UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________

FORM 10-Q

_______________________


x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2017~~March 31, 2018


¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 1-6961

___________________________

TEGNA INC.

(Exact name of registrant as specified in its charter)

___________________________



Delaware		16-0442930
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7950 Jones Branch Drive, McLean, Virginia		22107-0150
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (703) 873-6600.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):



Large accelerated filer	x	Accelerated filer	¨

Non-accelerated filer	¨ (Do not check if a smaller reporting company)	Smaller reporting company	¨

		Emerging growth company	¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. c

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ¨ No x

The total number of shares of the registrant’s Common Stock, $1 par value, outstanding as of ~~September 30, 2017~~March 31, 2018 was ~~215,205,823.~~215,679,758.

INDEX TO TEGNA INC.

~~September 30, 2017~~March 31, 2018 FORM 10-Q


Item No.		Page		Page
	PART I. FINANCIAL INFORMATION		PART I. FINANCIAL INFORMATION

1.	Financial Statements		Financial Statements

	Condensed Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016	3	Condensed Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017	3

	Consolidated Statements of Income for the Quarters and Nine Months Ended September 30, 2017 and 2016	5	Consolidated Statements of Income for the Three Months Ended March 31, 2018 and 2017	5

	Consolidated Statements of Comprehensive Income for the Quarters and Nine Months Ended September 30, 2017 and 2016	6	Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2018 and 2017	6

	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2017 and 2016	7	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2018 and 2017	7

	Notes to Condensed Consolidated Financial Statements	8	Notes to Condensed Consolidated Financial Statements	8

2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

3.	Quantitative and Qualitative Disclosures about Market Risk	33	Quantitative and Qualitative Disclosures about Market Risk	29

4.	Controls and Procedures	34	Controls and Procedures	29

	PART II. OTHER INFORMATION		PART II. OTHER INFORMATION

1.	Legal Proceedings	34	Legal Proceedings	30

1A.	Risk Factors	34	Risk Factors	30

2.	Unregistered Sales of Equity Securities and Use of Proceeds	34	Unregistered Sales of Equity Securities and Use of Proceeds	30

3.	Defaults Upon Senior Securities	34	Defaults Upon Senior Securities	30

4.	Mine Safety Disclosures	34	Mine Safety Disclosures	30

5.	Other Information	34	Other Information	30

6.	Exhibits	35	Exhibits	31

SIGNATURE	SIGNATURE	36	SIGNATURE	32

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

TEGNA Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

In thousands of dollars


	Sept. 30, 2017			Dec. 31, 2016			Mar. 31, 2018			Dec. 31, 2017
	(Unaudited)			(Recast)			(Unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	383,354		$	15,879		$	8,338		$	98,801
Accounts receivable, net of allowances of $3,222 and $3,404, respectively	382,791			386,074
Accounts receivable, net of allowances of $3,007 and $3,266, respectively							430,151			406,852
Other receivables	20,384			20,685			16,076			32,442
Programming rights							25,194			37,758
Prepaid expenses and other current assets	80,201			62,090			27,536			61,070
Current discontinued operations assets	—			305,960
Total current assets	866,730			790,688			507,295			636,923
Property and equipment
Cost	801,791			805,349			815,648			782,602
Less accumulated depreciation	(456,768		)	(430,028		)	(459,330		)	(447,262		)
Net property and equipment	345,023			375,321			356,318			335,340
Intangible and other assets
Goodwill	2,579,417			2,579,417			2,602,849			2,579,417
Indefinite-lived and amortizable intangible assets, less accumulated amortization	1,278,667			1,294,839			1,540,303			1,273,269
Investments and other assets	173,219			180,616			138,564			137,166
Noncurrent discontinued operations assets	—			3,321,844
Total intangible and other assets	4,031,303			7,376,716			4,281,716			3,989,852
Total assets	$	5,243,056		$	8,542,725		$	5,145,329		$	4,962,115

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEGNA Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

In thousands of dollars, except par value and share amounts


	Sept. 30, 2017			Dec. 31, 2016			Mar. 31, 2018			Dec. 31, 2017
	(Unaudited)			(Recast)			(Unaudited)
LIABILITIES AND EQUITY
Current liabilities
Accounts payable	$	102,758		$	99,568		$	44,732		$	52,992
Accrued liabilities	219,701			200,417
Compensation							27,836			54,088
Interest							53,948			39,217
Contracts payable for programming rights							82,833			105,040
Other							44,843			58,196
Dividends payable	15,190			30,178			15,226			15,173
Income taxes	14,304			11,448			2,960			—
Current portion of long-term debt	280,646			646			485			646
Current discontinued operations liabilities	—			276,924
Total current liabilities	632,599			619,181			272,863			325,352
Noncurrent liabilities
Income taxes	19,711			22,644			20,269			20,203
Deferred income taxes	585,173			648,920			386,781			382,310
Long-term debt	3,035,166			4,042,749			3,196,070			3,007,047
Pension liabilities	168,024			187,290			146,466			144,220
Other noncurrent liabilities	96,508			75,438			86,244			87,942
Noncurrent discontinued operations liabilities	—			347,233
Total noncurrent liabilities	3,904,582			5,324,274			3,835,830			3,641,722
Total liabilities	4,537,181			5,943,455			4,108,693			3,967,074

Redeemable noncontrolling interests related to discontinued operations	—			46,265

Equity
TEGNA Inc. shareholders’ equity
Shareholders’ equity
Common stock of $1 par value per share, 800,000,000 shares authorized, 324,418,632 shares issued	324,419			324,419			324,419			324,419
Additional paid-in capital	390,886			473,742			303,926			382,127
Retained earnings	5,777,443			7,384,556			6,124,209			6,062,995
Accumulated other comprehensive loss	(121,073		)	(161,573		)	(125,993		)	(106,923		)
Less treasury stock at cost, 109,212,809 shares and 109,930,832 shares, respectively	(5,665,800		)	(5,749,726		)
Total TEGNA Inc. shareholders’ equity	705,875			2,271,418
Noncontrolling interests related to discontinued operations	—			281,587
Less treasury stock at cost, 108,738,874 shares and 109,487,979 shares, respectively							(5,589,925		)	(5,667,577		)
Total equity	705,875			2,553,005			1,036,636			995,041
Total liabilities, redeemable noncontrolling interests and equity	$	5,243,056		$	8,542,725
Total liabilities and equity							$	5,145,329		$	4,962,115

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEGNA Inc.

CONSOLIDATED STATEMENTS OF INCOME

Unaudited, in thousands of dollars, except per share amounts


	Quarter ended Sept. 30,						Nine months ended Sept. 30,
	2017			2016			2017			2016			Quarter ended Mar. 31,
				(recast)						(recast)			2018			2017
																(recast)
Revenues	$	464,264		$	519,617		$	1,412,703		$	1,457,233		$	502,090		$	459,070

Operating expenses:
Cost of revenues, exclusive of depreciation	235,474			200,495			696,565			590,058			258,493			231,408
Business units - Selling, general and administrative expenses, exclusive of depreciation	70,914			83,039			214,645			246,280			73,621			68,429
Corporate - General and administrative expenses, exclusive of depreciation	12,881			16,027			42,462			43,865			12,708			15,333
Depreciation	15,186			13,212			41,721			42,653			13,471			13,217
Amortization of intangible assets	5,395			5,775			16,172			17,542			6,782			5,389
Asset impairment and facility consolidation charges	7,553			15,218			11,086			18,946			—			2,183
Total	347,403			333,766			1,022,651			959,344			365,075			335,959
Operating income	116,861			185,851			390,052			497,889			137,015			123,111

Non-operating income (expense):
Equity income (loss) in unconsolidated investments, net	866			(1,198		)	(1,549		)	(2,763		)
Non-operating (expense):
Equity loss in unconsolidated investments, net													(1,238		)	(1,469		)
Interest expense	(51,855		)	(57,601		)	(162,113		)	(175,444		)	(47,725		)	(55,415		)
Other non-operating items	(3,671		)	(11,874		)	(26,853		)	(16,029		)	(12,480		)	(2,074		)
Total	(54,660		)	(70,673		)	(190,515		)	(194,236		)	(61,443		)	(58,958		)

Income before income taxes	62,201			115,178			199,537			303,653			75,572			64,153
Provision for income taxes	11,447			38,441			54,855			92,038			20,385			19,495
Net Income from continuing operations	50,754			76,737			144,682			211,615			55,187			44,658
(Loss) income from discontinued operations, net of tax	(10,803		)	56,698			(233,261		)	132,141
Net income (loss)	39,951			133,435			(88,579		)	343,756
Net loss (income) attributable to noncontrolling interests from discontinued operations	2,806			(14,752		)	58,698			(40,178		)
Net income (loss) attributable to TEGNA Inc.	$	42,757		$	118,683		$	(29,881	)	$	303,578
Income from discontinued operations, net of tax													—			19,241
Net income													55,187			63,899
Net income attributable to noncontrolling interests from discontinued operations													—			(6,185		)
Net income attributable to TEGNA Inc.													$	55,187		$	57,714

Earnings from continuing operations per share - basic	$	0.24		$	0.36		$	0.67		$	0.98		$	0.26		$	0.21
(Loss) earnings from discontinued operations per share - basic	(0.04		)	0.19			(0.81		)	0.42
Net income (loss) per share – basic	$	0.20		$	0.55		$	(0.14	)	$	1.40
Earnings from discontinued operations per share - basic													—			0.06
Net income per share – basic													$	0.26		$	0.27

Earnings from continuing operations per share - diluted	$	0.23		$	0.35		$	0.66		$	0.96		$	0.25		$	0.21
(Loss) earnings from discontinued operations per share - diluted	(0.04		)	0.19			(0.80		)	0.42
Net income (loss) per share – diluted	$	0.19		$	0.54		$	(0.14	)	$	1.38
Earnings from discontinued operations per share - diluted													—			0.06
Net income per share – diluted													$	0.25		$	0.27

Weighted average number of common shares outstanding:
Basic shares	215,863			214,813			215,558			216,865			216,276			215,305
Diluted shares	218,095			218,099			217,827			220,511			216,989			217,569

Dividends declared per share	$	0.07		$	0.14		$	0.28		$	0.42		$	0.07		$	0.14

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEGNA Inc.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Unaudited, in thousands of dollars


	Quarter ended Sept. 30,						Nine months ended Sept. 30,						Quarter ended March 31,
	2017			2016			2017			2016			2018			2017

Net income (loss)	$	39,951		$	133,435		$	(88,579	)	$	343,756
Net income													$	55,187		$	63,899
Redeemable noncontrolling interests (earnings not available to shareholders)	36			(1,353		)	(2,797		)	(3,628		)	—			(1,815		)
Other comprehensive income (loss), before tax:
Foreign currency translation adjustments	24,764			(1,973		)	34,126			(7,934		)	202			2,262
Recognition of previously deferred post-retirement benefit plan costs	2,201			1,763			6,603			6,085			1,250			2,075
Unrealized (losses) gains on available for sale investment during the period	—			(3,743		)	1,776			(8,017		)
Other comprehensive income (loss), before tax	26,965			(3,953		)	42,505			(9,866		)
Pension lump-sum payment charge													6,300			—
Unrealized losses on available for sale investment during the period													—			(2,293		)
Other comprehensive income, before tax													7,752			2,044
Income tax effect related to components of other comprehensive income (loss)	(752		)	(688		)	(2,445		)	(2,368		)	(1,977		)	(797		)
Other comprehensive income (loss), net of tax	26,213			(4,641		)	40,060			(12,234		)
Comprehensive income (loss)	66,200			127,441			(51,316		)	327,894
Comprehensive income (loss) attributable to noncontrolling interests, net of tax	1,360			(12,470		)	55,676			(32,813		)
Other comprehensive income, net of tax													5,775			1,247
Comprehensive income													60,962			63,331
Comprehensive loss attributable to noncontrolling interests, net of tax													—			(5,435		)
Comprehensive income attributable to TEGNA Inc.	$	67,560		$	114,971		$	4,360		$	295,081		$	60,962		$	57,896

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEGNA Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Unaudited, in thousands of dollars

Nine months ended Sept. 30,
2017 2016

Cash flows from operating activities:
Net (loss) income $ (88,579 ) $ 343,756
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation and amortization 117,762
153,197
Stock-based compensation 14,189
13,216
Loss on sale of CareerBuilder 342,900
—
Other losses on sales of assets and impairment charges 19,803
24,082
Equity losses in unconsolidated investments, net 1,488
6,530
Pension (contributions), net of expense (12,547 ) 2,135
Spectrum channel share agreement proceeds 32,588
—
Change in other assets and liabilities, net (76,421 ) (88,153 )
Net cash flow from operating activities 351,183
454,763
Cash flows from investing activities:
Purchase of property and equipment (63,846 ) (68,577 )
Payments for acquisitions of businesses, net of cash acquired —
(196,751 )
Payments for investments (2,778 ) (19,132 )
Proceeds from sale of CareerBuilder, net of $36,581 cash transferred 198,342
—
Proceeds from investments 15,122
10,127
Proceeds from sale of assets 5,659
1,024
Net cash flow from (used for) investing activities 152,499
(273,309 )
Cash flows from financing activities:
(Payments) proceeds of borrowings under revolving credit facilities, net (635,000 ) 10,000
Proceeds from Cars.com borrowings 675,000
—
Proceeds from other borrowings —
300,000
Debt repayments (99,185 ) (249,592 )
Payments of debt issuance costs (6,208 ) (1,684 )
Dividends paid (75,109 ) (91,627 )
Repurchases of common stock (8,453 ) (150,917 )
Distributions to noncontrolling membership interests (22,980 ) —
Cash transferred to the Cars.com business (20,133 ) —
Other, net (5,180 ) (19,505 )
Net cash flow used for financing activities (197,248 ) (203,325 )
Increase (decrease) in cash and cash equivalents 306,434
(21,871 )
Cash and cash equivalents from continuing operations, beginning of period 15,879
26,096
Cash and cash equivalents from discontinued operations, beginning of period 61,041
103,104
Balance of cash and cash equivalents, beginning of period 76,920
129,200
Cash and cash equivalents from continuing operations, end of period 383,354
19,185
Cash and cash equivalents from discontinued operations, end of period —
88,144
Balance of cash and cash equivalents, end of period $ 383,354
$ 107,329

Supplemental cash flow information:
Cash paid for income taxes, net of refunds $ 104,422
$ 145,052
Cash paid for interest $ 133,752
$ 153,510



	Quarter ended Mar. 31,
	2018			2017

Cash flows from operating activities:
Net income	$	55,187		$	63,899
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation and amortization	20,253			52,105
Stock-based compensation	3,599			5,103
Other (gains) losses on sales of assets and impairment charges	(1,010		)	885
Equity losses in unconsolidated investments, net	1,238			1,469
Pension contributions, net of expense	(23,072		)	(1,350		)
Change in other assets and liabilities, net	(5,009		)	17,806
Net cash flow from operating activities	51,186			139,917
Cash flows from investing activities:
Purchase of property and equipment	(10,643		)	(17,959		)
Payments for acquisitions of businesses, net of cash acquired	(325,903		)	—
Payments for investments	(3,991		)	(775		)
Proceeds from investments	1,010			1,369
Proceeds from sale of businesses and assets	1,373			4,535
Net cash flow used for investing activities	(338,154		)	(12,830		)
Cash flows from financing activities:
Proceeds (payments) of borrowings under revolving credit facilities, net	220,000			(46,000		)
Debt repayments	(33,062		)	(33,062		)
Dividends paid	(15,043		)	(29,998		)
Repurchases of common stock	—			(7,252		)
Other, net	(4,630		)	(8,144		)
Net cash flow provided by (used for) financing activities	167,265			(124,456		)
Decrease (increase) in cash and cash equivalents	(119,703		)	2,631
Cash, cash equivalents and restricted cash from continuing operations, beginning of period	128,041			44,076
Cash, cash equivalents and restricted cash from discontinued operations, beginning of period	—			61,041
Balance of cash and cash equivalents, beginning of period	128,041			105,117
Cash, cash equivalents and restricted cash from continuing operations, end of period	8,338			40,133
Cash, cash equivalents and restricted cash from discontinued operations, end of period	—			67,615
Balance of cash and cash equivalents, end of period	$	8,338		$	107,748

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEGNA Inc.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – ~~Basis of presentation~~Accounting Policies

Basis of presentation: Our accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial reporting, the instructions for Form 10-Q and Article 10 of the U.S. Securities and Exchange Commission (SEC) Regulation S-X. Accordingly, they do not include all information and footnotes which are normally included in the Form 10-K and annual report to shareholders. In our opinion, the condensed consolidated financial statements reflect all adjustments of a normal recurring nature necessary for a fair presentation of results for the interim periods presented. The condensed consolidated financial statements should be read in conjunction with our (or “TEGNA’s”) audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017.

The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from these estimates. Significant estimates include, but are not limited to, evaluation of goodwill and other intangible assets for impairment, business combinations, fair value measurements, post-retirement benefit plans, income taxes including deferred taxes, and contingencies. The condensed consolidated financial statements include the accounts of subsidiaries we control and variable interest entities (VIEs) if we are the primary beneficiary. We eliminate all intercompany balances, transactions, and profits in consolidation. Investments in entities over which we have significant influence, but do not have control, are accounted for under the equity method. Our share of net earnings and losses from these ventures is included in “Equity ~~(loss) income~~loss in unconsolidated investments, net” in the Consolidated Statements of Income. ~~In addition, certain reclassifications have been made to prior years’ consolidated Statements of Income to conform to the current year’s presentation.~~

On May 31, 2017, we completed the spin-off of our digital automotive marketplace business, Cars.com. In addition, on July 31, 2017, we completed the sale of our majority ownership stake in CareerBuilder. ~~Our digital marketing services (DMS) business is now reported within our Media business.~~ As a result of these strategic actions, we have disposed of substantially all of our Digital Segment business and have therefore classified its historical financial results as discontinued ~~operations.~~operations in our Consolidated Statements of Income. See Note 12, “Discontinued Operations”, for further details regarding the spin-off of Cars.com and the sale of CareerBuilder and the impact of each transaction on our condensed consolidated financial statements.

We operate one operating and reportable segment, which primarily consists of our 47 television stations operating in 39 markets, offering high-quality television programming and digital content. Our reportable segment determination is based on our management and internal reporting structure, the nature of products and services we offer, and the financial information that is evaluated regularly by our chief operating decision maker.

