* Q3 adj loss of 1 cent vs. Wall St view EPS 8 cents
* Revenue up almost 1 pct, misses estimates
By Jennifer Saba
Oct 25 The New York Times Co reported
worse-than-expected results on Thursday as advertisers cut
spending on both print and digital outlets, sending shares down
Meanwhile, on a conference call with analysts about the
results, Chairman Arthur Sulzberger Jr. said he supported Mark
Thompson, the incoming president and chief executive, and
addressed the scandal roiling Britain's BBC, where Thompson
served in the top job until September.
The British Broadcasting Corp has been damaged by the
accusations of sexual abuse of young girls and women by a former
TV host, the late Jimmy Savile. The scandal also involves a BBC
news program on Savile that was shelved.
Sulzberger said Thompson "provided a detailed account" of
his involvement with the program and is starting as planned on
"I am satisfied that played no role in the
cancellation of that segment," Sulzberger said. "Our opinion ...
remains that he abides by high ethical standards and is the
ideal person to lead our company."
The New York Times public editor has questioned whether
Thompson is fit to serve as CEO. He has not been implicated in
Earlier, the company reported that revenue was up almost 1
percent to $449 million. Still, the result missed the analysts'
consensus estimate of $479.23 million, according to Thomson
Adjusting for severance costs and other special items, the
company reported a quarterly loss of 1 cent per share, well
below expectations of earnings of 8 cents per share.
The slight uptick in revenue was due to a 7.4 percent rise
in circulation revenue helped by the company's digital
But as the company tries to rely more on circulation for its
revenue, advertising sales are in a persistent slump.
"It wasn't a nice quarter on revenue," said Edward Atorino,
an analyst with Benchmark Co. "The advertising numbers look
terrible. I thought they might do a little better. They are
caught up in the downslide like everybody else."
The stock dropped 16 percent to $8.93 in afternoon trade.
DIGITAL REVENUE DROPS
Print ad revenue, coming primarily from its namesake
newspaper and the Boston Globe, dropped almost 11 percent from a
year earlier - an even steeper decline than the previous
Digital ad revenue, which has been a bright spot for the
company, fell 2.2 percent.
The company attributed the declines to the "challenging
economic environment, ongoing secular trends and an increasingly
complex and fragmented digital advertising marketplace."
Advertising revenue at The New York Times depends largely on
national accounts from sectors like telecommunications and
technology that use the newspaper to reach people across the
"I think that really reflects that national newspaper
revenue is much more exposed to secular pressures than the local
retailer," said Leo Culp, an analyst with Citi.
The trend of declining national ad revenue was apparent at
Gannett Co, the largest newspaper chain in the United
States, and its national newspaper USA Today, a competitor to
While Gannett turned in better-than-expected results last
week, national advertising, primarily through USA Today, was
down almost 8 percent at its U.S. newspapers.
The clampdown by advertisers is expected at the New York
Times into the next quarter - typically the strongest one for
the newspaper industry as it's buoyed by holiday spending.
The company said it expects the same advertising trends in
the fourth quarter as the third period.
Paid subscribers to the digital editions of The New York
Times and sister paper International Herald Tribune increased 11
percent and totaled 566,000.
Once a sprawling media conglomerate, The New York Times has
tightened its focus and shed assets. Over the past year, it sold
a group of newspapers in the U.S. Southeast and in California,
digital property About Group and stakes in sports ventures
including the Boston Red Sox and Liverpool Soccer Club.
It is now down to a handful of newspapers, including its
flagship, the Boston Globe, the Worcester Telegram & Gazette and
the International Herald Tribune.