By David B. Wilkerson, MarketWatch
Last update: 5:37 p.m. EDT Sept. 18, 2008
CHICAGO (MarketWatch) - New York Times Co. shares rose 12% Thursday after the company reported August revenue results at its newspapers that reflected an improvement in online ad growth after a particularly tepid July, along with better results at the long-beleaguered Boston Globe.
NYT rose $1.63 to close at $15.25.
The media company said online ad revenue rose 7.9% in August, mostly due to growth in display advertising. Online help-wanted ad sales, a sore spot in July, remained a problem, especially in the later part of August. In July, online ad revenue rose just 0.9%, far worse than analysts had been expecting.
The digital growth still lags New York Times' typical performance. In June, the newspapers saw online revenue rise 21.5% over June 2007. Online ad revenue grew 14.2% in May, 25.6% in April, and 14.8% in March.
Total digital revenue rose 6%, with online ad revenue increasing 10.9%. Both figures are sharply up from July, when digital revenue rose 2.6%, with online-ad revenue up 5.5%.
Digital businesses accounted for 12.7% of total revenues in August, compared with 11% in August 2007.
There were also some signs of improvement at the company's New England Media Group, which includes the Boston Globe, Boston.com and the Worcester Telegram & Gazette. Ad revenue fell 16.4% after dropping 24.5% in July.
There have been persistent calls from Wall Street observers for a sale of the Globe, but New York Times has maintained that the newspaper remains an important outlet for New England advertisers.
Overall, weakness in print advertising continued unabated in August, leading ad revenue to plunge 15.9%.
Newspapers have been in dire straits over the last three years as a shift to online consumption of news and information has left publishers scrambling to deal with rapidly declining ad sales at their print editions.
The weakened U.S. economy, stifled by the subprime mortgage crisis, has dealt a punishing blow to classified revenues, particularly in the areas of real estate, help-wanted and automotive. Classified revenue has historically been the main source of income for newspapers.
At the New York Times Media Group, including the flagship newspaper, ad revenue fell 15.1%, hampered by weakness in the studio entertainment, transportation, hotel and national automotive categories.
The regional media group, including papers in midsize markets such as Wilmington, N.C., and Santa Rosa, Calif., saw ad revenue decline 17.5%.
At the group that includes About.com, the company's online-information portal, revenue climbed 16.1 % on increased cost-per-click and display advertising.
Other newspaper companies advanced Thursday. David B. Wilkerson is a reporter for MarketWatch in Chicago.