Accounting guidance adopted in ~~2017:~~2018: In ~~March 2017,~~May 2014, the Financial Accounting Standards Board (FASB) issued new guidance that changes the presentation of net periodic pension and other post-retirement benefit costs (post-retirement benefit costs) in the Consolidated Statements of Income. Under this new guidance, the service cost component of the post-retirement benefit expense will continue to be presented as an operating expense while all other components of post-retirement benefit expense will be presented as non-operating expense. Previously, all components of post-retirement benefit expense were presented as operating expense in the Consolidated Statements of Income. The FASB permitted early adoption of this guidance, and we elected to early adopt in the first quarter of 2017. We believe the new guidance provides enhanced financial reporting by limiting operating expense classification to the service cost component of post-retirement benefit expense. Service cost is the component of the expense that relates to services provided by employees in the current period and thus better reflects the current continuing operating costs. Changes to the classification of Consolidated Statements of Income amounts resulting from the new guidance were made on a retrospective basis, wherein each period presented was adjusted to reflect the effects of applying the new guidance. We utilized amounts previously disclosed in our retirement plan footnote to retrospectively apply the guidance. As a result of adopting this guidance, operating expenses in the third quarter and for the first nine months of 2017 were lower by $1.7 million and $4.9 million, respectively, while non-operating expenses were higher by the same amounts. In 2016, operating expenses in the third quarter and first nine months were reduced by $1.8 million and $5.8 million, respectively, with corresponding increases in non-operating expenses as a result of adopting this new guidance. Net income, earnings per share, and retained earnings were not impacted by the new guidance.

In January 2017, the FASB issued guidance that eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of the goodwill impairment test) to measure a goodwill impairment charge. Instead, companies will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on Step 1 of the impairment test). The FASB permitted early adoption of this guidance, and we elected to early adopt in the second quarter of 2017 in connection with the calculation of CareerBuilder’s goodwill impairment charge, discussed in Note 12.

~~New accounting pronouncements not yet adopted:~~ ~~In May 2014, the FASB~~ issued new guidance related to revenue recognition. Under the new guidance, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the guidance requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers.

We ~~will adopt~~adopted the guidance beginning January 1, 2018 using the modified retrospective method. We began recognizing revenue under this new guidance in the first quarter of 2018 and did not restate prior years. We applied the standard to all contracts open as of January 1, 2018. The ~~two permitted transition methods are the full retrospective method, in which case the guidance would be applied to each~~cumulative prior ~~reporting~~ period ~~presented and the cumulative~~ effect of applying the guidance ~~would~~was $3.7 million which was recorded as a decrease to retained earnings upon adoption. This adjustment represents a deferral of revenue associated with certain performance obligations that were not fully completed as of the reporting date. In addition, with the adoption of the new guidance, we have determined that certain barter revenue and expense related to syndicated programming will no longer be recognized. The revenue and expense previously recognized atfor this type of barter transaction was approximately $2.0 million in 2017. Other than these two items, there were no other changes to the ~~earliest period shown;~~timing and amount of revenue recognition for our contracts.

For contracts with an effective term of less than one year, and for our subscription revenue contracts, we applied certain of the ~~modified retrospective method,~~standard’s practical expedients relating to disclosure that permit the exclusion of quantifying and disclosing unsatisfied performance obligations. In addition, the adoption of this standard did not result in significant changes to our accounting policies, business processes, systems or controls. See discussion of our revenue policy below.

In August 2016, the FASB issued new guidance which ~~case~~clarifies several specific cash flow classification issues. The objective of the new guidance is to reduce the existing diversity in practice in how these cash flows are presented in the statement of cash flows. The guidance updated the classification in the Statement of Cash Flows in several areas. The most relevant updates for us are the following: 1) payments made for premiums, fees paid to lenders and other related third party costs when debt is repaid early will each be classified as financing cash outflows (we have historically classified these types of cash payments as operating outflows), 2) contingent consideration payments made for acquisitions will be classified as either operating, investing, or financing cash outflows depending on the timing and nature of the payment, 3) cash receipts received due to the settlement of insurance claims will be classified as either operating or investing cash inflows, depending on the nature of the underlying loss,

4) proceeds received from trust owned life insurance policies will be classified as investing cash inflows (we have historically classified these types of cash receipts as operating inflows), and 5) distributions received from equity method investments will be classified as either operating or investing cash inflows, depending on the ~~cumulative effect~~amount of ~~applying~~cash received as compared to the amount of inception to date earnings recognized on the individual investment. We adopted the guidance ~~would~~retrospectively beginning in the first quarter of 2018. As a result of adopting this guidance, we reclassified approximately $0.9 million of life insurance proceeds received in the first quarter of 2017 from operating to investing inflows.

In January 2016, the FASB issued new guidance that amended several elements surrounding the recognition and measurement of financial instruments. Most notably for our company, the new guidance requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation) to be measured at fair value with changes in fair value recognized in net income. For equity investments that do not have readily determinable prices, those investments may be recorded at cost less impairments, if any, plus or minus changes in observable prices for those investments. This new guidance will require us to adjust the value of our cost method investments to account for any observable price changes in those investments. Cost method investments had previously been recorded at cost, less any impairments. We adopted the new guidance in the first quarter of 2018 and the provision discussed above has been adopted on a prospective basis. There was no impact to our financial statements as a result of adopting this new guidance.

In February 2018, the FASB issued guidance on accounting for certain tax effects that resulted from the Tax Cuts and Jobs Act, or the Act, that was enacted into law as of December 22, 2017. The guidance addresses the accounting for amounts that had previously been recorded in accumulated other comprehensive income on a net tax basis, using the tax rate that was in effect at the ~~date~~time. Due to the reduction in the tax rates under the Act, certain tax effects were “stranded” in accumulated other comprehensive income. This new guidance allows these stranded tax effects to be reclassified from accumulated other comprehensive income to retained earnings. Other tax amounts stranded in accumulated other comprehensive income due to reasons other than the Act may not be reclassified. As a result of ~~initial application.~~adopting this guidance, in the first quarter of 2018, we reclassified approximately $24.8 million from accumulated other comprehensive income to retained earnings. We ~~will adopt~~believe that reclassifying these amounts more accurately presents the ~~guidance using the modified retrospective method.~~balance of accumulated other comprehensive loss.

~~While we continue to evaluate~~In November 2016, the ~~full impact~~FASB issued guidance on the presentation of restricted cash which requires that on the statement of cash flows, amounts generally described as restricted cash or restricted cash equivalents should be included within the beginning and ending balances of cash and cash equivalents. We adopted this guidance ~~we do not believe~~in the first quarter of 2018 on a retrospective basis. As a result, restricted cash amounts that ~~it will~~ have ~~a material impact~~historically been included in prepaid expenses and other current assets and investments and other assets on our consolidated ~~financial statements.~~balance sheets are now included with cash and cash equivalents on the consolidated statements of cash flows. We ~~are in the process~~did not have any restricted cash as of ~~evaluating the other requirements~~March 31, 2018, however, these restricted cash balances totaled $29.2 million as of ~~the new~~December 31, 2017, $28.1 million as of March 31, 2017 and $28.2 million as of December 31, 2016. Our restricted cash is used to pay deferred compensation and TEGNA Supplemental Retirement Plan (SERP) obligations. The adoption of this standard ~~which may result in~~did not change our balance sheet presentation. See Note 10 for additional ~~revenue related disclosures.~~information about our restricted cash balances.

~~Based on our evaluation performed to date, we believe that 90% of our revenues will~~New accounting pronouncements not be materially impacted by the new guidance. Specifically, our television spot advertising contracts, which comprised approximately 60% of 2016 revenue are short-term in nature with transaction price consideration agreed upon in advance. We expect revenue will continue to be recognized when commercials are aired. Further, we expect that subscription revenue earned under retransmission agreements will be recognized under the licensing of intellectual property guidance in the standard, which will not have a material change to our current revenue recognition. Subscription revenue comprised approximately 30% of 2016 revenue. We continue to evaluate the impact to our online digital and other services revenue (which represents approximately 10% of our revenues).

yet adopted:In February 2016, the FASB issued new guidance related to leases which will require lessees to recognize assets and liabilities on the balance sheet for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP—which requires only capital leases to be recognized on the balance sheet—the new guidance will require both types of leases to be recognized on the balance sheet. The new guidance is effective for us beginning in the first quarter of 2019 and will be adopted using a modified retrospective approach. We are currently evaluating the effect ~~it is expected to~~the standard will have on our consolidated financial statements and related ~~disclosures.~~disclosures, but currently we estimate that our total assets and liabilities as presented on our Condensed Consolidated Balance Sheet as of March 31, 2018, will grow by less than 5% as a result of adopting this standard.

In June 2016, the FASB issued new guidance related to the measurement of credit losses on financial instruments. The new guidance changes the way credit losses on accounts receivable are estimated. Under current GAAP, credit losses on accounts receivable are recognized once it is probable that such losses will occur. Under the new guidance, we will be required to estimate credit losses based on the expected amount of future collections which may result in earlier recognition of allowance for doubtful accounts. The new guidance is effective for public companies beginning in the first quarter of 2020 and will be adopted using a modified retrospective approach. We are currently evaluating the effect this new guidance will have on our consolidated financial statements and related disclosures.

~~In August 2016,~~Revenue recognition: Revenue is recognized upon transfer of control of promised services to our customers in an amount that reflects the ~~FASB issued new guidance~~consideration we expect to receive in exchange for those services. Revenue is recognized net of agency commissions and any taxes collected from customers, which ~~clarifies several specific cash flow classification issues. The objective~~are subsequently remitted to governmental authorities. Amounts received from customers in advance of providing services to our customers are recorded as deferred revenue.

Our primary source of revenue is earned through the sale of advertising and marketing services (AMS). This revenue stream includes all sources of our traditional television and radio advertising, as well as digital revenues including Premion, our digital marketing services business unit and other digital advertising across our platforms. Contracts within this revenue stream are short-

term in nature (most often three months or less). Contracts generally consist of multiple deliverables, such as television commercials, or digital advertising solutions, that we have identified as individual performance obligations. Before performing under the contract we establish the transaction price with our customer based on the agreed upon rates for each performance obligation. There is no material variability in the transaction price during the term of the ~~new~~contract.

Revenue is recognized as we deliver our performance obligations to our customers. For our AMS revenue stream, we measure our performance based on the airing of the individual television commercials or display of digital advertisements. This measure is most appropriate as it aligns our revenue recognition with the value we are providing to our customers. Customers are billed monthly and payment is generally due 30 days after the date of invoice. Commission costs related to these contracts are expensed as incurred due to the short term nature of the contracts.

We also earn subscription revenue from retransmission consent contracts with multichannel video programming distributors (e.g., cable and satellite providers) and over the top providers (companies that deliver video content to consumers over the Internet). Under these multi-year contracts, we have performance obligations to provide our customers with our stations’ signals, as well as our consent to retransmit those signals to their customers. Subscription revenue is recognized in accordance with the guidance for licensing intellectual property utilizing a usage based method. The amount of revenue earned is based on the number of subscribers to ~~reduce~~which our customers retransmit our signal and the ~~existing diversity~~negotiated fee per subscriber included in ~~practice~~our contract agreement. Our customers submit payments monthly, generally within 60-90 days after the month that service was provided. Our performance obligations are satisfied, and revenue is recognized, as we provide our consent for our customers to retransmit our signal. This measure toward satisfaction of our performance obligations and recognition of revenue is the most appropriate as it aligns our revenue recognition with the value that we are delivering to our customers through our retransmission consent.

We also generate revenue from the sale of political advertising. Contracts within this revenue stream are short term in ~~how~~nature (typically weekly or monthly buys during political campaigns). Customers pre-pay these ~~cash flows~~contracts and we therefore defer the associated revenue until the advertising has been delivered, at which time we have satisfied our performance obligations and recognize revenue. Commission costs related to these contracts are ~~presented in~~expensed as incurred due to the ~~statement~~short term nature of ~~cash flows. The standard~~the contracts.

Our remaining revenue is ~~effective for us beginning~~comprised of various other services, primarily production services (for news content and commercials) and sublease rental income. Revenue is recognized as these various services are provided to our customers.

In instances where we sell services from more than one revenue stream to the same customer at the same time, we recognize one contract and allocate the transaction price to each deliverable element (e.g. performance obligation) based on the relative fair value of each element.

Revenue earned by categories in the first quarter of 2018 and ~~early adoption~~2017 is permitted. One classification change we will make when we adopt the standard relates to payments made for premiums, fees paid to lenders and other related third party costs when debt is repaid early. Under the new guidance these payments will be classified as financing cash outflows (we have historically classified these types of cash payments as operating outflows).shown below (amounts in thousands):



	Quarter ended Mar. 31,
	2018		2017

AMS	$	282,939	$	269,012
Subscription	205,556		182,310
Political	7,606		2,157
Other	5,989		5,591
Total revenue	$	502,090	$	459,070

NOTE 2 – Goodwill and other intangible assets

The following table displays goodwill, indefinite-lived intangible assets, and amortizable intangible assets as of ~~September 30, 2017~~March 31, 2018 and December 31, ~~2016~~2017 (in thousands):


	Sept. 30, 2017					Dec. 31, 2016					Mar. 31, 2018					Dec. 31, 2017
	Gross		Accumulated Amortization			Gross		Accumulated Amortization			Gross		Accumulated Amortization			Gross		Accumulated Amortization
						(recast)		(recast)
Goodwill	$	2,579,417	$	—		$	2,579,417	$	—		$	2,602,849	$	—		$	2,579,417	$	—
Indefinite-lived intangibles:
Television station FCC licenses	1,191,950		—			1,191,950		—
Television and radio station FCC licenses											1,387,373		—			1,191,950		—
Amortizable intangible assets:
Retransmission agreements	110,191		(58,586		)	110,191		(47,280		)	121,184		(66,360		)	110,191		(62,355		)
Network affiliation agreements	43,485		(18,139		)	43,485		(14,445		)	99,511		(21,603		)	43,485		(19,371		)
Other	15,763		(5,997		)	15,763		(4,825		)	27,137		(6,939		)	15,763		(6,394		)
Total indefinite-lived and amortizable intangible assets	$	1,361,389	$	(82,722	)	$	1,361,389	$	(66,550	)	$	1,635,205	$	(94,902	)	$	1,361,389	$	(88,120	)

Our retransmission agreements and network affiliation agreements are amortized on a straight-line basis over their estimated useful lives. Other intangibles primarily include customer relationships and favorable lease agreements which are amortized on a straight-line basis over their useful lives.

On February 15, 2018 we acquired a business consisting of assets in San Diego: KFMB-TV (the CBS affiliated station), KFMB-D2 (the CW station), and radio stations KFMB-AM and KFMB-FM (collectively KFMB). The transaction price was approximately $325.9 million in cash, which we funded through the use of available cash and borrowings under our revolving credit facility (see Note 5). The fair value of the assets acquired and liabilities assumed were based on a preliminary valuation and, as such, our estimates and assumptions are subject to change as additional information is obtained about the facts and circumstances that existed as of the acquisition date. The primary areas of purchase price allocation that were not yet finalized are related to fair value of intangible assets and income taxes.

During the ~~second~~first quarter of ~~2017,~~2018, in connection with our preliminary purchase accounting, we recorded ~~a goodwill impairment charge within discontinued operations~~an indefinite lived intangible asset for FCC licenses of $195.4 million and amortizable intangible assets of $78.4 million, primarily related to ~~our former CareerBuilder reporting unit. See Note 12 for further discussion.~~retransmission and network affiliation agreements. The amortizable assets will be amortized over a weighted average period of 8 years. We also recognized goodwill of $23.4 million as a result of the acquisition.

NOTE 3 – Investments and other assets

Our investments and other assets consisted of the following as of ~~September 30, 2017,~~March 31, 2018, and December 31, ~~2016~~2017 (in thousands):


	Sept. 30, 2017		Dec. 31, 2016		Mar. 31, 2018		Dec. 31, 2017
			(recast)
Cash value life insurance	$	60,873	$	64,134	$	50,823	$	51,188
Deferred compensation investments	28,593		23,715		9,448		9,546
Equity method investments	35,599		18,016		27,279		27,098
Available for sale investment	—		16,744
Deferred debt issuance cost	7,008		9,856		5,109		6,048
Other long term assets	41,146		48,151		45,905		43,286
Total	$	173,219	$	180,616	$	138,564	$	137,166

Cash value life insurance: We are the beneficiary of life insurance policies on the lives of certain employees/retirees, which are recorded at their cash surrender value as determined by the insurance carrier. These policies are utilized as a partial funding source for deferred compensation and other non-qualified employee retirement plans. Gains and losses on these investments are included in Other non-operating expenses within our Consolidated Statement of Income and were not material for all periods presented.

Deferred compensation investments: Employee ~~compensation-related~~compensation related investments consist of ~~debt and equity securities~~a life insurance annuity policy which ~~are classified as trading securities and fund our~~funds a deferred compensation plan ~~liabilities.~~liability. Amounts presented above are expected to be converted to cash beyond one year.

Equity method investments:~~Investments over which we have the ability to exercise significant influence but do not control, are accounted for under the~~ We hold several strategic equity method of accounting. Significant influence typically exists when we own between 20% and 50% of the voting interests in a corporation, own more than a minimal investment in a limited liability company, or hold substantial management rights in the investee. Under this method of accounting, our share of the net earnings or losses of the investee is included in non-operating income on our Consolidated Statements of Income. We evaluate our equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may be impaired. If a decline in the value of aninvestments. Our largest equity method investment is ~~determined to be other than temporary, a loss equal to the excess~~our ownership in CareerBuilder, of ~~carrying value over fair value is recorded in earnings in the current period.~~Certain differences exist between our investment carrying value and the underlying equity of the investee companies, principally due to fair value measurement at the date of investment acquisition and due to impairment chargeswhich we ~~recorded for certain investments. As part of the agreement to sell the majority of CareerBuilder, we retained an investment of~~own approximately 17% (or approximately 12% on a fully-diluted basis) ~~in the entity.~~. Our

ownership stake provides us with two seats on CareerBuilder’s board of directors and thus we concluded that we have significant influence over the ~~entity and have classified our investment as an equity method investment.~~entity. In the ~~third~~first quarter of ~~2017,~~2018, we recorded ~~$0.5~~$1.3 million of equity ~~earnings~~loss from our CareerBuilder investment.

On ~~October 18, 2017, we closed on the sale of our equity investment in Livestream,~~April 24, 2018, CareerBuilder announced that it had entered into a ~~business specializing in live video streaming. Our share~~definitive agreement to sell its subsidiary Economic Modeling LLC (also known as EMSI) to Strada Education Network, a national education nonprofit, and subsequently entered into an exclusive re-seller arrangement to enable CareerBuilder to continue to offer EMSI data to its corporate customers. The closing of the sale ~~proceeds was $21.4 million.~~

~~Available for sale investment: Our investment~~is expected to occur in ~~Gannett Co., Inc., common stock, was sold in its entirety during~~ the ~~third~~second quarter of ~~2017. Proceeds from~~2018, and we anticipate that we will receive a dividend of approximately $8 million in connection with the sale were $14.6 million and for the three months and nine months ended September 30, 2017 we recorded losses of $0.4 million and $3.9 million, respectively. These losses are reflected in the Other non-operating items, in the accompanying Consolidated Statements of Income.sale.

