10-K: TEGNA's 2025 Performance: Merger Pending, Revenue Declines

TEGNA Inc. reports a significant decline in 2025 revenues and net income, primarily due to cyclical political advertising and ongoing challenges in the TV advertising market, as it progresses towards a merger with Nexstar Media Group.

Summary

• TEGNA entered into an Agreement and Plan of Merger with Nexstar Media Group, Inc. on August 18, 2025, for $22.00 per share in cash, with stockholders adopting the agreement on November 18, 2025, and the merger expected to close by the second half of 2026.
• Total revenues decreased by $390.0 million (13%) to $2.71 billion in 2025 from $3.10 billion in 2024.
• Net income attributable to TEGNA Inc. decreased by 63% to $219.9 million in 2025 from $599.8 million in 2024.
• Diluted earnings per share (EPS) decreased by 62% to $1.34 in 2025 from $3.53 in 2024.
• Political advertising revenue declined $334.4 million (90%) in 2025, consistent with the cyclical even-to-odd-year comparison.
• Advertising & Marketing Services (AMS) revenue declined $45.5 million (4%) due to ongoing challenges in the television advertising market, the absence of Summer Olympic games in 2025, and lower Premion-related revenue following Gray Media's exit as an exclusive reseller partner.
• Distribution revenue was down $10.5 million (1%) due to subscriber declines, partially offset by contractual rate increases.
• Operating income decreased $341.8 million (44%) in 2025 compared to 2024.
• The company repaid $550 million of unsecured notes that were scheduled to mature in March 2026 using available cash on hand.
• Goodwill and indefinite-lived intangible assets (primarily FCC broadcast licenses) totaled approximately $5.14 billion as of December 31, 2025, representing about 75% of total assets.
• TEGNA operates 64 television stations and two radio stations in 51 U.S. markets, reaching approximately 39% of U.S. television households.
• Strategic priorities include commitment to local journalism, A+ talent and culture, maximizing linear TV business, reimagining news production, integrating sales across platforms, personalized viewer experiences, and 'Zero Waste' operations.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this as a challenging period marked by significant revenue and profit declines, primarily due to cyclical political advertising and secular pressures in traditional TV, partially offset by strategic digital initiatives and debt management. The pending merger introduces both opportunity and uncertainty.

Positives

• Stockholders voted to adopt the Merger Agreement with Nexstar Media Group on November 18, 2025, progressing towards a cash acquisition at $22.00 per share.
• Successfully repaid $550 million of unsecured notes due March 2026 using available cash on hand, demonstrating strong liquidity management.
• Maintained a healthy leverage ratio of 2.78x as of December 31, 2025, well below the permitted 4.50x, indicating financial stability.
• Continued investment in new technologies like NextGen TV (ATSC 3.0), with 23 primary channels broadcasting in both ATSC 1.0 and ATSC 3.0 formats.
• Premion, the local advertising solution for streaming apps and CTV platforms, continues to be a strategic focus for digital advertising growth.
• Received significant industry recognition in 2025, including six National Edward R. Murrow Awards (more than any other station group) and 59 Regional Edward R. Murrow Awards, highlighting journalistic excellence.
• Demonstrated commitment to corporate responsibility and sustainability through environmental stewardship and social impact initiatives, such as the TEGNA Texas Flood Relief Fund which raised over $800,000.
• Offers comprehensive employee benefits, including new healthcare options, increased HSA contributions, expanded parental leave, fertility coverage, and free mental healthcare sessions.

