LEE ENTERPRISES, Inc
For the period ended Dec 28, 2025. Filed Feb 11, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 28, 2025 · Filed Feb 11, 2026
LEE$6.59-5.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-29; filed 2025-08-08.
0001628280-25-039251
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-12-28; filed 2026-02-11.
0000058361-26-000014
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 95 previous paragraphs and 78 current paragraphs.
29 unchanged; 22 reworded; 27 added; 39 removed; 5 previous and 0 current paragraphs rearranged.
Tables are not compared: 4 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (27)
Current report
RECENT DEVELOPMENTS
Current report
Private Placement Agreement
Current report
At the closing of the private placement on February 5, 2026, we issued an aggregate of 16,000,000 shares of Common Stock, consisting of 15,384,615 shares of Common Stock to certain investors and 615,385 shares of Common Stock to service providers as reimbursement for certain expenses incurred by certain investors, at a price of $3.25 per share through the private placement. The aggregate gross proceeds from the private placement were approximately $50.0 million, before deducting offering expenses. We expect to use the net proceeds for working capital and for other general corporate purposes. Further, in connection with the closing, we amended our Certificate of Incorporation, increasing the number of authorized shares from 12,000,000 to 40,000,000.
Current report
Registration Rights Agreement
Current report
At the closing, in connection with the private placement agreement, we entered into a registration rights agreement pursuant to which we will agree to provide certain customary registration rights, including the registration of the Shares for resale. We are required to use commercially reasonable efforts to file a registration statement with the Securities and Exchange Commission covering the resale by the investors of their shares within 60 days following the closing.
Current report
Credit Agreement Amendment
Current report
Additionally, concurrently with the execution of the private placement agreement, we entered into the Second Amendment to Credit Agreement. The amendments became operative concurrently with the closing. The amendments include among other things, a reduction of the applicable margin on our 25-year term loan from 9.00% to 5.00% for a period of five years following the closing and amending the definition of “Excess Cash Flow” such that the minimum amount of cash-on-hand held by us before being deemed Excess Cash Flow would be equal to $64.0 million for a period of five years.
Current report
Rights Agreement Amendment
Current report
On February 4, 2026, in connection with the closing of the private placement, the Board of Directors amended the termination date of the Rights Agreement to February 4, 2026, causing each Right to expire and to be extinguished and for the Rights Agreement to be terminated. See Note 12 of the unaudited condensed consolidated financial statements for additional discussion.
Current report
PRESIDENT AND CHIEF EXECUTIVE OFFICER TRANSITION
Current report
As discussed in Note 12, in connection and concurrently with the closing of the private placement, Kevin Mowbray, our President and Chief Executive Officer, entered into an agreement to voluntarily retire from his positions at the Company and its subsidiaries and affiliates. Pursuant to this agreement, we have agreed to pay (i) a severance payment to Mr. Mowbray of $1,500,000 payable in thirty-six installments and (ii) COBRA medical premiums for a period of 18 months for Mr. Mowbray and his spouse. In addition, Mr. Mowbray agreed to provide consultation, advice and assistance in the transition and operation of our business as reasonably requested by us through May 31, 2026. In connection with the closing and the planned retirement of the Chief Executive Officer, Nathan Bekke, our current Chief Operating Officer, assumed the role of Interim Chief Executive Officer.
Current report
VICE PRESIDENT, CHIEF FINANCIAL OFFICER TRANSITION
Current report
On November 17, 2025, Timothy R. Millage, Vice President, Chief Financial Officer informed us of his decision to resign from his positions with us to pursue an opportunity in church ministry. His resignation became effective February 3, 2026, and he has agreed to provide consulting services to the Company through May 31, 2026. In connection with Mr. Millage’s resignation, we and Mr. Millage entered into a separation agreement, dated November 20, 2025 (the “Separation Agreement”). Under the terms of the Separation Agreement, Mr. Millage will receive (a) his full compensation through the end of his consulting role, (b) a severance payment equaling twenty-six weeks of his base salary, (c) the vesting of all unvested stock awards on February 3, 2026, and (d) survival of the indemnification terms under his employment agreement and indemnity agreement. The Separation Agreement also includes customary non-compete, non-solicitation, and release of claims provisions. We have initiated a search process to identify a new Chief Financial Officer. Josh Rinehults, the Company’s current Vice President of Operations and Finance, has been appointed as Vice President, Interim Chief Financial Officer, and Treasurer, effective as of February 3, 2026.