Other ~~long term assets~~strategic investments: During the second quarter of 2017, we recognized a $5.8 million loss associated with a write-off of a note receivable from one of our equity method investments. This loss is reflected in Other non-operating items,These investments are carried at cost and adjusted for any impairments or other observable price changes in the accompanying Consolidated Statements of Income. The loss was a result of a decision made during the second quarter of 2017 by the investee’s board of directors to discontinue the business, and the investee not having sufficient funds to repay the full note at that time.

~~Cost method investments~~:investment. The carrying value of ~~cost method~~these investments was ~~$15.3~~$22.1 million as of ~~September 30, 2017~~March 31, 2018 and ~~$14.8~~$19.4 million as of December 31, ~~2016,~~2017, and is included within other long term assets in the table above.

NOTE 4 – Income taxes

The total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was approximately ~~$9.7~~$10.6 million as of ~~September 30, 2017,~~March 31, 2018, and ~~$10.8~~$10.7 million as of December 31, ~~2016.~~2017. The amount of accrued interest and penalties payable related to unrecognized tax benefits was ~~$1.2~~$1.7 million as of ~~September 30, 2017,~~March 31, 2018, and ~~$1.5~~$1.6 million as of December 31, ~~2016.~~2017.

It is reasonably possible that the amount of unrecognized benefits with respect to certain of our unrecognized tax positions will increase or decrease within the next 12 months. These changes may be the result of settlement of ongoing audits, lapses of statutes of limitations or other regulatory developments. At this time, we estimate the amount of gross unrecognized tax positions may be reduced by up to approximately ~~$3.5~~$4.0 million within the next 12 months primarily due to lapses of statutes of limitations and settlement of ongoing audits in various jurisdictions.

Pub. L. No. 115-97, commonly referred to as the Tax Cuts and Jobs Act, or the Act, was enacted into law as of December 22, 2017. Among other provisions, the Act reduced the federal tax rate to 21% effective for us as of January 1, 2018. On the same date, the SEC staff issued Staff Accounting Bulletin No. 118 to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Act. We recognized the provisional tax impacts related to the revaluation of deferred tax assets and liabilities and included these amounts in our consolidated financial statements for the year ended December 31, 2017. The ultimate impact may differ from these provisional amounts, possibly materially, due to, among other things, additional analysis, changes in interpretations and assumptions we have made, additional regulatory guidance that may be issued, and actions we may take as a result of the Act. Our accounting is expected to be complete when our 2017 U.S. federal and state corporate income tax returns are filed in late 2018. During the three month period ending March 31, 2018, there were no changes made to the provisional amounts recognized in 2017. We will continue to analyze the effects of the Act on our consolidated financial statements. Additional impacts from the enactment will be recorded as they are identified during the measurement period as provided for in Staff Accounting Bulletin No. 118.

NOTE 5 – Long-term debt

Our long-term debt is summarized below (in thousands):

Sept. 30, 2017 Dec. 31, 2016

Unsecured floating rate term loan due quarterly through August 2018 $ 28,400
$ 52,100
VIE unsecured floating rate term loans due quarterly through December 2018 808
1,292
Unsecured floating rate term loan due quarterly through June 2020 110,000
140,000
Unsecured floating rate term loan due quarterly through September 2020 240,000
285,000
Borrowings under revolving credit agreement expiring June 2020 —
635,000
Unsecured notes bearing fixed rate interest at 5.125% due October 2019 600,000
600,000
Unsecured notes bearing fixed rate interest at 5.125% due July 2020 600,000
600,000
Unsecured notes bearing fixed rate interest at 4.875% due September 2021 350,000
350,000
Unsecured notes bearing fixed rate interest at 6.375% due October 2023 650,000
650,000
Unsecured notes bearing fixed rate interest at 5.50% due September 2024 325,000
325,000
Unsecured notes bearing fixed rate interest at 7.75% due June 2027 200,000
200,000
Unsecured notes bearing fixed rate interest at 7.25% due September 2027 240,000
240,000
Total principal long-term debt 3,344,208
4,078,392
Debt issuance costs (23,462 ) (27,615 )
Other (fair market value adjustments and discounts) (4,934 ) (7,382 )
Total long-term debt 3,315,812
4,043,395
Less current portion of long-term debt maturities 280,646
646
Long-term debt, net of current portion $ 3,035,166
$ 4,042,749

In connection with and prior to the completion of the spin-off, Cars.com borrowed an aggregate principal amount of approximately $675.0 million under a revolving credit facility agreement. The proceeds were used to make a tax-free distribution of $650.0 million from Cars.com to TEGNA. In the second quarter of 2017, TEGNA used $609.9 million of the tax-free distribution proceeds to fully pay down our then-outstanding revolving credit agreement borrowings plus accrued interest. As of September 30, 2017, we had an unused borrowing capacity of $1.5 billion under our revolving credit facility.

As a result of the sale of our majority ownership stake in CareerBuilder we received cash proceeds of $198.3 million, net of cash transferred of $36.6 million. Additionally, during the third quarter of 2017 and prior to the closing of the sale, CareerBuilder issued a final cash dividend to its selling shareholders, of which $25.8 million was retained by TEGNA.

On October 16, 2017, we used the net proceeds from the CareerBuilder sale, as well as the remaining cash distribution from Cars.com and other cash on hand to retire $280.0 million of principal of our unsecured notes due in October 2019 on an accelerated basis. This principal amount was classified as current debt at the end of the third quarter of 2017 due to our intention to retire it in October 2017.



	Mar. 31, 2018			Dec. 31, 2017

Unsecured floating rate term loan due quarterly through August 2018	$	12,600		$	20,500
VIE unsecured floating rate term loans due quarterly through December 2018	485			646
Unsecured floating rate term loan due quarterly through June 2020	90,000			100,000
Unsecured floating rate term loan due quarterly through September 2020	210,000			225,000
Borrowings under revolving credit agreement expiring June 2020	220,000			—
Unsecured notes bearing fixed rate interest at 5.125% due October 2019	320,000			320,000
Unsecured notes bearing fixed rate interest at 5.125% due July 2020	600,000			600,000
Unsecured notes bearing fixed rate interest at 4.875% due September 2021	350,000			350,000
Unsecured notes bearing fixed rate interest at 6.375% due October 2023	650,000			650,000
Unsecured notes bearing fixed rate interest at 5.50% due September 2024	325,000			325,000
Unsecured notes bearing fixed rate interest at 7.75% due June 2027	200,000			200,000
Unsecured notes bearing fixed rate interest at 7.25% due September 2027	240,000			240,000
Total principal long-term debt	3,218,085			3,031,146
Debt issuance costs	(19,315		)	(20,551		)
Other (fair market value adjustments and discounts)	(2,215		)	(2,902		)
Total long-term debt	3,196,555			3,007,693
Less current portion of long-term debt maturities	485			646
Long-term debt, net of current portion	$	3,196,070		$	3,007,047

On August 1, 2017, we amended our Amended and Restated Competitive Advance and Revolving Credit Agreement. Under the amended terms, our maximum total leverage ratio will remain at 5.0x through June 30, 2018, after which, as amended, it will be reduced to 4.75x through June 2019 and then to 4.5x until the expiration date of the credit agreement on June 29, 2020.

During the first quarter of 2018, we borrowed $220.0 million under the revolving credit facility primarily to finance the acquisition of assets in San Diego consisting of KFMB-TV, the CBS affiliate, KFMB-D2 (the CW station), and radio stations KFMB-AM and KFMB-FM. As of March 31, 2018, we had unused borrowing capacity of $1.27 billion under our revolving credit facility.

NOTE 6 – Retirement plans

Our principal defined benefit pension plan is the TEGNA Retirement Plan (TRP). The disclosure table below includes the pension expenses of the TRP and the ~~TEGNA Supplemental Retirement Plan (SERP).~~SERP. In connection with our acquisition of KFMB, we assumed its preexisting pension plan which, as of the acquisition date, had a total net pension obligation of $7.3 million. All plan participants’ benefits were frozen prior to the acquisition date. We intend to merge the KFMB pension plan into the TRP in the second quarter of 2018. The total net pension obligations, both current and non-current liabilities, as of ~~September 30, 2017,~~March 31, 2018, were ~~$199.0~~$151.6 million ($~~31.0~~5.1 million is recorded as a current obligation within accrued liabilities on the Condensed Consolidated Balance Sheet).

Our pension costs, which primarily include costs for the qualified TRP plan and the nonqualified SERP plan, are presented in the following table (in thousands):


	Quarter ended Sept. 30,						Nine months ended Sept. 30,						Quarter ended Mar. 31,
	2017			2016			2017			2016			2018			2017

Service cost-benefits earned during the period	$	218		$	204		$	654		$	612		$	—		$	125
Interest cost on benefit obligation	5,990			6,449			17,971			19,636			5,150			5,925
Expected return on plan assets	(6,580		)	(6,691		)	(19,741		)	(20,073		)	(7,450		)	(6,650		)
Amortization of prior service cost	159			165			476			505			50			150
Amortization of actuarial loss	2,081			1,846			6,242			5,740			1,250			1,975
Lump-sum payment charge													6,300			$	—
Expense for company-sponsored retirement plans	$	1,868		$	1,973		$	5,602		$	6,420		$	5,300		$	1,525

The 2017 service cost component of our pension expense is recorded within the operating expense line items Cost of revenue, Business units - Selling, general and administrative, and Corporate - General and administrative within the Consolidated Statements of Income. All other components of the pension expense are included within the Other non-operating items line item of the Consolidated Statements of Income.

During the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2018 we made ~~$10.9~~$1.7 million in cash contributions to the TRP, and plan to make additional contributions of ~~$1.7~~$9.0 million to the TRP during the ~~fourth quarter~~remainder of ~~2017.~~2018. We ~~did not make any~~made no contributions to the TRP ~~in 2016.~~during the three months ended March 31, 2017. During the ~~nine~~three months ended ~~September 30,~~March 31, 2018 and 2017, ~~and 2016,~~ we made benefit payments to participants of the SERP of ~~$7.2~~$26.7 million and ~~$4.2~~$2.9 million, respectively. SERP payments during the three months ended March 31, 2018 primarily relate to lump sum payments made to certain former executives of the company.

In the first quarter of 2018, we incurred a special charge as a result of the lump sum payments. This charge of $6.3 million was reclassified from accumulated other comprehensive income (loss) into net periodic benefit cost.

NOTE 7 – Supplemental equity information

The following table summarizes equity account activity for the ~~nine~~three months ended ~~September 30,~~March 31, 2018 and 2017 ~~and 2016~~ (in thousands):

TEGNA Inc. Shareholders’ Equity Noncontrolling Interests Total Equity

Balance at Dec. 31, 2016 $ 2,271,418
$ 281,587
$ 2,553,005
Comprehensive income:
Net loss (29,881 ) (58,698 ) (88,579 )
Redeemable noncontrolling interests (income not available to shareholders) —
(2,797 ) (2,797 )
Other comprehensive income 34,241
5,819
40,060
Total comprehensive income (loss) 4,360
(55,676 ) (51,316 )
Dividends declared (60,121 ) —
(60,121 )
Stock-based compensation 14,189
—
14,189
Treasury shares acquired (8,453 ) —
(8,453 )
Spin-off of Cars.com (1,510,851 ) —
(1,510,851 )
Deconsolidation of CareerBuilder —
(225,911 ) (225,911 )
Other activity, including shares withheld for employee taxes (4,667 ) —
(4,667 )
Balance at Sept. 30, 2017 $ 705,875
$ —
$ 705,875

Balance at Dec. 31, 2015 $ 2,191,971
$ 264,773
$ 2,456,744
Comprehensive income:
Net income 303,578
40,178
343,756
Redeemable noncontrolling interests (income not available to shareholders) —
(3,628 ) (3,628 )
Other comprehensive (loss) (8,497 ) (3,737 ) (12,234 )
Total comprehensive income 295,081
32,813
327,894
Dividends declared (90,755 ) —
(90,755 )
Stock-based compensation 13,216
—
13,216
Treasury shares acquired (150,917 ) —
(150,917 )
Spin-off of Publishing businesses (39,456 ) —
(39,456 )
Other activity, including shares withheld for employee taxes (17,645 ) (2,923 ) (20,568 )
Balance at Sept. 30, 2016 $ 2,201,495
$ 294,663
$ 2,496,158



	TEGNA Inc. Shareholders’ Equity			Noncontrolling Interests			Total Equity

Balance at Dec. 31, 2017	$	995,041		$	—		$	995,041
Comprehensive income:
Net income	55,187			—			55,187
Other comprehensive income	5,775			—			5,775
Total comprehensive income	60,962			—			60,962
Dividends declared	(15,095		)	—			(15,095		)
Stock-based compensation	3,599			—			3,599
Impact from adoption of new revenue standard	(3,724		)	—			(3,724		)
Other activity, including shares withheld for employee taxes	(4,147		)	—			(4,147		)
Balance at Mar. 31, 2018	$	1,036,636		$	—		$	1,036,636

Balance at Dec. 31, 2016	$	2,271,418		$	281,587		$	2,553,005
Comprehensive income:
Net income	57,714			6,185			63,899
Redeemable noncontrolling interests (income not available to shareholders)	—			(1,815		)	(1,815		)
Other comprehensive income	182			1,065			1,247
Total comprehensive income	57,896			5,435			63,331
Dividends declared	(30,065		)	—			(30,065		)
Stock-based compensation	5,103			—			5,103
Treasury shares acquired	(7,252		)	—			(7,252		)
Other activity, including shares withheld for employee taxes	(7,963		)	(1,337		)	(9,300		)
Balance at Mar. 31, 2017	$	2,289,137		$	285,685		$	2,574,822

The following table summarizes the components of, and the changes in, Accumulated Other Comprehensive Loss (AOCL), net of tax and noncontrolling interests (in thousands):

Retirement Plans Foreign Currency Translation (1) Other Total

Quarters Ended:
Balance at June 30, 2017 $ (124,632 ) $ (23,608 ) $ 2,364
$ (145,876 )
Other comprehensive income before reclassifications —
1,428
—
1,428
Amounts reclassified from AOCL 1,351
22,024
—
23,375
Other comprehensive income 1,351
23,452
—
24,803
Balance at Sept. 30, 2017 $ (123,281 ) $ (156 ) $ 2,364
$ (121,073 )

Balance at June 30, 2016 $ (113,854 ) $ (23,282 ) $ 1,400
$ (135,736 )
Other comprehensive loss before reclassifications —
(1,043 ) (3,743 ) (4,786 )
Amounts reclassified from AOCL 1,075
—
—
1,075
Other comprehensive income (loss) 1,075
(1,043 ) (3,743 ) (3,711 )
Balance at Sept. 30, 2016 $ (112,779 ) $ (24,325 ) $ (2,343 ) $ (139,447 )

Retirement Plans Foreign Currency Translation (1) Other Total

Nine Months Ended:
Balance at Dec. 31, 2016 $ (127,341 ) $ (28,560 ) $ (5,672 ) $ (161,573 )
Other comprehensive income (loss) before reclassifications —
6,380
(1,707 ) 4,673
Amounts reclassified from AOCL 4,060
22,024
9,743
35,827
Other comprehensive income 4,060
28,404
8,036
40,500
Balance at Sept. 30, 2017 $ (123,281 ) $ (156 ) $ 2,364
$ (121,073 )

Balance at Dec. 31, 2015 $ (116,496 ) $ (20,129 ) $ 5,674
$ (130,951 )
Other comprehensive loss before reclassifications —
(4,196 ) (8,017 ) (12,213 )
Amounts reclassified from AOCL 3,717
—
—
3,717
Other comprehensive income (loss) 3,717
(4,196 ) (8,017 ) (8,496 )
Balance at Sept. 30, 2016 $ (112,779 ) $ (24,325 ) $ (2,343 ) $ (139,447 )

(1) Our entire foreign currency translation adjustment is related to our CareerBuilder investment. As a result of deconsolidating the investment due to the sale of our majority ownership, we reclassified the translation adjustment from AOCL to the Consolidated Statement of Income as of the date of sale, July 31, 2017. Due to the noncontrolling stake that we retained in CareerBuilder, we will continue to record our ownership share of foreign currently translation adjustments through our equity method investment.



	Retirement Plans			Foreign Currency Translation			Other			Total

Quarters Ended:
Balance at Dec. 31, 2017	$	(107,037	)	$	114		$	—		$	(106,923	)
Other comprehensive income before reclassifications	—			150			—			150
Amounts reclassified from AOCL	5,625			—			—			5,625
Total other comprehensive income	5,625			150			—			5,775
Reclassification of stranded tax effects to retained earnings	(24,845		)	—			—			(24,845		)
Balance at Mar. 31, 2018	$	(126,257	)	$	264		$	—		$	(125,993	)

Balance at Dec. 31, 2016	$	(127,341	)	$	(28,560	)	$	(5,672	)	$	(161,573	)
Other comprehensive loss before reclassifications	—			1,197			(2,293		)	(1,096		)
Amounts reclassified from AOCL	1,278			—			—			1,278
Other comprehensive income (loss)	1,278			1,197			(2,293		)	182
Balance at Mar. 31, 2017	$	(126,063	)	$	(27,363	)	$	(7,965	)	$	(161,391	)

Reclassifications from AOCL to the Statement of Income are comprised of pension and other post-retirement ~~components and a loss on our available for sale investment.~~components. Pension and other post retirement reclassifications are related to the amortization of prior service costs, ~~and~~ amortization of actuarial losses. The loss on our available for sale investments represents an other than temporary impairment (OTTI) recognized on our investment in shares of common stock of Gannett Co., Inc. in the second quarter of 2017. The OTTI loss represents the amount of loss previously recorded to AOCL which was recognized aslosses, a ~~non-operating expense on the Consolidated Statement of Income due to the fact that we did not expect the investment to fully recover the losses prior~~lump-sum payment charge related to our ~~sale~~SERP plan, and reclassification of ~~it. We sold~~stranded tax effects in AOCL due the ~~entirety of our investment in Gannett Co., Inc. common stock in the third quarter of 2017.~~Act (see Note 1). Amounts reclassified out of AOCL are summarized below (in thousands):


	Quarter ended Sept. 30,						Nine months ended Sept. 30,						Quarter ended Mar. 31,
	2017			2016			2017			2016			2018			2017

Amortization of prior service (credit) cost	$	16		$	(22	)	$	48		$	108		$	(100	)	$	—
Amortization of actuarial loss	2,185			1,785			6,555			5,977			1,350			2,075
Reclassification of CareerBuilder foreign currency translation	22,024			—			22,024			—
Reclassification of available for sale investment	—			—			9,743			—
Lump-sum payment charge													6,300			—
Total reclassifications, before tax	24,225			1,763			38,370			6,085			7,550			2,075
Income tax effect	(850		)	(688		)	(2,543		)	(2,368		)	(1,925		)	(797		)
Total reclassifications, net of tax	$	23,375		$	1,075		$	35,827		$	3,717		$	5,625		$	1,278

Performance Share Award Program

During the first quarter of 2018, our Leadership Development and Compensation Committee (LDCC) of the Board of Directors established new long-term incentive awards under the 2001 Omnibus Incentive Compensation Plan (Plan) for our executives designed to better reflect TEGNA as a pure-play broadcaster. On March 1, 2018, we granted certain employees performance share awards (PSAs) with an aggregate target award of approximately 0.6 million shares of our common stock.

