Emac's Stock Watch | Fox Business
  • July 23, 2008 10:38 AM EDT by Elizabeth MacDonald

    Profit Plunge at the New York Times

    The New York Times (NYT) fell as low as $12.38 this morning after its second quarter earnings missed estimates. Profits plunged 82% to $21 mn versus the $118 mn posted in the same period a year ago, a period that was helped along by the one-time sale of an asset.

    The share plunge is the lowest since July 1995. An historic come-down for the newspaper of record, given that in 2003, the stock traded at $45, notes Frazer Rice, a private banker in New York.

    Print ads dollars at the Times continue to shrivel, sending operating income in a nosedive, as ad dollars continued their inexorable march toward the Internet. Hotels, automakers, airlines, all hurt by high energy prices, have pulled back sharply.

    What exactly is wrong with the Times' business model? "Rightly or wrongly, the New York Times has had to serve three functions," says Rice, a private banker in New York.  "One, inform the world; two, act as the moral barometer of the nation; three, turn a profit.  All three of which are vital legs in the New York Times’ stool.  The last one, turning a profit, is the one they are having, as the Irish would say, a spot of bother." So what's the problem? Although the Times has "many interesting properties like the Boston Globe and about.com," Rice says, it "has managed to be a follower in the information age as opposed to a driver."

    Specifically, the Times is "being taken over by Google as people’s news gathering tastes were dictated by the marketing information that search engines had as opposed and the costs of newsprint and bureau chiefs soared to through the roof," Rice explains. "The fact is that the Timesis the brand leader in a product that is becoming more and more commoditized and whose brand is being co-opted by its individual journalists," adding, how many people do you know who buy the Times solely to read "Maureen Dowd, Thomas Friedman or Paul Krugman?" 

    The Times is hoping against hope that its mix of assets, including The Boston Globe, the International Herald Tribune, About.com, regional newspapers and a classical music radio station in New York can pull it out of its corkscrew dive south.

    How to fix it? "Perhaps a relationship with Google or another search engine makes sense," Rice says. "The Times has failed to make any headway in the digital age, why not seek out the advice of the people who are making a killing in it?"  Stay tuned.

bill kelly

GOOD

July 23, 2008 at 2:12 pm

Ross

I'd like to hear what Bill O'Reilly has to say about this! Good riddance NYT. It couldn't happen to a more deserving rag.

July 23, 2008 at 2:12 pm

Mac

Liz, Has the great prophet O'Reilly indeed foreseen the doom of this once great icon of the press? Their undeclared war on FOXNews(among others) and their one-sided, liberal bias has driven away once faithful readers. I won't even do their crossword puzzles any more! Mac in Miami

July 23, 2008 at 2:12 pm

Greg Costa

Rush signs a contract for 400m and the Times tanks...get used to it lefty.

July 23, 2008 at 2:11 pm

Tom Tassara

The best part is that they don't understand why. It's probably all just a vast right-wing conspiracy.

July 23, 2008 at 2:11 pm

saneperson

It's fascinating that a group of right-wing bloggers see it fit to castigate for the New York Times for one-sided reporting, which it does not engage in - having both conservative and liberal columnists - and doing so, in the most idiotic and hypocritical forum imaginable: any related to Rupert Murdoch. God, people, whom are you fooling? Look at yourselves, and stop throwing stones as long as you reside in the glasshouse constructed by Murdoch and Cavuto/Ailes. And - by the way - if you have trouble comprehending any of the words above (which is very likely, given the usual readership base for this trash), consider picking up a book and reading it.

July 23, 2008 at 2:11 pm

Bill Paterson

Revenues for all papers are sliding,not because of liberal or conservative leaning but due to the changing ways we get our news.

July 23, 2008 at 2:10 pm

David Dalton

I hope it rolls over for good. When you stop reporting the news in favor of promoting your views this is the result. ABC, CBS and NBC is not far behind! Just witness their pandering to Obama and his trip and virtually ignoring McCain.

July 23, 2008 at 2:08 pm

Larry

I wouldnt line a birdcage with the NY Times. I can understand a paper having a liberal slant, but they take it way too far.

