Digital revenue saves the day at NY Times as print ads fall
THE NEW York Times Company on Wednesday reported a steep decline in print advertising revenue for the third quarter, adding to the newspaper industry’s woes.
For the quarter, print advertising revenue fell 19 percent, driving an 8 percent decline in total advertising revenue. The drop followed a 14 percent decline in print advertising revenue in the second quarter.
Digital advertising revenue, however, which now represents 36 percent of the company’s advertising revenue, increased 21 percent in the quarter, to $44 million, a welcome relief for the company after a decline in digital advertising last quarter.
The Times also added 116,000 net digital-only subscriptions for news products during the quarter, bringing its total to 1.3 million. Including crossword product subscriptions, it has about 1.6 million digital-only subscribers.
Digital success
This is an anxious and challenging time for the newspaper industry. The Times results were announced the same day that the Wall Street Journal informed its staff of sweeping changes to its print paper, including a cutback to its Greater New York section.
On Tuesday the Gannett Co, the publisher of USA Today and more than 100 other papers, walked away from its deal to acquire Tronc, formerly Tribune Publishing, in part because of the financial obstacles involved.
Print advertising revenue, which once sustained newspaper companies, has been falling for years.
But the pace of the decline has accelerated, and digital advertising and other forms of revenue have not yet bridged the gap.
In an earnings call on Wednesday, Mark Thompson, chief executive of the Times Co, said it had been “a much tougher quarter for print advertising” for the company, but he focused largely on the company’s digital success.
At the Times, adjusted operating profit, the company’s preferred method for assessing performance, fell to $39 million, from $48 million in the same quarter a year earlier.
The Times took a $2.9 million charge related to the closing of its Paris editing and prepress operations.
Circulation revenue increased 3 percent, to $217 million, as digital-only subscription revenue rose 16 percent, to $59 million. Total revenue for the quarter fell 1 percent, to $364 million from $367 mil- lion in the same period last year. This year, the Times began a sweeping review of its newsroom to determine how to transform it for a digital age. The resulting report is expected to be released in some form in the next few weeks.
At the same time, the Times has aggressively pursued new revenue opportunities, including a virtual reality video project introduced on Tuesday, the Daily 360.
Anxiety in the newsroom
During the earnings call, Thompson said the company would continue to focus on lowering its costs.
At the Wall Street Journal, employees say anxiety in the newsroom has been particularly high since buyouts were announced in mid-October.
On Wednesday, Gerard Baker, the editor in chief, outlined a revamping of the Journal’s print newspaper that will be introduced November 14.
The Journal will also combine two business sections in the paper – Business & Tech and Money & Investing – into one, and will consolidate its coverage of arts, culture, entertainment and sports coverage that was in the paper’s Personal Journal and Arena sections into a new section called Life & Arts that will be in the main section of the paper.