Opening the call by immediately citing the troubled economy and the challenges faced by the newspaper industry at large, Janet Robinson, NYTCo.’s president and CEO, sought to highlight a few bright spots. Even with the decreased operating income and revenue, Robinson pointed to what she said was the NYT’s continued brand strength, reflected in 2 percent growth in circulation revenue in the face of raising newsstand and home delivery prices. The newsstand price will rise again on August 18 from $1.25 to $1.50, Robinson noted.
On NYTimes.com, traffic is continuing to grow, with 17.7 million uniques last month, up roughly 40 percent over last year, Robinson said, citing Nielsen Online data. But on the ad side, the economic slowdown has affected advertising, in particular in the airlines and autos area. Trying to offset what she described as softness in display, digital investments are expected to rise — and therefore lead to increased costs — for the About Group.
— Asked about the online ad situation, Martin Nisenholtz, SVP, Digital Operations, insisted that pricing has generally held firm. “We’ve seen decent price increases on major display units. There has been a bifurcation between premium positions and remnant, which largely includes banner. At NYTimes.com, we don’t see any cannibalization from the remnant business. At About.com, we’ve seen softness in display, mainly due to execution issues, which current investment proposals are attempting to address.”
— Of the major ad categories, entertainment cutbacks particularly hurt the June numbers. The category represents a little over 10 percent of the company’s ad revenues. Executives said that other categories have followed previous trends. Looking ahead to 2009, Robinson said she sees a tough second half, and signs suggest that the housing market won’t make a comeback until the end of next year. She doesn’t expect an impact from the Newsday sale.
— Asked about what sort of results NYTCo (NYSE: NYT). is seeing from digital subscriptions and sales on the Amazon (NSDQ: AMZN) Kindle, Nisenholtz said he feels the trends are good, but a confidentiality agreement with the e-tailer prevents further the company from getting into the details. Nisenholtz: “The Kindle is attracting attention. We’re the 11th or 12th most popular item being purchased there. But I would characterize it as more of an R&D effort, rather than a revenue generator.”