Publisher of USA Today, other papers axes staff to cut costs

By AP News

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Newspaper publisher Gannett Co. confirmed Friday that it's laying off some of its newsroom staff, part of a cost-cutting effort to lower expenses as its revenue crumbles amid a downturn in ad sales and customer subscriptions.

Newspaper publisher Gannett Co. confirmed Friday that it's laying off some of its newsroom staff, part of a cost-cutting effort to lower expenses as its revenue crumbles amid a downturn in ad sales and customer subscriptions.

The McLean, Virginia-based company declined to provide details about the number of people losing their jobs. In a statement, Gannett spokesperson Lark-Marie Anton cited a need “to take swift action given the challenging economic environment. These staffing reductions are incredibly difficult, and we are grateful for the contributions of our departing colleagues."

Gannett, which owns USA Today and more than 200 other daily U.S. newspapers with print editions, ended last year with more than 16,000 employees worldwide, according to the company's annual report. The payroll included more than 4,200 reporters, editors and photographers,.

The layoffs are the latest sign of the unrelentingly tough times in the newspaper industry, which has been steadily shrinking for more than a decade as more advertising shifts from print to digital and readers turn to other online outlets for information and entertainment.

Major newspapers such as The New York Times, The Wall Street Journal and The Washington Post have been able to amass substantial digital audiences by focusing their coverage on broad topics that appeal to people across the country. But regional and local papers have struggled to find a formula that works in narrower markets.

Gannett CEO Michael Reed foreshadowed the cutbacks last week after the company reported disappointing results for the April-June period and dimmed its outlook for the rest of this year.

Reed told industry analysts that Gannett would be “taking significant and and permanent costs" out its business, with an emphasis on operations devoted to producing and delivering the print editions of its newspapers. That decision reflected a recognition that Gannett is unlikely to recover much of the revenue that has evaporated along with demand for print editions.

In its most recent quarter, Gannett's revenue dropped 7% from the same time last year to nearly $749 million. Meanwhile, the company's operating expenses edged up 1% from last year to nearly $770 million.

That disparity is one of the reasons Gannett suffered a loss of nearly $54 million during the quarter. In another sign of distress, Gannett trimmed its revenue projection for the full year to roughly $3 billion, from a previous forecast of $3.1 billion to $3.2 billion.

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Industries:
Communication Services
Consumer Discretionary

Author: AP News

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Originally published by Associated Press Valuethemarkets.com, Digitonic Ltd (and our owners, directors, officers, managers, employees, affiliates, agents and assigns) are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above.

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