Shares of USA Today publisher
Gannett
tanked earlier this month after the newspaper chain reported disappointing second-quarter results. CEO Michael Reed bought the dip this past week.
Gannett (ticker: GCI), which also owns hundreds of local newspapers in the U.S., said on Aug. 4 that its second-quarter revenue declined 6.9% from 2021. Its earnings swung to a net loss of $53.7 million, compared with net income of $14.7 million in the second quarter of 2021. In the earnings release, Reed pointed to a “rapidly tightening macroeconomic environment” that weighed on the firm’s print business.
Gannett also cut its full-year earnings outlook. It now forecasts a net loss between $70 million and $60 million. Media division head Maribel Perez Wadsworth sent an email to staff signaling imminent job cuts, according to Poynter.
Gannett stock sank 28% on Aug. 4 to close at $2.30 after the earnings report. Reed then paid $1.22 million for 500,000 shares on Aug. 8, according to a filing with the Securities and Exchange Commission. He paid an average price of $2.44 to increase his Gannett stake to nearly 1.84 million shares. It was Reed’s first open-market purchase of Gannett stock since March 5, 2020, when he bought 100,000 shares.
Gannett declined to make Reed available for comment, but the company said, “Mr. Reed purchased these shares because he believes in our strategy and mission.”
Gannett stock rallied to $2.60 by Thursday’s close. That’s 6.6% higher than Reed’s average price for the purchases.
Write to Connor Smith at connor.smith@barrons.com
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