NY Times Reports Loss in Second Quarter

NYTlogoThe NY Times Company reported a loss of $211,000 in the second quarter as revenues declined 2.7%.

Operating profit at the company decreased to $9.1 million in the second quarter of 2016 from $38.1 million in the same period of 2015. The decline was driven by costs incurred in connection with the streamlining of the Company’s international print operations, a charge for a partial withdrawal obligation under a multiemployer pension plan and lower advertising revenues.

“We once again saw a robust quarter in terms of digital subscriber growth, with 51,000 net paid digital-only subscriptions to our news products added in Q2 and growth of 22 percent year-over-year. Much of our success in building our digital pay model is the result of a renewed effort to clearly communicate the value of Times journalism and our products through mission-related, native messaging to an expanding number of highly engaged readers,” said Mark Thompson, president and chief executive officer, The New York Times Company.

“Advertising was tougher in the quarter, particularly on the print side. In digital, we saw very strong growth in mobile, video and virtual reality, branded content and programmatic advertising. These were not enough to offset declines in traditional web display in Q2, which led to an overall decline in digital advertising. However, we expect that situation to improve in the second half of the year; in fact, we are already seeing a marked turnaround in July. We expect to deliver strong revenue growth from both digital advertising and our digital consumer business in Q3.

“And finally, in the quarter, we have undertaken a variety of steps to keep our cost base in line and will continue to maintain a mindful eye in this respect.”

The company has offered buyouts to employees this year to reduce costs and layoffs are possible. The newsroom at the NY Times employs 1,300.

Total revenues for the second quarter of 2016 decreased 2.7 percent to $372.6 million from $382.9 million in the second quarter of 2015. Circulation revenues increased 3.0 percent, while advertising revenues declined 11.7 percent and other revenues increased 4.0 percent.

Circulation revenues rose as revenues from the Company’s digital subscription initiatives and the 2016 increase in home-delivery prices at The New York Times newspaper more than offset a decline in print copies sold. Circulation revenue from the Company’s digital-only subscriptions (which includes news product and Crossword product subscriptions) increased 15.3 percent compared with the second quarter of 2015, to $56.4 million. Circulation revenue from digital-only subscriptions to our news products increased 14.0 percent to $54.1 million.

Paid digital-only subscriptions totaled approximately 1,424,000 as of the end of the second quarter of 2016, a net increase of 67,000 subscriptions compared to the end of the first quarter of 2016 and a 25 percent increase compared to the end of the second quarter of 2015. Of the 67,000 net additions, 51,000 net additions came from the Company’s digital news products, while the remainder came from the Company’s Crossword product.

Second-quarter print advertising revenue decreased 14.1 percent while digital advertising revenue decreased 6.8 percent. Digital advertising revenue was $45.0 million, or 34.3 percent of total Company advertising revenues, compared with $48.3 million, or 32.5 percent, in the second quarter of 2015. The decrease in print advertising revenues resulted primarily from a decline in display advertising. The decrease in digital advertising revenues primarily reflected a decrease in traditional website display advertising, partially offset by increases in revenue from our mobile platform, our programmatic buying channels and branded content.