The number of shares earned is determined based on the achievement of certain financial performance criteria (adjusted EBITDA and free cash flow as defined by the PSA) over a two-year cumulative financial performance period. If the financial performance criteria are met and approved by the LDCC, the PSA will be subject to an additional one year service period before the common stock is released to the employees. The PSAs do not pay dividends or allow voting rights during the performance period. Therefore, the fair value of the PSA is the quoted market value of our stock on the grant date less the present value of the expected dividends not received during the relevant performance period. The PSA provides the LDCC with limited discretion to make adjustments to the financial targets to ensure consistent year-to-year comparison for the performance criteria.

For expense recognition, in the period it becomes probable that the minimum performance criteria specified in the PSA will be achieved, we will recognize expense for the proportionate share of the total fair value of the shares subject to the PSA related to the vesting period that has already lapsed. Each reporting period we will adjust the fair value of the PSAs to the quoted market value of our stock price. In the event we determine it is no longer probable that we will achieve the minimum performance criteria specified in the PSA, we will reverse all of the previously recognized compensation expense in the period such a determination is made.

NOTE 8 – Earnings per share

Our earnings per share (basic and diluted) are presented below (in thousands of dollars, except per share amounts):


	Quarter ended Sept. 30,						Nine months ended Sept. 30,						Quarter ended Mar. 31,
	2017			2016			2017			2016			2018		2017

Net income from continuing operations	$	50,754		$	76,737		$	144,682		$	211,615		$	55,187	$	44,658
(Loss) income from discontinued operations, net of tax	(10,803		)	56,698			(233,261		)	132,141
Net loss (income) attributable to noncontrolling interests from discontinued operations	2,806			(14,752		)	58,698			(40,178		)
Net income (loss) attributable to TEGNA Inc.	$	42,757		$	118,683		$	(29,881	)	$	303,578
Income from discontinued operations, net of tax													—		19,241
Net income attributable to noncontrolling interests from discontinued operations													—		(6,185		)
Net income attributable to TEGNA Inc.													$	55,187	$	57,714

Weighted average number of common shares outstanding - basic	215,863			214,813			215,558			216,865			216,276		215,305
Effect of dilutive securities:
Restricted stock units	828			1,630			880			1,662			177		992
Performance share units	721			775			674			1,049			216		541
Stock options	683			881			715			935			320		731
Weighted average number of common shares outstanding - diluted	218,095			218,099			217,827			220,511			216,989		217,569

Earnings from continuing operations per share - basic	$	0.24		$	0.36		$	0.67		$	0.98		$	0.26	$	0.21
(Loss) earnings from discontinued operations per share - basic	(0.04		)	0.19			(0.81		)	0.42
Net income (loss) per share - basic	$	0.20		$	0.55		$	(0.14	)	$	1.40
Earnings from discontinued operations per share - basic													—		0.06
Net income per share - basic													$	0.26	$	0.27

Earnings from continuing operations per share - diluted	$	0.23		$	0.35		$	0.66		$	0.96		$	0.25	$	0.21
(Loss) earnings from discontinued operations per share - diluted	(0.04		)	0.19			(0.80		)	0.42
Net income (loss) per share - diluted	$	0.19		$	0.54		$	(0.14	)	$	1.38
Earnings from discontinued operations per share - diluted													—		0.06
Net income per share - diluted													$	0.25	$	0.27

Our calculation of diluted earnings per share includes the impact of the assumed vesting of outstanding restricted stock units, performance share units, and the exercise of outstanding stock options based on the treasury stock method when dilutive. The diluted earnings per share amounts exclude the effects of approximately ~~96,000~~87,000 and ~~142,000~~100,000 stock awards for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2018 and 2017, ~~respectively; and 192,000 and 292,000 for the three and nine months ended September 30, 2016,~~ respectively, as their inclusion would be accretive to earnings per share.

NOTE 9 – Fair value measurement

We measure and record in the accompanying condensed consolidated financial statements certain assets and liabilities at fair value. U.S. GAAP establishes a hierarchy for those instruments measured at fair value that distinguishes between market data (observable inputs) and our own assumptions (unobservable inputs). The hierarchy consists of three levels:

Level 1 - Quoted market prices in active markets for identical assets or liabilities;

Level 2 - Inputs other than Level 1 inputs that are either directly or indirectly observable; and

Level 3 - Unobservable inputs developed using our own estimates and assumptions, which reflect those that a market participant would use.

~~The following table summarizes our assets and liabilities measured at~~ Our deferred compensation investments were valued using Level 1 inputs with a fair value ~~in the accompanying Condensed Consolidated Balance Sheets~~of $14.6 million as of ~~September 30, 2017, and~~ December 31, ~~2016 (in thousands):~~

Fair Value Measurements as of Sept. 30, 2017
Level 1 Level 2 Level 3 Total

Available for sale investment —
—
—
—
Total $ —
$ —
$ —
$ —

Deferred compensation investments valued using net asset value as a practical expedient:
Interest in registered investment companies $ 14,921
Fixed income fund 13,672
Total investments at fair value $ 28,593

Fair Value Measurements as of Dec. 31, 2016 (recast)
Level 1 Level 2 Level 3 Total

Available for sale investment 16,744
—
—
16,744
Total $ 16,744
$ —
$ —
$ 16,744

Deferred compensation investments valued using net asset value as a practical expedient:
Interest in registered investment companies $ 10,140
Fixed income fund 13,575
Total investments at fair value $ 40,459

~~Available for sale investment~~:2017. Our ~~investment previously consisted of shares of common stock of Gannett Co., Inc., which had been classified as~~deferred compensation assets were invested in a ~~Level 1 asset as the shares are listed on the New York Stock Exchange.~~fixed income mutual fund. During the ~~second~~first quarter of ~~2017~~2018, we ~~recorded an OTTI loss in~~liquidated the ~~non-operating items line item of the Consolidated Statement of Income, and in the third quarter of 2017 we sold the~~deferred compensation investment ~~in its entirety.~~to cover payments made to SERP participants (see Note 6).

~~Interest in registered investment companies~~: These investments include one fund which invests in intermediate-term investment grade bonds and a fund which invests in equities listed predominantly on European and Asian exchanges. Funds are valued using the net asset values as quoted through publicly available pricing sources and investments are redeemable on request.

~~Fixed income fund investment: Valued using the net asset value provided monthly by the fund company and shares are generally redeemable on request. There are no unfunded commitments to these investments as of September 30, 2017.~~

~~In addition to the financial instruments listed in the table above, we~~We additionally hold other financial instruments, including cash and cash equivalents, receivables, accounts payable and debt. The carrying amounts for cash and cash equivalents, receivables and accounts payable approximated their fair values. The fair value of our total debt, based on the bid and ask quotes for the related debt (Level 2), totaled ~~$3.49~~$3.30 billion at ~~September 30, 2017,~~March 31, 2018, and ~~$4.19~~$3.16 billion at December 31, ~~2016.~~

The sale of the majority of our ownership in CareerBuilder resulted in a $342.9 million pre-tax loss recorded within discontinued operations (see Note 12). The loss includes a goodwill impairment charge of $332.9 million. The valuation used in

~~the Step 1 goodwill impairment test was based on the enterprise value determined in the purchase agreement (which represents a Level 3 input in the fair value hierarchy).~~

During the third quarter of 2017, a few of our television stations were impacted by hurricanes Harvey and Irma. In particular, Hurricane Harvey caused major damage to our Houston television station (KHOU), and as a result, we recognized $10.2 million in non-cash charges, writing off destroyed equipment and recording an impairment to the value of the building (fair value of the building was determined using a market based valuation). In addition, we incurred $8.4 million in cash expenses related to repairing the studio and office and providing for additional staffing and operational needs to keep the station operating during and immediately following these weather emergencies. Partially offsetting these expenses, we received initial insurance proceeds of $11.0 million ($5.0 million was received as of September 30, 2017 and $6.0 million was received in October 2017). The net expense impact from the hurricane of $7.6 million has been recorded in asset impairment and facility consolidation charges on our Consolidated Statements of Income.

~~We also recorded a non-cash impairment charge of $5.8 million in the second quarter of 2017 associated with the write-off of a note receivable from one of our equity method investments (see Note 3).~~

2017.

NOTE 10 – ~~Business segment~~Supplemental cash flow information

~~Our reportable segment determination is based~~The following table provides a reconciliation of cash and cash equivalents, as reported on our ~~management~~Condensed Consolidated Balance Sheets, to cash, cash equivalents, and ~~internal reporting structure, the nature~~restricted cash, as reported on our Condensed Consolidated Statement of ~~products and services offered by the segments, and the financial information that is evaluated regularly by our chief operating decision maker.~~Cash Flows (in thousands):



	Mar. 31, 2018		Dec. 31, 2017		Mar. 31, 2017		Dec. 31, 2016
Cash and cash equivalents included in:
Continuing operations	$	8,338	$	98,801	$	12,040	$	15,879
Discontinued operations	—		—		67,615		61,041
Restricted cash equivalents included in:
Prepaid expenses and other current assets	—		29,240		—		—
Investments and other assets	—		—		28,093		28,197
Cash, cash equivalents and restricted cash	$	8,338	$	128,041	$	107,748	$	105,117

~~Immediately following the spin-off~~Our restricted cash equivalents consist of ~~Cars.com~~highly liquid investments that are held within a rabbi trust and ~~the sale of~~are used to pay our ~~majority stake in CareerBuilder, we began classifying our operations as one operating~~deferred compensation and reportable segment, Media, which consists of our 46 television stations operating in 38 markets, offering high-quality television programming and digital content. Also now included in the Media Segment is our DMS business which was previously reported in our Digital Segment.SERP obligations.

~~As a result of classifying the former Digital Segment’s historical financial results as discontinued operations there is no remaining activity in 2017 as shown in the tables below.~~ The ~~2016 activity shown below for our Digital Segment relates~~following table provides additional information about cash flows related to our former Cofactor business which did not meet the criteria for discontinued operation reporting when the business was sold in December 2016. The historical periods below have also been updated to restate the historical results of our DMS business within our Media business.interest and taxes (in thousands):



	Quarter ended Mar. 31,
	2018			2017
Supplemental cash flow information:
Cash (received) paid for income taxes, net of refunds	$	(2,799	)	$	6,518
Cash paid for interest	$	30,128		$	34,185

~~Segment operating results are summarized as follows (in thousands):~~

Quarter ended Sept. 30, Nine months ended Sept. 30,
2017 2016 2017 2016
(recast) (recast)
Revenues:
Media $ 464,264
$ 517,021
$ 1,412,703
$ 1,449,202
Digital —
2,596
—
8,031
Total $ 464,264
$ 519,617
$ 1,412,703
$ 1,457,233

Operating Income (net of depreciation, amortization, asset impairment and facility consolidation charges):
Media ^(a)
$ 130,338
$ 219,766
$ 433,629
$ 568,163
Digital —
(17,832 ) —
(23,300 )
Corporate ^(a)
(13,477 ) (16,083 ) (43,577 ) (46,974 )
Total $ 116,861
$ 185,851
$ 390,052
$ 497,889

Depreciation, amortization, asset impairment and facility consolidation charges:
Media $ 27,538
$ 18,583
$ 67,864
$ 59,735
Digital —
15,565
—
16,297
Corporate 596
57
1,115
3,109
Total $ 28,134
$ 34,205
$ 68,979
$ 79,141

(a) In the first quarter of 2017, we adopted new accounting guidance that changed the classification of certain components of net periodic pension and other post-retirement benefit expense (post-retirement benefit expense). The service cost component of the post-retirement benefit expense will continue to be presented as an operating expense while all other components of post-retirement benefit expense will be presented as non-operating expense. The prior year period was adjusted to reflect the effects of applying the new guidance. This resulted in an increase to operating income in third quarter of 2017 and 2016 of $1.7 million and $1.8 million and for the nine months ended September 30, 2017 and 2016 of $4.9 million and $5.8 million, respectively. Net income, earnings per share, and retained earnings were not impacted by the new standard.

NOTE 11 – Other matters

Commitments, contingencies and other matters

We, along with a number of our subsidiaries, are defendants in judicial and administrative proceedings involving matters incidental to our business. We do not believe that any material liability will be imposed as a result of these matters.

~~Voluntary Retirement Program~~

During the first quarter of 2016, we initiated a Voluntary Retirement Program (VRP) at our Media Segment. Under the VRP, Media employees meeting certain eligibility requirements were offered buyout payments in exchange for voluntarily retiring. Eligible non-union employees had until April 7, 2016, to retire under the plan. In 2016, based on acceptances received, we recorded $16.0 million of severance expense. Upon separation, employees accepting the VRP received salary continuation payments primarily based on years of service, the majority of which occurred evenly over the 12-month period following separation date. As of September 30, 2017, we had less than $0.4 million of VRP buyout obligation remaining.

FCC Broadcast Spectrum Program

~~Congress authorized~~In April 2017, the ~~Federal Communications Commission (FCC) to conduct~~FCC announced the completion of a voluntary incentive auction to reallocate certain spectrum currently occupied by television broadcast stations to mobile wireless broadband services, along with a related “repacking” of the television spectrum for remaining television stations. The repacking requires that certain television stations move to different channels, and some stations will have smaller service areas and/or experience additional interference. Congress announced the results of the auction, including a list of the stations to be repacked, in April 2017. None of our stations will relinquish any spectrum rights as a result of the auction, and accordingly we will not receive any incentive auction proceeds. The FCC has, however, notified us that 13 of our stations will be repacked to new channels. The repacking requires that certain television stations move to different channels, and some stations may have smaller service areas and/or experience additional interference. The legislation authorizing the incentive auction and repacking established a $1.75 billion fund for reimbursement of costs incurred by stations required to change channels in the repacking. Subsequent legislation enacted on March 23, 2018, appropriated an additional $1 billion for the repacking fund, of which up to $750 million may be made available to repacked full power and Class A television stations and multichannel video programming distributors. Other funds are earmarked to assist affected low power television stations, television translator stations, and FM radio stations, as well for consumer education efforts. Some of our television translator stations have been or will be displaced as a result of the repacking, and thus may be eligible under the new repacking funds appropriation to seek reimbursement for costs incurred as a result of such displacement. No reimbursement funds will be available to television translator stations until the FCC completes a rulemaking to govern reimbursement requests by such stations, and there is no guarantee that all costs will be reimbursed. The FCC is statutorily required to complete its rulemaking regarding these reimbursements by March 23, 2019.

The repacking process is scheduled to occur over a 39-month period, divided into ten phases. Our full power stations have been assigned to phases two through nine, and a majority of our capital expenditures in connection with the repack will occur in 2018 and 2019. No FCC reimbursements were received in the first quarter of 2018. When future reimbursements are received, we will record the reimbursement as a contra operating expense within our asset impairment and facility consolidation charges line item on our Consolidated Statement of Income.

Each repacked full power commercial television station, including each of our 13 repacked stations, has been allocated a reimbursement amount equal to approximately 92.5% of the station’s estimated repacking costs, as verified by the FCC’s fund

We are eligible to seek reimbursement for costs associated with implementing changes to our facilities required by the repack. The legislation authorizing the incentive auction and repacking established a $1.75 billion fund for reimbursement of costs incurred by stations required to change channels in the repacking. The FCC has reported that the aggregate cost estimated by repacked stations to complete the repack will be almost $1.9 billion. In October 2017, the FCC announced that it had made an approximately $1 billion allocation from the fund to repacked stations to allow those stations to begin to be reimbursed for expenses incurred in connection with the construction of facilities on reassigned channels. This allocation represents approximately 52% of the total estimated demand for repack funds.

administrator. Although we expect the FCC to make additional allocations from the fund, it is not ~~clear at this time whether~~guaranteed that the FCC ~~ultimately~~ will ~~receive from Congress the additional funds~~approve all reimbursement requests necessary to completely reimburse each repacked station for all amounts incurred in connection with the repack. Beyond the potential for not being reimbursed for all amounts we incur, it is still too early to predict the ultimate impact of the incentive auction and repacking upon our business.

As noted above, while we did not sell any of our spectrum in the auction, we did enter into a channel share agreement with another broadcaster that sold spectrum in the auction. Pursuant to the terms of our channel share agreement we received $32.6 million in cash proceeds during the third quarter of 2017. These proceeds were deferred and will be amortized on a straight-line basis as other revenue over a 20 year period. The $32.6 million cash proceeds were reflected as cash flow from operating activities on our Condensed Consolidated Statements of Cash Flow.

NOTE 12 – Discontinued operations

Cars.com spin-off

On May 31, 2017, we completed the previously announced spin-off of Cars.com creating two publicly traded companies: TEGNA, an innovative media company with the largest broadcast group among major network affiliates in the top 25 markets; and Cars.com, a leading digital automotive marketplace.Cars.com. The spin-off was effected through a pro rata distribution of all outstanding common shares of Cars.com to TEGNA stockholders of record at the close of business on May 18, 2017 (the ~~“Record Date”)~~Record Date). Stockholders retained their TEGNA shares and received one share of Cars.com for every three shares of TEGNA stock they owned on the Record Date. Cars.com began “regular way” trading on the New York Stock Exchange on June 1, 2017 under the symbol “CARS”. In connection with the Cars.com spin-off, we received a one time tax-free cash distribution from Cars.com of $650.0 million. In the second quarter of 2017, we used $609.9 million of the tax-free distribution proceeds to fully pay down outstanding revolving credit agreement borrowings. In October 2017, we used the remainder of the proceeds to pay down a portion of the outstanding principal on unsecured notes due in October 2019 (see Note 5).

~~Separation Agreement~~

We entered into a separation agreement with Cars.com which sets forth, among other things, the identified assets transferred, the liabilities assumed and the contracts assigned to each of TEGNA and Cars.com as part of the separation and the conditions related to the distribution of Cars.com outstanding stock to TEGNA stockholders.

~~Transition Services Agreement~~

We entered into a transition services agreement with Cars.com prior to the distribution pursuant to which we and our subsidiaries will provide certain services to Cars.com on an interim and transitional basis, not to exceed 24 months. The services to be provided include certain tax, human resource and risk management consulting services, and certain other short term services to complete a limited number of ongoing analysis projects. The agreed upon charges for such services are generally intended to allow us to recover all costs and expenses of providing such services, and such charges are not expected to be material to either us or Cars.com.

The transition services agreement will terminate on the expiration of the term of the last service provided under it, with a minimum service period of 60 days and a maximum service period of 24 months, with most services expected to last for less than the maximum service period following the distribution date. Cars.com generally can terminate a particular service prior to the scheduled expiration date, subject generally to the minimum service period and a minimum notice period of 45 days.

