During the election campaign, and even after assuming office, President Donald Trump has been critical of media houses, saying they were biased. He also said many of the media superpowers were on the verge of failing. The New York Times (NYSE:NYT) was a top target of Trump. He went into a Twitter war with the news group.
It seems Trump may have been right about NYT at least. On Thursday, the New York Times announced the fourth quarter financial results of 2016. The company also disclosed the full year report, and the story isn’t a happy one. The silver lining, however, is that their digital subscription has grown impressively.
Poor Financial Results Disclosed By The New York Times
According to the report, the per share earnings of New York Times has come down to 24 cents in the last quarter, from 31 cents for each share for the same period of 2015. This is quite a big slip, which will surely worry the management and their investors. That’s not all. When adjusted from “continuing operations”, the NYT stock has come down from the 37 cents for each share of the last quarter of 2015 to 30 cents for each share in 2016.
Operating profits of the business have also come down to $55.6 million in the last quarter. In the same period of 2015, it was way higher at $87.7 million.
In the last quarter, they earned a profit of $95.7 million, which is down from the $117.7 million earned in the same quarter of 2015.
The company issued a statement shortly after disclosing the results. They are saying most of the loss of profit was because of pension settlement charge, which includes payments made for former employees, and also the fall in advertising revenues from print. To make matters worse, their operating costs has gone up at the same time.
Marked Improvement in Digital Subscriptions
Mark Thompson, the President and CEO, disclosed the number of digital subscriptions has gone up by 276,000 in the fourth quarter. This is the best increase in the last five years, which will surely give The New York Times new hope.
In fact, not just The New York Times (NYSE:NYT), but many other traditional newspapers and even television news channels are reporting falling revenues and lower profits because they are losing readership and viewership to internet news channels. It’s a common problem. And like the NYT, many of them are trying to compensate by boosting their web presence and subscriptions.