Segment reporting

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Segment reporting

NOTE 14 — Segment reporting

We define our reportable segments based on the way the Chief Operating Decision Maker ("CODM"), which is our Chief Executive Officer, manages the operations for purposes of allocating resources and assessing performance. Our reportable segments include the following:

•Gannett Media is comprised of our portfolio of local, regional, national, and international newspaper publishers. The results of this segment include Advertising and marketing services revenues from local, classified, and national advertising across multiple platforms, including print, online, mobile, and tablet as well as niche publications, Circulation revenues from home delivery, digital distribution and single copy sales of our publications, and Other revenues, mainly from commercial printing, distribution arrangements, revenues from our events business, digital content syndication and affiliate revenues, and third-party newsprint sales. The Gannett Media reportable segment is an aggregation of two operating segments: Domestic Gannett Media and Newsquest.

•Digital Marketing Solutions, is comprised of our digital marketing services companies under the brand LocaliQ. The results of this segment include Advertising and marketing services revenues through multiple services, including search advertising, display advertising, search optimization, social media, website development, web presence products, customer relationship management, and software-as-a-service solutions.

In addition to the reportable segments above, we have a Corporate and other category that includes activities not directly attributable to a specific segment. This category primarily consists of broad corporate functions, including legal, human resources, accounting, finance and marketing, as well as other general business costs.

In the ordinary course of business, our reportable segments enter into transactions with one another. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues and expenses recognized by the segment that is the counterparty to the transaction are eliminated in consolidation and do not affect consolidated results.

The CODM uses Adjusted EBITDA and Adjusted EBITDA margin to evaluate the performance of the segments and allocate resources. Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial performance measures we believe offer a useful view of the overall operation of our businesses and may be different than similarly-titled measures used by other companies. We define Adjusted EBITDA as Net loss attributable to Gannett before (1) Income tax expense (benefit), (2) Interest expense, (3) Gains or losses on the early extinguishment of debt, (4) Non-operating pension income, (5) Loss on convertible notes derivative, (6) Depreciation and amortization, (7) Integration and reorganization costs, (8) Other operating expenses, including third-party debt expenses and acquisition costs, (9) Asset impairments, (10) Goodwill and intangible impairments, (11) Gains or losses on the sale or disposal of assets, (12) Share-based compensation, and (13) certain other non-recurring charges. We define Adjusted EBITDA margin as Adjusted EBITDA divided by total Operating revenues.

Management considers Adjusted EBITDA and Adjusted EBITDA margin to be important metrics to evaluate and compare the ongoing operating performance of our segments on a consistent basis across reporting periods as they eliminate the effect of items that we do not believe are indicative of each segment's core operating performance.

The following tables present our segment information:

In thousands	Gannett Media			Digital Marketing Solutions			Corporate and other		Intersegment Eliminations		Consolidated
Year ended December 31, 2022
Advertising and marketing services - external sales	$	1,027,254		$	468,883		$	—	$	—	$	1,496,137
Advertising and marketing services - intersegment sales	143,456			—			—		(143,456)		—
Circulation	1,084,637			—			—		—		1,084,637
Other	359,089			—			5,440		—		364,529
Total operating revenues	$	2,614,436		$	468,883		$	5,440	$	(143,456)	$	2,945,303
Adjusted EBITDA (non-GAAP basis)	$	247,675		$	57,580		$	(47,972)	$	—	$	257,283
Adjusted EBITDA margin (non-GAAP basis)	9.5		%	12.3		%	NM		NM		8.7		%
Year ended December 31, 2021
Advertising and marketing services - external sales	$	1,207,881		$	441,394		$	1,886	$	—	$	1,651,161
Advertising and marketing services - intersegment sales	129,322			—			—		(129,322)		—
Circulation	1,249,669			—			5		—		1,249,674
Other	299,863			905			6,480		—		307,248
Total operating revenues	$	2,886,735		$	442,299		$	8,371	$	(129,322)	$	3,208,083
Adjusted EBITDA (non-GAAP basis)	$	433,973		$	50,960		$	(51,221)	$	—	$	433,712
Adjusted EBITDA margin (non-GAAP basis)	15.0		%	11.5		%	NM		NM		13.5		%
Year ended December 31, 2020
Advertising and marketing services - external sales	$	1,295,158		$	411,940		$	3,146	$	—	$	1,710,244
Advertising and marketing services - intersegment sales	114,342			—			—		(114,342)		—
Circulation	1,391,983			—			13		—		1,391,996
Other	278,964			16,665			7,801		—		303,430
Total operating revenues	$	3,080,447		$	428,605		$	10,960	$	(114,342)	$	3,405,670
Adjusted EBITDA (non-GAAP basis)	$	459,195		$	24,361		$	(69,661)	$	—	$	413,895
Adjusted EBITDA margin (non-GAAP basis)	14.9		%	5.7		%	NM		NM		12.2		%

NM indicates not meaningful.

The following table presents our reconciliation of Net loss attributable to Gannett to Adjusted EBITDA and Net loss attributable to Gannett margin to Adjusted EBITDA margin:

	Year ended December 31,
In thousands	2022			2021			2020
Net loss attributable to Gannett	$	(78,002)		$	(134,962)		$	(670,479)
Provision (benefit) for income taxes	1,349			48,250			(33,450)
Interest expense	108,366			135,748			228,513
(Gain) loss on early extinguishment of debt	(399)			48,708			43,760
Non-operating pension income	(58,953)			(95,357)			(72,149)
Loss on convertible notes derivative	—			126,600			74,329
Depreciation and amortization	182,022			203,958			263,819
Integration and reorganization costs	87,974			49,284			145,731
Other operating expenses	1,892			20,952			11,152
Asset impairments	1,056			3,976			11,029
Goodwill and intangible impairments	—			—			393,446
(Gain) loss on sale or disposal of assets, net	(6,883)			17,208			(5,680)
Share-based compensation expense	16,751			18,439			26,350
Other items	2,110			(9,092)			(2,476)
Adjusted EBITDA (non-GAAP basis)	$	257,283		$	433,712		$	413,895
Net loss attributable to Gannett margin	(2.6)		%	(4.2)		%	(19.7)		%
Adjusted EBITDA margin (non-GAAP basis)	8.7		%	13.5		%	12.2		%

Asset information by segment is not a key measure of performance used by the CODM function. Accordingly, we have not disclosed asset information by segment. Additionally, equity income in unconsolidated investees, net, interest expense, other non-operating items, net, and provision for income taxes, as reported in the Consolidated financial statements, are not part of operating income and are primarily recorded at the corporate level.