Investors were tuning out Gray Television (GTN -22.77%) on Friday after the company published its latest set of quarterly and annual results. The stock’s price took a nearly 23% hit that day, a far worse performance than the sideways trajectory of the S&P 500 index.

Top-line decline, bottom-line flip

The market’s reaction wasn’t all that shocking, given that for the quarter Gray’s revenue declined and it flipped to a bottom-line loss.

To put numbers on those dynamics, the TV station operator’s total revenue was $864 million for the period, down from the $1.07 billion it earned in the fourth quarter of 2022. The GAAP net loss amounted to $22 million ($0.24 per share), while in the year-ago frame Gray netted a profit of $173 million.

On average, analysts tracking the stock were anticipating just over $863 million on the top line and a per-share net loss of only $0.16.

In its earnings release, Gray — which operates a clutch of TV stations throughout the U.S. but concentrated in the Southeast — attributed the revenue decline entirely to a lack of political advertising in what was mostly an election off-year. It did not comment in the document about the sudden lurch into the red on the bottom line.

Revenue guidance falls short

Gray did proffer guidance for its current (first) quarter. The company expects to take in revenue of $810 million to $830 million; however, that’s well below the consensus analyst projection of more than $863 million. Operating expenses should total $641 million to $657 million.

Gray did not provide a bottom-line forecast.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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