NY Times 2Q Profits Drop 82%

From the Financial Times

The New York Times suffered a 16.4 per cent decrease in June advertising revenues and warned on Wednesday that the effects of high oil prices, a slowing economy and the housing crisis were likely to weigh on its prospects for some time.

“I think it’s clear that many of the advertising budgets are tightening up,” said Janet Robinson, chief executive of the New York Times Company, predicting a “tough” second half of the year.

June performance followed an 11.9 per cent decline in May advertising revenues, and suggested that an already deep erosion in newspaper advertising could be accelerating. Ms Robinson said the company would respond by raising newsstand prices for the New York Times from $1.25 to $1.50 per copy beginning in August, marking the paper’s second increase in a year.

That announcement came as the company reported that second-quarter profits fell 82 per cent to $21m, or 15 cents per share, compared with the same period a year ago, when it benefited from a $94m gain from the sale of television stations.

Excluding that and other one-time events, income from continuing operations was down 5.5 per cent for the quarter. Revenue fell 6 per cent to $742m.

The New York Times Company’s results were the latest sign of gloom from the newspaper industry, which is now feeling the effects of a slowing economy as it grapples with an ongoing migration of readers and advertisers to the internet.

Faster please.

UPDATE:
The Rapid Decline of the New York Times

The core newspaper franchise maintains its residual magic as a brand name; and within the lush niche — urban professional high income people of sophisticated tastes and liberal politics — the Times has carefully cultivated, its name remains incomparably authoritative.

EXACTLY. The Times has become a niche newspaper catering to a niche market. In other industries this would required downsizing, which the Times is doing. But that also means that it no longer support the resources that allow it to appear authoritative to its niche. Between a rock and a hard place.