MSLO Digital Earnings Dip, Online Video Expanded
Due in part
to a weaker digital ad business, Martha Stewart Living Omnimedia on Friday said third-quarter revenue was $27.6 million -- down from $33.2 million during the same period last year.
The news comes amid broad efforts by MSLO to shed operating costs and recast itself as a digital media company.
“We are transitioning our content operations to digital, mobile and video platforms that feature lower fixed costs and align with evolving consumer preferences for how and where they engage with our content,” Lisa Gersh, President and CEO of Martha Stewart Living Omnimedia, explained on Friday.
In September, MSLO announced that it had expanded its content business with new video partners Hulu and Hulu Plus, The AOL On Network and Fullscreen.
The new agreements reflect MSLO's strategy to redefine its video business by providing content across multiple platforms, especially online, according to Gersh. “We are seeing some encouraging early results, particularly in video,” Gersh said.
According to comScore, total unique visitors across MSLO's Web sites increased 42% in the quarter, compared to the same period in the prior year.
Of note, however, the company’s most recent deal with Hallmark TV expired in May 2012 and was not renewed.
More broadly, MSLO reported a third-quarter operating loss of $50.7 million on Friday.
The loss included a $44.3 million non-cash impairment charge reflecting the write-down of goodwill related to the company's publishing segment, and which result from continued softness in the print publishing industry overall and, specifically, a decrease in the company's ad revenues.
Total revenues were $43.5 million in the third quarter -- down from $52.2 million in the third quarter of 2011.
On Thursday, MSLO said it plans to lay off 12% of its roughly 600 employees -- cutting around 70 positions -- as well as cease publishing Everyday Food as a stand-alone publication, and put another title, Whole Living, up for sale.