• by Michael Shields , October 14, 2004

A prolonged slump in technology advertising is taking its toll on The Wall Street Journal's bottom line. Tech advertising plummeted by 36 percent in the third quarter and is down 23 percent for the year for the financial bible, according to earnings results announced by parent company Dow Jones on Thursday.

Overall, revenue for the company rose by 5.0 in the quarter to $394.9 million, with operating income making a 21.5 percent gain versus last year, receiving a major boost from electronic publishing. Total advertising revenue for the company grew by just 2 percent.

It was the company's Web properties that continued to shine during Thursday's announcement. The publisher has benefited from a hot Internet advertising market, as "Electronic Publishing" revenue shot up 23.1 percent in the quarter.

Still, the struggles for the company's signature property, the Journal, are indicative of an uncertain period for national newspaper advertising, echoing so-so results announced Wednesday by The New York Times. The Journal's advertising linage was down 6 percent overall in the quarter, and the "Print Publishing" segment saw revenue decline by 1.9 percent.

Peter R. Kann, chairman and chief executive officer of Dow Jones, did not mince words. "Our results were negatively affected by very weak technology advertising, which led to a 6 percent decline in ad linage at The Wall Street Journal in the quarter, after four consecutive quarterly gains," he said in a statement. "Thus, B2B advertising remains volatile."

Besides the technology category, financial advertising was down 10 percent, although 11 percent growth from classified advertising helped offset that dip.

The company's other print properties also struggled, particularly internationally. The Asian Wall Street Journal suffered a 21 percent hit in ad volume, while The Wall Street Journal Europe was down nearly as much, minus 19.4 percent.

Barron's, which had enjoyed a strong second-quarter performance, slipped 5.1 percent in advertising volume.

One bright spot was the company's Ottaway Community Newspapers division, which saw revenue increase by 5.6 percent.

Just as officials from The New York Times did on Wednesday, Kann mentioned controlling spending and improving infrastructure as being key to ensuring future growth.