Current report
For the three months ended December 28, 2025, our total operating revenue was $130.1 million, down 10.0% from the three months ended December 29, 2024. Total Digital Revenue was $70.3 million and represented 54.1% of our total operating revenue. Total Print Revenue was $59.7 million, a 16.1% decrease to the three months ended December 29, 2024. We continued to deliver positive performance in our digital-only subscription business totaling $22.7 million, driving year-over-year revenue growth of 5.3%. Another key piece of our digital business, Amplified Digital® agency revenue totaled $23.6 million in the quarter.
Current report
Operating expenses totaled $125.9 million and Cash Costs (a non-GAAP financial measure) totaled $121.2 million, a 15.5% decrease and a 12.5% decrease, respectively, compared to the three months ended December 29, 2024 due to continued strong cost management, particularly in legacy revenue streams. Operating expenses during the quarter included $2.0 million in business interruption insurance reimbursements related to the Cyber claim. The remaining business-interruption claims remain under review. See Note 10 for further discussion.
Current report
Net loss totaled $5.1 million and Adjusted EBITDA (a non-GAAP financial measure) totaled $12.3 million, a 68% and 61% increase, respectively, due primarily to the cost reduction actions noted above. Net loss for the quarter included $2.0 million in insurance reimbursements discussed above.
Current report
Cash on the balance sheet totaled $12.6 million. Debt, net of cash on the balance sheet, totaled $443 million. Since May 2025, we have satisfied all principal and interest payments through organic free cash flow generation.
Current report
We are a leading digital-first subscription and marketing services company committed to delivering high-quality, trusted, and deeply local news and information. Our mission is to strengthen and enrich the communities we serve by providing compelling local content, superior subscriber experiences, and innovative, data-driven advertising and marketing solutions. Through a premium, high-margin portfolio of digital products and marketing services — including owned-and-operated platforms, branded content, over-the-top advertising, AI-powered solutions, and targeted print — we enable more than 15,000 local advertisers to meaningfully engage customers, strengthen their brands, and accelerate growth.
Current report
Our core strategy is to expand audiences and deepen engagement by delivering robust, hyper-local content that informs and connects our communities. We are committed to creating, collecting, and distributing trusted local news and information across platforms designed to meet audiences wherever they are — print, web, mobile, social, and emerging channels. At the same time, we are investing in world-class digital products that elevate the subscriber experience through personalization, seamless access, and continuous innovation.
Current report
RESULTS OF OPERATIONS
Current report
*** Indicates an absolute value percentage change greater than 100.
Current report
Total operating revenue was $130.1 million in the three months ended December 28, 2025, down $14.5 million, or 10.0%, compared to the the three months ended December 29, 2024.
Current report
Equity in earnings of TNI and MNI in the three months ended December 28, 2025 is essentially flat to the three months ended December 29, 2024.
Current report
Restructuring costs and other decreased $2.0 million, or 38.9% in the three months ended December 28, 2025, compared to the three months ended December 29, 2024. The prior year quarter included significant costs associated with the shutdown of one of our production facilities.
Current report
Total operating expenses during the quarter included $2.0 million in business interruption reimbursements.
Current report
Cash required for financing activities was $1.1 million for the three months ended December 28, 2025 due to offering costs that will offset the proceeds from the private placement.
Current report
Please see “Recent Developments” for discussion of the Credit Agreement Amendment, which became operative upon the closing of the private placement.
Removed paragraphs (39)
Previous report
Lee Enterprises, Incorporated, together with its subsidiaries, is a digital-first subscription business providing local markets with valuable, high quality, trusted, intensely local news, information, advertising and marketing services. We inform consumers in 72 mid-sized local communities in 25 states with a rapidly growing digital subscription platform including 670,000 digital subscribers. Our core strategy aims to grow audiences and engagement through creating, collecting, and distributing trusted local news and information, continuous improvements to subscriber experience, and offering a full suite of omni-channel advertising and marketing to more than 20,000 local advertisers.
Previous report
Our product portfolio includes digital subscription platforms, daily, weekly and monthly newspapers and niche products, all delivering original local news and information as well as national and international news. Our products offer digital and print editions, and our content and advertising is available in real time through our websites and mobile apps. We operate in predominately mid-sized communities with products ranging from large daily newspapers and associated digital products, such as the St. Louis Post-Dispatch and The Buffalo News, to non-daily newspapers with news websites and digital platforms serving smaller communities.
