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Facebook still isn't a friend to publishers: Gannett CEO

·Anchor, Editor-at-Large
·2-min read
In this article:
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Facebook (FB) may be opening its wallet to the legacy news publishers it has taken traffic from over the years, but way more needs to be done to level the playing field. 

"[Facebook] is not a friend to the industry, not at all. We do over $3 billion in sales per year between subscriptions, digital marketing solutions and that's on the back of the great content we produce and 150 million people driving to us. It's not even a drop in the bucket what the likes of Facebook talks to us about today," said Gannett (GCI) Chairman and CEO Michael Reed on Yahoo Finance Live

Added Reed, "We are driving a billion and a half of subscription revenue"

Suffice it to say, Facebook sees it a little bit different. 

"Facebook is more than willing to partner with news publishers. We absolutely recognize quality journalism is at the heart of how open societies function — informing and empowering citizens and holding the powerful to account. That’s why we’ve invested $600 million since 2018 to support the news industry, and plan at least $1 billion more over the next three years," said Nick Clegg, Facebook's vice president of global affairs, in a blog post earlier this year. 

Even without Facebook being a friend, the turnaround at Gannett continued under Reed in the second quarter as he pivots to digital subscriptions.

Here is how Gannett performed compared to Wall Street analyst estimates for the second quarter:

  • Net Sales: $804.3 million vs. $767 million

  • Diluted EPS: $0.10 vs. loss per share of $0.23

Gannett set new records in the second quarter by ending with 1.4 million digital subscriptions, up 41% from a year ago. Total sales rose 4.9% from a year ago, while adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) surged 48.4%. 

Meanwhile, Gannett said it hauled in 174 million average monthly unique visitors in the quarter across its USA Today Network and U.K. digital properties.

Gannett shares surged 13% on Friday's session following the much better than expected second quarter. Shares are up 86% year-to-date, outperforming the 7.5% drop in rival The New York Times. 

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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