Group Nine Media, whose digital media properties include PopSugar, The Dodo and NowThis, laid off dozens of employees, or 7% of its more than 700-person staff, across the company.
It’s the latest publisher to take drastic action as COVID-19 has drastically altered the media landscape. As the first quarter just wrapped, media companies including Bustle Digital Group, CQ Roll Call and G/O Media announced layoffs last week.
Executives had privately forecasted Group Nine Media to turn a profit this year. But the company, facing the effects of the coronavirus on the industry, took additional action after already announcing changes for employees two weeks ago.
Last month, Group Nine Media took action to prevent additional cost-cutting steps, including reducing pay for executives by 25% for the rest of 2020 (a longer, more definitive timeline than other media companies have so far established).
CEO Ben Lerer opted to give up six months of pay, and the company temporarily suspended 401(k) matching last week.
In September, the company announced it had raised $50 million in funding for strategic investments led by Discovery (which had bankrolled the founding of Group Nine in 2016 with a $100 million investment, then added another $40 million in 2017). One of those investments, PopSugar, went through its own round of layoffs before 2020 and executives also expected the company to turn a profit.
Group Nine Media did not immediately provide an on-the-record statement for this piece.
As industries impacted by the coronavirus freeze their marketing budgets or outright cancel planned campaigns, publishers have been feeling the blow. Full ad sales, across all media, had been expected to grow by nearly 7% but are now forecast to decrease by 2.8%, according to the latest forecast from IPG Mediabrands-owned Magna Global.
Alt-weeklies and local publications were hit first, as publishers dependent on local advertising dollars lost significant revenue as those businesses, too, closed their doors.