The New York Times reported Wednesday that advertising revenue in the second quarter fell by 43.6% compared to the same period last year. Digital advertising was down 32% and print 55%.
With Tribune Publishing reporting results later Wednesday and Gannett Thursday morning, we will get a read on whether the Times may have been harder hit than regional papers and their digital sites in the pandemic-related ad recession.
The Times’ biggest categories — tech, luxury goods and entertainment — all suffered, executives said, the latter especially with theaters and movie releases all but shut down.
By way of a silver lining, the company offered that for the first time total digital revenues topped print — though it would doubtless have preferred not to back into that milestone.
The Times did record its single best quarter of digital subscription growth — adding 493,000 subscribers to its main news product and 176,000 to its other digital products like cooking and crosswords for a total net gain of 669,000.
The record came even as the Times was reducing its own subscription marketing effort by more than half.
It goes to show, CEO Mark Thompson said in a conference call with analysts, that “the power of great journalism” is the most important driver of subscription revenue.
The company expects more of the same for the balance of the year — projecting that digital subscription revenue will be up 30% year to year in the third quarter as advertising revenue falls 35 to 40%. The home stretch of the presidential election should keep news interest high even as the traffic bumps from the pandemic and protest marches level out.
Chief operating officer Meredith Kopit Levien (who succeeds Thompson in the top job in early September) talked about the company’s acquisition of Serial Productions and its ambitions to grow audio as a business line.
The company’s own podcast, The Daily, reaches an average audience of 3.5 million, she said, “mostly people who (initially) never read the paper.” Since the podcast consists of a single story, the hope is that listeners will come back for more on the site, register to receive newsletters and promotions and begin the path that leads to a subscription order.
An analyst asked if the company planned to begin charging for access to The Daily. Kopit Levien said no — The Daily’s advertising generates important revenue. The Times expects further revenue growth as its audio offerings expand.
Video is less vibrant as a business, she said. The company is cutting “The Weekly,” its Netflix show, back to monthly frequency and renaming it “The New York Times Presents” — but still sees video as a strong added format to promote the brand.
The digital and news-first emphasis is accelerating, the two executives said. Print subscriptions continued to fall in the quarter. The company trimmed expenses mainly by reducing its ad sales force and spending less on printing and distribution. Spending on journalism actually increased.
Thompson said that the Times now employs roughly 1,750 journalists and that that number will grow as the drive for digital subscribers continues.
Rick Edmonds is Poynter’s media business analyst. He can be reached at email@example.com.