The New York Times Co. said Tuesday that it expects fourth-quarter digital ad revenue to be up 10% year-over-year. Showing slowing growth, however, the company's digital ad sales during the third quarter were up 14% year-over-year.
That said, The New York Times Co. "remained vigilant in managing our expenses and re-engineering our cost base, and as a result we expect our full-year 2010 operating profit excluding depreciation, amortization, severance and special items to show significant improvement over 2009," Janet Robinson, president and CEO of the company, said Tuesday.
Meanwhile, the company projects fourth-quarter operating costs to decrease 2-3%, and operating costs excluding depreciation, amortization and severance to be comparable to the same period in 2009.
These costs reflect significantly higher newsprint prices and costs associated with the launch of the NYTimes.com pay model, Robinson said Tuesday. The expected decrease in operating costs on a GAAP basis for the fourth quarter of 2010 is due in large part to approximately $25 million in severance costs in the fourth quarter of 2009.
"Our results reflect the steady progress we have made this year," Robinson added. "The improvement in print advertising trends and solid growth in digital advertising reaffirms that advertisers are committed to reaching our sizable and highly desirable audience across multiple platforms."
After more than a year in the works, The New York Times is expected to debut its "metered" pay model next month, which will charge readers a fee for high levels of online content consumption.
Surely troubling executives at The New York Times, the (UK) Times last month said it had so far convinced just 0.5% of its readership to pay for premium content. Worse still, only half of those 105,000 paying readers actually subscribed -- as opposed to paying per day -- so a mere 0.25% of The Times' online audience had become regular customers.
Continued economic uncertainty will inspire advertisers to rely more heavily on digital channels, spending forecasts released by eMarketer this week indicate. Next year, U.S. online ad spending will increase 10.5% -- followed by double-digit growth every year through 2014, when spending will reach $40.5 billion, eMarketer predicts.