The New York Times Company (NYT) plans to trim its workforce to rein in costs amid dwindling print advertising demand and divest resources to digital offerings. The move will involve the elimination of 100 workers across the newsroom section and a few more from other business operations. This diversified media conglomerate has also decided to shut down NYT Opinion, a mobile app, as it failed to generate enough subscriptions.
Advertising, which remains a significant source of revenue, is largely dependent upon the global financial health. Softness in print advertising demand has been weighing on The New York Times Company’s performance. This Zacks Rank #3 (Hold) stock saw its print advertising revenue decreasing 6.6%, and total advertising revenue falling 4.1% in the second quarter of 2014. The company expects total advertising revenue to decline in the mid single-digit range in the third quarter.
Consequently, the company is trying every means to shield itself from the impact of an unstable market and contemplating on new revenue generating avenues.
The New York Times Company has been adding diverse revenue streams, which include a pay-and-read model to make it less vulnerable to economic conditions. The company is also adapting to the changing face of the multiplatform media universe, and has already included mobile and reader application products to its portfolio. Other publishing companies such as Journal Communications, Inc. (JRN), The E.W. Scripps Co. (SSP) and Gannett Co., Inc. (GCI) are also trying to adapt to different revenue generating ways.
Earlier, Gannett had also announced the elimination of 60 to 70 staff across the newsroom section and other business operations. The move is being seen as part of Gannett’s restructuring plan to split its print business from its profitable broadcasting and digital ventures.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment