McClatchy, the newspaper chain that owns the Kansas City Star and the Wichita Eagle, continues to hemorrhage value, according to its 2018 first quarter earnings report. Though the chain couches its shrinking numbers in bright spots in an earnings press release, it may be time to put McClatchy on a newspaper death watch.
With its recent announcement, the newspaper chain’s stock has lost 85 percent of its value in the last four years.
In its 2018 first quarter report, McClatchy announced a net loss of $38.9 million. That’s about $5.04 per share, but it’s an improvement over the losses from the first quarter of 2017 when the paper lost $95.6 million. Though the newspaper chain reported lower losses in the first quarter, it also reported revenue was down 10 percent of what it was during the same time frame in 2017. Advertising revenues dipped by nearly $100 million, or 16.7 percent, but digital-only advertising grew.
Audience revenues dipped by 5.6 percent, but McClatchy boasted its digital-only audience revenues increased by 32.8 percent, or to 112,200 digital-only subscribers.
Craig Forman, McClatchy president, said the quarter reflects a crossover point in the company’s digital transformation.
“Despte strong industry headwinds, we are making progress in our strategy to drive digital growth,” he said.
The digital growth wasn’t enough to prevent layoffs. McClatchy announced layoffs last week. Though the Star didn’t report on its layoffs, KCUR public radio reported the Star laid off 10 newsroom employees on Tuesday.
An internal McClatchy memo said the newspaper chain is restructuring in a way that will require “painful reductions,” and “new or revised roles for staff members in every Midwest newsroom.” The memo names Wichita, Kansas City, Fort-Worth, and Belleville as the Midwest region.
The Eagle devoted a ton of ink to 56 state employees losing their jobs, but it has yet to report on the layoffs at its parent company. McClatchy owns 30 newspapers in 14 states.