Gray Media posts $972 million revenue, misses EPS by $0.20

Gray Media (NYSE: GTN) reported $0.66 in earnings per share (EPS) on Friday, $0.20 below FiscalAI’s $0.86 consensus estimate. A separate market summary placed the estimate range at roughly $0.84-$0.86, putting the company below consensus across that range.

Revenue rose 29.8% year over year to $972 million, beating analysts’ $955.75 million expectation by $16.25 million. Gray Media posted a $0.24 loss per share in the same quarter a year earlier. Its net margin (profit as a share of revenue) was negative 0.83%, while return on equity (ROE, profit relative to shareholder equity) was negative 1.12%.

Takeaway: The quarter delivered a large sales increase, but profit remained below expectations.

What drove the revenue increase?

Political advertising set a third-quarter record at $198 million, above company guidance. Management expects $630 million-$640 million through Election Day in 2026, surpassing the previous record.

Full-year 2026 revenue guidance of $3.7 billion stands $100 million above the $3.6 billion consensus. Fourth-quarter revenue guidance is $1.1 billion, in line with expectations.

Takeaway: Record political spending now carries more of the revenue burden as core advertising remains under pressure.

What is happening outside political advertising?

Core advertising, excluding acquisitions, fell by a mid-single-digit percentage in the third quarter. Fourth-quarter performance was pacing down by a low- to mid-single-digit percentage as political advertising took spending from other advertisers amid macroeconomic softness. Management said early first-quarter same-station pacing—advertising trends at existing stations—was “positive,” though comparisons were challenging.

Digital revenue grew 12% year over year. As integration of acquired stations continues, management expects acquired-station expenses to decline, with most benefits flowing through in 2027.

Takeaway: Digital growth is improving, but core advertising still needs to stabilize.

How are debt and retransmission changing?

Management plans to repay another $175 million-$200 million of debt by year-end. Debt reduction and refinancing should produce at least $40 million in lower interest costs in 2027.

Net retransmission revenue (payments from distributors for programming rights, after costs) reached $150 million in the third quarter, at the high end of guidance. Management expects gross and net retransmission revenue to grow in 2027.

Takeaway: Gray Media expects less debt, lower financing costs and improving retransmission revenue in 2027.

What do the market metrics show?

• Friday open and size: GTN opened at $4.89; market capitalization was $504.11 million.
• Valuation: The price-to-earnings (P/E, share price divided by earnings per share) ratio was 16.88. P/E/G (P/E relative to expected growth) was 0.10, and beta (a measure of market sensitivity) was 1.01.
• Price trend: The 50-day moving average (a 50-session price average) was $4.65, the 200-day moving average was $4.59, and the one-year range ran from $3.55 to $6.43.
• Leverage and liquidity: Debt-to-equity (debt relative to equity) was 2.73. Both the current ratio (current assets divided by current liabilities) and quick ratio (quick assets divided by current liabilities) were 0.95.

Takeaway: The Friday opening price sat above both moving averages, while debt remained substantially higher than equity.

What does the dividend mean?

Gray Media will pay a quarterly cash dividend of $0.08 per share on Thursday, December 31. Stockholders of record on Tuesday, December 15, will receive it; December 15 also is the ex-dividend date, the cutoff for buying shares with the dividend attached.

The payment annualizes at $0.32 per share and carries a 6.5% yield (annual dividend divided by share price). The current payout ratio (dividends as a share of the earnings used in the calculation) was 110.34%, so the annualized dividend exceeded that earnings base.

Takeaway: The cash return is sizable, but the payout ratio shows earnings do not fully cover it.

How have analyst ratings shifted?

Ratings remained divided: three Buy, two Hold and one Sell. MarketBeat.com’s consensus rating was “Hold,” with a consensus target price of $7.88.

• Wednesday, October 28: Zacks Research lowered its rating from “strong-buy” to “hold.”
• Saturday: Wall Street Zen downgraded its rating from “buy” to “hold” in a research note.
• Friday, October 9: Weiss Ratings lowered its rating from “sell (d+)” to “sell (d).”

Takeaway: No consensus emerged, with the six published ratings split across all three categories.

What does Gray Media operate?

Gray Media, formerly known as Gray Television, owns and operates local television stations and related digital media properties across the United States. Its stations provide local news, weather, sports, public affairs and entertainment programming, while websites, mobile platforms and other digital channels extend distribution.

Its broadcast portfolio includes affiliates of ABC, CBS, NBC, FOX and The CW, along with independent and specialty stations.

Takeaway: Gray Media remains a local-broadcast operator, with political dollars, digital growth and financing costs shaping the near term.