~~Tax Matters Agreement~~

Prior to the distribution, we entered into a tax matters agreement that governs the parties’ respective rights, responsibilities and obligations with respect to taxes (including taxes arising in the ordinary course of business and taxes, if any, incurred as a result of any failure of the distribution and certain related transactions to qualify as tax-free for U.S. federal income tax purposes), tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings and assistance and cooperation in respect of tax matters.

~~Employee Matters Agreement~~

We entered into an employee matters agreement with Cars.com prior to the distribution to allocate liabilities and responsibilities relating to employment matters, employee compensation and benefit plans and programs and other related matters. The employee matters agreement governs certain compensation and employee benefit obligations with respect to the current and former employees and non-employee directors of each company.

The employee matters agreement provides that, unless otherwise specified, Cars.com will be responsible for liabilities associated with employees who will be employed by Cars.com following the spin-off and former employees whose last employment was with the Cars.com businesses, and we will be responsible for all other current and former TEGNA employees. Cars.com will retain sponsorship of 401(k) retirement plans, deferred compensation plans and other incentive plans maintained for the exclusive benefit of Cars.com employees as well as various welfare plans applicable to the Cars.com employees.

CareerBuilder Sale

On July 31, 2017, we sold our majority ownership interest in CareerBuilder to an investor group led by investment funds managed by affiliates of Apollo Global Management, LLC, a leading global alternative investment manager, and the Ontario Teachers’ Pension Plan Board. Our share of the pre-tax net cash proceeds from the sale was $198.3 million. These net proceeds were used in October 2017 to pay down existing debt (see Note 5). Additionally, during the third quarter of 2017 and prior to the closing of the sale, CareerBuilder issued a final dividend to its selling shareholders, of which $25.8 million was retained by TEGNA. As part of the agreement, we remain an ongoing partner in CareerBuilder, ~~reducing our 53% controlling interest to~~retaining an approximately 17% interest (or approximately 12% on a fully-diluted basis) and two seats on CareerBuilder’s 10 person board. ~~As a result, subsequent to~~Following the sale, CareerBuilder is no longer consolidated within our reported operating results. Our remaining ownership interest will be accounted for as an equity method investment. ~~Subsequent to~~For the ~~date~~first three months of ~~sale~~2018, we recorded ~~$0.5~~a loss of $1.3 million ofin equity earnings ~~during the remainder of the third quarter of 2017~~ from our remaining interest in CareerBuilder.

Financial Statement Presentation of Digital Segment

As a result of the Cars.com and CareerBuilder transactions described above, the operating results ~~and financial position~~ of our former Digital Segment have been included in discontinued operations in the ~~Condensed Consolidated Balance Sheet and~~ Consolidated Statements of Income for ~~all applicable periods presented. The results of discontinued operations for~~ the nine months ended September 2017 include a $342.9 million pre-tax loss related to the sale of CareerBuilder (after noncontrolling interest, $271.7 million of the pre-tax loss is attributable to TEGNA). The pre-tax loss includes a goodwill impairment charge of $332.9 million and costs to sell the business of $10.9 million. Fair value used for the pre-tax loss was based on the enterprise value of CareerBuilder as determined in the definitive purchase agreement.prior year period.

~~The carrying value of the assets and liabilities of our former Digital Segment’s discontinued operations as of December 31, 2016 were as follows (in thousands):~~

Dec. 31, 2016

ASSETS
Cash and cash equivalents $ 61,041
Accounts receivable, net 214,171
Property and equipment, net 74,695
Goodwill 1,488,112
Other Intangibles, net 1,718,592
Other assets 71,193
Total assets $ 3,627,804

LIABILITIES
Accounts payable $ 166,853
Deferred revenue 110,071
Deferred tax liability 280,264
Other liabilities 66,969
Total liabilities $ 624,157

The financial results of discontinued operations in the third quarter and the nine months ended September 30, 2017 and 2016 are presented as a loss (income) from discontinued operations, net of tax, on our Consolidated Statements of Income. The following table presents the financial results of discontinued operations (in thousands):

Quarter ended
Sept. 30,

Nine months ended
Sept. 30,
2017 (1) 2016 2017 (1) 2016 (2)

Operating revenues $ 54,874
$ 340,649
$ 647,021
$ 999,929

Cost of revenue and SG&A expenses 60,301
228,152
522,287
708,815
Depreciation —
9,421
19,569
24,843
Amortization —
23,385
40,300
68,159
Loss on sale of CareerBuilder (1,872 ) —
342,900
—
Total operating expenses 58,429
260,958
925,056
801,817

Total operating (loss) income (3,555 ) 79,691
(278,035 ) 198,112

Non-operating income (expense) 647
(3,304 ) (1,078 ) (8,989 )

(Loss) income from discontinued operations, before income taxes (2,908 ) 76,387
(279,113 ) 189,123
Provision for income taxes (7,895 ) (19,689 ) 45,852
(56,982 )
(Loss) income from discontinued operations, net of tax $ (10,803 ) $ 56,698
$ (233,261 ) $ 132,141

(1) The quarter and nine months ended September 30, 2017 include CareerBuilder’s operations through the date of sale on July 31, 2017. Cars.com operations are included in the nine months ended September 30, 2017 through the date of spin-off on May 31, 2017.
(2) The nine months ended September 30, 2016 include approximately $7.5 million of net loss from discontinued operations related to the operations of our former Sightline business through the date of sale on March 18, 2016.



	Quarter ended Mar. 31, 2017

Revenues	$	319,401
Operating expenses	289,135
Income from discontinued operations, before income taxes	28,330
Provision for income taxes	(9,089		)
Income from discontinued operations, net of tax	19,241
Net loss (income) attributable to noncontrolling interests from discontinued operations	$	(6,185	)

The financial results reflected above may not represent our former Digital stand alone operating results, as the results reported within income from discontinued operations, net, include only certain costs that are directly attributable to those businesses and exclude certain corporate overhead costs that were previously allocated. For earnings per share information on discontinued operations, see Note 8.

In our Condensed Consolidated ~~Statements~~Statement of Cash Flows, the cash flows from discontinued operations are not separately ~~classified. As such, major categories~~classified, but supplemental cash flow information for these business units is presented below. The depreciation, amortization, and significant cash investing items of the discontinued ~~operation cash flows for the nine months ended September 30, 2017 and 2016 are presented below~~operations were as follows (in thousands):

Nine months ended Sept. 30,
2017 (1) 2016

Depreciation $ 19,569
$ 24,843
Amortization 40,300
68,159
Capital expenditures 37,441
38,825
Payments for acquisitions, net of cash acquired $ —
$ 196,750

(1) The nine months ended September 30, 2017 includes Cars.com through the spin-off date of May 31, 2017 and CareerBuilder’s operations through the date of sale on July 31, 2017.



	Quarter ended Mar. 31, 2017

Depreciation	$	9,870
Amortization of intangible assets	23,629
Capital expenditures	$	10,858

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Company Overview

We are an innovative media company that serves the greater good of our ~~communities.~~communities through empowering stories, impactful investigations and innovative marketing services. With 4647 television stations in 3839 U.S. markets, we are the largest owner of ~~top~~big four network affiliates in the top 25 markets, reaching approximately one-third of all television households nationwide. Each television station also has a robust digital presence across online, mobile and social platforms, reaching consumers whenever, wherever they are. Each month, we reach approximately 50 million ~~adults~~consumers on-air and 35approximately 30 million across our digital platforms. We have been consistently honored with the industry’s top awards, including Edward R. Murrow, George Polk, Alfred I. DuPont and Emmy Awards. WeBeyond integrated broadcast advertising products and services, we deliver results for advertisers through ~~unparalleled and~~ innovative solutions including our Over the Top ~~(“OTT”)~~(OTT) local advertising network, ~~Premion, centralized marketing resource, Hatch;~~Premion; and our digital marketing services (DMS) business, a one-stop shop for local businesses to connect with consumers through digital marketing. ~~Across platforms,~~

All of this is now delivered through a company with one singular focus; in 2017, we ~~tell empowering stories, conduct impactful investigations~~completed our transformation into a pure-play media company. On May 31, 2017 we successfully completed the spin-off of Cars.com into a separate stand-alone public company and ~~deliver innovative marketing solutions.~~ on July 31, 2017, we completed the sale of our controlling ownership interest in CareerBuilder. The completion of these strategic actions has reduced our debt and has further strengthened our balance sheet, providing us the ability to invest in our media businesses, capitalizing on opportunities for organic and acquisition-related growth. Our media operations generate strong and dependable cash flows and we are financially disciplined, which allows us to return additional value to shareholders through dividends and share repurchases. We are a leader in embracing change and driving innovation across our businesses, and we are well-positioned to benefit from the evolving regulatory environment.

We continue to make innovative programming a priority and invest in local news and other special programming to ensure we stay connected to our audiences and empower them throughout the day. For example, we recently launched VERIFY news, a fact-checking segment across platforms, and HeartThreads, a new national digital content vertical. Additionally, in September 2017 we premiered our TEGNA-owned daily live syndicated program “Daily Blast LIVE,” which airs on 36 TEGNA stations and nationally on Facebook and YouTube. Also in September, we launched a daily talk show, “Sister Circle,” produced out of WATL in Atlanta, which airs in 12 TEGNA markets and nationally live on TV One, reaching 60% of U.S. television households. Finally, our KXTV station in Sacramento partnered with Cheddar network to launch “Cheddar Local,” which provides KXTV with local business and technology segments relevant to the Sacramento community.

~~After completing the strategic actions discussed below, we now have~~operate one operating and reportable segment. The primary sources of our revenues are: 1) advertising & marketing services revenues, which include local and national non-political advertising, ~~as well as DMS~~digital marketing services (including Premion), and advertising on the stations’ websites and tablet and mobile products; 2) political advertising revenues, which are driven by ~~elections~~even year election cycles at the local and ~~peak in even years~~national level (e.g. ~~2016, 2014)~~2018, 2016) and particularly in the second half of those years; 3) subscription revenues, ~~representing~~reflecting fees ~~primarily~~ paid by satellite, ~~and~~ cable, ~~operators~~OTT (companies that deliver video content to consumers over the Internet) and telecommunications ~~companies~~providers to carry our television signals on their ~~systems and OTT revenues;~~systems; and 4) other services, such as production of programming from third parties and production of advertising material.

Our corporate costs are separated from our business expenses and are recorded as general and administrative expenses in our Consolidated Income Statement. These costs include activities that are not directly attributable or allocable to our media business operations. This category primarily consists of broad corporate management functions including legal, human resources, and finance, as well as activities and costs not directly attributable to the operations of our media business.

~~Strategic Actions~~

On ~~May 31, 2017,~~February 15, 2018, we ~~completed~~acquired, for approximately $325 million in cash, assets in San Diego consisting of KFMB-TV (the CBS affiliated station), KFMB-D2 (CW channel) and radio broadcast stations KFMB-AM and KFMB-FM (collectively KFMB). Through this transaction, we added a strong market to our portfolio. San Diego is the previously announced spin-off of Cars.com. The spin-off was achieved through a pro rata distribution of all outstanding common shares of Cars.com to TEGNA stockholders of record at the close of business on May 18, 2017 (the “Record Date”). Stockholders retained their TEGNA shares and received one share of Cars.com for every three shares of TEGNA stock they owned on the Record Date. Cars.com began “regular way” trading on the New York Stock Exchange on June 1, 2017 under the symbol “CARS”. In connection29th largest U.S. TV market with ~~the Cars.com spin-off we received a one time cash distribution from Cars.com of $650.0 million.~~

On July 31, 2017, we completed the sale of our majority ownership interest in CareerBuilder to an investor group led by investments funds managed by affiliates of Apollo Global Management, LLC, a leading global alternative investment manager,

1.1 million households and the ~~Ontario Teachers’ Pension Plan Board. Our~~17th largest radio market. KFMB-TV is the long-standing market leader in San Diego. It leads the market in audience ratings and share ~~of the pre-tax net cash proceeds from the sale was $198.3 million. These net proceeds were used~~across all demographics and is number one in ~~October 2017 to pay down existing debt (see Note 5). Additionally, prior to the sale, CareerBuilder issued a final dividend to its selling shareholders, $25.8 million of which was retained by TEGNA.~~

As part of the sale agreement, we remain an ongoing partner in CareerBuilder, reducing our 53% controlling interest to approximately 17% equity interest (or approximately 12% on a fully-diluted basis) and two seats on CareerBuilder’s 10 member board.news across all major time slots. As a result ~~CareerBuilder is no longer consolidated within~~of this acquisition, our ~~reported operating results. Our remaining ownership interest is accounted for as an equity method investment.~~U.S. television household reach increased by more than one million or one percentage point.

Consolidated Results from Operations

The following discussion is a period-to-period comparison of our consolidated results from continuing operations on a GAAP basis. On May 31, 2017, we completed the spin-off of Cars.com and on July 31, 2017, we completed the sale of our majority ownership interest in CareerBuilder. Results for Cars.com and CareerBuilder are now reflected as Discontinued Operations in our Consolidated Statements of Income for all applicable periods presented. As a result, we will report one segment going forward which will include the results for Media and a remaining DMS contract that was previously reported in the Digital Segment. The historical financial results also include our former Cofactor business through the date of its sale in December 2016.

The period-to-period comparison of financial results is not necessarily indicative of future results. In addition, see the section on page 2623 titled ‘Results from Operations - Non-GAAP Information’ for additional tables presenting information which supplements our financial information provided on a GAAP basis. Our consolidated results of continuing operations on a GAAP basis were as follows (in thousands, except per share amounts):


	Quarter ended Sept. 30,								Nine months ended Sept. 30,								Quarter ended Mar. 31,
	2017			2016			Change		2017			2016			Change		2018			2017			Change
				(recast)								(recast)
Revenues	$	464,264		$	519,617		(11	%)	$	1,412,703		$	1,457,233		(3	%)	$	502,090		$	459,070		9	%

Operating expenses:
Cost of revenues, exclusive of depreciation	235,474			200,495			17	%	696,565			590,058			18	%	258,493			231,408			12	%
Business units - selling, general and administrative expenses, exclusive of depreciation	70,914			83,039			(15	%)	214,645			246,280			(13	%)
Business units - Selling, general and administrative expenses, exclusive of depreciation																	73,621			68,429			8	%
Corporate - General and administrative expenses, exclusive of depreciation	12,881			16,027			(20	%)	42,462			43,865			(3	%)	12,708			15,333			(17	%)
Depreciation	15,186			13,212			15	%	41,721			42,653			(2	%)	13,471			13,217			2	%
Amortization of intangible assets	5,395			5,775			(7	%)	16,172			17,542			(8	%)	6,782			5,389			26	%
Asset impairment and facility consolidation charges	7,553			15,218			(50	%)	11,086			18,946			(41	%)	—			2,183			***
Total operating expenses	$	347,403		$	333,766		4	%	$	1,022,651		$	959,344		7	%	$	365,075		$	335,959		9	%

Total operating income	$	116,861		$	185,851		(37	%)	$	390,052		$	497,889		(22	%)	$	137,015		$	123,111		11	%

Non-operating expense	(54,660		)	(70,673		)	(23	%)	(190,515		)	(194,236		)	(2	%)	(61,443		)	(58,958		)	4	%
Provision for income taxes	11,447			38,441			(70	%)	54,855			92,038			(40	%)	20,385			19,495			5	%
Net income from continuing operations	$	50,754		$	76,737		(34	%)	$	144,682		$	211,615		(32	%)	$	55,187		$	44,658		24	%

Earnings from continuing operations per share - basic	$	0.24		$	0.36		(33	%)	$	0.67		$	0.98		(32	%)	$	0.26		$	0.21		24	%
Earnings from continuing operations per share - diluted	$	0.23		$	0.35		(34	%)	$	0.66		$	0.96		(31	%)	$	0.25		$	0.21		19	%

*** Not meaningful																	*** Not meaningful

Revenues

~~During the second quarter of 2017, we changed the way we present certain revenues, which we now call~~Our Advertising and Marketing Services (AMS)~~, to better reflect our sales transformation strategy that focuses on customer needs versus specific products. This~~ category includes all sources of our traditional television advertising and digital revenues including Premion, DMS and other digital advertising and marketing revenues across our platforms.

~~Also, the “Retransmission”~~ Our Subscription revenue category ~~was renamed “Subscription”~~includes revenue earned from cable and satellite providers for the right to ~~better reflect changes in that revenue stream, including~~carry our signals and the distribution of TEGNA stations on OTT streaming services.

As a result of these changes, revenues are grouped into the following categories: Advertising & Marketing Services, Political, Subscription, Other, and our former business unit Cofactor (sold in December 2016).

The following table summarizes the year-over-year changes in ~~these select~~our revenue categories (in thousands):


	Quarter ended Sept. 30,						Nine months ended Sept. 30,						Quarter ended Mar. 31,
	2017		2016		Change		2017		2016		Change		2018		2017		Change
Advertising & Marketing Services ^(a)	$	277,817	$	330,589	(16	%)	$	843,175	$	934,977	(10	%)

Advertising & Marketing Services													$	282,939	$	269,012	5	%
Subscription													205,556		182,310		13	%
Political	3,783		38,060		(90	%)	13,387		64,050		(79	%)	7,606		2,157		***
Subscription	177,692		143,676		24	%	540,344		436,292		24	%
Other	4,972		4,696		6	%	15,797		13,883		14	%	5,989		5,591		7	%
Cofactor	—		2,596		***		—		8,031		***
Total	$	464,264	$	519,617	(11	%)	$	1,412,703	$	1,457,233	(3	%)	$	502,090	$	459,070	9	%

(a) Includes traditional television advertising, digital advertising as well as revenue from our DMS business.
*** Not meaningful													*** Not meaningful

Revenues ~~decreased $55.4~~increased $43.0 million, or ~~11%~~9%, in the ~~third~~first quarter of ~~2017~~2018 compared to the same period in ~~2016.~~2017. This net ~~decrease~~increase was ~~primarily~~partially due to ~~a decline~~an increase in AMS revenue of ~~$52.8~~$13.9 million, or ~~16%~~5%, in the ~~third~~first quarter of ~~2017. This decline was~~2018. AMS revenue increased primarily due to ~~the absence of Olympic revenue in 2017 as compared to $57.3~~$49.5 million in ~~2016~~Winter Olympic and ~~lower~~Super Bowl advertising (approximately $24.0 million of which was incremental). This increase was partially offset by a decline in DMS revenue of $10.5 million due to the conclusion of a transition services agreement with Gannett. ~~Partially offsetting~~Also contributing to the overall ~~AMS decline~~revenue increase was an increase in digital revenue, including Premion revenue. Political revenue was down by $34.3 million, due to an expected decrease reflecting the absence of 2016 politically related advertising spending. Partially offsetting these decreases was an increase in subscription revenue ~~of $34.0~~which increased $23.2 million, or ~~24%,~~13% in the first quarter of 2018, primarily due to ~~the recent renewal of certain retransmission agreements as well as~~ annual rate increases under ~~other~~ existing retransmission ~~agreements.~~agreements and increases from OTT streaming service providers.

