Gray Television swung to profitability in the third quarter, taking advantage of political advertising spending and bigger scale following a series of acquisitions.
Net income jumped to $95 million, or $103 per share, compared to a loss of $30 million a year ago.
Revenue rose to $909 million, up 51%, powered by the acquisition of stations and other businesses. Core advertising revenue–excluding political spending–was $359 million, up 23% from a year ago.
On a combined historical basis, taking into account the acquisitions, revenue was up 15% and core advertising revenue decreased 3% as political advertising displaced spending by other clients.
The company collected $144 million in political advertising in the third quarter, up 30% on a combined historical basis taking into account stations the company has acquired since the last election.
Though impressive, the political ad spending fell short of expectations because of what the company called an unexpected pullback in certain key political races.
Looking ahead to the fourth quarter, the company said political advertising revenue increased rapidly in October and is expected to remain robust through election day.
The company now expects full-year political advertising to be between $495 million and $505 million, including $235 million to $245 million in the fourth quarter..
The company also provided guidance that core advertising revenue in the fourth quarter would be between $385 million and $400 million, with retransmission revenue between $345 million and $350 million. Adding in political and production company revenue, the company expects to take in between $1.017 billion and $1.049 billion in the fourth quarter. ■
