As we wait to hear about layoffs coming out of Time Inc. today, we got a chance to look at the magazine publisher’s parent Time Warner’s third quarter earnings.
The company reported a 5 percent decline in revenues compared to the third quarter of last year — they dropped to $7.1 billion. Time Warner attributed the decline to low revenues at AOL and its publishing and film entertainment divisions, offsetting 5 percent revenue growth in its networks division, which includes HBO and Turner Broadcasting.
Time Warner also updated its predictions for the rest of 2009, noting that it plans to take $100 million in restructuring charges at Time Inc. during the fourth quarter. Although previous reports had said the company would be looking to shed $100 million through layoffs, putting this much into restructuring means the company will probably end up saving more in the long run. Time Inc. spokeswoman Dawn Bridges told The New York Times the current restructuring program “will result in a charge of up to $100 million.” Explained Bridges:
“While advertising remains challenged, readers continue to value print publications and affiliated websites. This restructuring will allow us to most efficiently focus our resources on the creation of compelling content at our world class titles. Unfortunately, given the tough market conditions, this restructuring will mean a loss of jobs. We wish our departing colleagues and friends the very best with their future projects.”
As for its earnings, the publishing division saw revenues drop 18 percent to $914 million, thanks to a 22 percent decline in ad revenues and a 13 percent decrease in subscription revenues. Other revenues also saw a drop of 24 percent, which Time Warner chalked up to declines in the non-magazine business, including Southern Living At Home, which also caused the company decreases last quarter. Surprisingly, Time Warner said it sold the property during the quarter.
But even growth in Time Warner’s network segment was hampered by declining ad revenues — the prevailing problem across all of the media. The group’s ad revenues dropped 1 percent and slowing DVD sales led to a 12 percent decrease in content revenues, while subscription revenues showed promise with a 9 percent increase.