In the ~~first nine~~second quarter of 2018, we expect revenue will increase mid-single digits year-over-year driven by subscription revenue growth, political revenue, and growth initiatives. As we approach the one year anniversary of the wind-down of the terminated digital business; which occurred in second quarter last year, the impact to the year-over-year total revenue comparison is only one percent.

In addition, for our subscription revenue, we have experienced three months of ~~2017, operating~~sequential growth in total paid subscribers (which includes subscribers in OTT streaming service providers), and as a result we expect our full year subscription revenue decreased $44.5 million, or 3%, compared to the same period in 2016. The net decrease was due to a net decline in AMS revenue of $91.8 million, or 10%, for the first nine months of 2017. The third quarter decline in AMS revenue, described above, drove most of the year-to-date decline. In addition we had lower Super Bowl revenue due to the shift in coverage from our larger CBS station footprint to smaller FOX station footprint (which impacted 2017 results by $9.1 million). These AMS declines were partially offset by angrowth will increase in ~~digital revenue, including our Premion revenue. Additionally, political revenue was down $50.7 million for~~ the nine months ended September 30, 2017 due to an expected decrease reflecting the absence of 2016 Presidential election year political spending. Partially offsetting these decreases was an increase in subscription revenue of $104.1 million, or 24%, in the first nine months of 2017 due to the recent renewal of certain retransmission agreements as well as annual rate increases under other existing retransmission agreements.mid-teens year-over-year.

Cost of Revenues

Cost of revenues increased ~~$35.0~~$27.1 million, or ~~17%~~12%, in the ~~third~~first quarter of ~~2017~~2018 compared to the same period in ~~2016.~~2017. The increase was primarily due to a ~~$42.6~~$13.5 million increase in programming costs, ~~(primarily driven by 11~~a $9.8 million increase in digital expenses (due to investments made in Premion business), and approximately $6.0 million primarily associated with production of ~~our NBC stations paying reverse compensation payments for first time in 2017). This increase was~~original content (Daily Blast LIVE!), variable editorial costs tied to increased revenues (event coverage costs of Olympics and Super Bowl), and the acquisition of KFMB. These increases were partially offset by a decline in DMS costs of ~~$7.4~~$6.0 million ~~driven by~~due to the conclusion of the transition ~~service agreement with Gannett.~~

In the first nine months of 2017, cost of revenues increased $106.5 million, or 18%, compared to the same period in 2016. The increase was primarily due to a $135.1 million increase in programming costs (primarily driven by 11 of our NBC stations paying reverse compensation payments for first time in 2017). This increase was partially offset by the absence of $10.8 million of expenses associated with our 2016 voluntary retirement program and a decline in DMS costs of $11.8 million associated with the conclusion of the transition serviceservices agreement with Gannett.

Business Units - Selling, General and Administrative Expenses

Business unit selling, general and administrative expenses ~~decreased $12.1~~increased $5.2 million, or ~~15%~~8%, in the ~~third~~first quarter of ~~2017~~2018 compared to the same period in ~~2016.~~2017. The ~~decrease~~increase was primarily the result of a ~~$6.0~~$3.9 million ~~decline~~increase in ~~DMS selling~~sales expenses, driven by the incremental revenue from Olympics and ~~advertising expense related~~Super Bowl. The remaining variance is attributable to ~~the transition service agreement conclusion. Also contributing to the decline was the absence of $2.6 million of Cofactor expenses, due to its disposition in December 2016.~~

In the first nine months of 2017, business unit selling, general and administrative expenses decreased $31.6 million, or 13%, compared to the same period in 2016. This decrease was due to a $14.7 million decline in DMS selling and advertising expenses, the absence of $6.5 million of expensesvarious items including incremental costs associated with ~~Cofactor, and the absence~~acquisition of ~~$4.0 million of expenses associated with our 2016 voluntary retirement program. These decreases were partially offset by $1.6 million of severance expenses for broadcast employees in 2017.~~

KFMB.

Corporate General and Administrative Expenses

Corporate general and administrative expenses decreased ~~$3.1~~$2.6 million, or ~~20%~~17%, in the ~~third~~first quarter of ~~2017~~2018 compared to the same period in ~~2016.~~2017. The decrease was primarily due to the absence of ~~$1.6~~$0.9 million ofin severance ~~expenses from~~incurred in 2017, with the ~~third quarter of 2016, as well as~~remaining decrease primarily due to lower corporate rent expense and reductions in various departments associated with the ~~continued right sizing~~right-sizing of the corporate function following the spin-off of Cars.com and the sale of our majority interest in ~~connection with the strategic actions impacting our former Digital Segment.~~

~~During the first nine months of 2017, corporate general and administrative expenses decreased $1.4 million, or 3%, compared to the same period~~CareerBuilder in 2016. This change was primarily due to the absence of $1.6 million of severance expenses from the third quarter of 2016, partially offset by severance expense incurred in the first nine months of 2017 of approximately $1.1 million. The remaining difference is attributable to the continued right sizing of the corporate function in connection with the strategic actions impacting our former Digital Segment.2017.

Depreciation Expense

Depreciation expense increased ~~$2.0~~$0.3 million, or ~~15%~~2%, in the ~~third~~first quarter of ~~2017~~2018 compared to the same period in ~~2016.~~2017. The increase was primarily due to ~~$1.4 million of additional depreciation related to a change in useful lives of certain broadcasting assets in connection with the FCC channel reassignment process.~~

~~In the first nine months of 2017,~~incremental depreciation expense ~~decreased $0.9 million, or 2%, as compared to the same period in 2016. The decrease was primarily due to recent declines in the purchase~~resulting from our acquisition of ~~property and equipment, offset by accelerated depreciation related to a change in useful lives of certain broadcasting assets.~~KFMB.

Amortization Expense

Amortization expense ~~decreased~~increased by ~~$0.4 million and~~ $1.4 million in the ~~third~~first quarter ~~and first nine months~~ of ~~2017, respectively,~~2018, compared to the same ~~periods~~period in ~~2016.~~2017. The ~~decreases were~~increase was a result of ~~certain~~amortization of intangible assets ~~associated~~acquired in connection with ~~previous acquisitions reaching the end~~our acquisition of ~~their useful lives.~~KFMB.

Asset Impairment and Facility Consolidation Charges

Asset impairment and facility consolidation charges were $7.6 million in the third quarter of 2017 compared to $15.2 million in the third quarter of 2016. In the third quarter of 2017, a few television stations were impacted by hurricanes Harvey and Irma. In particular, Hurricane Harvey caused significant damage to our Houston television station (KHOU); as a result, we recognized $10.2 million in non-cash charges, writing off destroyed equipment and recording an impairment to the value of the building. In addition, we incurred $8.4 million in cash expenses related to repairing the studio and office and providing for additional staffing and operational needs to keep the stations operating during and immediately following these weather emergencies. Partially offsetting these expenses, we received initial insurance proceeds of $11.0 million ($5.0 million was received as of September 30, 2017 and $6.0 million was received in October 2017). The net expense impact from the hurricane of $7.6 million has been recorded in asset impairment and facility consolidation charges. The 2016 charge relates to a goodwill impairment at Cofactor.

~~During the first nine months of 2017,~~We had no asset impairment and facility consolidation charges ~~were $11.1 million,~~in the first quarter of 2018 compared to ~~$18.9~~$2.2 million in the ~~same period in 2016.~~first quarter of 2017. The 2017 charges ~~primarily~~ consisted of ~~net $7.6 million in expenses related to Hurricane Harvey, $1.4 million related to the consolidation of office space at corporate headquarters and at our DMS business unit, and~~ $2.2 million of non-cash asset impairment charges ~~incurred by~~associated with operating assets at one of our ~~broadcast~~ stations. ~~The 2016 charges were comprised of the third quarter goodwill impairment charge of $15.2 million at Cofactor and a $3.7 million impairment charge related to a long-lived-asset.~~

Operating Income

Our operating income ~~decreased $69.0~~increased $13.9 million, or ~~37%, in the third quarter of 2017 and $107.8 million, or 22%~~11%, in the first ~~nine months~~quarter of ~~2017,~~2018 compared to the same ~~periods~~period in ~~2016.~~2017. The ~~decreases were~~increase was driven by the changes in revenue and expenses discussed above. As a result, our consolidated operating margins were ~~25%~~27% in both the ~~third~~first quarter of ~~2017~~2018 and ~~28% in the first nine months of 2017, compared to 36% in the third quarter of 2016 and 34% in the first nine months of 2016.~~2017.

Non-Operating ~~Income (Expense)~~Expense

Non-operating expense ~~decreased $16.0~~increased $2.4 million, or ~~23%~~4%, in the ~~third~~first quarter of ~~2017~~2018 compared to the same period in ~~2016.~~2017. The ~~decrease~~increase was primarily due to a ~~reduction~~pension-related charge in ~~transaction costs~~first quarter of ~~$10.9~~2018 of $6.3 million ~~primarily associated with costs incurred~~(primarily related to lump sum payments made to certain former executives of the company). In addition, in the ~~prior year period~~first quarter 2017 we recorded a $5.2 million gain related to the ~~Cars.com spin-off. Also contributing to the decrease~~reversal of unclaimed property reserve as a result of a change in state law.

Offsetting these increases was a decline in interest expense of ~~$5.7~~$7.7 million driven by lower average debt ~~outstanding, due to the pay down of the drawn amounts on the revolving line of credit.~~outstanding. The total average outstanding debt was ~~$3.38~~$3.22 billion for the ~~third~~first quarter of ~~2017,~~2018, compared to ~~$4.31~~$4.06 billion in the same period of ~~2016.~~2017. The weighted average interest rate on total outstanding debt was ~~5.75%~~5.84% for the ~~third~~first quarter of ~~2017,~~2018, compared to ~~5.21%~~5.28% in the same period of ~~2016.~~

During the first nine months of 2017, non-operating expenses decreased $3.7 million, or 2%, compared to the same period in 2016. The decrease was primarily due to lower interest expense of $13.3 million, partially offset by increased costs associated with the strategic actions of $3.4 million (primarily the Cars.com spin-off) and a $5.8 million loss associated with the write-off of a note receivable from one of our equity method investments. The lower interest expense was due to lower average debt outstanding. The total average outstanding debt was $3.75 billion during the first nine months of 2017, compared to $4.28 billion in the same period of 2016. The weighted average interest rate on total outstanding debt was 5.51% for the first nine months of 2017, compared to 5.32% in the same period of 2016.2017.

Income Tax Expense

Income tax expense ~~decreased $27~~increased to $20.4 million ~~or 70%,~~ in the ~~third~~first quarter of 2018 from $19.5 million in the first quarter of 2017, ~~as compared to the same period in 2016, and decreased $37.2 million, or 40%, in the first nine months~~an increase of ~~2017 compared to the same period in 2016.~~5%. The ~~decrease in Income tax expense is~~increase was primarily due to ~~a decline~~increases in net income before tax ~~as well~~, partially offset by a reduction in the federal corporate tax rate from 35% to 21% as a ~~favorable deferred tax adjustment related to a previously-disposed business.~~result of the enactment of Pub. L. No. 115-97 (the Act). Our reported effective income tax rate was ~~18.4% in~~27% for the ~~third~~first quarter of ~~2017,~~2018, compared to ~~33.4%~~30.4% for continuing operations for the ~~third~~first quarter of ~~2016.~~2017. The ~~reported effective income~~ tax rate ~~was 27.5%~~ for the first ~~nine months of 2017, compared to 30.3% for the same period~~quarter in ~~2016. The tax rates for the third quarter and first nine months of 2017 are~~2018 is lower than the comparable ~~2016 rates~~rate in 2017 primarily due to the corporate tax rate reduction from 35% to 21%, partially offset by the repeal of the domestic manufacturing deduction, both in ~~net~~accordance with the Act, as well as an increase in state income ~~before tax and~~taxes due to the ~~deferred tax adjustment mentioned above.~~acquisition of KFMB.

Income ~~from continuing operations~~From Continuing Operations

Income from continuing operations was ~~$50.8~~$55.2 million, or ~~$0.23~~$0.25 per diluted share, in the ~~third~~first quarter of ~~2017~~2018 compared to ~~$76.7~~$44.7 million or ~~$0.35~~$0.21 per diluted share during the same period in 2016. For the first nine months of 2017, we reported net income from continuing operations of $144.7 million, or $0.66 per diluted share, compared to $211.6 million, or $0.96 per diluted share, for the same period in 2016.2017. Both income from continuing operations and earnings per share were affected by the factors discussed above.

The weighted average number of diluted shares outstanding in the ~~both the third~~first quarter of 2018 and 2017 was 217.0 million and ~~2016 was 218.1 million. The weighted average number of diluted shares outstanding in the first nine months quarter of 2017 decreased by 2.7~~217.6 million, ~~shares to 217.8 million from 220.5 million in the same period in 2016.~~respectively.

Results from Operations - Non-GAAP Information

Presentation of Non-GAAP information

We use non-GAAP financial performance and liquidity measures to supplement the financial information presented on a GAAP basis. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for, the related GAAP measures, nor should they be considered superior to the related GAAP measures, and should be read together with financial information presented on a GAAP basis. Also, our non-GAAP measures may not be comparable to similarly titled measures of other companies.

Management and our Board of Directors use the non-GAAP financial measures for purposes of evaluating business unit and consolidated company performance. Furthermore, the ~~Executive~~Leadership Development and Compensation Committee of our Board of Directors uses non-GAAP measures such as Adjusted EBITDA, non-GAAP net income, non-GAAP EPS and free cash flow to evaluate management’s performance. Therefore, we believe that each of the non-GAAP measures presented provides useful information to investors and other stakeholders by allowing them to view our business through the eyes of management and our Board of Directors, facilitating comparisons of results across historical periods and focus on the underlying ongoing operating performance of our business. We discuss in this Form 10-Q non-GAAP financial performance measures that exclude from our reported GAAP results the impact of “special items” consisting of transaction costs, severance expense, charges related to asset impairment and facility consolidations, TEGNA Foundation donations, costs associated with the Cars.com spin-off transaction, and ~~certain~~ tax ~~benefits~~impacts associated with the ~~Cars.com spin-off and sale~~acquisition of ~~CareerBuilder.~~KFMB. We believe that such expenses ~~charges~~ and ~~gains~~charges are not indicative of normal, ongoing operations. Such items vary from period to period and are significantly impacted by the timing and nature of these events. Therefore, while we may incur or recognize these types of expenses ~~charges~~ and ~~gains~~charges in the future, we believe that removing these items for purposes of calculating the non-GAAP financial measures provides investors with a more focused presentation of our ongoing operating performance.

We discuss Adjusted EBITDA (with and without corporate expenses), a non-GAAP financial performance measure that we believe offers a useful view of the overall operation of our businesses. We define Adjusted EBITDA as net income from continuing operations before (1) interest expense, (2) income taxes, (3) equity income (losses) in unconsolidated investments, net, (4) other non-operating items such as ~~spin-off~~corporate transaction expenses (such as business acquisition and disposition costs) and investment income, (5) severance expense, (6) facility consolidation charges, (7) impairment charges, (8) depreciation and (9) amortization. The most directly comparable GAAP financial measure to Adjusted EBITDA is Net income from continuing operations. Users should consider the limitations of using Adjusted EBITDA, including the fact that this measure does not provide a complete measure of our operating performance. Adjusted EBITDA is not intended to purport to be an alternative to net income as a measure of operating performance or to cash

flows from operating activities as a measure of liquidity. In particular, Adjusted

EBITDA is not intended to be a measure of free cash flow available for management’s discretionary expenditures, as this measure does not consider certain cash requirements, such as working capital needs, capital expenditures, contractual commitments, interest payments, tax payments and other debt service requirements.

We also consider adjusted revenues to be an important non-GAAP financial measure. Our adjusted revenue is calculated by taking total company revenues on a GAAP basis and adjusting it to exclude (1) estimated net incremental Olympic and Super Bowl revenue, (2) Political revenues, ~~(3) revenues from a previously sold business (Cofactor),~~ and ~~(4)~~(3) revenues associated with a discontinued portion of our DMS business. These adjustments are made to our reported revenue on a GAAP basis in order to evaluate and assess our core operations on a comparable basis, and it represents the ongoing operations of our broadcast business.

We also discuss free cash flow, a non-GAAP liquidity measure. Free cash flow is defined as “net cash flow from operating activities” as reported on the statement of cash flows reduced by “purchase of property and equipment”. We believe that free cash flow is a useful measure for management and investors to evaluate the level of cash generated by operations and the ability of its operations to fund investments in new and existing businesses, return cash to shareholders under the company’s capital program, repay indebtedness, add to our cash balance, or use in other discretionary activities. We use free cash flow to monitor cash available for repayment of indebtedness and in discussions with the investment community. Like Adjusted EBITDA, free cash flow is not intended to be a measure of cash flow available for management’s discretionary use.

Discussion of special charges ~~and credits~~ affecting reported results

Our results for the quarter ~~and first nine months~~ ended ~~September 30, 2017~~March 31, 2018 included the following items we consider “special items” and are not indicative of our normal ongoing operations:

~~Operating asset impairment~~Pension lump-sum payment charge as a result of payments that were made to certain SERP plan participants in early 2018; and ~~facility consolidation charges related to damage caused by Hurricane Harvey and the consolidation of office space at corporate headquarters and at our DMS business unit;~~

Other non-operating items associated with transaction costs of the spin-off of our Cars.com business unit, charitable donations made to the TEGNA Foundation, non-cash asset impairment charges associated with write off of a note receivable from an equity method investment;

~~A special tax benefit related to deferred tax remeasurement attributable to the spin-off of our Cars.com business unit~~ and a deferred tax ~~adjustment~~provision impact related to ~~a previously-disposed business; and~~

~~Severance charges which included payroll and related benefit costs.~~our acquisition of KFMB.

Our results for the quarter ~~and first nine months~~ ended ~~September 30, 2016~~March 31, 2017 included the following special items:

Severance charges ~~primarily~~ related to ~~a voluntary retirement program at~~ our ~~broadcast stations~~Media and Corporate personnel (which includes payroll and related benefit costs);

Non-cash asset impairment charges associated with ~~goodwill, an~~ operating ~~asset, and equity method investments;~~assets at one of our stations; and

Non-operating costs associated with the spin-off of our Cars.com business unit and ~~acquisition-related costs.~~a charitable donation made to the TEGNA Foundation.

