Profits at the Washington Post newspaper operation plunged in the 2nd quarter of 2007, led by a 13 percent decline in print advertising revenues, according to the Washington Post Company’s most recent quarterly report. Revenue declines were particularly brutal in classified ads and in all types of real estate advertising.
Meanwhile circulation of the print newspaper continues to erode, losing another 2.9 percent over the past year. That’s all the more extraordinary when you consider that the Washington metro area is one of the fastest-growing big metros in the country.
The only good news in the newspaper publishing division was the performance of the online operation: 2Q revenues increased 11 percent to $28.2 million. The fast-growing online business is generating in excess of $100 million a year in revenue now. Thanks to the strength of the online operation, newspaper publishing division revenues declined only seven percent overall.
But online isn’t growing enough to salvage profits. In the 2Q of 2006, before taking into account a $46.8 million retirement plan buyout, the newspaper division generated $29.4 million in profits. This year, quarterly profits were only $17.8 million. (The year-to-date numbers, encompassing two quarters, aren’t looking any better.)
At some point, plummeting revenues and profits will force the WaPo to engage in another round of editorial cost cutting.