Negatives

• Total revenues decreased by 13% ($390.0 million) in 2025 compared to 2024.
• Net income attributable to TEGNA Inc. decreased by 63% ($379.9 million) in 2025 compared to 2024.
• Diluted EPS decreased by 62% in 2025 compared to 2024.
• Operating income decreased by 44% ($341.8 million) in 2025 compared to 2024.
• Political advertising revenue experienced a significant decline of 90% ($334.4 million) in 2025 due to the odd-year election cycle.
• Advertising & Marketing Services (AMS) revenue declined 4% ($45.5 million) due to ongoing challenges in the television advertising market and the absence of Summer Olympic games in 2025.
• Distribution revenue declined 1% ($10.5 million) due to subscriber declines, despite contractual rate increases.
• Incurred $19.6 million in M&A-related costs in 2025, contributing to increased corporate general and administrative expenses.
• Recognized $14.4 million in impairment charges related to equity and debt investments in 2025.
• Corporate general and administrative expenses increased $9.6 million (19%) in 2025, primarily driven by M&A-related costs.
• Pay-TV subscribers decreased by an estimated 5.9% from 2024 to 2025, according to a Wells Fargo equity research report, indicating continued pressure on distribution revenue.

Risks

• The merger with Nexstar is subject to satisfaction of closing conditions, including regulatory approvals, which may not be completed on a timely basis, if at all.
• Failure to complete the merger could negatively impact the company's future business, financial condition, results of operations, and stock price, and may result in significant costs.
• Restrictions in the merger agreement may hinder operations and delay or prevent the company from pursuing business opportunities or effectively responding to competitive pressures.
• The pendency of the merger may disrupt current plans and operations, making it difficult to maintain relationships with employees, clients, and customers.
• Litigation related to the merger has been filed by purported stockholders, alleging false and misleading information in proxy statements and seeking to enjoin the merger or compensatory damages.
• Demand for advertising is highly correlated with the strength of the U.S. economy and is subject to cyclical and seasonal fluctuations, as well as other factors beyond the company's control.
• Competition from alternative forms of media, including social media platforms, streaming services, search engines, online publishers, programmatic platforms, and FAST distributors, may impair the ability to grow or maintain revenue levels.
• Declining traditional broadcast television viewership and accelerated 'cord-cutting' negatively impact the ability to generate distribution revenues.
• Information technology system failures, data security breaches, network disruptions, and cybersecurity attacks could disrupt business, lead to disclosure of nonpublic information, loss of sales, litigation, and financial consequences.
• Reliance on third-party cloud computing services makes the business vulnerable to damage or interruption from infrastructure changes, natural disasters, or cyberattacks.
• Loss of, or changes in, network affiliation agreements or retransmission consent agreements could adversely affect operating results for stations.
• Operating in a single broadcast segment increases exposure to the changes and highly competitive environment of the broadcast industry.
• Changes in governmental regulation, interpretation, or legislative reform (e.g., FCC rules on ownership, retransmission consent) could increase costs or limit opportunities for growth.
• The company may be subject to investigations or fines by governmental authorities for violations of FCC rules (e.g., indecency, children's programming, sponsorship identification).
• The success of much of the business is dependent upon the retention and performance of on-air talent, program hosts, and other key employees, with intense competition for these individuals.
• Investments in new technology initiatives, such as NextGen TV (ATSC 3.0), may not result in usable technology or sufficient additional revenues to offset related expenditures.
• Strikes or other union job actions could adversely affect the business by causing delays in production, significant disruption of operations, and reductions in profit margins.
• Pandemics or other health emergencies could materially adversely impact operations and business.
• Inability to protect domain names could adversely affect the company's reputation and brands.
• The company may face intellectual property infringement claims that could be time-consuming, costly to defend, and result in loss of significant rights.
• Risks related to the use of Generative Artificial Intelligence (GAI), including ethical considerations, public perception, intellectual property protection, regulatory compliance, privacy, labor issues, and reliability and accuracy of information produced.
• Volatility in the U.S. credit markets could significantly impact the ability to obtain new financing or refinance existing debt at reasonable rates and terms.
• The value of existing intangible assets (goodwill and FCC broadcast licenses) may become impaired, depending upon future operating results and market pressures.
• Changes in accounting standards can significantly impact reported operating results.
• Future share repurchase activity may not realize anticipated benefits or enhance long-term stockholder value.
• Any decrease in dividend payments or suspension of dividend payments could cause the stock price to decline.
• Any potential hostilities, terrorist attacks, or similarly newsworthy events leading to broadcast interruptions may affect revenues and results of operations.
• Future acquisitions or business opportunities, including investments in complementary businesses, could involve unknown risks, significant cash expenditures, and integration difficulties.
• Resources consumed in researching acquisitions, business opportunities, or financings that are not consummated could materially adversely affect subsequent attempts.
• The company may be subject to litigation for which it may be unable to accurately assess its level of exposure, potentially having a material adverse effect.
• Delays or difficulty in satisfying Sarbanes-Oxley Act Section 404 requirements or negative reports concerning internal controls could have a material adverse effect.
• The imposition of tariffs may negatively impact the demand for advertising by affecting the businesses of current and prospective customers.

