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USA Today is warning that it expects its circulation to drop 17 percent, the largest fall-off in its 27-year history. Citing a staff memo from USAT Publisher David Hunke, E&P reported that the average circulation at the Gannett (NYSE: GCI) owned weekday-only daily was 1.88 million from April through September for a loss of 398,000 copies. Putting that drop-off in context, E&P’s Jen Saba compared that figure to the entire daily circ of The Arizona Republic the 10th largest paper in the U.S. as of last spring. As advertising revenue declines deepen, circulation dollars have become more precious to newspapers like USAT. As a result of the falling circ numbers, the segment’s revenues are expected to be flat in Q3, thought the Hunke says it will turnaround next year.
The losses stem primarily from USAT’s reliance on hotel distribution. The loss of some automatic Marriott hotel deliveries to its guests and the reduction of travelers in general has caused the losses, on top of the general cutbacks in newspaper subscriptions due to the economy and readers’ migration to the internet. Though USAT it still has its title as the number one daily for the moment, when the Audit Bureau of Circulations releases the latest numbers on Oct. 26, it is very likely to could lose that perch and slip to second place.
Earlier this week, USAT released its second iPhone app, AutoPilot, which is geared to travelers, which the paper still considers one of its key audience segments. During Gannett’s Q2 earnings call, Gannett EVP/CFO Gracia Martore said the company was trying to secure another hotel deal. Gannett will release its Q3 report on Monday, October 19th.