READERS UP, ADS DOWN: The New York Times reported second-quarter earnings Thursday that again showed encouraging returns in digital subscriptions but single-digit declines in advertising.
Print and digital advertising revenues declined 6.8 and 2.7 percent, respectively, in keeping with industry-wide advertising trends.
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The decline was offset by the paper’s digital subscriptions, which grew to 699,000, a 35 percent increase year-to-year, including the company’s International Herald Tribune, to be re-branded in October as the International New York Times.
Still, improvements in circulation have not kept up with the steady drop in spending by advertisers, so a lot of the analysts on Thursday’s earnings call wondered how the Times planned to narrow the gap. Should they just assume more of the same trend coming forward, chief executive officer Mark Thompson was asked.
“I absolutely do not think that we should be satisfied with a continued contraction of digital advertising revenue. We are looking for solutions,” he said.
To turn things around, Thompson repeatedly touted the hire of an outsider to the Times, Meredith Kopit Levien, formerly chief revenue officer at Forbes, who started Monday as the chief ad boss. A longtime Times ad executive who was seen as a candidate for that job, Todd R. Haskell, separately said Monday he was leaving in September to join Hearst Magazines. Levien is tasked with improving the Times’ traditional advertising business and also expanding new sources of revenue, like live events, one of the areas she spearheaded at Forbes.
One exception to the advertising declines is T: The New York Times Style Magazine, which thanks to a fall issue that is its largest since 2008, got a special citation from Thompson as “a great advertising platform for luxury goods.”
Even as Thompson defended the Times’ efforts to improve advertising, he said it was imperative to grow other revenue streams, especially those where there was already signs of health, like circulation.
His priority is growing the number of subscribers by offering a broad array of new, digital products, including subscriptions to be sold at a range of price points, and brand extensions, like apps, e-commerce and games. Thompson revealed little about those products, which he called “flavors,” beyond saying they were in the development stage.
Executive editor Jill Abramson described some of those new digital products in a memo from mid-July describing new positions for several editors. Sam Sifton, the national editor, is now in charge of developing an “immersive digital magazine experience,” different from the Sunday weekly, in the vein of interactive multimedia features like the popular “Snow Fall.” And Cliff Levy, deputy metro editor, is working on a lower-priced digest of the Times called Need to Know.
Thompson said those products will be rolled out in the first half of next year.
For the second quarter anyway, the Times company, which includes the Herald Tribune and the Boston Globe properties, told a story of stability. Revenues stayed steady with a decrease of only 0.9 percent to $485.4 million from $489.8 million, while operating profits equaled $53 million, up from roughly $44 million at the same time last year.