MCLEAN, Va. (AP) — Gannett Co. reported a 25 percent drop in first-quarter net income Monday, as advertising in its newspapers continued to decline.
The media company, which owns 82 U.S. newspapers including USA Today, 23 broadcast television stations and several digital media properties, earned $68.2 million, or 28 cents per share, in the three months that ended Mar. 25.
That's down from earnings of $90.5 million, or 37 cents per share, in the same period last year.
Revenue fell 2.6 percent to $1.22 billion from $1.25 billion last year. Analysts were expecting revenue of $1.24 billion, according to a poll by FactSet.
Results were helped by strong TV advertising and growth in digital products like the CareerBuilder website. Even so, overall revenue came in below analysts' expectations, sending the company's stock down.
Gannett's stock fell 7 percent, or $1, to $14.03 in mid-afternoon trading Monday. The day's low of $13.73 was the stock's lowest level since January.
Excluding special items such as the cost of an early retirement offer plan for employees, Gannett earned 34 cents per share in the latest quarter. That compares to the 41 cents per share the company earned, excluding special items, in the same period in 2011.
Analysts were expecting earnings of 31 cents per share, according to a poll by FactSet.
On a conference call with investors and analysts, CEO Gracia Martore said the company exceeded its own expectations and analysts' forecast because it spent less than expected on "strategic investments." That includes spending on an initiative to get local businesses to use its digital marketing services.
Revenue in Gannett's newspaper publishing division fell 6 percent to $874 million from $930 million during the same period in 2011.
Broadcasting revenue rose 7.5 percent to $176 million, helped by advertising related to autos, the Super Bowl and political campaigns.
Revenue at the company's digital division rose 6.8 percent to $168.4 million.