Previous report
We have made investments in talent and technology to improve user experience, content, data visualization and marketing to align with the shift in spending habits by both consumers and advertisers toward digital products.
Previous report
We aim to grow our business through three main categories: subscriptions to our product offerings, advertising and marketing solutions to local advertisers, and digital services to a diverse set of customers. Execution of this strategy is expected to transform Lee into a growing and sustainable local media organization.
Previous report
•Our digital subscription platforms are the fastest growing digital subscription platforms in local media.
Previous report
•Amplified Digital® Agency("Amplified"), our digital marketing services agency, offers a full suite of digital marketing solutions to local advertisers.
Previous report
•BLOX Digital (formerly known as TownNews), our software as a service (SaaS) content platform, is one of the largest web-hosting and content management SaaS providers in North America. BLOX Digital represents a powerful opportunity to drive additional digital revenue by providing state-of-the-art web hosting and content management services to more than 2,000 customers who rely on BLOX Digital for their web, over-the-top display, mobile, video and social media products.
Previous report
We generate revenue primarily through advertising and marketing services, subscriptions to our digital and print products, and digital services, primarily through our majority-owned subsidiary, BLOX Digital.
Previous report
We are a major subscription and advertising platform, a trusted local news provider and innovative, digitally-focused marketing solutions company. Our focus is on the local market - including local news and information, local advertising and marketing services to top local accounts, and digital services to local content curators. To align with the core strength of our Company, our operating strategy is locally focused around three pillars:
Previous report
•Grow digital audiences by transforming the way we present local news and information.
Previous report
•Expand our digital subscription base and revenue through audience growth and continued conversion of our massive digital audiences.
Previous report
•Diversify and expand offerings for advertisers through our vast array of rapidly growing digital products, our large digitally adept sales force, and Amplified, our full-service digital agency.
Previous report
References to the “2025 Quarter” refer to the three months ended June 29, 2025. Similarly, references to the “2024 Quarter” refer to the three months ended June 23, 2024.
Previous report
Total operating revenue was $141.3 million in the 2025 Quarter, down $9.3 million, or 6.2%, compared to the 2024 Quarter.
Previous report
Equity in earnings of TNI and MNI decreased $0.4 million in the 2025 Quarter.
Previous report
Restructuring costs and other increased $3.3 million, or 88.2%, compared to the 2024 Quarter. The increase is primarily driven from costs associated with recovering from the Cyber Incident, closing down outsourced production facilities, ongoing business transformation efforts, and severance. Restructuring costs and other include severance costs, litigation expenses, restructuring expenses, cyber restoration costs, and advisor expenses.
Previous report
We recorded an income tax benefit of $2.7 million, or 61.4% of pretax loss in the 2025 Quarter. In the 2024 Quarter, we recognized an income tax benefit of $0.8 million, or 18.7% of pretax loss.
Previous report
Nine Months Ended June 29, 2025
Previous report
Operating results are summarized below.
Previous report
References to the “2025 Period” refer to the nine months ended June 29, 2025. Similarly, references to the “2024 Period” refer to the nine months ended June 23, 2024.
Previous report
Operating Revenue
Previous report
Total operating revenue was $423.2 million in the 2025 Period, down $29.6 million, or 6.5%, compared to the 2024 Period.
Previous report
Advertising and marketing services revenue totaled $193.6 million in the 2025 Period, down 5.0% compared to the 2024 Period. Print advertising revenues were $53.9 million in the 2025 Period, down 13.3% compared to the 2024 Period due to continued secular declines in demand for print advertising and impacts from the Cyber Incident, which limited capacity for print advertising for certain publications for a short period of time. Digital advertising and marketing services totaled $139.8 million in the 2025 Period, down 1.4% compared to the 2024 Period. Digital advertising and marketing services represented 72.2% of the 2025 Period total advertising and marketing services revenue, compared to 69.5% during the 2024 Period.
Previous report
Subscription revenue totaled $191.4 million in the 2025 Period, down 8.4% compared to the 2024 Period. Decline in full access volume, consistent with historical and industry trends were partially offset by selective increases on our full access subscriptions, and price increases on digital subscriptions. Digital-only subscribers now total 670,000. Digital-only subscription revenue grew 14.0% compared to the 2024 Period.
Previous report
Other revenue, which primarily consists of commercial printing revenue and digital services from BLOX Digital, decreased $1.9 million, or 4.7%, in the 2025 Period compared to the 2024 Period. Digital services revenue totaled $15.2 million in the 2025 Period, a 0.1% increase compared to the 2024 Period. Commercial printing revenue totaled $12.1 million in the 2025 Period, a 8.0% decrease compared to the 2024 Period, primarily driven by reductions in print volumes from our partners.
