All right. Well, thank you everyone for joining us. We've got USA TODAY here, Mike Reed, CEO, and Trisha Gosser, CFO. Thank you so much for joining us.
Yeah, great to be with you, Matt.
Thanks for having us. Maybe we would start off with just Q4. You know, you outlined some targets for same store revenue growth, returning to growth in 2026. Can we maybe just dig in on each one of those key drivers to get there and just this inflection point that you're kind of seeing in the business?
Yeah. I'll start at a higher level. I think first of all, in the fourth quarter, 47% of our business was now driven out of the digital category, we're nearing one of the important inflection points, which is more than half of our revenue coming from digital and for digital to be growing. 47% in Q4, we expect to surpass 50% in 2026. Second point is we did return to growth in Q4, we have a great jumping-off point as we go into 2026. We think about our digital business in two ways. There's B2C, and there's B2B. On the B2C side, we have the largest audience from a traditional news media business in the United States, reaching about 180 million uniques.
The core to the strategy on the B2C side is monetizing each of those users, so increasing ARPU per user. That really comes when you drill down from a very three different categories. One is advertising, two is subscription, and three is commerce. Commerce can be shopping, can be affiliate revenues. Right now, commerce is all off platform, but we're also exploring ways to develop commerce on platform. On the consumer side, advertising, subscription, commerce, growing ARPU per user, leveraging data and technology to be the most effective we can across each consumer. On the B2B side, it's taking this content we produce for the consumers and selling it to other companies who have commercial businesses like AI licensing, like syndication revenue.
We have some deals with MSN and with Yahoo for syndication, so leveraging the content we produce, selling it in other ways is a B2C business. As we go into 2026, we're really excited about all of those revenue categories being growth. Finally, on the B2B side, we also sell DMS marketing solutions, which has struggled for the past year. We're seeing some green shoots based on the strategy we've deployed, leveraging AI to do more that's sticky from a retention standpoint with consumers around how they get and retain customers. We're looking for DMS to turn the corner in late 2026 and be a contributor to overall growth as well.
Maybe we can just dig into each one of those in greater detail, 'cause last year you revamped your digital subscription strategy, for some near-term pain, for some long-term gain. Can you just discuss the specific strategy that you undertook?
Yeah
... underlying trends that give you the confidence for 2026?
Yeah. We did. What we had found in kinda 2022, 2023, 2024 is we had a lot of promotional themes going that were driving high volume to our subscriber base. It takes a while to cycle through those and understand what retention looks like, what their engagement looks like, and what their lifetime value is gonna be. What we found is a lot of the promotional tactics we were using were generating high volume with very little lifetime value. Based on the data that we had over this extended period of time, we were able to really identify who are the main or the ideal customers for us that present the best lifetime value. We started to test new acquisition strategies, new pricing strategies.
What we did is we started to adopt those in 2025 and let those promotional volumes go. What we saw in 2025 is a dip in volumes with no dip in revenue, 'cause the revenue we were really bringing in from the customers that had the best lifetime value. We've adopted now our customer acquisition strategy to focus not as quite as much on volume, certainly on volume, but not as much, and more on lifetime value and ARPU. We're getting better returns from each customer, but also lower churn from those customers. We've really turned the corner, and we started to see green shoots in Q3.
We really turned the corner in Q4, and we actually saw revenue grow over the prior year on a same-store basis in December, which was great. We saw sequential improvement in Q3 over Q2, Q4 over Q3, and we now expect 2026 to result in growth with a healthier customer base. Now we wanna return to growing both volumes and subscribers based on this. Or volume and revenue based on this, but we're also starting to develop new ways to take consumers through the journey. This is really important because not every consumer is gonna be a subscriber, and there are ways to monetize them better through advertising and through their engagement with us, which we start with registration. If somebody's not gonna engage as a subscriber, can we get them to register?
We have more data, they become a better customer for us from an advertising standpoint and from a commerce standpoint. We've also moved to a pay per article. Maybe somebody registers, maybe somebody pays per article, and what we're starting to see is better engagement and a slower journey for somebody becoming a subscriber, taking them through registration, taking them through paying for a particular article. Interestingly, we found that the price threshold for paying for one article can be higher than people who are paying to come in as a paid subscriber for a few months, it's really interesting. We're starting to better monetize each person in the audience, leading, we think, to a more healthy subscriber base and a better long-term subscription strategy.
DMS, you mentioned at the beginning of our talk that, you know, there have been some headwinds there, but trends are starting to improve underneath the surface a little bit. Can you take a step back and maybe just talk about the core value proposition of what is DMS, and then what are the key catalysts in 2026?
I'll take this.
