Time Inc. to Eliminate About 300 Jobs, or 4% of Workforce
14 June 2017 - 5:44AM
Dow Jones News
By Jeffrey A. Trachtenberg
In a major restructuring, Time Inc. is eliminating about 300
jobs in the U.S. and abroad, as the country's largest magazine
publisher sharpens its focus on digital media and video
opportunities.
The job cuts and buyouts will affect 4% of the company's
employees, which numbered about 7,450 at the end of December. The
streamlining will involve print magazines, corporate and sales,
with more than half of the employees affected based in the U.S.
The restructuring comes less than two months after Time Inc.'s
board decided not to sell the company and ended talks with
potential suitors.
"We're re-engineering our entire cost structure," said Rich
Battista, chief executive, in an interview. "We're trying to be as
nimble and efficient as possible, and get this process moving."
Mr. Battista said the next six to 12 months will be critical in
terms of the company's restructuring. "We're also looking to become
more efficient in terms of legacy systems in place," he said. "This
isn't only about cutting employees." Mr. Battista informed the
entire company about the layoffs in a memo issued Tuesday
afternoon.
Time Inc. already has begun hiring more staffers in video,
digital products and digital sales -- all growth areas, said a
company spokesman. The company publishes such high-profile
magazines as People, InStyle and Sports Illustrated.
When the company reported its first-quarter results in early
May, it said it was taking steps to strengthen its finances,
including cutting its dividend and exploring the sale of noncore
assets.
Mr. Battista signaled the current restructuring during that
earnings call, noting the media company had reduced first-quarter
costs by 7% from the year-earlier quarter. "The fact is, we can do
a lot more," he said at the time.
A number of traditional publishers, including News Corp's The
Wall Street Journal and New York Times Co., have also engaged in
staff buyouts while shifting more resources to digital
initiatives.
Time Inc. has launched its own digital brands such as
breakfast-minded Extra Crispy, while expanding on the video front.
The company said in May it will produce in excess of 50,000 videos
and more than 1,500 hours of live programming in 2017.
Time Inc., like its rivals, continues to grapple with declining
print-advertising revenue. Although Time Inc.'s digital ad revenue
increased 32% in the first quarter ended March 31, it wasn't enough
to compensate for the 21% decline in print advertising and other
revenue.
Altogether, advertising revenue for the quarter fell 8% to $ 331
million. Total revenue for the company declined 8% to $636
million.
Mr. Battista said the company is committed to its print
products. "I'm not assuming print revenue is going to go up," he
said. "We think we can stabilize it."
The layoffs are the largest since Time Inc. said in February
2014 that it would cut almost 500 employees, or about 6% of its
global staff. The publisher, then a unit of Time Warner Inc., was
spun off as a stand-alone, publicly traded company in June of that
year.
Write to Jeffrey A. Trachtenberg at
jeffrey.trachtenberg@wsj.com
(END) Dow Jones Newswires
June 13, 2017 15:29 ET (19:29 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
Time Inc. (NYSE:TIME)
Historical Stock Chart
From Apr 2024 to May 2024
Time Inc. (NYSE:TIME)
Historical Stock Chart
From May 2023 to May 2024