Previous report
Total digital revenue including digital advertising revenue, digital subscription revenue and digital services revenue totaled $223.8 million in the 2025 Period, an increase of 3.0% over the 2024 Period, and represented 52.9% of our total operating revenue in the 2025 Period.
Previous report
Equity in earnings of TNI and MNI decreased $0.9 million in the 2025 Period.
Previous report
Operating Expenses
Previous report
Compensation expense decreased $11.4 million in the 2025 Period, or 6.5%, compared to the 2024 Period from reductions in full time employees ("FTEs") due to continued business transformation efforts, partially offset by investments in digital talent and higher expenses related to the Company's self-insured medical plan.
Previous report
Newsprint and ink costs decreased $3.1 million in the 2025 Period, or 23.7%, compared to the 2024 Period. The decrease is attributable to declines in newsprint volumes.
Previous report
Restructuring costs and other increased $6.6 million in the 2025 Period, compared to the 2024 Period. The increase is primarily driven from costs associated with recovering from the Cyber Incident, closing down outsourced production facilities, ongoing business transformation efforts, and severance. Restructuring costs and other include severance costs, litigation expenses, restructuring expenses, cyber restoration costs, and advisor expenses.
Previous report
Depreciation and amortization expense decreased $6.2 million in the 2025 Period, or 29.0%, compared to the 2024 Period. The decrease in both is attributable to assets becoming fully depreciated or amortized.
Previous report
Assets loss (gain) on sales, impairments and other, was a net gain of $2.4 million in the 2025 Period compared to a net loss of $4.7 million in the 2024 Period. Assets loss (gain) on sales, impairments and other in the 2024 Period were primarily due to non-cash charges of $7.6 million that were recorded to reduce the carrying value of mastheads, which are non-amortized intangible assets. Assets gain on sales, impairments and other in the 2025 Period were the result of the disposition of non-core assets, including real estate.
Previous report
Non-operating Income and Expense
Previous report
Interest expense decreased $0.1 million, or 0.2%, to $30.4 million in the 2025 Period, compared to the same period last year. The decrease was due to a lower average outstanding balance on our Term Loan. Our weighted average cost of debt was 9% at the end of the 2025 Period and 2024 Period.
Previous report
Other non-operating income and expense consists of benefits associated with our pension and other postretirement plans. We recorded $2.2 million of periodic pension and other postretirement benefits in the 2025 Period compared to $4.7 million in the 2024 Period. The decrease was attributable due to the Company recognizing a non-cash curtailment gain of $1.2 million in the 2024 Period as a result of outsourcing certain postemployment defined benefit plan functions. Additionally, during the 2024 Period, the Company completed a voluntary lump sum payment of future benefits to terminated vested participants. The offer was accepted by 522 participants, representing a $22.6 million pension plan liability. As a result of the offer, a non-cash settlement gain of $2.4 million was recorded in Curtailment/Settlement gain on the Consolidated Statements of Loss and Comprehensive Loss. Both assets and liabilities of the plan were reduced by $22.6 million.
Previous report
Income Tax Benefit
Previous report
We anticipate that funds necessary for capital expenditures, which are expected to total up to $7.0 million in 2025, and other requirements, will be available from internally generated funds.
Previous report
Cash required for financing activities totaled $1.4 million in the 2025 Period compared to $3.0 million required in the 2024 Period. The Debt reduction accounted for nearly all the usage of funds in both periods.
Reworded paragraphs (22)
Previous wording
Advertising and marketing services revenue totaled $66.6 million in the 2025 Quarter, down 3.3% compared to the 2024 Quarter. Print advertising revenues were $17.5 million in the 2025 Quarter, down 7.7% compared to the 2024 Quarter due to continued secular declines in demand for print advertising and impacts from the Cyber Incident, which limited capacity for print advertising for certain publications for a short period of time. Digital advertising and marketing services totaled $49.1 million in the 2025 Quarter, down 1.6% compared to the 2024 Quarter. Digital advertising and marketing services represented 73.8% of the 2025 Quarter total advertising and marketing services revenue, compared to 72.5% in the same period last year.