Sure. Absolutely. DMS is simply this. Our mission is to help small and medium-sized businesses grow their revenue by taking the complexity out of digital marketing for them. We handle their fragmented tactics, publishers, tools that small and medium-sized businesses don't have the expertise to handle. We take the burden out of it. We let them run their businesses. We run their marketing for them and give them access to enterprise-grade technology, to proprietary data, to algorithms on our platform that have been optimizing hundreds of thousands of campaigns for years. We give them that expertise, and we give them outcomes that otherwise they couldn't achieve on their own. When you look back at what our DMS business has looked like, I'd say until 2024, it was heavily a search-based lead generation business, and there's still...
that's still an effective tool for small and medium-sized businesses, but it's infinitely more complicated now. In 2025, what we did was we introduced AI onto our platform, and what that did was allow us to operate at a scale and a level of sophistication that we and our small and medium-sized businesses didn't have access to before. It introduced AI to analysis, to lead conversion, to lead scoring. We introduced voice agents that can answer the phone and schedule appointments for these businesses. When we look at 2026, what we see is that we're gonna build on that foundation of the new tools that we put on our platform, and we're gonna couple it with the first-party data that we have on our media platform.
What that really allows us to do is to bring a full funnel marketing solution to these small and medium-sized businesses that they just wouldn't have access to. We give them what has been reserved for enterprise-level clients to the small and the medium-sized businesses that are in our local markets. It's been a journey to get here, as you mentioned. We've had some headwinds through 2024 and 25, but we see that what we've built last year and when we add in that first-party data, we get back to growth in 2026.
Got it. Maybe shifting gears, your LLM partnerships have really accelerated, specifically in 4 Q, the largest platform or the largest partnership that you've signed with Meta to date. Can you maybe just walk through what the strategy is and just what the opportunities to expand those partnerships, but also what does the pipeline of new partnerships look like as we head into this year?
Yeah. First of all, as we think about 2026, we do have meaningful growth, and that's already booked basically because of the partnerships we have, especially with Amazon, Microsoft, and Meta, and we've expanded our partnerships with Amazon and Microsoft, which really date back to 2024. What we really started to see in 2025 is more of an acceleration of closing deals in the pipeline. closed a really nice deal with Meta in Q4, and we had closed a deal with Perplexity in Q3, and we also did some marketplace deals with both Microsoft and Snowflake in 2025 as well. We started to see an acceleration of closing of deals in the pipeline, and that really positions us for revenue in 2026 or for growth in 2026.
We do expect growth later on in 2026 from closing more deals. We expect that growth to be able to accelerate in the out years when I think about 2027 through 2030. We continue to both close new deals, also importantly expand the deals we have with our customers today, but also more importantly, find out how these business models of our tech partners evolve and understanding how our content is best deployed and being able to make more money off of the deals that we have with our customers today. We're not signing long-term deals at this point because we understand that their product mix is gonna change, their go-to-market strategies are gonna change, how they make money is gonna change, and we wanna be in the best position to share in the growth that they...
that our partners realize. We wanna share in it as well. We're working with our partners. We're being great partners in flexibility, signing shorter term deals, positioning ourselves to continue to expand or re-sign with them, We're seeing that expansion already. As I mentioned, we expanded our deals with Amazon and Microsoft, just to name a couple. Excited about 26 based on what we've already booked, but also excited about the pipeline and getting more deals to market.
Maybe the flip side of the AI discussion, which is really I think everyone's wondering just what is AI's impact on open web publishers and specifically obviously for USA TODAY. Just have you seen any impact from just adoption of these AI chatbots or even just AI overviews that maybe some of your other publisher peers have seen?
Yeah. So a couple facts to just state. Everybody knows that the AI chatbots send virtually no traffic back to publishers. We can confirm that. They don't send any traffic back. That's why we're only licensing content to chatbots, AI chatbots, and if they're not licensing from us, we're blocking them. We use technology from Fastly that allows us to block them from taking our content. There could be sneaky ways around that. We're not 100% sure, but to the best of our ability, we're blocking them. But so the chatbots are sending no traffic back, and licensing is our path there. However, there are still search traffic coming back through Google blue links, and other search mechanisms, but primarily that one.
As you know, that's the big one. That has fallen off. We have not seen as big of a falloff as our industry peers. I know the industry has seen anywhere from 30-40% falloff. You know, we're down in that 0-5% falloff. However, we've been very proactive over the last two years in recognizing this was coming and getting proactive in bringing traffic in from other sources. What we're seeing grow right now is our traffic that's direct. Direct to us has grown, and social referrals from social is growing. We've been able to offset the loss of search traffic from Google links with direct and social referrals. We're not seeing any degradation in traffic overall. We're very pleased with the results there.
