Publishers Defy Traffic Declines With Revenue Growth
Major publishers like The New York Times and Reuters reported revenue gains despite declining referral traffic. However, they face challenges in sustaining growth due to tougher comparisons with last year's strong performance.
Original reporting · digiday.com
Original: “Media Briefing: Publishers’ revenue growth defies traffic declines, but tougher comparisons loom”
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How this was written. Awesome B2B wrote this article with a language model from Digiday’s reporting (model: @cf/meta/llama-3.3-70b-instruct-fp8-fast); it describes that reporting rather than adding to it. The original, linked above, is the full story.
Key points from Digiday’s report
- Major publishers have reported revenue growth despite declining referral traffic and AI disruption.
- AI licensing deals have driven significant revenue growth for companies such as People Inc. and Reuters.
- Publishers face challenges in sustaining growth due to tougher year-over-year comparisons with last year's strong performance.
- The industry is expected to continue facing complex market pressures, including the evolution of search and social algorithms.
- Publishers will need to adapt and find new ways to sustain growth and remain competitive in a rapidly changing market.
Several major publishers have managed to grow their revenue in recent quarters, driven by a combination of subscriptions, advertising, and content licensing. This growth is notable given the decline in referral traffic and the disruption caused by artificial intelligence. According to recent earnings reports, companies such as The New York Times, News Corp, People Inc., and Reuters have all seen revenue increases.
The growth in revenue is attributed to various factors, including the success of AI licensing deals. People Inc. and Reuters, in particular, have seen significant revenue growth from these deals, which has helped them diversify their revenue streams beyond advertising. However, as these agreements mature, it is becoming increasingly difficult to replicate the initial boost in revenue.
The New York Times is preparing for tougher year-over-year comparisons in the fourth quarter, primarily due to a significant increase in advertising supply in 2025. The company's CEO, Meredith Kopit Levien, noted that the strong prior-year performance will make it challenging to sustain the current pace of growth. Despite this, the company expects to continue adding supply, albeit at a more incremental pace.
News Corp's latest earnings report presented a mixed picture, with strong revenue growth in its Dow Jones business, but declines in its News Media division. The company's CEO, Robert Thomson, attributed the decline to complex market pressures, including a challenging advertising environment and the evolution of search and social algorithms.
People Inc. has seen impressive growth in licensing revenue, driven by its AI licensing deals with companies such as Apple, Meta, and Microsoft. However, the company's CFO, Tim Quinn, cautioned that the growth rate is expected to slow in the fourth quarter as the company laps the initial revenue boost from its Meta deal. Despite this, the company remains optimistic about the AI licensing market and its potential for growth.
Reuters has also seen significant revenue growth from its AI licensing deals, with a total of three publicly disclosed agreements. The company's CFO, Gary Bischoping, noted that the revenue from these deals has helped boost the company's overall business, but also creates volatility in year-over-year comparisons. The company expects its growth to be flattish in the fourth quarter due to tougher comparisons and the lapping of transactional AI licensing revenue.
The challenges faced by these publishers are not unique, and the industry as a whole is navigating complex market pressures. The advent of artificial intelligence and the evolution of search and social algorithms are expected to continue disrupting the industry. As such, publishers will need to adapt and find new ways to sustain growth and remain competitive. This article is based on reporting by Digiday.
Questions and answers
What is driving the revenue growth of major publishers?
The revenue growth is driven by a combination of subscriptions, advertising, and content licensing, including AI licensing deals.
What challenges do publishers face in sustaining growth?
Publishers face challenges in sustaining growth due to tougher year-over-year comparisons with last year's strong performance, as well as complex market pressures such as the evolution of search and social algorithms.
How are AI licensing deals impacting the revenue of publishers?
AI licensing deals have driven significant revenue growth for companies such as People Inc. and Reuters, but also create volatility in year-over-year comparisons.
