring costs and other 3.6 6.5

Insurance proceeds (3.8) --

(Millions of Dollars)

Q2 FY26

Q2 FY25

Operating Expenses

114.4

143.0

Adjusted to exclude

Cash Costs are defined as compensation, newsprint and ink and other operating expenses. Depreciation and amortization, assets loss (gain) on sales, impairments and other, other non-cash operating expenses and other expenses are excluded. Cash Costs also exclude restructuring costs and other, which are typically paid in cash.

Rounding - Items may not visually foot due to rounding.

Cash Costs 112.0 131.2

Disclaimer

Lee Enterprises Incorporated published this content on May 07, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 07, 2026 at 13:45 UTC.