Current wording
Advertising and marketing services revenue totaled $60.0 million in the three months ended December 28, 2025, down 9.9% compared to the three months ended December 29, 2024. Print advertising revenues were $17.2 million in the three months ended December 28, 2025, down 13.4% compared to the three months ended December 29, 2024 related to continued secular declines in demand for print advertising. Digital advertising and marketing services totaled $42.8 million in the three months ended December 28, 2025, down 8.4% compared to the three months ended December 29, 2024. Digital advertising and marketing services represented 71.3% of the three months ended December 28, 2025 total advertising and marketing services revenue, compared to 70.2% in the same period last year.
Previous wording
Subscription revenue totaled $61.6 million in the 2025 Quarter, down 9.9% compared to the 2024 Quarter. Decline in full access volume, consistent with historical and industry trends were partially offset by selective increases on our full access subscriptions, and price increases on digital subscriptions. Digital-only subscribers now total 670,000. Digital-only subscription revenue grew 13.4% compared to the 2024 Quarter.
Current wording
Subscription revenue totaled $57.7 million in the three months ended December 28, 2025, down 11.2% compared to the three months ended December 29, 2024. Declines in volumes, consistent with historical and industry trends were partially offset by strategic rate increases. Digital-only subscribers now total 609,000 as December 28, 2025. Digital-only subscription revenue grew 5.3% compared to the the three months ended December 29, 2024.
Previous wording
Other revenue, which primarily consists of commercial printing revenue and digital services from BLOX Digital, decreased $0.3 million, or 2.0%, in the 2025 Quarter compared to the 2024 Quarter. Digital services revenue totaled $5.3 million in the 2025 Quarter, a 3.5% increase compared to the 2024 Quarter. Commercial printing revenue totaled $4.2 million in the 2025 Quarter, a 4.9% decrease compared to the 2024 Quarter, primarily driven by reduction in print volumes from our partners.
Current wording
Other revenue, which primarily consists of commercial printing revenue and digital services from BLOX Digital, decreased $0.6 million, or 4.6%, in the three months ended December 28, 2025 compared to the three months ended December 29, 2024. Digital services revenue totaled $4.8 million in the three months ended December 28, 2025, a 5.1% decrease compared to the three months ended December 29, 2024. Commercial printing revenue totaled $3.9 million in the three months ended December 28, 2025, a 5.7% decrease compared to the three months ended December 29, 2024, primarily driven by lower print volumes from our partners.
Previous wording
Total digital revenue including digital advertising revenue, digital subscription revenue and digital services revenue totaled $77.9 million in the 2025 Quarter, an increase of 2.8% over the 2024 Quarter, and represented 55.1% of our total operating revenue in the 2025 Quarter.
Current wording
Total digital revenue including digital advertising revenue, digital subscription revenue and digital services revenue totaled $70.3 million in the three months ended December 28, 2025, a decrease of 4.2% over the three months ended December 29, 2024, and represented 54.1% of our total operating revenue in the the three months ended December 28, 2025
Previous wording
Total operating expenses were $137.3 million in the 2025 Quarter, a 6.4% decrease compared to the 2024 Quarter. Cash Costs, a non-GAAP financial measure used to summarize certain operating expense (see reconciliation of Non-GAAP financial measures below), were down 7.0% in the 2025 Quarter.
Current wording
Total operating expenses were $125.9 million in the three months ended December 28, 2025, a 15.5% decrease compared to the three months ended December 29, 2024. Cash Costs, a non-GAAP financial measure used to summarize certain operating expense (see reconciliation of Non-GAAP financial measures below), were down 12.5% in the three months ended December 28, 2025. These decreases were primarily due to cost reduction actions put in place in year ended September 28, 2025.
Previous wording
Compensation expense decreased $11.8 million in the 2025 Quarter, or 20.0%, compared to the 2024 Quarter from reductions in full time employees ("FTEs") due to continued business transformation efforts, partially offset by investments in digital talent and higher expenses related to the Company's self-insured medical plan.
Current wording
Compensation expense decreased $10.8 million in the three months ended December 28, 2025, or 18.0%, compared to the three months ended December 29, 2024 from reductions in full time employees due to continued business transformation efforts.
Previous wording
Newsprint and ink costs decreased $0.8 million in the 2025 Quarter, or 20.2%, compared to the 2024 Quarter. The decrease is attributable to declines in newsprint volumes.
Current wording
Newsprint and ink costs decreased $0.7 million in the three months ended December 28, 2025, or 18.1%, compared to the three months ended December 29, 2024. The decrease is attributable to declines in newsprint volumes and delivery costs.