Future Outlook

The merger with Nexstar Media Group is expected to close by the second half of 2026, subject to customary closing conditions including regulatory approvals. The company plans to continue paying a regular quarterly dividend of 12.5 cents per share through the closing of the merger. Macroeconomic factors, including inflation and changes in spending, tax, and trade policies, could continue to pressure advertising revenues in 2026. The company expects to continue rolling out NextGen TV (ATSC 3.0) service, but there is no guarantee that such service will earn sufficient additional revenues to offset the related expenditures.

Management Comments

• "TEGNA Inc. (the Company) serves local communities across the U.S. through trustworthy journalism, engaging content, and tools to help people navigate their daily lives."
• "Through customized marketing solutions, we help businesses grow and thrive."
• "We believe we are well-positioned for political revenues in even years to come based on our station footprint and our broadcast and digital reach."
• "Our core purpose is to build a sustainable future for trusted local journalism."
• "We will be relentless in eliminating inefficiencies and focusing only on high-impact work."
• "We believe that the claims asserted in the Advertising Cases are without merit and intend to defend vigorously against them."

Industry Context

StockSavvy.ai notes that TEGNA's significant revenue and profit declines in 2025, particularly in political advertising and AMS, reflect broader industry trends. The cyclical nature of political ad spending heavily impacts even-to-odd year comparisons, while ongoing challenges in the television advertising market and subscriber declines in traditional pay-TV (cord-cutting) highlight secular pressures. The company's strategic focus on local streaming apps, CTV advertising through Premion, and modernizing news operations with AI aligns with the industry's adaptation to evolving consumer content consumption habits and the fragmentation of audience attention. The pending merger with Nexstar underscores the ongoing consolidation within the broadcast sector as companies seek scale and efficiency in a challenging media landscape.

Comparison to Industry Standards

• Pay-TV subscribers decreased by an estimated 5.9% from 2024 to 2025, according to a January 2026 Wells Fargo equity research report, indicating that TEGNA's distribution revenue decline due to subscriber loss is consistent with broader industry trends.
• BIA Advisory Services expected digital media to account for 54% of local advertising spend in 2025, suggesting that TEGNA's AMS revenue challenges are part of a larger industry shift in advertiser spending towards digital platforms.
• TEGNA's receipt of six National Edward R. Murrow Awards in 2025, more than any other station group, demonstrates its continued excellence in local journalism, a key differentiator in a competitive content landscape.

Corporate Governance

Legal Proceedings

• **Litigation Relating to the Merger**: Three complaints were filed by purported stockholders (Faul v. TEGNA Inc., et al., Cohen v. TEGNA Inc., et al., and Brady v. TEGNA Inc., et. al.) alleging false and misleading information and/or failure to disclose material information in proxy statements related to the Nexstar merger. These complaints seek to enjoin the merger or, alternatively, rescission and/or compensatory damages. The Faul Litigation was dismissed without prejudice for want of prosecution as of February 17, 2026. TEGNA believes these allegations are without merit.
• **Antitrust Matters (In re: Local TV Advertising Antitrust Litigation)**: The company was involved in a DOJ antitrust investigation into local television advertising sales practices, which resulted in a settlement in June 2019 with no finding of wrongdoing or penalty. Subsequently, numerous putative class action lawsuits were consolidated into a single proceeding in the U.S. District Court for the Northern District of Illinois. TEGNA is a defendant in this litigation, denying any violation of law. Settlements with four co-defendants (CBS Corp, Fox Corp., certain Cox entities, and ShareBuilders, Inc.) totaling $48 million were approved in December 2023. Fact discovery is set to complete by June 1, 2026, class certification by approximately Q1 2027, summary judgment by approximately Q3 2027, and trial is scheduled to start on November 1, 2027.
• The company and its subsidiaries are also defendants in other judicial and administrative proceedings incidental to their business, none of which are believed to result in any material liability.