I think getting ahead of it, recognizing it was smart. We think we have great content, the most compelling content in the kinda the news media space in the United States, so. Unfortunately, our peers are suffering more dramatically. We are not and our proactive strategy, I think, has led to that, along with having great content that people are coming back to us for every day. I will say you have to block. You can't let the scrapers just scrape.
Yeah. You know, you just mentioned the great content that USA Today has, and we talked earlier about the 180 million unique monthly visitors. Just what are the keys to driving advertising revenue growth, you know, in 2026? Like what are the things that you need to do right to really, you know, drive and grow that business?
Yeah. The more information we have on our consumers, the better we can drive the advertising business because we have more data. The more data we have, the more premium we can sell. Premium's our best avenue, it's our highest CPM, we're now starting to deploy more video advertising, video digital advertising. Video is even two times, three times the CPM that premium advertising is. For us, it all starts with great content, engaging better with the consumer so we have more data. Leveraging that data to be able to sell premium content and be able to sell video content, digital advertising, video advertising in a premium atmosphere, moving away from programmatic, being less de-reliant on programmatic. Programmatic's the fallback when you can't get premium sold.
The other thing that we're seeing success with, I don't know if everybody knows, we went through a rebrand for the company last year. We changed our name from Gannett to USA TODAY Co. What we had really found in conversations across the globe, but here in the U.S. as well, is that people didn't really know what Gannett was. Everybody knew what USA TODAY was. That rebranding exercise has really allowed us to tell this digital story that we have that people didn't know. People thought of Gannett as a print company, not a digital company. We're a digital company. 99% of our audience comes to us on the digital platform. We've been retelling our story in the national advertising ecosystem as a digital business.
Since we did the rebrand in kind of the October timeframe last year through now, we've signed over 30 new brands to advertise with USA Today Co. across our platform in 2026. That's gonna contribute to growth as well.
Oh, that's great. Maybe moving down the income statement here, Trisha, you know...
You implemented a $100 million cost savings program in 3Q. Just what were the main areas of cost savings, and how should we think about the cost base going forward?
Absolutely. Our focus on that cost takeout, the $100 million that you referenced, was in automation, it was in outsourcing, and in general, it's focused on our print operations. We absolutely are creating capacity to invest in our product, in our content, in our data, in our technology. Where we're finding efficiencies is in our print portfolio. The biggest cost savings of that program was shuttering our two largest print facilities. We also converted properties where it makes sense from an economic standpoint to mail delivery, so our print product's delivered by mail versus a carrier bringing it to your doorstep. We're gonna continue to optimize that print portfolio, whether it's things like experimenting with frequency in places where it makes economic sense or looking at our print portfolio to make sure that all of them are optimized.
At the end of the day, what we're really trying to do, and we've always been excellent at managing our costs and taking out costs, is making sure that we have a sustainable cost base that still allows us to invest in the things that are gonna drive meaningful and sustainable revenue growth for us.
Yeah. No, you've done a great job delevering the business, and I think exiting the year at 2.4 x-
Yeah
firstly net leverage, targeting 2x exiting 2026. Just what are the keys to getting there? I think we're getting towards the end of asset sales and/or non-strategic asset sales and real estate sales. Just how are we gonna get to that 2x net leverage?
Yeah. We have used asset sales to date. You mentioned that we got to 2.4 x to end last year. That came at, you know, $135 million plus of debt paid down in 2025. That brought us below $1 billion in total debt. What that did was allow us to unlock a rate reduction of about half a point on our term loan, which makes a difference. We can use that extra capital to pay down debt as well. Exiting last year, our term loan sits at about $730 million. I think we're right at the place where if we chose to refinance, we would have the ability to. We're not there yet. I think we'll continue to make amortization payments through the end of the year.
That will give us more flexibility should we want to next year. This year it's all about cash flow, right? Our guide for 2026 is improving operations. It's getting to revenue growth later in the year. It's guiding to full year Adjusted EBITDA growth. It's double-digit free cash flow growth. It's those improving operations. That incremental free cash flow allows us to address our debt in 2026 and get to closer to 2 x first lien net leverage to end the year.
Got it. you know, you sold the Austin American-Statesman last year. It was a trophy asset for you guys.
Mm-hmm.
Just how do you think about balancing selling some of those trophy assets, keeping the core business? These are some of your best assets that you have in keeping the core business running. How do you balance that between the two things?
Yeah. I think Austin is a great example of the quality properties that we have within our portfolio, and it also reflects our willingness to consider an offer that comes our way that's highly accretive to where we're trading.
Mm-hmm
you know, Austin was an example of. You're right, it's in a balance, and we do think that scale matters in this industry. We're very happy with the scale of our audience and of our portfolio. We're not actively marketing any of our properties. You know, Mike talked about the importance of our brand, and I think that the scale of our properties, the scale of our audience, makes a difference when we're in conversations with national advertisers. It makes a difference when we're talking to AI licensing companies. I think it's why you see that we are one of the few publishers that's in the majority of the AI licensing deals that have been signed to date. We're mindful of that.
