Gray Television reported a loss in the third quarter as a charge against earnings related to sports rights outweighed a small gain in core advertising revenue.
The third-quarter loss was $53 million, or 57 cents a share, compared to net income of $95 million or $1.04 a share a year ago.
The loss includes a $43-million charge related to bankrupt Diamond Sports Group dropping Gray’s Raycom Sports unit’s Atlantic Coast Conference rights package. Diamond was replaced by new, lower-valued deals with The CW and ESPN.
Revenue fell 12% to $803 million.
Core advertising revenue — excluding political spending — rose 1% to $363 million, while political advertising was just $26 million, compared to $144 million a year ago.
Retransmission revenue rose 4% to $378 million.
For the fourth quarter, Gray said it expects total revenue of $854 million to $864 million.
Core advertising revenue is expected to grow by low single digits, to $410 million to $414 million, with political advertising of $34 million to $35 million.
Retransmission revenue is expected to be up by low single digits, to $362 to $365 million.
“Gray continued to execute across its portfolio of high-quality television stations and digital platforms as it combines its market-leading local news with strong network programming to deliver unparalleled reach for advertisers,” the company said in its earnings announcement.
“We are particularly pleased with the performance of our television stations during the quarter, whose core advertising revenue increased 1% on a year-over-year basis. We saw continued improvement in the automobile advertising category with an 18% year-over-year increase,” Gray said. “Given these solid performances across our television stations in the first three quarters of 2023, we currently anticipate that our television-station operations will grow advertising revenues during the remainder of 2023, due to our strong positions in local markets and the exceptional efforts of our local station staff.”
