Newsweek's Revenue Declines 31% as Washington Post Seeks Magazine's Sale
Newsweek, the magazine that Washington Post Co. said this week is for sale, reported a 31 percent decline in first-quarter revenue.
The weekly news magazine’s sales fell to $29.4 million from $42.7 million a year earlier, according to a statement today. Washington Post Chief Executive Officer Donald Graham said May 5 that Newsweek would continue to be unprofitable this year after losses from 2007 through 2009.
Washington Post hired investment bank Allen & Co. to help with a possible sale of the publication, which it’s owned since 1961. Newsweek’s advertising sales plunged 30 percent in 2009 and the magazine cut its guaranteed circulation by 42 percent to 1.5 million as part of a redesign last year.
Jon Meacham, Newsweek’s editor, said he was considering seeking backers to help make a bid for the magazine. In a May 5 e-mail, he said he set a deadline of about one month “to see whether this is a feasible option.”
Washington Post swung to a profit of $45.8 million, or $4.91 a share, in the quarter ended April 4, from a loss of $18.7 million, or $2.04, a year earlier. Sales gained 11 percent to $1.17 billion.
Last year, the Washington-based company sold its Newsweek Budget Travel magazine, which drew $3.4 million in revenue in 2009’s first quarter.
Washington Post dropped $12.38, or 2.5 percent, to $476.12 at 3:09 p.m. in New York Stock Exchange composite trading. The shares had climbed 11 percent this year before today.
In the company’s newspaper division, which includes Washington Post and The Herald of Everett, Washington, revenue dropped 3.2 percent to $155.8 million. Print advertising sales at the company’s namesake newspaper fell 7.5 percent to $68.7 million from $74.3 million a year earlier.
Washington Post’s Kaplan education unit boosted revenue by 20 percent to $711.4 million and sales in the cable-television division grew 3.2 percent to $189.4 million.