Gray Media (NYSE:GTN) reported a 30% increase in third-quarter revenue as political advertising and recently acquired stations boosted results, and executives said the company plans further debt reductions before the end of 2026.
Revenue rose to $972 million, approximately $7 million above the high end of the company’s updated guidance, Executive Chairman and CEO Hilton Howell said on the earnings call. Net income attributable to common stockholders was $78 million, while adjusted EBITDA was $319 million.
Political Advertising Sets a Record
With Election Day behind it, Gray expects 2026 political advertising revenue through Election Day of $630 million to $640 million. Howell said that would surpass the company’s previous high of $600 million during the 2020 presidential election year.
President and Co-CEO Pat LaPlatney said fourth-quarter political revenue is expected to be between $319 million and $329 million. A strong October more than offset the limited number of November days before the election, he said.
Chief Legal and Development Officer Kevin Latek said political spending shifted during the cycle from states including Georgia and North Carolina to markets such as Iowa, Alaska, Maine and Nebraska, where Gray has a substantial presence. Howell said he sees more potentially competitive states in the company’s footprint heading into the 2028 election, although executives cautioned that the political map could change.
Core Advertising and Retransmission Trends
Third-quarter core advertising revenue rose 1% on a reported basis. Without the acquisitions, it would have declined in the mid-single-digit range, LaPlatney said, citing political advertising crowd-out and softer macroeconomic conditions.
For the full fourth quarter, core advertising was pacing down in the low- to mid-single digits. LaPlatney said November and December were solid after significant political crowd-out in October. He also said early first-quarter 2027 pacing was positive; Howell clarified that the first-quarter figure was on a same-station basis.
Digital revenue grew 12% year over year in the third quarter, LaPlatney said. He cited the migration of Gray’s digital video platforms to Quickplay as one contributor to the growth.
Net retransmission revenue was $150 million, at the high end of guidance, and included $9 million from 2026 acquisitions. Howell said full-year net retransmission revenue should approach its 2023 high of $595 million. Latek said Gray anticipates both gross and net retransmission revenue growth in 2027; Howell later clarified that the forecast includes acquisitions.
Debt Reduction and Acquisition Integration
Gray intends to use political cash flow to reduce debt by another $175 million to $200 million by year-end, Chief Financial Officer Jeff Gignac said. Refinancing and lower debt balances are expected to reduce annual interest costs by at least $40 million in 2027 compared with 2026.
Recent transactions included the issuance of $750 million in 7.5% first-lien notes due in 2034, most of which was used to redeem higher-cost notes. Gray also issued a $675 million term loan and extended its revolving credit facility. The company incurred $65 million in refinancing transaction costs, including approximately $43 million in call premiums on its 10.5% notes, Gignac said.
Broadcast expenses before depreciation, amortization and gains or losses on asset disposals rose to $596 million from $542 million a year earlier. Howell attributed almost all of the increase to acquisitions. LaPlatney said acquired-station expenses should decline materially in the fourth quarter from $52 million in the third quarter.
Gignac estimated that acquisition integration was 75% to 80% complete in terms of reaching a run rate, with the effects becoming more visible through the fourth and first quarters. Latek said retransmission benefits from acquired stations began immediately, while other efficiencies take longer; he expects the full impact of the acquisitions in 2027.
Gray also lowered its 2026 capital expenditure estimate to $110 million to $120 million from $120 million to $130 million, largely because some station construction projects moved into 2027. Full-year tax guidance was reduced to $75 million to $80 million.
Sports and Staffing
Gray has professional sports programming in 90 markets, LaPlatney said, with recently expanded coverage including the Charlotte Hornets, St. Louis Blues, Minnesota Timberwolves, Cleveland Cavaliers and Orlando Magic. Most of its sports agreements are short-term, although some larger deals are multiyear, he said.
Asked about staffing costs, Howell said Gray continually monitors expenses but does not see a need for large, dramatic workforce reductions. Chief Operating Officer Sandy Breland said the company is examining artificial intelligence as a tool to improve efficiency in areas such as sales and content, with journalistic work verified by a person.
About Gray Media (NYSE:GTN)
Gray Media, formerly known as Gray Television, is a multimedia company that owns and operates local television stations and related digital media properties in markets across the United States. Its stations provide local news, weather, sports, public affairs and entertainment programming, while also distributing content through websites, mobile platforms and other digital channels.
The company’s broadcast portfolio includes affiliates of major networks such as ABC, CBS, NBC, FOX and The CW, as well as independent and specialty stations.