Previous wording
Other operating expenses increased $3.1 million in the 2025 Quarter, or 4.1%, compared to the 2024 Quarter. Other operating expenses include all operating costs not considered to be compensation, newsprint, depreciation and amortization, or restructuring costs and assets loss on sales, impairments, and other, net. The largest components are costs associated with printing and distribution of our printed products, digital cost of goods sold and facility expenses. The increase is attributable to investments to our digital growth.
Current wording
Other operating expenses decreased $5.9 million in the three months ended December 28, 2025, or 7.9%, compared to the three months ended December 29, 2024. Other operating expenses include all operating costs not considered to be compensation, newsprint, depreciation and amortization, or restructuring costs and assets loss on sales, impairments, and other, net. The largest components are costs associated with printing and distribution of our printed products, digital cost of goods sold and facility expenses.
Previous wording
Depreciation and amortization expense decreased $3.1 million, or 44.8%, in the 2025 Quarter. The decrease in both is attributable to assets becoming fully depreciated or amortized.
Current wording
Depreciation and amortization expense decreased $2.7 million, or 42.9%, in the three months ended December 28, 2025. The decrease in both is attributable to assets being fully depreciated or amortized.
Previous wording
Assets gain on sales, impairments and other, was a net gain of $1.6 million in the 2025 Quarter compared to a net gain of $1.4 million in the 2024 Quarter. Assets gain on sales in both quarters were due to asset sales.
Current wording
Assets gain on sales, impairments and other, was de minimis in the three months ended December 28, 2025 (a net gain of $0.0 million) compared to a net gain of $0.9 million in the the three months ended December 29, 2024.
Previous wording
The factors noted above resulted in an operating loss of $3.2 million in the 2025 Period compared to operating income of $8.2 million in the 2024 Period.
Current wording
The factors noted above resulted in an operating income of $5.2 million in the three months ended December 28, 2025 compared to an operating loss of $3.4 million in the three months ended December 29, 2024.
Previous wording
Non-operating income and expense decreased by $0.4 million, or 4.0%. The decrease is primarily driven by an increase in Pension and OPEB related benefits offset by an increase in Interest expense of $0.1 million, or 0.5%, to $10.1 million in the 2025 Quarter, compared to the same Quarter last year. The increase to interest expense was due to the interest and rent waivers received in the second quarter which was added to the outstanding balance on our Term Loan. Our weighted average cost of debt was 9% at the end of the 2025 Quarter and 2024 Quarter.
Current wording
Non-operating income and expense decreased by $0.2 million, or 2.3%. The decrease is primarily driven by an increase in Pension and OPEB related benefits. Our weighted average cost of debt was 9% at the end of both the three months ended December 28, 2025 and the three months ended December 29, 2024.
Previous wording
We recorded an income tax expense of $1.3 million, or 4.1% of pretax loss in the 2025 Period. In the 2024 Period, we recognized an income tax benefit of $3.4 million, or 19.6% of pretax loss.
Current wording
We recorded an income tax expense of $0.9 million, or (21.4)% of pretax loss in the three months ended December 28, 2025. In the three months ended December 29, 2024, we recorded an income tax expense of $3.2 million, or (25.0)% of pretax loss.
Previous wording
Net loss was $1.7 million and diluted loss per share were $0.31 for the 2025 Quarter compared to net loss of $3.7 million and diluted losses per share of $0.73 for the 2024 Quarter. The change reflects the various items discussed above.
Current wording
Net loss was $5.1 million and diluted loss per share were $0.92 for the three months ended December 28, 2025 compared to net loss of $16.2 million and diluted losses per share of $2.80 for the the three months ended December 29, 2024. The change reflects the various items discussed above.
Previous wording
In this report, we present Adjusted EBITDA and Cash Costs which are non-GAAP financial performance measures that exclude from our reported GAAP results the impact of certain items consisting primarily of restructuring charges and non-cash charges. We believe such expenses, charges and gains are not indicative of normal, ongoing operations, and their inclusion in results makes for more difficult comparisons between years and with peer group companies. In the future, however, we are likely to incur expenses, charges and gains similar to the items for which the applicable GAAP financial measures have been adjusted and to report non-GAAP financial measures excluding such items. Accordingly, exclusion of those or similar items in our non-GAAP presentations should not be interpreted as implying the items are non-recurring, infrequent, or unusual.