Related Party Transactions

• TEGNA had equity investments in MadHive, which was a related party through December 31, 2025.
• A commercial agreement with MadHive, under which MadHive provided platform services to TEGNA's Premion business, expired on December 31, 2025. Expenses incurred under this agreement were $0.7 million in 2025.
• A previous commercial agreement with MadHive, providing Premion access to streaming inventory, expired on December 31, 2024. Total expenses incurred under both commercial agreements with MadHive were $58.1 million in 2024 and $90.6 million in 2023.
• As of December 31, 2025, TEGNA had accounts receivable of $0.1 million from MadHive.

Stakeholder Impact

• **Shareholders**: Will receive $22.00 per share in cash if the merger with Nexstar is consummated. If the merger fails, the stock price may be negatively impacted. Dividends are expected to continue at 12.5 cents per share until the merger closes.
• **Employees**: May experience uncertainty about their future roles with the combined company following the merger, potentially affecting the ability to attract and retain key personnel. Workforce restructuring costs were incurred in 2025.
• **Customers (Advertisers)**: Face impacts from declining advertising demand, increased competition from digital platforms, and macroeconomic factors. The company's integrated sales approach aims to enhance value for advertisers.
• **Customers (Distribution Partners)**: Subscriber declines are impacting distribution revenue, leading to ongoing negotiations for retransmission consent agreements.
• **Communities**: The company maintains a core mission of helping people thrive in their local communities through trusted local journalism and social impact initiatives, including crisis reporting and charitable funds.

Next Steps

• Closing of the merger with Nexstar Media Group, Inc. by the second half of 2026.
• Continue paying a regular quarterly dividend of 12.5 cents per share through the closing of the merger.
• Continue rolling out NextGen TV (ATSC 3.0) service in coordination with other broadcasters.
• Completion of fact discovery in the In re: Local TV Advertising Antitrust Litigation by June 1, 2026.
• Completion of the class certification process in the In re: Local TV Advertising Antitrust Litigation through approximately Q1 2027.
• Completion of the summary judgment process in the In re: Local TV Advertising Antitrust Litigation through approximately Q3 2027.
• Start of trial for the In re: Local TV Advertising Antitrust Litigation on November 1, 2027.
• Make $9.0 million of contributions to the TEGNA Retirement Plan (TRP) and $8.5 million to the TEGNA Supplemental Retirement Plan (SERP) during 2026.

Key Dates

Recommendation

The pending merger with Nexstar at a fixed cash price of $22.00 per share creates a clear ceiling for the stock price, suggesting a 'hold' position for investors awaiting the merger's completion. However, the significant declines in revenue and net income for 2025, driven by cyclical political advertising and secular challenges in traditional TV, indicate underlying operational headwinds. While the company is strategically investing in digital and managing debt effectively, the risks associated with regulatory approvals for the merger and ongoing litigation introduce uncertainty. A seasoned investor would likely hold to capture the merger premium, but acknowledge the operational challenges if the merger were to fail.

Keywords

TEGNA, Nexstar Merger, Broadcast Television, Local News, Advertising, Digital Media, Premion, SEC Filing, 10-K, Media Industry, Corporate Governance, Risk Factors, Financial Performance, ATSC 3.0, FCC Regulations, Share Repurchase, Dividends, Cybersecurity, Generative AI, Litigation, Retransmission Consent