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Friday, October 26, 2012

NY Times loses a fifth of its value in one day, what does this mean for the rest? Edmonds

10/26/12, "What dismal earnings at The New York Times mean for the newspaper industry," Poynter, Rick Edmonds

"Just when investor confidence in the newspaper industry was picking up, the New York Times Co. stopped the turnaround with a surprisingly dismal earnings report Thursday.

New York Times shares lost more than a fifth of their value in a single day and did not rally Friday morning. The markdown spilled over to Gannett and other newspaper stocks as well.

Furthering the gloom, Times’ executives said in a conference call that they expect similarly bad ad trends in the fourth quarter.

So the morning after question is whether the Times’ reversals portend trouble for the industry at large. One could argue (see below) that the Times’ operations and advertising base are so different from most other papers that it should be viewed as an outlier.

But for the last several years, it has been an industry leader, pioneering a successful digital and print subscription model, while wheeling out impressive digital editions on all platforms and expanding internationally.

If the top dog stumbles after a new round of advertising setbacks, the rest of the pack seems even more vulnerable."...

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