Reconciliations of certain line items impacted by special items to the most directly comparable financial measure calculated and presented in accordance with GAAP on our consolidated statements of income follow (in thousands, except per share amounts):


				Special Items														Special Items
Quarter ended September 30, 2017	GAAP measure			Operating asset impairment and facility consolidation			Other non-operating items		Tax benefits			Non-GAAP measure
Quarter ended March 31, 2018															GAAP measure			Pension lump-sum payment charge		Other non-operating items			Non-GAAP measure

Operating expenses	$	347,403		$	(7,553	)	$	—	$	—		$	339,850
Operating income	116,861			7,553			—		—			124,414
Other non-operating items	(3,671		)	—			2,688		—			(983		)	$	(12,480	)	$	6,300	$	9,462		$	3,282
Total non-operating expense	(54,660		)	—			2,688		—			(51,972		)	(61,443		)	6,300		9,462			(45,681		)
Income before income taxes	62,201			7,553			2,688		—			72,442			75,572			6,300		9,462			91,334
Provision for income taxes	11,447			2,780			629		8,086			22,942
Provision (benefit) for income taxes															20,385			1,608		(1,443		)	20,550
Income from continuing operations	50,754			4,773			2,059		(8,086		)	49,500			55,187			4,692		10,905			70,784
Earnings from continuing operations per share - diluted ^(a)	$	0.23		$	0.02		$	0.01	$	(0.04	)	$	0.23		$	0.25		$	0.02	$	0.05		$	0.33
(a) Per share amounts do not sum due to rounding.

Special Items
Quarter ended September 30, 2016
GAAP
measure
Severance expense Operating asset impairment and facility consolidation Other non-operating items Non-GAAP measure

Operating expenses $ 333,766
$ (2,870 ) $ (15,218 ) $ —
$ 315,678
Operating income 185,851
2,870
15,218
—
203,939
Other non-operating items (11,874 ) —
—
13,161
1,287
Total non-operating expense (70,673 ) —
—
13,161
(57,512 )
Income before income taxes 115,178
2,870
15,218
13,161
146,427
Provision for income taxes 38,441
1,112
5,900
3,515
48,968
Income from continuing operations 76,737
1,758
9,318
9,646
97,459
Earnings from continuing operations per share - diluted ^(a)
$ 0.35
$ 0.01
$ 0.04
$ 0.04
$ 0.45

~~(a) Per share amounts do not sum due to rounding.~~

Special Items
Nine Months Ended September 30, 2017
GAAP
measure
Severance expense Operating asset impairment Other non-operating items Tax benefits Non-GAAP measure

Operating expenses $ 1,022,651
$ (3,053 ) $ (11,086 ) $ —
$ —
$ 1,008,512
Operating income 390,052
3,053
11,086
—
—
404,191
Other non-operating items (26,853 ) —
—
31,991
—
5,138
Total non-operating expense (190,515 ) —
—
31,991
—
(158,524 )
Income before income taxes 199,537
3,053
11,086
31,991
—
245,667
Provision for income taxes 54,855
1,174
4,104
6,921
11,724
78,778
Income from continuing operations 144,682
1,879
6,982
25,070
(11,724 ) 166,889
Earnings from continuing operations per share - diluted $ 0.66
$ 0.01
$ 0.03
$ 0.12
$ (0.05 ) $ 0.77

Special Items
Nine Months Ended September 30, 2016
GAAP
measure
Severance expense Operating asset impairment Equity investment impairment Other non-operating items Non-GAAP measure

Operating expenses $ 959,344
$ (20,118 ) $ (18,946 ) $ —
$ —
$ 920,280
Operating income 497,889
20,118
18,946
—
—
536,953
Equity (loss) income in unconsolidated charges (2,763 ) —
—
1,869
—
(894 )
Other non-operating items (16,029 ) —
—
—
16,324
295
Total non-operating expense (194,236 ) —
—
1,869
16,324
(176,043 )
Income before income taxes 303,653
20,118
18,946
1,869
16,324
360,910
Provision for income taxes 92,038
7,799
7,345
725
4,583
112,490
Income from continuing operations 211,615
12,319
11,601
1,144
11,741
248,420
Earnings from continuing operations per share - diluted $ 0.96
$ 0.06
$ 0.05
$ 0.01
$ 0.05
$ 1.13



				Special Items
Quarter ended March 31, 2017	GAAP measure			Severance expense			Operating asset impairment and facility consolidation			Other non-operating items		Non-GAAP measure

Operating expenses	$	335,959		$	(1,699	)	$	(2,183	)	$	—	$	332,077
Operating income	123,111			1,699			2,183			—		126,993
Other non-operating items	(2,074		)	—			—			9,549		7,475
Total non-operating expense	(58,958		)	—			—			9,549		(49,409		)
Income before income taxes	64,153			1,699			2,183			9,549		77,584
Provision for income taxes	19,495			651			803			2,350		23,299
Income from continuing operations	44,658			1,048			1,380			7,199		54,285
Earnings from continuing operations per share - diluted	$	0.21		$	—		$	0.01		$	0.03	$	0.25

Adjusted Revenues

Reconciliations of adjusted revenues to our revenues presented in accordance with GAAP on our Consolidated Statements of Income are presented below (in thousands):


	Quarter ended Sept. 30,								Nine months ended Sept. 30,								Quarter ended Mar. 31,
	2017			2016			Change		2017			2016			Change		2018			2017			Change

Advertising & Marketing Services ^(a)	$	277,817		$	330,589		(16.0	%)	$	843,175		$	934,977		(9.8	%)	$	282,939		$	269,012		5	%
Subscription																	205,556			182,310			13	%
Political	3,783			38,060			(90.1	%)	13,386			64,050			(79.1	%)	7,606			2,157			***
Subscription	177,692			143,676			23.7	%	540,345			436,292			23.8	%
Other	4,972			4,696			5.9	%	15,797			13,883			13.8	%	5,989			5,591			7	%
Cofactor	—			2,596			***		—			8,031			***
Total company revenues (GAAP basis)	$	464,264		$	519,617		(10.7	%)	$	1,412,703		$	1,457,233		(3.1	%)	$	502,090		$	459,070		9	%
Factors impacting comparisons:
Estimated incremental Olympic and Super Bowl	$	—		$	(28,300	)	***		$	—		$	(37,210	)	***
Estimated net incremental Olympic and Super Bowl																	$	(24,000	)	$	(323	)	***
Political	(3,783		)	(38,060		)	(90.1	%)	(13,386		)	(64,050		)	(79.1	%)	(7,606		)	(2,157		)	***
CoFactor (sold in December 2016)	—			(2,596		)	***		—			(8,031		)	***
Discontinued digital marketing services	—			(13,893		)	***		(16,673		)	(40,509		)	(58.8	%)	—			(10,501		)	***
Total company adjusted revenues	$	460,481		$	436,768		5.4	%	$	1,382,644		$	1,307,433		5.8	%
Total company adjusted revenues (non-GAAP basis)																	$	470,484		$	446,089		5	%

(a) Includes traditional advertising, digital advertising as well as revenue from our DMS businesses.
*** Not meaningful

Excluding the impacts of Political revenue, impacts from the discontinued DMS transition services agreement ~~the absence of Cofactor revenue,~~ and estimated prior year incremental Olympic and Super Bowl revenue, total company adjusted revenues on a comparable basis increased ~~five percent in the third quarter and six~~5.5% percent in the first ~~nine months of 2017~~quarter 2018 compared to the same ~~periods~~period in ~~2016.~~

2017.

Adjusted EBITDA - Non-GAAP

Reconciliations of Adjusted EBITDA to net income from continuing operations ~~attributable to TEGNA Inc.~~ presented in accordance with GAAP on our Consolidated Statements of Income are presented below (in thousands):


	Quarter ended Sept. 30,							Nine months ended Sept. 30,						Quarter ended Mar. 31,
	2017			2016		Change		2017		2016		Change		2018		2017		Change

Net income from continuing operations (GAAP basis)	$	50,754		$	76,737	(34	%)	$	144,682	$	211,615	(32	%)	$	55,187	$	44,658	24	%
Provision for income taxes	11,447			38,441		(70	%)	54,855		92,038		(40	%)	20,385		19,495		5	%
Interest expense	51,855			57,601		(10	%)	162,113		175,444		(8	%)	47,725		55,415		(14	%)
Equity loss in unconsolidated investments, net	(866		)	1,198		***		1,549		2,763		(44	%)	1,238		1,469		(16	%)
Other non-operating items	3,671			11,874		(69	%)	26,853		16,029		68	%	12,480		2,074		***
Operating income (GAAP basis)	116,861			185,851		(37	%)	390,052		497,889		(22	%)	137,015		123,111		11	%
Severance expense	—			2,870		***		3,053		20,118		(85	%)	—		1,699		***
Asset impairment and facility consolidation charges	7,553			15,218		(50	%)	11,086		18,946		(41	%)	—		2,183		***
Adjusted operating income (non-GAAP basis)	124,414			203,939		(39	%)	404,191		536,953		(25	%)	137,015		126,993		8	%
Depreciation	15,186			13,212		15	%	41,721		42,653		(2	%)	13,471		13,217		2	%
Amortization of intangible assets	5,395			5,775		(7	%)	16,172		17,542		(8	%)	6,782		5,389		26	%
Adjusted EBITDA (non-GAAP basis)	144,995			222,926		(35	%)	462,084		597,148		(23	%)	157,268		145,599		8	%
Corporate - General and administrative expense, exclusive of depreciation (non-GAAP basis)	12,881			14,470		(11	%)	41,402		42,308		(2	%)	12,708		14,410		(12	%)
Adjusted EBITDA, excluding Corporate (non-GAAP basis)	$	157,876		$	237,396	(33	%)	$	503,486	$	639,456	(21	%)	$	169,976	$	160,009	6	%

*** Not meaningful

~~Third~~First quarter ~~2017~~2018 adjusted EBITDA margin was 34% without corporate expense or 31% with ~~corporate.~~corporate expense. Our total Adjusted EBITDA ~~decreased $77.9~~increased $11.7 millionor~~35%~~ 8% in the ~~third~~first quarter of ~~2017~~2018 compared to ~~2016~~2017. The increase was primarily due to $49.5 million in Winter Olympic and ~~decreased $135.1~~Super Bowl advertising (approximately $24.0 million ~~or 23%~~of which was net incremental).

Free cash flow reconciliation

Our free cash flow, a non-GAAP liquidity measure, was $40.5 million for the first ~~nine~~three months of 2018 compared to $122.0 millionfor the same period in 2017. Our free cash flow for the first three months of 2018 was lower than the first three months of 2017 because of the same factors affecting cash flow from operating activities discussed in the ~~prior year comparable period. The decrease was primarily driven by higher programming costs (due~~”Liquidity and capital resources” section below.

Reconciliations from “Net cash flow from operating activities” to ~~11 of our NBC stations which began making reverse compensation payments for the first time), the absence of Olympic revenue in 2017 and the expected decline in political revenue in 2017.~~“Free cash flow” follow (in thousands):



	Three months ended Mar. 31,
	2018			2017

Net cash flow from operating activities	$	51,186		$	139,917
Purchase of property and equipment	(10,643		)	(17,959		)
Free cash flow	$	40,543		$	121,958

~~Certain Matters Affecting Future Operating Results~~

~~The following items will affect year-over-year comparisons for 2017 results:~~

~~Revenues~~ - In the fourth quarter of 2017 revenue will be impacted primarily due to the absence of $82 million in net political revenues compared to the fourth quarter of 2016, and the absence of $16 million of DMS revenue due to the conclusion of a transition services agreement with Gannett.

Based on current trends, we expect total company revenues on a GAAP basis compared to the prior year quarter to be down in the high-single to low double-digits. Adjusting to remove political revenue and revenue related to the terminated transition services agreement, we expect our fourth quarter adjusted company revenues to be up in the high single-digit to low double-digits year-over-year.

~~Programming Costs~~ - Beginning in January 2017, 11 of our NBC stations began making reverse compensation payments for the first time. As such, 2017 is an unusual year as there will be an unfavorable gap between the increase in subscription revenue we earn from multichannel video programming distributors (MVPD), compared to the increase in fees we will pay our affiliates. At the end of 2016, we renegotiated several new subscriptions agreements with major MVPD carriers, and as a result, we have reduced our net retransmission gap in 2017 to approximately $31 million to $34 million. Further, we expect our strategic initiatives launched in 2016 (including Premion, centralized pricing initiatives, and Hatch) will more than offset the remaining net retransmission gap in 2017.

~~Income Taxes~~ - After the spin-off of Cars.com and disposition of CareerBuilder, the recurring effective income tax rate for 2018 is anticipated to be approximately 35%. This estimated effective income tax rate is higher than that for the third quarter and the first nine months of 2017 due to tax benefits associated with the spin-off of Cars.com and other non-recurring items realized in 2017.

Liquidity, Capital Resources and Cash Flows

Our ~~strong~~ cash generation capability and financial condition, together with our significant borrowing capacity under our revolving credit agreement, are more than sufficient to fund our capital expenditures, interest, dividends, share repurchases, investments in strategic initiatives and other operating requirements. Over the longer term, we expect to continue to fund debt maturities, acquisitions and investments through a combination of cash flows from operations, borrowings under our revolving credit agreement and funds raised in the capital markets. As we summarize below, during 2017 we have completed several strategic actions that have positioned us to be able to pursue strategic acquisition opportunities that may develop in our sector, invest in new content and revenue initiatives, and grow revenue in fiscal year 2018.

During the second quarter we completed our spin-off of Cars.com which resulted in a one-time tax-free cash distribution of $650.0 million to TEGNA. We used $609.9 million of the tax-free distribution proceeds to fully pay down our then outstanding revolving credit agreement borrowings.

On July 31, 2017, we sold our majority ownership interest in CareerBuilder. Our share of the pre-tax net cash proceeds from the sale was $198.3 million, net of cash transferred of $36.6 million. Additionally, prior to the sale, CareerBuilder issued a final dividend to its selling shareholders, of which $25.8 million was retained by TEGNA. On October 16 2017, we used the net proceeds from the CareerBuilder sale, the remaining cash distribution proceeds from Cars.com of $40.1 million, and cash on hand to early retire $280.0 million of principal of unsecured notes due in October 2019.

On September 19, 2017, we announced that our Board of Directors authorized a new share repurchase program for up to $300 million of our common stock over ~~the next~~ three years.

During the first quarter of 2018, we borrowed $220.0 million under the revolving credit facility primarily to finance the acquisition of KFMB. At the end of the ~~third~~first quarter of ~~2017,~~2018, our total debt was ~~$3.32~~$3.20 billion and cash and cash equivalents totaled ~~$383.4~~$8.3 million. As of ~~September 30, 2017,~~March 31, 2018, we had unused borrowing capacity of ~~$1.5~~$1.27 billion under our revolving credit facility. ~~We intend to continue~~

Our operations have historically generated strong positive cash flow which, along with availability under our existing revolving credit facility, provides adequate liquidity to invest in organic and strategic growth opportunities, ~~and also intend to maintain the financial flexibility to pursue strategic acquisitions when appropriate.~~as well as acquisitions. Our financial and operating performance, as well as our ability to generate sufficient cash flow to maintain compliance with credit facility covenants, are subject to certain risk factors; see ~~the~~ Part II. Other Information, Item 1A. Risk Factors ~~discussion below.~~for further discussion.

Cash Flows

The following table provides a summary of our cash flow information followed by a discussion of the key elements of our cash flow (in thousands):

Nine months ended Sept. 30,
2017 2016

Cash and cash equivalents from continuing operations, beginning of period $ 15,879
$ 26,096
Cash and cash equivalents from discontinued operations, beginning of period 61,041
103,104
     Balance of cash and cash equivalents, beginning of the period 76,920
129,200

Operating activities:
    Net (loss) income (88,579 ) 343,756
    Loss on write down of CareerBuilder 342,900
—
    Depreciation, amortization and other non-cash adjustments 153,242
197,025
    Pension (contributions), net of expense (12,547 ) 2,135
    Spectrum channel share agreement proceeds 32,588
—
    Other, net (76,421 ) (88,153 )
Net cash flows from operating activities 351,183
454,763
Net cash from (used for) investing activities 152,499
(273,309 )
Net cash used for financing activities (197,248 ) (203,325 )
Increase (decrease) in cash and cash equivalents 306,434
(21,871 )

Cash and cash equivalents from continuing operations, end of period 383,354
19,185
Cash and cash equivalents from discontinued operations, end of period —
88,144
     Balance of cash and cash equivalents, end of the period $ 383,354
$ 107,329



	Three months ended Mar. 31,
	2018			2017

Cash, cash equivalents and restricted cash from continuing operations, beginning of period	$	128,041		$	44,076
Cash, cash equivalents and restricted cash from discontinued operations, beginning of period	—			61,041
Balance of cash, cash equivalents and restricted cash beginning of the period	128,041			105,117

Operating activities:
Net income	55,187			63,899
Depreciation, amortization and other non-cash adjustments	24,080			59,562
Pension (contributions), net of expense	(23,072		)	(1,350		)
Other, net	(5,009		)	17,806
Net cash flows from operating activities	51,186			139,917
Net cash used for investing activities	(338,154		)	(12,830		)
Net cash provided by (used for) financing activities	167,265			(124,456		)
(Decrease) increase in cash and cash equivalents	(119,703		)	2,631

Cash, cash equivalents and restricted cash from continuing operations, end of period	$	8,338		$	40,133
Cash, cash equivalents and restricted cash from discontinued operations, end of period	—			67,615
Balance of cash, cash equivalents and restricted cash end of the period	$	8,338		$	107,748

Operating Activities - Cash flow from operating activities was ~~$351.2~~$51.2 million for the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2018, compared to ~~$454.8~~$139.9 million for the ~~nine~~three months ended ~~September 30, 2016.~~March 31, 2017. The decrease in net cash flow from operating activities was primarily due to ~~higher programming costs~~the absence of ~~$135.1~~approximately $61.1 million ~~(primarily due to the NBC affiliation agreement), the decline in political revenue of $50.7 million, and the absence~~ of operating cash flow related to Cars.com and CareerBuilder ~~following their spin-off~~which were spun-off and ~~sale, respectively.~~ sold, respectively, during 2017 as well as an increase of $25.5 million in pension payments and contributions. In addition, we had higher accounts payable disbursements (primarily associated with increased programming costs).

These decreases were partially offset by declines in tax payments of ~~$40.6~~$9.3 million and interest payments of ~~$19.8 million. Also partially offsetting~~$4.0 million for the ~~net~~three months ended March 31, 2018. The remaining change in operating cash flow ~~decrease was a cash inflow received~~is attributable to declines in ~~2017 of $32.6 million from a spectrum channel sharing agreement.~~working capital (defined as trade receivables, accounts payable, accrued liabilities and deferred revenue), primarily due to decreases in accrued liabilities.

Investing Activities - Cash flow ~~from investing activities totaled $152.5 million for the nine months ended September 30, 2017, compared to cash~~ used for investing activities ~~of $273.3~~was $338.2 million for the three months ended March 31, 2018, compared to $12.8 million for the same period ~~2016.~~2017. The ~~2017~~ net ~~cash inflow~~increase in 2018 was primarily a result of the ~~sale~~acquisition of the majority of our ownership in CareerBuilder, which provided $198.3 million of proceeds, net of cash transferred. Additionally, we had cash inflow of $15.1 million from the sale of assets, primarily comprised of proceeds of $14.6 million from the sale of Gannett Co., Inc., common stock. These inflows were partially offset by purchases of property and equipment of $63.8 million in 2017.

