The New York Times Company (NYSE:NYT) which generally reports other company’s earnings, announced its second quarter earnings today. NY Times reported a second-quarter loss today, mainly due to write-down in the value of About.com and continuing decline in print and digital advertising revenue.
The total net loss amounted to $88.1 million or 60 cents a share against loss of $119.7 million, or 79 cents a share a year earlier. However revenue increased by 0.6 percent to $515.2 million due to increases in circulation and digital subscriptions, which exceeded the analysts’ average expectation of $510.9 million. The Times posted an operating loss of $143.6 million, compared to operating profit of $31.5 million for the same period last year. A $194.7 million write-down of About.com, the online resource guide that the company bought in 2005, robbed much of its profit. Similarly, last year in second quarter, the Times company wrote-down $152 million on the Regional Media Group, which it sold to Halifax Media Holdings in January for $143 million.
The Advertising revenue from group companies including, The Times, The International Herald Tribune, and The Boston Globe, fell 6.6 percent, to $220 million. Print advertising revenue declined by 8 percent, mainly due to slow real estate advertising. Despite efforts to push in video to add new clients to NYTimes.com., online ad revenue decreased 1.6 percent, to $52.6 million. However, Circulation revenue saw an increase of 8.3 percent, to $233 million, owing heavily to a price increase in home-delivery subscriptions, and also to single-copy plans introduced in January. One more strategy that worked well, was replacing the old online subscription program with the new one. Under the new approach, the earlier threshold of reading 20 free articles on NYTimes.com, was replaced by 10 free articles per month, after which readers must pay for subscription.
Digital subscriptions, up 12 percent, helped to improve circulation revenue, compared with advertising revenue of $171 million. Excluding depreciation, amortization, severance, and special items, profits from operations increased by 6.5 percent, to $78.1 million, against $73.4 million for the period last year. The Times Group gained $37.8 million in the quarter from the sale of remaining units of Fenway Sports Group.
According to chairman and chief executive, Arthur Sulzberger Jr., results “reflect our ongoing strides in repositioning the Times Company for an increasingly multiplatform future,” though; he cautioned that “the advertising market remains challenging.”
The Times Company is in search for its new chief executive to succeed Janet L. Robinson, who left the company last year after Mr. Sulzberger decided on a leadership change. A source close to the company hinted that successor may be announced by September this year.