Business Overview / Sources of Revenue

Gray Media (NYSE: GTN.A) is a leading U.S. media company that owns and operates television stations and digital assets across 113 markets, reaching about 37% of U.S. TV households[1][2][3]. The company primarily earns revenue from local and national television advertising, retransmission consent fees from cable/satellite providers, and digital marketing services[3][5]. Additional revenue comes from video production, sports programming, and studio facilities through subsidiaries like Raycom Sports and Tupelo Media Group[1][5]. While an exact percentage breakdown is not provided in the search results, the majority of Gray Media’s revenue is traditionally derived from advertising and retransmission fees, with digital and production services contributing a smaller share[3][5].

Revenue Growth Potential and Recurrence

Gray Media (GTN.A) generates a significant portion of its revenue from advertising, including both core and political ads, which are not inherently recurring. However, the company also earns income from retransmission agreements and digital advertising—these sources are more stable and recurring in nature, but they do not constitute a majority of total revenue[5][2].

Looking ahead, Gray Media faces limited revenue growth potential over the next five years. The firm’s Q1 2025 results showed a 5% year-over-year revenue decline, and its five-year annual revenue growth rate has been stagnant to declining[4][5]. While digital advertising is growing, core advertising revenue is under pressure, and overall industry dynamics suggest that meaningful top-line growth is unlikely. Most forecasts expect Gray Media's revenue to be flat or to grow only at a low single-digit rate at best in the foreseeable future[4][5].

Economic Moat Factors

Gray Media (GTN.A) possesses a moderate economic moat, primarily due to its scale and market leadership in local television broadcasting. The company owns and operates top-rated stations in 113 U.S. markets, collectively reaching about 37% of U.S. TV households[1][2]. This scale creates some advantages in advertising sales and content purchasing, resulting in limited economies of scale[2][5]. However, switching costs and network effects are relatively low for viewers and advertisers, as alternatives abound. Brand power at the national level is weak, though Gray’s local station brands can be significant in their respective markets[1]. Unique assets include its production studios and digital media operations, but these do not constitute a strong standalone moat. Overall, while Gray benefits from size and local market strength, it faces ongoing threats from digital disruption and changing viewer habits, limiting the depth of its economic moat[1][5].

Leadership

Gray Media (GTN.A) is led by Hilton H. Howell Jr., who serves as Executive Chairman and CEO. Howell is not a founder; he has been CEO since 2019 and chairman since 2016[5]. He holds a significant ownership stake, with tens of thousands of shares reported in SEC filings, reflecting substantial vested interests[4]. The leadership team includes Pat LaPlatney (President, Co-CEO), Bob Smith (COO), and Nick Waller (Chief Administrative Officer)[1][5]. The team emphasizes innovation and local news impact, steering the company’s expansion and digital transformation[2][3][5].

Financial Health

Gray Media (GTN.A) carries a significant debt load, with a debt-to-equity ratio of 1.94, but maintains adequate liquidity indicated by a current ratio of 1.03[5]. The company has actively reduced debt, paying down $17 million in principal during Q1 2025[3]. It generates free cash flow, as seen by an enterprise value to operating cash flow ratio of 7.94[5], but its free cash flow margin is not explicitly provided. Recent reports do not indicate share dilution; rather, Gray Media focuses on debt reduction and strengthening its balance sheet, not on issuing more shares[3][5].

Last updated Jun 12, 2025