New results from the New York Times Co., Gannett and the Tribune Co. show major newspaper properties continuing to suffer as ad dollars continue to desert print for the Web.
The disappointing results underscored the increasingly tough economic times faced by the industry as advertisers continued to shift their focus away from print to the Internet. In particular, areas like real estate and classified, previously rich revenue generators for newspapers, continued to be weak.
The New York Times Company reported a 26 percent decline in its first-quarter profit. Earnings were $23.9 million, compared with $32.4 million last year. Stripping out special items like staff reduction costs, an accelerated depreciation charge and a tax adjustment, the company’s earnings of 25 cents a share were the same as a year ago.
Within the Times Company’s news media group, which includes The New York Times and The Boston Globe, overall advertising revenue decreased by 4.3 percent. Advertising revenue at The New York Times Media Group declined 3.5 percent, and it was down 4.2 percent at The New England Media Group.
While newspaper companies have been eager to highlight how fast their Internet advertising is growing, the Times Company decided to reduce its 2007 guidance for Internet revenue growth, suggesting that the transition from a print advertising model may be a long time coming.
“Clearly this is not going to be a bang-up year for the newspaper business,” said John Morton, an independent newspaper analyst. “There is stiff competition for Internet advertising, and the transition will take longer and may well be less profitable than was anticipated.”
In a statement, Janet L. Robinson, the chief executive of the Times Company, described the advertising environment as “difficult.” She also mentioned the recent 31 percent increase in the company’s dividend and said that the company’s dividend yield of 4 percent was above its peers.