Like several other major newspaper publishers, the New York Times Co. posted an increase in profits in the third quarter, but this good news was offset by continued double-digit declines in overall revenue and advertising revenue. In other words, while the company has managed to maintain profitability by cutting costs, the big picture is still one of steady contraction.
NYTCO's operating profit grew 30% from $61.9 million in the third quarter of 2008, to $80.6 million in the same quarter this year. This was mostly due to a 21.6% drop in operating costs, which are expected to yield a total $475 million in savings in 2009. The company has also raised circulation revenues by increasing the cost of newsstand copies and home delivery.
However, total revenue continued to decline, falling 17% from $687 million in the third quarter of 2008 to $570.6 million in the third quarter of this year. The drop was due mostly to a 26.9% decline in advertising revenues, which fell from $398.2 million in the third quarter of 2008 to $291 million this year.
This is the fourteenth straight quarter in which NYTCO's overall revenue has declined on a year-over-year basis. Total revenue in the third quarter of 2009 is down 28% from the third quarter of 2005, when it came to $791.1 million.
The third-quarter report comes just a few days after NYTCO announced it would be cutting 100 newsroom positions at the flagship New York Times, equaling about 8% of the newsroom staff. Earlier this year, the newspaper also laid off 100 employees of its business operations division. A gradual reduction has also been accomplished through attrition. The New York Times Co. instituted a 5% pay cut earlier this year, and obtained significant concessions from unions at The Boston Globe amid threats to sell the newspaper.
At the end of 2008, NYTCO's payroll totaled 9,346 full-time employees. Subtracting the 200 positions cut this year leaves a current total of 9,146 -- down 33.7% from 13,800 in 2000.