July 23, 2008 at 2:08 pm

Ken

Ditto, ditto and ditto Love IT!

July 23, 2008 at 1:57 pm

Nord Foster

I want a paper to give me the news not sell me on their opinion based on the mix of stories they provide. The Times is a propaganda rag, nothing more. Fidel would be proud to have it in Cuba. RIP NTY Times, I no longer buy it.

July 23, 2008 at 1:53 pm

Fred Buchanan

The NY Times brought this on themselves. Their incessant need to try to harm the Bush Administration in any way they can, they leak information that may/has cause damage to our ability to fight our enemies. If they tried to do the same thing during WWII, the paper would have been shut down as the traitors they are. I was called by a NYT subscription sales agent about a month ago. He YELLED at me when I told him I would not buy the Times because of their obvious liberal bias, and their inability to report the news from a neutral point of view. I said "I don't need my news pre-digested." He called me a back-woods country f*** Republican.... I told him I grew up in Boston, and live in LA, so how could I a country f*** Republican? He hung up on me... If this is a reflection of how the NY Times does business, it is my sincere hope that they fold as an organization.

July 23, 2008 at 1:53 pm

Patricia

It is about time that liberal Newspaper does down the drain to the gutter enough is enough. Too bad they can take their liberal friends with them.

July 23, 2008 at 1:53 pm

David

Ya know, I can't add to the list of comments already posted. Previous posters have said it all. Buh-bye, NYT.

July 23, 2008 at 1:50 pm

Randy

Hooray for Fox News for keeping the full court press on the NYT. Maybe Rupert Murdoch will buy NYT and turn it back into a profitable, balanced publication.

July 23, 2008 at 1:49 pm

Ernie Prigge

Only risk in NYT failure is that Obama is elected and he gets the Dem congress to bail it out by making it the paper version of PBS. Remember, Fasists/communists always control their proaganda media.

July 23, 2008 at 1:46 pm

rob lapham

Ms. MacDonald: What's the NYT's circulation trend and, is there any discernable apparent connection between that and their left-of-center bias?

July 23, 2008 at 1:44 pm

greg

Liberal print is dead! Hope there is more rags to follow.

July 23, 2008 at 1:43 pm

cjo011

Wonderful News keep it coming.

July 23, 2008 at 1:42 pm

Dan Sergiacomi

If The New York Times fails, how will Al Qaeda and The Taliban get their respectives messages to the American people ? The editorial board at this alleged newspaper should be indicted for treason. I do believe the end is near.

July 23, 2008 at 1:41 pm

Rob - a friend of John Galt

It just goes to show you that Capitalism still works. The NYT caters to the pinkos, so maybe they should seek funding from the Government. I'm sure that Jon Corzine (the Governor of the People's State of New Jersey) would gladly saddle us with more debt to prop them up. In the interest of equal access of course...

July 23, 2008 at 1:38 pm

Elated

When's the funeral. I want to send some cold, dead and black flowers. Of course the Demon-Crats will cry foul becuse of the fairness doctrine. Just like Air (Error) America - a liberal rag or radio business will not last.

July 23, 2008 at 1:36 pm

Alex Badme, Albuquerque, NM

Very appropriate for the National Enquirer puls very liberal biased rag-sheet. FAILURE for those who invent the news and try and influence others.

July 23, 2008 at 1:31 pm

Cap'n Andy

It may be time for Rupert Murdoch to get out his checkbook and pick up this miserable rag at a bargain price. Then he can re-format the Times, give us some worthwhile reading material on Sunday morning and make a pile of dough, all at the same time.

July 23, 2008 at 1:25 pm

H. Jones

Just like Air America...right down the tubes. No wonder Liberals (oops..Progressives) hate open competitive markets.

July 23, 2008 at 1:14 pm

about this blog

  • Elizabeth MacDonald is the stocks editor for Fox Business Network. She is recognized as one of the top prize-winning business journalists in the country, and has received 14 awards, including the top prize in business journalism, the Gerald Loeb Award for Distinguished Business Journalism, and the Newswomen's Club of New York Front Page Award for Excellence in Investigative Journalism.

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