Lee Enterprises is in the red again
For this item, I turn it over to my Poynter colleague, Angela Fu.
For the fourth quarter in a row, Lee Enterprises lost money, the company announced Thursday.
The newspaper chain — which operates in more than 72 markets and owns titles like the St. Louis Post-Dispatch, The Buffalo News and Tulsa World — lost $16 million during the quarter ending Dec. 29. It was the largest quarterly loss the company has suffered since 2013.
As readers and advertisers abandon print, Lee, like many other newspaper companies, has focused on growing the digital side of its business. But the 5% increase in digital revenue Lee experienced last quarter was not enough to offset continuing declines in print. Total operating revenues declined 7% year-over-year to $144.6 million. Operating expenses stayed largely flat.
Lee plans to cut $40 million in costs by the end of the current quarter. Asked on an earnings call for details about those cost-cutting measures, vice president, CFO and treasurer Tim Millage said they would involve “a number of things, including optimizing our print business and driving efficiencies through additional technologies like agentic (artificial intelligence).”
As they did during an earnings call in December, Lee executives trumpeted investments the company had made in AI. In December, Lee signed a deal with Amazon Web Services to develop generative AI platforms. The company expects this deal — along with partnerships with ProRata.ai and Perplexity — to accelerate digital revenue growth over the next three quarters.
The dismal earnings report comes just days after “companywide technology issues” prevented several Lee outlets from publishing printed newspapers and e-editions. The past two years have been tough for Lee. The company has reduced print days at most of its papers and executed multiple rounds of layoffs.
Lee stock was trading at $12.32 a share Thursday afternoon, down nearly 8% from the previous day's close.
Pushing back
On Thursday, President Donald Trump took to Truth Social and again, without evidence, pushed the conspiracy theory that the government had been paying news organizations to give Democrats favorable coverage. Trump said “billions of dollars” from the U.S. Agency for International Development and other agencies had ended up with the “fake news media.” He also claimed Politico had received $8 million and wondered if The New York Times received money, too.
The New York Times’ Isabella Kwai wrote, “Records on USAspending.gov, a federal site that tracks government payments, show that federal agencies have paid Politico for subscriptions, including to its Politico Pro service. The money allocated to Politico across all agencies was more than $8 million in the 2024 fiscal year, records show. Politico Pro offers policy-related resources and tracks news and legislation, and has more than 30,000 subscribers, according to a Politico overview. U.S.A.I.D. paid $44,000 to Politico during the 2023 and 2024 fiscal years, according to the spending records, which described the two contracts as for ‘E&E news subscriptions.’ E&E News covers energy and environmental issues.”
Still, the narrative on X is that the government was funding Politico for positive stories about Democrats.
On Thursday, Politico CEO Goli Sheikholeslami and global editor-in-chief John F. Harris published a note to readers that said some of the debate on X was “misinformed” and some was “flat-out false.”
They wrote, “POLITICO is a privately owned company. We have never received any government funding — no subsidies, no grants, no handouts. Not one dime, ever, in 18 years.”
They later added, “POLITICO Pro is different. It is a professional subscription service used by companies, organizations, and, yes, some government agencies. They subscribe because it makes them better at their jobs — helping them track policy, legislation, and regulations in real-time with news, intelligence, and a suite of data products. At its core, POLITICO Pro is about transparency and accountability: Shining a light on the work of the agencies, regulators, and policymakers throughout our vast federal government. Businesses and entities within the government find it useful as they navigate the chaotic regulatory and legislative landscape. It’s that simple.”
They wrote that most of the Politico Pro subscribers are in the private sector, adding, “Government agencies that subscribe do so through standard public procurement processes — just like any other tool they buy to work smarter and be more efficient. This is not funding. It is a transaction — just as the government buys research, equipment, software, and industry reports. Some online voices are deliberately spreading falsehoods. Let’s be clear: POLITICO has no financial dependence on the government and no hidden agenda. We cover politics and policy — that’s our job.”
Then came this story from Axios’ Zachary Basu and Marc Caputo on Thursday: “Trump orders key government agency to cancel all media contracts.”
