New York Times to cut about 100 newsroom jobs

The New York Times Co. said Wednesday it plans to cut about 100 newsroom jobs through buyouts, and perhaps layoffs, to cut costs and shift more resources to digital news products.

The company, whose advertising revenue fell 4% year-over-year in the most recent quarter, will offer buyouts to employees at its editorial and business operations. If not enough employees take the offer, it will resort to layoffs. The number of jobs affected in the business operations will be smaller, the company said.

The number of editorial jobs cut represents about 7.5% of the newsroom staff, according to The New York Times.

"The job losses are necessary to control our costs and to allow us to continue to invest in the digital future of The New York Times, but we know that they will be painful both for the individuals affected and for their colleagues," said newspaper publisher Arthur Sulzberger Jr. and company CEO Mark Thompson in a note to the staff.

They also announced that the company will shut down NYT Opinion, a recently launched mobile app for opinion content, because it wasn't getting enough subscribers.

Sulzberger and Thompson said cost savings are needed "to safeguard the long-term profitability of The Times, not because of any short-term business difficulties."

Unlike many large newspaper publishers, the Times' circulation revenues ticked up in the second quarter. But with print advertising sinking ceaselessly and digital revenues' gain not offsetting the losses sufficiently, its other financial performance indicators fell.

Its total revenue inched down 0.6% to $389 million. Operating profit fell 64% to $16.5 million.

While the newspaper has a popular website and breaking stories are published online real-time, it is seeking to broaden its digital offerings to spur more ad sales and other revenue opportunities, including "native ads" that are paid by advertisers. While its digital subscriber base is still growing, the rate of growth remains volatile.

In the first quarter, it added 39,000 paid digital-only subscribers. In the second quarter, it added 32,000 despite introducing several new digital editorial products, including NYT Now, NYT Opinion and Times Premier.

In their note, Sulzberger and Thompson said they estimate digital advertising grew 16% in the quarter that ended on Sept. 30 as advertisers bought more "Paid Posts," its native ad offering that places paid-for content along with other news items in its NYT Now news app. Ad sales in smartphone and video also contributed to the growth, they said. But with expenses continuing to rise, the company's profitability for the third quarter and the year as a whole is estimated to be lower than last year, they said.

Digital subscription during the quarter grew by more than 40,000, after accounting for those who canceled their subscription, they said. The company will show a "modest growth" in its circulation revenue, they said.

But print advertising continues to be "volatile" even though a September rally helped offset declines in July and August, they said. As a result, total company-wide advertising revenue growth will be "roughly flat" in the quarter vs. the "mid-single digit decline" they predicted earlier, they said.

Still, its operating costs will rise in the third quarter by "low- to mid-single digit percentage," not including severance costs, they said.

It's "a reminder that the combination of the continuing secular pressure on our high margin print advertising revenue and the need for investment in the future is impacting our profitability and for this reason, we are now focused on cutting our costs," they said.