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NPR, television, the internet, The Daily Show -- consumers get their news from lots of sources these days, and the widespread accessibility to information is having an effect on the traditional newspaper business. Gannett Inc. (NYSE: GCI), which publishes about 90 daily papers including the nation's largest newspaper, USA Today, is feeling the ill effects of such competition. Earlier today, GCI reported that its third-quarter earnings dropped 11% to $234 million, or $1.01 per share. Revenue was down 4% during the latest reporting period, to $1.81 billion. Newspaper advertising revenue slipped 6% to $1.19 billion and broadcasting revenue was off 3.4% to $189.5 million. Gannett owns 23 television stations in 20 markets, according to Hoover's.
With regard to analysts' expectations, the publisher's results were mixed. Earnings were a penny above Street estimates of $1.00 per share, while revenue fell just shy of the $1.82 billion figure expected on Wall Street.
While the numbers reflected a loss, they may not have been as bad as investors were expecting; the stock has gained nearly 1.3% in early trading today. But today's move higher is certainly not the trend -- GCI shares have been in decline mode for more than 3 years, shedding roughly half of their value since their April 2004 peak. Even today's attempted rally was quickly thwarted by overhead short-term resistance in the form of the stock's 10-day and 20-day moving averages.
Beth Gaston Moon is an analyst at Schaeffer's Investment Research.
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