New York Times Turns A Profit, Says Ready To Take On WSJ

Apr 22, 2010 7 Comments ›› Pat Dollard

WASHINGTON (AFP) – The New York Times posted a first quarter net profit Thursday, turning around a loss in the same quarter a year ago, and said it was ready to meet a challenge from the upcoming New York edition of The Wall Street Journal.

“When you’re the lead dog people are constantly going to go after you, whether it be The Wall Street Journal or other magazines or other platforms,” Times Co. president and chief executive Janet Robinson said.

“We don’t shy away from the competition, we never have and we never will,” Robinson told financial analysts after the Times Co. reported its earnings for the first quarter.

“We fully understand how to compete and in fact we enjoy it,” she said.

Wall Street Journal owner Rupert Murdoch plans to unveil a New York edition of the newspaper on Monday in a bid to compete for readers and advertising dollars with The New York Times on its home ground.

Murdoch, in a speech last month, said the Journal’s new section will be “feisty” and will “cover everything that makes New York great: state politics, local politics, business, culture, and sports.”

Robinson said she does not expect advertisers to abandon the Times for Murdoch’s Journal.

“The advertisers are aware of the fact that our audience is 22 million in print and online versus the Journal’s 13 (million),” she said. “They’re well aware of the fact that 75 percent of Wall Street Journal readers already read The New York Times.”

On the earnings front, the Times Co. said cost-cutting and an improved advertising climate helped the owner of the flagship New York Times, Boston Globe, International Herald Tribune and 15 other dailies reverse losses of a year ago.

The Times Co. reported a net profit of 14.15 million dollars compared with a loss of 74.22 million dollars in the same quarter a year earlier.

Revenue declined 3.2 percent year-on-year to 588 million dollars, but was an improvement from the 11.5-percent slide of the previous quarter.

Advertising revenue declined 6.1 percent in the quarter to 313 million dollars with print advertising revenue falling 12.3 percent.

Digital advertising revenue rose 18.3 percent to 80 million dollars.

“As the quarter progressed we saw acceleration in the rate of advertiser spending across our newspapers, websites and other platforms, reflecting a firming of economic conditions,” Robinson said.

She said online advertising revenue increased to 26 percent of total ad revenue in the first quarter, up from 20 percent a year earlier.

“Once again strong cost control was a leading contributor to our improved operating performance in the quarter,” Robinson added.

The Times Co. brought down operating costs by 18 percent in the quarter to 535.2 million dollars, helped by a series of job cuts at the Times last year and lower newsprint prices.

Like other US newspaper groups, the Times Co. has been grappling with declining print advertising revenue, falling circulation and the migration of readers to free news on the Internet.

Robinson said a plan to begin charging online readers early next year for full access to of NYTimes.com was on track. “We made further progress in the areas of product design and development towards that launch,” she said.

The Wall Street Journal is one of the few US newspapers charging readers for full access to its website and Murdoch has announced plans to eventually make readers pay for online access to all of the newspapers in his stable.

Times Co. shares were 3.45 percent lower in early afternoon trading on Wall Street at 12.30 dollars.