USA Today Q2 Earnings Call Highlights

Key Points

• Revenue declined but profitability and cash flow improved: Second-quarter revenue fell 8.3% year over year to $536.3 million, while net income reached $9.1 million and free cash flow rose 11.2% to $19.6 million. The company reaffirmed its full-year outlook.
• Digital subscriptions and other revenue offset advertising weakness: Digital advertising declined 9.2%, but digital-only subscription revenue increased 6.8%, with record average revenue per user, and digital other revenue grew 20.2% amid expanding AI licensing and syndication opportunities.
• Management is shifting toward first-party audiences and AI-driven monetization: USA Today is emphasizing social, video, newsletters and direct reader relationships as search referrals weaken. Its Palantir data initiative and DeeperDive AI tool are intended to improve personalization, conversions, engagement and revenue per user, though no Palantir benefit is included in current guidance.

USA Today NYSE: TDAY reported second-quarter 2026 revenue of $536.3 million, down 8.3% from a year earlier, as lower digital advertising revenue and quarter-to-quarter variability in content licensing offset gains in digital-only subscriptions and other digital revenue streams.

The company generated $19.6 million in free cash flow during the quarter, up 11.2% year over year, and posted net income of $9.1 million, its second consecutive profitable quarter. Adjusted EBITDA was $56.9 million, down from the prior-year period, while the adjusted EBITDA margin was 10.6%.

Chairman and Chief Executive Officer Michael Reed said the quarter reflected continued progress toward the company’s longer-term digital strategy despite uneven quarterly results. The company reaffirmed its full-year outlook, including expectations for improved same-store revenue trends, adjusted EBITDA growth, net income growth and double-digit free-cash-flow growth.

Digital subscriptions and licensing offset advertising pressure

Total digital revenue was $254.3 million, down 4.2% year over year and representing 47.4% of total revenue. Digital advertising revenue declined 9.2%, which Chief Financial Officer Trisha Gosser attributed to lower page views, the loss of a programmatic advertising partner and a platform policy change affecting a sponsored-links partner.

Gosser said the three factors had a roughly similar year-over-year effect on digital advertising. Still, she noted that premium sales on the company’s platform increased from a year ago and revenue per thousand impressions improved during the quarter.

Digital-only subscription revenue rose 6.8% to $45.6 million, marking the second consecutive quarter of year-over-year growth. Digital-only average revenue per user reached a record $10.47, up 34.4% from a year earlier. The company said subscriber volume declines moderated further and its start-to-stop ratio improved sequentially.

Kristin Roberts, president of USA TODAY Media, said the company’s subscription strategy has emphasized subscriber quality, more consistent offers and less reliance on heavily discounted subscriptions. She said ARPU gains were not solely driven by broad price increases and reflected a more valuable subscriber mix.

Digital other revenue, which includes AI partnerships, content licensing and syndication, climbed 20.2% to $20.4 million. Reed said the company expects to expand its portfolio of AI licensing partners and is working to format content in machine-readable ways to support both existing and future agreements.

“We do see more AI licensing deals coming this year,” Reed said during the question-and-answer session, while adding that the company would not provide details before agreements are announced.

Audience strategy shifts beyond traditional search

Management said changing consumer discovery habits and the growing use of AI-generated answers have increased the importance of building direct relationships with readers and viewers. The company is emphasizing newsletters, social platforms, video and other channels intended to generate repeat visits and more identifiable first-party audience relationships.

Roberts said USA TODAY Media generated 3 billion off-platform video views in the first half of 2026, putting it on pace to more than double the prior year’s total. TikTok accounted for more than 1 billion views during the period.

The company acknowledged that monthly unique visitors declined, primarily because of lower referrals from traditional search. Roberts said the decrease did not reflect lower content demand, arguing that audiences increasingly find USA TODAY content through social and video platforms that are not fully captured by traditional unique-visitor metrics.

Reed said the company is prioritizing engagement and monetization per user over anonymous, “one and done” traffic. He pointed to the company’s subscription business as an example of accepting lower volume in favor of improving long-term economics.

Search remains important in certain categories, management said. Roberts noted that USA TODAY Network coverage of the World Cup generated 97 million page views, with search accounting for nearly 65% of that traffic.

Palantir work targets first-party data monetization

A central theme of the call was USA TODAY’s work with Palantir to connect audience behavior, content engagement and first-party data. Reed said the company expects the effort to help it convert anonymous interactions into known customer relationships and improve personalization for content, advertising, commerce and subscription offers.

Reed said the company will evaluate the initiative through measures including conversion, retention, engagement and revenue per user. He said management expects to provide more specific discussion of potential financial effects over the next one to two quarters, but added that no projected benefit from the Palantir work is included in the company’s current full-year forecast.

Roberts said the technology could also support commerce by matching affiliate products and offers with relevant content in real time, reducing reliance on manual processes. Reed said commerce and affiliate revenue were producing double-digit growth.

The company also highlighted DeeperDive, its generative AI answer engine. Reed said readers had asked more than 50 million questions through the product since its September launch, with average daily activity exceeding 390,000 interactions. Tests showed that pages using DeeperDive produced longer time on site, higher advertising revenue per session and stronger subscription intent than pages without the tool, he said.

LocaliQ shows sequential improvement as debt declines

Within LocaliQ, management reported sequential improvement in core platform revenue, customer counts and ARPU. Core platform revenue was $106.3 million, up 7% sequentially, while average customer count increased by 300, or 2.8%. Core platform ARPU rose 4.1% to a record $2,908.

LocaliQ segment adjusted EBITDA was $13.2 million and margin expanded 560 basis points to 12.4%, according to Gosser.

USA TODAY ended the quarter with $86.7 million in cash and net debt of $883.8 million, down from the prior period. Cash provided by operating activities increased 8.6% to $35.4 million.

Reed also said the company remains optimistic about pending litigation against Google. He said USA TODAY’s outlook does not assume any benefit from possible changes resulting from U.S. Department of Justice remedies in the Google case or from the company’s own litigation, which he described as potential future upside.

About USA Today (NYSE:TDAY)

Gannett Co, Inc NYSE: GCI is a media and marketing solutions company headquartered in McLean, Virginia. As the largest U.S. newspaper publisher by circulation, Gannett publishes USA Today alongside more than 260 local news brands. The company’s multimedia platforms include daily and weekly newspapers, websites, mobile apps and a network of subscription-based digital products.

In addition to journalism and content production, Gannett offers a suite of digital marketing services designed to help small and medium-sized businesses grow online.

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