We're not actively marketing any of our properties, but, you know, we'll always consider an offer that comes to us.
Yeah.
Can I add to that, Matt? One of the things about looking at individual property sales, why it's a balance, we, you know, we know how important scale is to our digital strategy, but also we can't underemphasize how important unique local content is to our strategy because that's not commoditized, and that's something we do every day that's new. Fewer local properties means fewer, less unique content that's bringing people back every day. We've proved that out through the blocking of the AI bots coming from AI companies, and almost all of the bots, they're scraping our local content, not USA Today. About 90% of the bots OpenAI sends in, ChatGPT, they're scraping our local content, not USA Today.
We know how valuable it is, how sought after it is, we wanna maintain the local properties to the best we can. With a great offer, we would take it and pay down debt. The other thing I think just for folks that maybe haven't been investors for the long haul with us, when we bought Gannett in 2019, we closed in November of 2019, we had $1.8 billion of first lien debt. COVID hit a couple months later. There was a little bit of a reset of the business, many of the synergies that we were counting on for growth ended up being to maintain. We've taken $1.8 billion of debt, that's now $700 million of first lien debt with $90 million of cash on the balance sheet.
Our history of being able to to rapidly pay down debt is really proven, and us getting over the next couple of years to a place where leverage is significantly below two is something that we have our sights set on. The, our, where we've come from to where we are is really impressive, I think.
No, definitely. I think the big, one of the big questions for investors today is just the Google trial.
Yeah.
You received a partial summary judgment, which was granted in your favor in October. Can you maybe just walk through just where we sit today in the trial? What are the key milestones going forward? Obviously it seems like things are all moving in the right direction.
Yeah. The summary judgment was great for us because it moved some of our claim from arguing about the merits of the claim to just arguing about what the settlement is. That was great. Google, as expected, in normal course, filed their summary judgment against our claims a couple weeks ago. We expect to have a favorable ruling in that case. There's nothing new there. We expect the summary judgment to be not ruled in Google's favor, but in ours. The other kinda key milestones coming up in 2026, one is, we're expecting really any day, any week, the remedies rulings from the judge in the DOJ case against Google, which Google was found guilty of antitrust violations last summer.
There was a remedies hearing between the DOJ and Google October, November last year. The judge has been deciding what that ruling's gonna be and really is supposed to issue a ruling any day. Once that ruling takes place, and we're hoping there's a good outcome there, that creates a more level playing field for companies like us. Set aside our own litigation against Google, just a more level playing field is gonna lead to a bigger digital advertising opportunity for companies like ours. Also once the remedies are known, there's a trial by the State of Texas against Google for antitrust violations in the ad tech ecosystem. 17 states attached onto that. That trial is gonna begin within weeks of the remedies being ruled on.
We expect that trial to take a couple months, assuming the State of Texas wins that trial, it puts our case in even a better position. Finally, we hope to have a jury trial scheduled and on the docket at some point, hopefully by Q4 or early Q1 of next year. Those are kinda the next key events for us.
Mike, as we go through this next year and, you know, you come back next year and we sit here and we're talking, you know, there's a lot of moving pieces to the business, a lot of things going right on the top line. You've got the cost savings, deleveraging the business. Can you maybe just take a step back and just talk about what do you think would make you most excited as we sit here next year? Like, what are the key things that you really wanna execute on in the business, and what are your key focus areas?
Yeah. The thing I'd be most excited to be back here next year talking to you about is that our top line, our revenues, are now growing. We're no longer a melting ice cube based on a print business that dominates our overall revenue profile. You know, we've been in transformation for a long time. There's been two steps forward, one step back, two steps forward, one step back. Feel like we're right on the cusp now. Big picture, the single biggest thing I'd love to be able to be talking to you about next year is that our revenues are now growing, and we're focused on how we're investing, growing profitably, and we're talking about investing to accelerate that growth. To me, that's a game changer and really kinda resets the multiple that we trade at.
When you think about a comparison, you can go look at The New York Times, which is growing its top line. They're primarily a digital company, although still, they still have a print component. Their strategy is around growing a content business that's based not only on news, but games, cooking, sports with their acquisition of The Athletic, their commerce business in Wirecutter. We have a similar strategy. Almost all of our new content creation is in other areas around entertainment, sports, gaming. We launched our play division. Super excited about really a re-rating because of leverage dropping below two and revenue being a top-line grower sustainably.
Mike and Trisha, thank you so much for the time today.
Yeah. Thank you.
Thank you.
It's great to be here. Thank you.
Thanks, Mike. I appreciate it.
Yeah, appreciate it.