Magazines have been facing dwindling advertising revenues for years as the Internet continues its dominance over print and Time Warner Inc (NYSE:TWX) was looking to lose the anchor. Presently, Time Inc. is trading at $22.60 down $0.88 or 3.85%. After opening at $23.07 the stock made a precipitous drop as trading opened and the stock dropped below the $22 mark nearly immediately. It has subsequently fought its way back shedding half its early loss.

Time Inc

Time Inc cutting costs while making wise investments

“The greatest challenge is to get our organization focused on things need to do to for the future,” Time Inc. Chief Executive Officer Joe Ripp said while interviewed on Bloomberg TV earlier today. “We’re working with the entire organization to say, ‘How we do things differently?’ It’s not just about cutting costs — it’s about investing the dollars we save.”

While People (magazine) and Sports Illustrated remain popular titles, costs must still be cut in order for the new company to succeed. Ripp has cut staff and those remaining are in a tentative flux at as the company looks to build its online offerings around the established brands in print. Time sent 6% of its workforce packing last year when it cut 500 jobs.

Beyond cuts to staffing, there are other costs the company is looking to rein in in order to be successful on its own. For example, at present, the company has multiple test kitchens for its cooking magazines and the publisher is looking into whether or not one kitchen could be shared between them.

An analyst remains optimistic

Marci Ryvicker, an analyst at Wells Fargo & Co. in New York, however, remains optimistic about the newly spun-off company and maintains a stock value between $27 and $29, essentially a “buy” rating.

“The good news is that Time has massive scale and audience reach, to go along with a solid reputation and brand recognition,” Ryvicker said in a research note. “To take advantage of these strengths, management plans to invest in new technologies and talent that should help complement its existing brands, and allow Time to find additional streams of revenue.”

With newsstand and subscription dales down 11% to $1.1 billion last year, advertising revenues dropped 6% to $1.8 billion for the same year. Time Inc. expects sales to pick up this year but still anticipates a drop in sales around 5% in 2014.

Time Inc.’s advertising revenue fell 6 percent to $1.8 billion in 2013, compared with two years earlier, while newsstand and subscription sales plummeted 11 percent to $1.1 billion.

“The spinoff of Time Inc. completes the process we began several years ago to position Time Warner as the world’s leading video content company,” Time Warner CEO Jeff Bewkes said today in a statement. “The spinoff gives Time Warner even more focus as we continue to deliver on this strategy.”

Time Warner Inc (NYSE:TWX) is presently (12:03PM EDT) trading at $69.09 up $0.94 or 1.38%.