Current wording
In this report, we present Adjusted EBITDA and Cash Costs which are non-GAAP financial performance measures that exclude from our reported GAAP results the impact of certain items consisting primarily of restructuring charges and non-cash charges. We believe such expenses, charges and gains are not indicative of normal, on-going operations, and their inclusion in results makes for more difficult comparisons between years and with peer group companies. In the future, however, we are likely to incur expenses, charges and gains similar to the items for which the applicable GAAP financial measures have been adjusted and to report non-GAAP financial measures excluding such items. Accordingly, exclusion of those or similar items in our non-GAAP presentations should not be interpreted as implying the items are non-recurring, infrequent, or unusual.
Previous wording
Adjusted EBITDA is a non-GAAP financial performance measure that enhances financial statement users' overall understanding of the operating performance of the Company. The measure isolates unusual, infrequent, or non-cash transactions from the operating performance of the business. This allows users to easily compare operating performance among various fiscal periods and how management measures the performance of the business. This measure also provides users with a benchmark that can be used when forecasting future operating performance of the Company that excludes unusual, nonrecurring or one-time transactions. Adjusted EBITDA is also a component of the calculation used by stockholders and analysts to determine the value of our business when using the market approach, which applies a market multiple to financial metrics. It is also a measure used to calculate the leverage ratio of the Company, which is a key financial ratio monitored and used by the Company and its investors. Adjusted EBITDA is defined as net income (loss), plus non-operating expenses, income tax expense, depreciation and amortization, assets loss (gain) on sales, impairments and other, restructuring costs and other, stock compensation and our 50% share of EBITDA from TNI and MNI, minus equity in earnings of TNI and MNI.
Current wording
Adjusted EBITDA is a non-GAAP financial performance measure that enhances financial statement users' overall understanding of our operating performance. The measure isolates unusual, infrequent, or non-cash transactions from the operating performance of the business. This allows users to easily compare operating performance among various fiscal periods and how management measures the performance of the business. This measure also provides users with a benchmark that can be used when forecasting our future operating performance that excludes unusual, nonrecurring or one-time transactions. Adjusted EBITDA is also a component of the calculation used by stockholders and analysts to determine the value of our business when using the market approach, which applies a market multiple to financial metrics. It is also a measure used to calculate our leverage ratio, which is a key financial ratio monitored and used by us and our investors. Adjusted EBITDA is defined as net income (loss), plus non-operating expenses, net, income tax expense (benefit), depreciation and amortization, assets loss (gain) on sales, impairments and other, restructuring costs and other, stock compensation and our 50% share of EBITDA from TNI and MNI, minus equity in earnings of TNI and MNI.
Previous wording
Cash Costs represent a non-GAAP financial performance measure of operating expenses which are measured on an accrual basis and settled in cash. This measure is useful to investors in understanding the components of the Company’s cash-settled operating costs. Generally, the Company provides forward-looking guidance of Cash Costs, which can be used by financial statement users to assess the Company's ability to manage and control its operating cost structure. Cash Costs are defined as compensation, newsprint and ink and other operating expenses. Depreciation and amortization, assets loss (gain) on sales, impairments and other, other non-cash operating expenses and other expenses are excluded. Cash Costs also exclude restructuring costs and other, which are typically settled in cash.
Current wording
Cash Costs represent a non-GAAP financial performance measure of operating expenses which are measured on an accrual basis and settled in cash. This measure is useful to investors in understanding the components of our cash-settled operating costs. Generally, we provide forward-looking guidance of Cash Costs, which can be used by financial statement users to assess our ability to manage and control its operating cost structure. Cash Costs are defined as compensation, newsprint and ink and other operating expenses and exclude restructuring costs and other, which are typically settled in cash.
Previous wording
Cash required for operating activities totaled $0.8 million in the 2025 Period compared to cash provided by operating activities of $1.4 million in 2024 Period, a decrease of $0.6 million. The decrease was primarily driven by a decrease in operating results of $24.1 million (defined as net loss adjusted for non-working capital items), partially offset by non-cash interest expense of $10.1 million and an increase in working capital of $13.4 million. The increase in working capital is primarily related to the cyber incident, which increased both accounts payable and accounts receivable.
Current wording
Cash provided by operating activities totaled $4.5 million in the three months ended December 28, 2025 compared to cash used by operating activities of $7.3 million in the three months ended December 29, 2024, an increase of $11.8 million. The increase was primarily driven by an increase in operating results of $8.3 million (defined as net loss adjusted for non-working capital items) and an increase in working capital of $3.5 million. The increase in working capital is primarily related to elevated prepaid offering costs and accrued liabilities related to the private offering transaction.
