DallasNews Stock

DallasNews Corporation (DallasNews) engages in producing journalism for its communities and providing digital marketing solutions for its customers through its agency capabilities.

The company is the Dallas-based holding company of The Dallas Morning News and Medium Giant.

The Dallas Morning News is Texas' leading daily newspaper with a strong journalistic reputation, intense regional focus and close community ties.

The company has a full-service agency, Medium Giant, with capabilities, including strategy, creative and media management with a focus on strategic and digital marketing, and data intelligence that provide a measurable return on investment to its clients.

The company operates The Dallas Morning News (dallasnews.com), Texas’ leading newspaper and various niche publications targeting specific audiences. These operations generate revenue from sales of advertising within the company’s newspaper and digital platforms, subscriptions and retail sales of its newspapers, commercial printing and distribution services primarily related to national newspapers, and preprint advertising.

The News is one of the leading metropolitan newspapers in the United States. The newspaper is distributed primarily in Dallas County and five surrounding counties. This coverage area represents one of the most populous and fastest growing metropolitan areas in the country. The News also publishes Briefing and Al Dia, a Spanish-language newspaper, both distributed on Wednesdays at no charge to households in select coverage areas.

In addition to traditional print and digital advertising, the company has a full-service agency, Medium Giant, with capabilities, including strategy, creative and media management with a focus on strategic and digital marketing, and data intelligence that provide a measurable return on investment to its clients. Through the full-service capabilities, the company is able to offer businesses comprehensive, strategic and creative marketing solutions which allow its clients to connect with their business, their brand and their audiences to drive growth. The company has aligned management and its sales teams to provide a cross-functional integrated approach to maximize the development of these businesses. Digital marketing services are provided through the following service offerings:

Multi-channel marketing solutions through subscription sales of the company’s cloud-based software, allowing customers to manage and individualize their marketing campaigns. In addition, multi-channel marketing services are provided to customers without access to the proprietary software.

Digital and strategic marketing services, paid media strategy and management, and other marketing related services. Multi-channel digital advertising and marketing services campaigns for customers, allowing them to target demographic audiences using data analytics and determine the delivery media, such as email campaigns, banner impressions or video views on third-party websites.

The following describes the company’s various revenue streams:

Advertising and Marketing Services Revenue

The company has a comprehensive portfolio of print advertising products, which include display, classified and preprint advertising. Display revenue results from sales of advertising space within the company’s core newspapers and niche publications to local, regional or national businesses with local operations, affiliates or resellers. Classified revenue, which includes automotive, real estate, employment, obituaries and other, results from sales of advertising space in the classified and other sections of the company’s newspapers. Preprint revenue results from sales of preprinted advertisements or circulars inserted into the company’s core newspapers, niche publications, and distributed to publications in other markets, or distributed by mail or through third-party distributors to households in targeted areas in order to provide total market coverage for advertisers. The company’s capabilities allow its advertisers to target preprint distribution selectively at the sub-zip code level in order to optimize coverage for the advertisers’ locations. Preprint advertising also includes other services revenue related to the company’s niche publications.

The company’s digital advertising and marketing services revenue consists of strategic marketing services, consulting, branding, paid media strategy and management, creative services, search optimization, direct mail and the sale of promotional materials, as well as providing multi-channel marketing solutions through subscription sales of the company’s cloud-based software. In addition, it includes digital sales of banner, classified and native advertisements on the company’s news and entertainment-related websites and mobile apps, as well as targeted and multi-channel (programmatic) advertising placed on third-party websites.

Circulation Revenue

Circulation revenue includes subscriptions and single copy sales related to the company’s core newspapers in print and digital formats. DallasNews’ steadfast commitment to producing superior, unduplicated local journalism enables the company’s newspapers to charge premium subscription rates. The Dallas Morning News’ goal is to maximize the amount of recurring revenue from consumers of the company’s print and digital products. The company continuously assesses the journalism provided to subscribers and their willingness and ability to pay higher rates by geographic area. The company has implemented effective rate increases to select subscribers or retailers. A digital replica version of The Dallas Morning News is offered for subscribers to purchase if they prefer to consume news through a digital device in a more traditional format. DallasNews’ newspapers and the newspaper industry as a whole are challenged to maintain and grow print circulation volume. To the extent circulation volume declines cannot be offset by rate increases, the company will realize lower circulation revenue. Circulation volume declines could also result in lower rates and volumes for advertising revenue.

The company’s news websites, including dallasnews.com and aldiadallas.com, are the leading English and Spanish news and entertainment digital platforms in the North Texas region. The news websites offer late-breaking and other up-to-date news coverage, user-generated content, advertising, e-commerce, and other services. Readers can access news content across multiple digital platforms and obtain relevant local customized content and advertising. The company’s journalists have expanded their reach and deepened their engagement with audiences by delivering news and content through social media platforms, such as blogs, Facebook and Twitter, which direct traffic to the core websites.

Printing, Distribution and Other Revenue

Printing, distribution and other revenue includes commercial printing, distribution, and shared mail packaging services. The company’s commercial printing and distribution services leverage the capacity of its production and distribution assets.

Commercial printing and delivery services are provided for certain national newspapers. A shared mail packaging business is operated in Tempe, Arizona, providing mailed advertisements for business customers.

Raw Materials and Distribution

The company has a Paper Supply Agreement, expiring in August 2025, with Gannett Supply Corporation (Gannett), a newsprint broker, which will be the company’s sole supplier of newsprint from designated newsprint suppliers at market-based prices during the term of the agreement, except in certain specified instances.

The company’s newspapers and other commercial print products are produced at its facility in Plano, Texas. The distribution of printed products to subscribers, retailers and newsstands is made under terms of agreements with third-party distributors.

Strategy

The key elements of the company’s strategy are to produce quality local journalism at scale, distributed through digital platforms that improve user engagement and result in increased digital subscriptions and customer retention; develop new ways to grow advertising dollars on the company’s digital platforms; grow recurring advertising and digital marketing services revenue through a client-first approach and enhanced full-service agency capabilities; and provide flexibility to meet strategic investment opportunities.

Seasonality

DallasNews’ advertising revenues are subject to moderate seasonality, with print and digital advertising revenue typically higher in the fourth calendar quarter of each year (year ended December 2022) because of the holiday shopping season.

History

The company, a Texas corporation, was founded in 1842. It was formerly known as A. H. Belo Corporation and changed its name to DallasNews Corporation in 2021.