Gannett, publisher of USA Today and a number of other newspapers, reported its Q4 earnings today, missing analysts' estimates.
The company's publishing segment operating revenue was down 5.3% year-over-year to $1.01 billion for the quarter. Ad revenues were $670.7 million in the quarter compared to $722.3 million in the fourth quarter last year.
Digital revenues in the Publishing segment, however, were up 6.9% in the quarter.
Here's the part of the report that pertains to Gannett's digital business:
Digital segment operating revenues were 9.4 percent higher in the quarter and totaled $181.5 million due primarily to strong revenue growth at CareerBuilder. Digital Segment operating expenses increased 10.6 percent to $142.8 million reflecting significantly higher sales incentive and bonus costs associated with higher revenue levels for CareerBuilder. Due to substantially higher year-over-year revenue as the quarter progressed, a significant number of sales personnel exceeded their annual sales goals very late in the quarter, and were therefore entitled to incremental commissions and bonuses. There were also incremental costs for new initiatives and new product development by PointRoll and ShopLocal. These incremental costs for CareerBuilder, PointRoll and ShopLocal together totaled approximately $9 million for the quarter. Digital segment operating income was 5.3 percent higher on a reported basis and was up 2.5 percent on a non-GAAP basis. Operating cash flow was $46.6 million, an increase of 3.2 percent.
Digital revenues company-wide, including the Digital segment and all digital revenues generated by the other business segments, totaled $290.3 million, an increase of 6.5 percent. Digital revenues for the 2011 fiscal year were up 10.1 percent and totaled $1.1 billion, about 21 percent of total operating revenues. At the end of the quarter, Gannett had about 120 domestic web sites affiliated with its local publishing and television markets, USA TODAY, Gannett Government Media and Gannett Healthcare Group.
USATODAY.com is one of the most popular newspaper sites on the Web and the USA TODAY app is now a top news app with more than 11 million downloads including those across iPad, iPhone, Android and Windows. In December, Gannett’s consolidated domestic Internet audience share was 50.8 million unique visitors reaching 23.0 percent of the Internet audience, according to Comscore Media Metrix. Newsquest is also an Internet leader in the UK where its network of web sites attracted 66.3 million monthly page impressions from approximately 8.7 million unique users in December 2011. CareerBuilder’s unique visitors in the fourth quarter averaged 21.2 million.