Davenport, Iowa – Lee Enterprises has reported $2 million in recovery costs after a ransomware attack in February that disrupted its operations and affected its financial performance.
The attack, which encrypted key applications and stole data, forced the company to halt billing and payments temporarily, impacting second-quarter advertising revenue. Lee Enterprises owns newspapers in 72 markets across 25 states, including the Omaha World-Herald, St. Louis Post-Dispatch, and Buffalo News.
“While technical recovery is complete, we’re still dealing with financial impacts,” said Tim Millage, VP, CFO, and treasurer, during a recent earnings call. He added the company is working to improve its balance sheet by reducing outstanding payments and accounts receivable.
To support recovery, Lee’s lender, BH Finance, waived interest and rent payments for March, April, and May. The company currently holds $453 million in debt under its agreement with BH Finance.
Millage noted that insurance claims are ongoing, and some recovery costs may be reimbursed.
For the quarter, Lee Enterprises reported $137 million in total revenue. Digital revenue rose 3% year-over-year to $73 million. However, the company posted a net loss of $12 million for the period.
The ransomware group Qilin claimed responsibility for the attack, alleging it had stolen 350 gigabytes of data and threatened to leak it. Lee Enterprises said it was aware of the claim and continues to investigate but has not confirmed how the attackers breached its systems.
Cybersecurity firm Sophos previously linked Qilin to phishing attacks on managed service providers.
The incident highlights the costly aftermath of ransomware attacks. Forrester estimates the average data breach cost reached $2.7 million in 2024.
“It’s critical to have strong incident response processes,” said Allie Mellen, principal analyst at Forrester. “In ransomware cases, every minute matters to protect business continuity.”
