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Digital Ad Sales Remain Soft For New York Times, Which Says Marketers Are Avoiding News Podcasts.


News avoidance is not just for listeners anymore. The New York Times says advertisers are also shying away from news content, and as a result the home of podcasts such as the morning news show The Daily saw a dip in its digital revenue during the fourth quarter. The Times says its digital ad revenue declined 3.7% during the fourth quarter compared to a year earlier, totaling $107.7 million representing roughly two-thirds of the company’s overall ad revenue.


“Our digital performance, including podcasts, was impacted by marketers avoiding some hard news topics like Middle East,” CEO Meredith Kopit Levien said. “You have the war between Israel and Hamas breakout in early October, and that has an effect in both display and audio.” The drag was even more pronounced since a bookkeeping change meant there were five fewer days during Q4 of 2023 than 2022 for the company. “We are nonetheless confident in the long-term potential of our digital advertising business,” Levien told investors Wednesday during a conference call.


The Times is predicting that its digital advertising revenue will increase low-to-high-single-digits during the first quarter despite the fact that Levien said their ad business continues to “grapple with the heightened market volatility” among advertisers.


Barclays media analyst Kannan Venkateshwar says the Times seems to be hurt also by “weak” pricing trends in podcasting, something that he Spotify also told investors when it reported its quarterly revenue on Tuesday. “This may continue to have an impact in the coming quarters,” he told clients in a note, adding, “Some of these impacts appear to have been offset by increased inventory in The Athletic.”


The Athletic, which the Times bought for $550 million two years ago, is a big reason for Levien’s optimism. She says the sports news website and podcaster has been a “bright spot” in terms of advertising and subscription sales. It has also been focused on cutting costs to become more efficient under the Times ownership. The sports unit underwent a “significant reorganization” that led to several of its podcasts being cancelled last summer. It still lost $4.4 million during Q4, but that was less than the $9.6 million loss it had in the prior year while revenue grew 31% to $38.5 million.


“One of the things that gives us a lot of confidence is we tend to get more middle and upper funnel advertising, meaning not direct response brand advertising, in most parts of our portfolio,” Levien said. “And what you're watching us do is extend those ads across more parts of the platform.”


The Times has also started to experiment with the use of generative AI in its advertising, using first-party data to bring contextual targeting at scale. Levien said they also began in the fall a relatively small experiment that translates Times content into Spanish, but says it remains “very early days” on the project. The company will, however, expand it within the next few months around using AI to voice written Times content.


In the meantime, the Times reported $676.2 million in revenue during the fourth quarter, an increase of 1.3% from the prior year. And it had an operating profit of $154 million, an 8.5% increase year-to-year. The Times says it had 10.36 million subscribers at year-end, including 9.7 million digital-only readers as the number of print subscribers shrank to 660,000.

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