~~The 2016 net cash used~~KFMB for investing activities of $273.3 million was primarily comprised of $196.8 million paid for the acquisitions of businesses (net of cash acquired) and purchase of property and equipment in the amount of $68.6$325.9 million.

Financing Activities - Cash flow provided by financing activities was $167.3 million for the three months ended March 31, 2018, compared to cash used for financing activities ~~totaled $197.2 million for the nine months ended September 30, 2017, compared to $203.3 million net outflow for the same period in 2016. The 2017 net outflow~~ of cash for financing activities was primarily due to debt activity and dividends. With regards to 2017 debt activity, prior to the completion of the spin-off, Cars.com borrowed approximately $675.0 million under a revolving credit facility agreement, while incurring $6.2 million of debt issuance costs. The proceeds were used to make a one time tax-free cash distribution of $650.0 million from Cars.com to TEGNA. We used most of the cash received to pay down our then outstanding revolving credit balance of $609.9 million. Total net payments on the revolving credit facility in the first nine months of 2017 were $635.0 million. We used an additional $99.2 million to pay down other existing debt. Additionally, in 2017 we made dividend payments of $75.1 million, paid a final dividend to the noncontrolling owners of CareerBuilder of $23.0 million, and transferred $20.1 million to Cars.com in connection with the spin-off.

The 2016 net financing outflow of $203.3 million was primarily a result of stock repurchases of $150.9 million and dividend payments of $91.6 million. These outflows were partially offset by a net debt inflow of $58.7 million primarily comprised of $310.0 million of borrowings which were partially offset by debt repayments of $249.6 million.

~~Non-GAAP Liquidity Measure~~

~~Our free cash flow, a non-GAAP liquidity measure, was $287.3 million for the first nine months of 2017 compared to $386.2~~$124.5 million for the same period in ~~2016. Our free cash flow~~2017. The change was primarily due to 2018 borrowings under our revolving credit facilities of $220.0 million (primarily for the acquisition of KFMB). In the first ~~nine months~~quarter of 2017, ~~was lower than~~we made repayments of $46.0 million on the outstanding balance of the revolving credit facilities. Also contributing to the fluctuation were dividend payments and stock repurchases, which combined resulted in cash outflows of $15.0 million in the first ~~nine months~~quarter of ~~2016 because~~2018 as compared to $37.3 million in the first quarter of the same factors affecting cash flow from operating activities discussed above. Free cash flow, which we reconcile to “Net cash flow from operating activities,” is cash flow from operating activities reduced by “Purchase of property and equipment.” We believe that free cash flow is a useful measure for management and investors to evaluate the level of cash generated by operations and the ability of our operations to fund investments in new and existing businesses, return cash to shareholders under our capital program, repay indebtedness or to use in other discretionary activities.

~~Reconciliations from “Net cash flow from operating activities” to “Free cash flow” follow (in thousands):~~

Nine months ended September 30,
2017 2016

Net cash flow from operating activities $ 351,183
$ 454,763
Purchase of property and equipment (63,846 ) (68,577 )
Free cash flow

$ 287,337
$ 386,186
2017.

Certain Factors Affecting Forward-Looking Statements

Certain statements in this Quarterly Report on Form 10-Q contain forward-looking statements regarding business strategies, market potential, future financial performance and other matters. The words “believe,” “expect,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek,” “anticipate,” “project” and similar expressions, among others, generally identify “forward-looking statements”. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results and

events to differ materially from those anticipated in the forward-looking statements, including those described under Item 1A. “Risk Factors” in our ~~2016~~2017 Annual Report on Form 10-K.

Our actual financial results may be different from those projected due to the inherent nature of projections. Given these uncertainties, forward-looking statements should not be relied on in making investment decisions. The forward-looking statements contained in this Form 10-Q speak only as of the date of its filing. Except where required by applicable law, we expressly disclaim a duty to provide updates to forward-looking statements after the date of this Form 10-Q to reflect subsequent events, changed circumstances, changes in expectations, or the estimates and assumptions associated with them. The forward-looking statements in this Form 10-Q are intended to be subject to the safe harbor protection provided by the federal securities laws.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

For quantitative and qualitative disclosures about market risk, refer to the following section of our ~~2016~~2017 Annual Report on Form 10-K: “Item 7A. Quantitative and Qualitative Disclosures about Market Risk.” Our ~~exposure~~exposures to market risk ~~has been reduced~~have not changed materially since December 31, ~~2016, due to the sale of our majority ownership in CareerBuilder, which has decreased our exposure to changes in foreign exchange rates related to CareerBuilder’s international operations.~~2017.

As of ~~September 30, 2017,~~March 31, 2018, we had ~~$379.2~~$533.1 million in long-term floating rate obligations outstanding. These obligations fluctuate with market interest rates. By way of comparison, a 50 basis points increase or decrease in the average interest rate for these obligations would result in a change in annualized interest expense of approximately ~~$1.9~~$2.7 million. The fair value of our total debt, based on bid and ask quotes for the related debt, totaled ~~$3.49~~$3.30 billion as of ~~September 30, 2017,~~March 31, 2018 and ~~$4.19~~$3.16 billion as of December 31, ~~2016.~~2017.

Item 4. Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of ~~September 30, 2017.~~March 31, 2018. Based on that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective, as of ~~September 30, 2017,~~March 31, 2018, to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 are recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

There have been no material changes in our internal controls or in other factors during the fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Other than ordinary, routine litigation incidental to our business, neither we nor any of our subsidiaries currently is party to any material pending legal proceeding.

Item 1A. Risk Factors

While we attempt to identify, manage and mitigate risks and uncertainties associated with our business, some level of risk and uncertainty will always be present. “Item 1A. Risk Factors” of our ~~2016~~2017 Annual Report on Form 10-K describes the risks and uncertainties that we believe may have the potential to materially affect our business, results of operations, financial condition, cash flows, projected results and future prospects. The information below ~~describes material changes from~~represents an update to the cybersecurity risk ~~factors~~factor disclosed in our ~~2016~~2017 Form 10-K and should be read in conjunction with the other risk factors and information described therein.

~~The spin-off~~Our efforts to minimize the likelihood and impact of adverse cybersecurity incidents and to protect our technology and confidential information may not be successful and our business could be negatively affected

Our information technology systems are critically important to operating our business efficiently and effectively. We rely on our information technology systems to manage our business data, communications, news and advertising content, digital products, order entry, fulfillment and other business processes. As such, we are exposed to various cybersecurity threats, including but not limited to, threats to our information technology infrastructure, and unauthorized attempts to gain access to our confidential information, including third parties which receive our confidential information for business purposes. We take significant measures to mitigate cybersecurity risks and defend our company against such attacks, including by conducting regular periodic training of our ~~Cars.com~~employees as to the protection of sensitive information and training intended to prevent the success of “phishing” attacks.

While we believe that we have implemented effective cybersecurity policies, procedures and capabilities, due to the evolving nature and ever-increasing abilities of cyber-attacks, we may not be successful in detecting, reporting or responding to cyber incidents in a timely manner. Depending on the severity of the breach or cyber-attack, such events could result in business interruptions, disclosure of nonpublic information, loss of sales and ~~sale~~customers, misstated financial data, liabilities for stolen assets or information, diversion of our ~~majority ownership interest in CareerBuilder has reduced the size~~management’s attention, transaction errors, processing inefficiencies, increased cybersecurity protection costs, litigation, and ~~diversification~~financial consequences, any or all of ~~our business,~~ which ~~in turn increases our exposure to the changes and highly competitive environment of the broadcast industry.~~

We now operate as a single business segment which is more exposed to the increased competition and changing regulatory environment within the broadcast industry. Broadcast companies operate in a highly competitive environment and compete for audiences, advertising & marketing services revenue and quality programing. Lower audience share, declines in advertising & marketing services revenue and increased programming costs wouldcould adversely affect our business ~~financial condition~~operations and ~~results~~reputation. We maintain cyber risk insurance, but this insurance may be insufficient to cover all of ~~operations.~~

In addition, the Federal Communications Commission (FCC) and Congress are contemplating several new laws and changes to existing media ownership and other broadcast-related regulations, regarding a wide rangeour losses from any future breaches of matters (including permitting companies to own more stations in a single market, as well as owning more stations nationwide). Changes to FCC rules may lead to additional opportunities and increased uncertainty in the industry. We cannot be assured that we will be able to compete successfully in the future against existing, new or potential competitors, or that competition and consolidation in the media marketplace will not have a material adverse effect on our ~~business, financial condition or results of operations.~~systems.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On September 19, 2017, we announced that our Board of Directors authorized a new share repurchase program for up to $300.0 million of our common stock over ~~the next~~ three years. During the ~~third~~first quarter of ~~2017,~~2018, no shares were repurchased. As of March 31, 2018, approximately $285.0 million remained available for repurchase under this authorization.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

Item 6. Exhibits



Exhibit Number	Description	Location

3-1	Third Restated Certificate of Incorporation of TEGNA Inc.	Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s Form 10-Q for the fiscal quarter ended April 1, 2007.

3-1-1	Amendment to Third Restated Certificate of Incorporation of TEGNA Inc.	Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s Form 8-K filed on May 1, 2015.

3-1-2	Amendment to Third Restated Certificate of Incorporation of TEGNA Inc.	Incorporated by reference to Exhibit 3-1 to TEGNA Inc.’s Form 8-K filed on July 2, 2015.

3-2	By-laws, as amended through ~~December 8, 2015.~~February 22, 2018.	Incorporated by reference to Exhibit ~~3-2~~3-1 to TEGNA Inc.’s Form 8-K filed on ~~December 11, 2015.~~February 27, 2018.

10-1	~~Tenth Amendment, dated as~~Form of ~~August 1, 2017, to the Amended and Restated Competitive Advance and Revolving Credit Agreement, dated as~~Executive Officer Restricted Stock Unit Award Agreement.*	Attached.

10-2	Form of December 13, 2004 and effective as of January 5, 2005, as amended and restated as of August 5, 2013, and as further amended, among TEGNA Inc., JPMorgan Chase Bank, N.A., as administrative agent, and the several banks and other financial institutions from time to time parties thereto.Executive Officer Performance Share Award Agreement.*	Attached.

31-1	Rule 13a-14(a) Certification of CEO.	Attached.

31-2	Rule 13a-14(a) Certification of CFO.	Attached.

32-1	Section 1350 Certification of CEO.	Attached.

32-2	Section 1350 Certification of CFO.	Attached.

101	The following financial information from TEGNA Inc. Quarterly Report on Form 10-Q for the quarter ended ~~September 30, 2017,~~March 31, 2018, formatted in XBRL includes: (i) Condensed Consolidated Balance Sheets at ~~September 30, 2017~~March 31, 2018 and December 31, ~~2016,~~2017, (ii) Consolidated Statements of Income for the ~~quarter~~three months ended March 31, 2018 and ~~year-to-date periods ended September 30,~~March 31, 2017, ~~and September 30, 2016,~~ (iii) Consolidated Statements of Comprehensive Income for the ~~quarter~~three months ended March 31, 2018 and ~~year-to-date periods ended September 30,~~March 31, 2017, ~~and September 30, 2016,~~ (iv) Condensed Consolidated Cash Flow Statements for the ~~year-to-date periods~~three months ended ~~September 30,~~March 31, 2018 and March 31, 2017, ~~and September 30, 2016,~~ and (v) the notes to unaudited condensed consolidated financial statements.	Attached.

We agree to furnish to the Commission, upon request, a copy of each agreement with respect to long-term debt not filed herewith in reliance upon the exemption from filing applicable to any series of debt representing less than 10% of our total consolidated assets.

*Asterisks identify management contracts and compensatory plans or arrangements.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Date: ~~November~~May 8, ~~2017~~2018	TEGNA INC.

	/s/ Clifton A. McClelland III
	Clifton A. McClelland III
	Senior Vice President and Controller
	(on behalf of Registrant and as Chief Accounting Officer)

3632



	Retirement Plans			Foreign Currency Translation (1)			Other			Total

Quarters Ended:
Balance at June 30, 2017	$	(124,632	)	$	(23,608	)	$	2,364		$	(145,876	)
Other comprehensive income before reclassifications	—			1,428			—			1,428
Amounts reclassified from AOCL	1,351			22,024			—			23,375
Other comprehensive income	1,351			23,452			—			24,803
Balance at Sept. 30, 2017	$	(123,281	)	$	(156	)	$	2,364		$	(121,073	)

Balance at June 30, 2016	$	(113,854	)	$	(23,282	)	$	1,400		$	(135,736	)
Other comprehensive loss before reclassifications	—			(1,043		)	(3,743		)	(4,786		)
Amounts reclassified from AOCL	1,075			—			—			1,075
Other comprehensive income (loss)	1,075			(1,043		)	(3,743		)	(3,711		)
Balance at Sept. 30, 2016	$	(112,779	)	$	(24,325	)	$	(2,343	)	$	(139,447	)


	Retirement Plans			Foreign Currency Translation (1)			Other			Total

Nine Months Ended:
Balance at Dec. 31, 2016	$	(127,341	)	$	(28,560	)	$	(5,672	)	$	(161,573	)
Other comprehensive income (loss) before reclassifications	—			6,380			(1,707		)	4,673
Amounts reclassified from AOCL	4,060			22,024			9,743			35,827
Other comprehensive income	4,060			28,404			8,036			40,500
Balance at Sept. 30, 2017	$	(123,281	)	$	(156	)	$	2,364		$	(121,073	)

Balance at Dec. 31, 2015	$	(116,496	)	$	(20,129	)	$	5,674		$	(130,951	)
Other comprehensive loss before reclassifications	—			(4,196		)	(8,017		)	(12,213		)
Amounts reclassified from AOCL	3,717			—			—			3,717
Other comprehensive income (loss)	3,717			(4,196		)	(8,017		)	(8,496		)
Balance at Sept. 30, 2016	$	(112,779	)	$	(24,325	)	$	(2,343	)	$	(139,447	)

(1) Our entire foreign currency translation adjustment is related to our CareerBuilder investment. As a result of deconsolidating the investment due to the sale of our majority ownership, we reclassified the translation adjustment from AOCL to the Consolidated Statement of Income as of the date of sale, July 31, 2017. Due to the noncontrolling stake that we retained in CareerBuilder, we will continue to record our ownership share of foreign currently translation adjustments through our equity method investment.



	Fair Value Measurements as of Sept. 30, 2017
	Level 1		Level 2		Level 3		Total

Available for sale investment	—		—		—		—
Total	$	—	$	—	$	—	$	—

Deferred compensation investments valued using net asset value as a practical expedient:
Interest in registered investment companies							$	14,921
Fixed income fund							13,672
Total investments at fair value							$	28,593



	Quarter ended Sept. 30,						Nine months ended Sept. 30,
	2017 (1)			2016			2017 (1)			2016 (2)

Operating revenues	$	54,874		$	340,649		$	647,021		$	999,929

Cost of revenue and SG&A expenses	60,301			228,152			522,287			708,815
Depreciation	—			9,421			19,569			24,843
Amortization	—			23,385			40,300			68,159
Loss on sale of CareerBuilder	(1,872		)	—			342,900			—
Total operating expenses	58,429			260,958			925,056			801,817

Total operating (loss) income	(3,555		)	79,691			(278,035		)	198,112

Non-operating income (expense)	647			(3,304		)	(1,078		)	(8,989		)

(Loss) income from discontinued operations, before income taxes	(2,908		)	76,387			(279,113		)	189,123
Provision for income taxes	(7,895		)	(19,689		)	45,852			(56,982		)
(Loss) income from discontinued operations, net of tax	$	(10,803	)	$	56,698		$	(233,261	)	$	132,141

(1) The quarter and nine months ended September 30, 2017 include CareerBuilder’s operations through the date of sale on July 31, 2017. Cars.com operations are included in the nine months ended September 30, 2017 through the date of spin-off on May 31, 2017.
(2) The nine months ended September 30, 2016 include approximately $7.5 million of net loss from discontinued operations related to the operations of our former Sightline business through the date of sale on March 18, 2016.



				Special Items
Quarter ended September 30, 2016	GAAP measure			Severance expense			Operating asset impairment and facility consolidation			Other non-operating items		Non-GAAP measure

Operating expenses	$	333,766		$	(2,870	)	$	(15,218	)	$	—	$	315,678
Operating income	185,851			2,870			15,218			—		203,939
Other non-operating items	(11,874		)	—			—			13,161		1,287
Total non-operating expense	(70,673		)	—			—			13,161		(57,512		)
Income before income taxes	115,178			2,870			15,218			13,161		146,427
Provision for income taxes	38,441			1,112			5,900			3,515		48,968
Income from continuing operations	76,737			1,758			9,318			9,646		97,459
Earnings from continuing operations per share - diluted ^(a)	$	0.35		$	0.01		$	0.04		$	0.04	$	0.45



				Special Items
Nine Months Ended September 30, 2017	GAAP measure			Severance expense			Operating asset impairment			Other non-operating items		Tax benefits			Non-GAAP measure

Operating expenses	$	1,022,651		$	(3,053	)	$	(11,086	)	$	—	$	—		$	1,008,512
Operating income	390,052			3,053			11,086			—		—			404,191
Other non-operating items	(26,853		)	—			—			31,991		—			5,138
Total non-operating expense	(190,515		)	—			—			31,991		—			(158,524		)
Income before income taxes	199,537			3,053			11,086			31,991		—			245,667
Provision for income taxes	54,855			1,174			4,104			6,921		11,724			78,778
Income from continuing operations	144,682			1,879			6,982			25,070		(11,724		)	166,889
Earnings from continuing operations per share - diluted	$	0.66		$	0.01		$	0.03		$	0.12	$	(0.05	)	$	0.77

				Special Items
Nine Months Ended September 30, 2016	GAAP measure			Severance expense			Operating asset impairment			Equity investment impairment		Other non-operating items			Non-GAAP measure

Operating expenses	$	959,344		$	(20,118	)	$	(18,946	)	$	—	$	—		$	920,280
Operating income	497,889			20,118			18,946			—		—			536,953
Equity (loss) income in unconsolidated charges	(2,763		)	—			—			1,869		—			(894		)
Other non-operating items	(16,029		)	—			—			—		16,324			295
Total non-operating expense	(194,236		)	—			—			1,869		16,324			(176,043		)
Income before income taxes	303,653			20,118			18,946			1,869		16,324			360,910
Provision for income taxes	92,038			7,799			7,345			725		4,583			112,490
Income from continuing operations	211,615			12,319			11,601			1,144		11,741			248,420
Earnings from continuing operations per share - diluted	$	0.96		$	0.06		$	0.05		$	0.01	$	0.05		$	1.13



	Nine months ended September 30,
	2017			2016

Net cash flow from operating activities	$	351,183		$	454,763
Purchase of property and equipment	(63,846		)	(68,577		)
Free cash flow	$	287,337		$	386,186