The New York Times’ $50 million plan to increase its audience and revenue by catering more to international audiences is off to a rough start after the paper posted a loss for the second consecutive quarter this year.
The Time’s Sydney Ember wrote “revenue fell 3 percent, to $373 million from $383 million, in the same quarter a year earlier, as The Times continued to struggle with declining advertising revenue.” Digital ad revenue makes up about one-third of the Time’s income, and it wasn’t in good shape last quarter.
“Total advertising revenue fell about 12 percent, to $131 million,” Ember wrote. “Print advertising revenue slid 14 percent in the quarter, and digital advertising revenue dropped 7 percent, to $45 million.”
“The company reported a slight net loss of about $500,000 for the quarter, compared with net income of $16 million in the second quarter of 2015,” she wrote.
“Digital advertising was somewhat lower than we expected for the quarter,” CEO Mark Thompson said during a Thursday earnings call. He admitted increases in some ad sales were “not enough to offset declines in web home page and other traditional display advertising.”
The earnings report comes after Thompson, former BBC head, launched a massive effort to attract more readers abroad who would be willing to pay to read the Times. Thompson’s plan is to spend $50 million over three years on “a new era of international growth,” Politico reported in May.
It’s a bid to make more money by becoming less American. NYT officials already believe they have a distinctly American brand with readers abroad, but their plan is to put out more internationally appealing content.
“Every part of the company … needs to think creatively about attracting and retaining a bigger non-American audience and growing revenue outside the U.S.,” Thompson wrote in an april staff memo. “We intend to cultivate a much larger and deeper readership in core markets abroad.”
“We have this extraordinary brand recognition around the world, but not a lot of relevance,” Lydia Polgreen, the head of NYT Global, told Politico.
“People know who we are, but they don’t have any sense that we are for them,” she said. “Every single product we have, all of them are really great, and all of them are designed with the U.S. audience in mind.”
The Times kicked off its international plan in February with the launch of The New York Times en Español for its Latin American readers. The paper also plans to expand its reach into some 10 key markets, including Europe, India and Japan.
Thompson expects advertising losses to decrease to single digits next quarter, but eventually expects double-digit growth in ads.
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