Previous wording
Cash provided by investing activities totaled $5.1 million in the 2025 Period compared to cash provided by investing activities of $0.5 million in the 2024 Period. 2025 Period and 2024 Period included $8.7 million and $7.1 million, respectively, in proceeds from the sale of assets as the Company divested non-core real estate.
Current wording
Cash used in investing activities totaled $0.8 million in the three months ended December 28, 2025 compared to cash provided by investing activities of $3.9 million in the in the three months ended December 29, 2024. The three months ended December 29, 2024 included $5.4 million in proceeds from the sale of assets as we divested non-core real estate.
Previous wording
Our liquidity, consisting of cash on the balance sheet, totaled $14.1 million on June 29, 2025. This liquidity amount excludes any future cash flows from operations. For the nine months ending June 29, 2025, cash provided by operating activities totaled $0.8 million. The current operating environment, business transformation spending, and impacts from the Cyber Incident have reduced net cash flows and put pressure on the Company's liquidity. In response to the current challenges, the Company has implemented specific plans to maintain sufficient liquidity for the foreseeable future.
Current wording
As discussed in Note 12, on December 30, 2025, we entered into an agreement pursuant to which we agreed to issue and sell an aggregate of 15,384,615 shares of our common stock at a purchase price of $3.25 per share in a private placement. The aggregate gross proceeds from the private placement are expected to be approximately $50.0 million, before deducting offering expenses. We expect to use the net proceeds for working capital and for other general corporate purposes. Our liquidity, consisting of cash on the balance sheet, totaled $12.6 million on December 28, 2025. This liquidity amount excludes any future cash flows from operations. For the three months ending December 28, 2025, cash provided by operating activities totaled $4.5 million. The current operating environment, business transformation spending, and impacts from the Cyber Incident have reduced net cash flows and put pressure on our liquidity. In response to the current challenges, we have implemented specific plans to maintain sufficient liquidity for the foreseeable future, including for at least the next 12 months.
Previous wording
The Company's plan includes reducing operating and capital spending and reducing outstanding accounts receivable. Reductions in operating expenses and capital spending largely impact the Company's print businesses and future products that are not generating revenue today. Due to the cyber incident and in an effort to improve liquidity, the Company was granted waivers of interest and rent for three months.
Current wording
Our plan includes reducing operating and capital spending and reducing outstanding accounts receivable. Reductions in operating expenses and capital spending largely impact our print businesses and future products that are not generating revenue today.
Previous wording
The Company executed its plan in the 13 weeks ended June 29, 2025, resulting in an improvement in operating results (defined as net loss adjusted for non-working capital items). This improvement marked a significant milestone in the cyber recovery, as since May 2025 all mandatory and principal payments were funded through cash from operations. The Company anticipates the improvement to continue into future quarters.
Current wording
We executed our plan in the quarter ended December 28, 2025, resulting in an improvement in operating results (defined as net loss adjusted for non-working capital items). This improvement marked a significant milestone in the cyber recovery, as all mandatory and principal payments were funded through cash from operations since May 2025. We anticipate the improvement to continue into future quarters.
Rearranged previous paragraphs (5)
Previous report — wording carried elsewhere
The factors noted above resulted in an operating income of $4.7 million in the 2025 Quarter compared to $4.9 million in the 2024 Quarter.
Previous report — wording carried elsewhere
Total operating expenses were $429.4 million in the 2025 Period, a 4.3% decrease compared to the 2024 Period. Cash Costs, a non-GAAP financial measure used to summarize certain operating expense (see reconciliation of Non-GAAP financial measures below), were down 3.0% in the 2025 Period.
Previous report — wording carried elsewhere
Other operating expenses increased $2.1 million in the 2025 Period, or 1.0%, compared to the 2024 Period. Other operating expenses include all operating costs not considered to be compensation, newsprint, depreciation and amortization, or restructuring costs and assets loss (gain) on sales, impairments, and other, net. The largest components are costs associated with printing and distribution of our printed products, digital cost of goods sold and facility expenses. The increase is attributable to investments to our digital growth.
Previous report — wording carried elsewhere
Net loss and Loss Per Share
Previous report — wording carried elsewhere
Net loss was $29.9 million and diluted loss per share were $5.16 for the 2025 Period compared to net loss of $14.1 million and diluted losses per share of $2.68 for the 2024 Period. The change reflects the various items discussed above.