New York Times revenue misses as print ad sales fall again

Digital ad revenue up 14.2% to $48.3m in second quarter

Circulation revenue grew slightly, helped by a 13.8 per cent rise in revenue from digital-only subscription products

Circulation revenue grew slightly, helped by a 13.8 per cent rise in revenue from digital-only subscription products

 

The New York Times reported lower-than-expected quarterly revenue as its print advertising sales fell for the fourth straight quarter.

Shares of the company, which also forecast a decline in its current-quarter ad revenue, fell as much as 6 per cent on Thursday.

Newspaper and magazine publishers are struggling to arrest the fall in their print ad revenue, caused by advertisers’ increasing preference for digital platforms as readers turn to smartphones and tablets.

The shift to digital platforms has also hurt US cable companies, with Viacom, Walt Disney, Twenty-First Century Fox, Discovery Communications and Time Warner reporting disappointing quarterly numbers.

New York Times’ print ad revenue fell 12.8 per cent in the second quarter.

“I think overcoming the decline in print is sort of like trying to overcome gravity,” FBR Capital Markets analyst William Bird said.

New York Times’ advertising revenue fell 5.5 per cent to $148.6 million. The company said it expected a mid-single digit percentage decline in its ad revenue in the current quarter.

However, New York Times’ digital ad revenue rose 14.2 per cent to $48.3 million, accounting for about a third of its total ad revenue.

Circulation revenue grew slightly, helped by a 13.8 per cent rise in revenue from digital-only subscription products. New York Times said its paid digital-only subscriber base topped 1 million as of July 30th.

The company needs to “continue execution on digital” to return to a path of revenue growth, Mr Bird said.

Net income attributable to New York Times’ shareholders jumped 78.5 per cent to $16.4 million, or 10 cents per share, in the second quarter, helped partly by cost cuts.

Operating costs fell 4.9 per cent to $344.8 million. The company said it expected operating costs to fall by low-single digit percent in the third quarter.

Excluding items, New York Times earned 13 cents per share.

Revenue declined 1.5 per cent to $382.9 million.

Analysts on average had expected a profit of 11 cents per share and revenue of $383.5 million, according to Thomson Reuters I/B/E/S.

Reuters