August 16, 2022

Not All Media Companies Are Struggling With Ads

Now that we are solidly in the third quarter, we are seeing results from public digital media companies. And I may be saying the obvious at this point, but ad markets have officially pulled back in Q2, and I anticipate much will look the same in Q3.

But first… A word about our sponsor, Omeda.

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To learn more, download the report here.

Now let’s jump in…


For most, but not all, we see a significant pullback in advertising; however, if we dig in, it does appear that certain publications are being hit far more than others. So let’s dig into them.

Dotdash Meredith

IAC announced its Q2 earnings on August 9th, and revenue was up 64% year-over-year, led by growth at Angi Inc. and Dotdash’s acquisition of Meredith. And so, revenue went from $73.3 million last year to $489.5 million this year.

However, if we dig in, Pro Forma revenue was down 18% year-over-year at Dotdash Meredith. On the digital side, it was down by 7% due to a pullback in advertising in key markets. Dotdash Meredith’s CEO, Neil Vogel, said this on the earning’s call:

So if you look at the ad market, it’s hard to look at it as a whole, right? You got to unpack it a bit. I think we have some pretty good diversity, and you saw that through the pandemic. I think health is decent. Finance is decent. Travel is actually excellent, which is not that big of a category. Beauty is good. I think you’ll see a lot of the concentrated problems for advertisers around retail. Those problems have been well talked about by you guys. Food and CPG, which links together, the assets that we bought, the Meredith assets over-indexing those categories based on the brands that they are.

And so, that actually makes a lot of sense. With the cost of goods up so much due to inflation, it’s no wonder food and CPG struggle the most. And because Meredith was overly dependent on those categories, the whole thing struggles when that goes.

But part of why the business also struggled is the company just hasn’t moved fast enough migrating the Meredith sites to Dotdash’s tech stack. I wrote about Dotdash two years ago and said this about its acquisition strategy:

The next step is to have a similar technology stack. According to a reader who used to work at Dotdash, the migration to Dotdash’s tech stack and CMS can take anywhere from 3-6 months.

But once that happens, the site is completely templatized. This allows Dotdash to spread the cost of doing new work across multiple sites. If a new template is created for one site, that same template could, theoretically, be used on other sites.

By doing this, Dotdash has a cleaner UX and a more efficient ad experience. However, Vogel said, “we’ve been a little slower on the migrations than we would have liked.” That matters.

The question is whether finalizing the migration will solve its problems. And here, I think it depends. Yes, the sites will be more efficient, but food and CPG will be a drag on the business until that part of the market corrects. That’ll likely take time.

The New York Times

If we turn to the Gray Lady, it’s clear that the economy is negatively impacting it. Ironically, it appears to be in different categories than Dotdash. According to the results press release:

Second-quarter 2022 digital advertising revenue decreased 2.4 percent and print advertising revenue increased 15.1 percent. Digital advertising revenue was $69.3 million, or 59.0 percent of total Company advertising revenues, compared with $71.0 million, or 63.0 percent, in the second quarter of 2021. Digital advertising revenue decreased primarily as a result of the macroeconomic environment, a reduction in marketer spend on advertising adjacent to news coverage given the current news environment, and fewer programmatic advertising impressions, which more than offset higher direct-sold advertising largely from the addition of advertising revenue from The Athletic. Print advertising revenue increased primarily in the entertainment and luxury categories, which were more severely impacted by the Covid-19 pandemic in the second quarter of 2021.

But what’s interesting is the categories that appear to be struggling. For example, according to CEO Meredith Kopit Levien:

The nice thing about Times as we work across a lot of categories and we have a very varied product set, but we are in fact seeing more pressure in some categories. So in digital advertising, we saw real pressure on tech and streaming and finance, which I think you would expect given the macroeconomic uncertainty.

So, Dotdash has “finance is decent,” whereas the Times sees real pressure on finance. This could be an audience conversation. Dotdash owns Investopedia, which is likely more contextually related than the New York Times for finance brands.

But it does make sense for finance to be pulling back. If the markets are in the gutter, people are less likely to create brokerage accounts and buy new assets. Fear is the worst thing for a market. Therefore, a pullback does make a lot of sense.

One final thing that Kopit Levien said that jumped out to me:

We are confident in our advertising approach, which is grounded in the market leading suite of first-party data and premium ad products that our subscription-first strategy enables.

Too often, people argue it’s an either/or with ads and subscriptions. On the contrary, because the Times has so many subscribers, it has a ton of first-party data it can then use to target ads for marketers. That gives it a significant advantage.


BuzzFeed actually saw a relatively decent Q2 with total revenue up 20% year-over-year.

  • Advertising revenue was up 11% year-over-year to $53.2 million.
  • Content revenue (custom assets for clients) was up 66% to $40.3 million
  • Commerce and other revenues declined 22% to $13.3 million.

In its second-quarter earnings call, CEO Jonah Peretti said this:

In terms of year-over-year trends, we saw mixed results across our largest category. Tech and retail were the most pressured, while financial services exhibited robust growth.

Notably, CPG recovered from year-over-year declines in Q1 to end the quarter flat. And our emerging categories, namely auto, restaurants and services have continued to grow rapidly through the first half of the year.

Finance again. BuzzFeed clearly sees pressure in some of its markets, but by and large, the business actually saw a decent Q2, even if it slowed down. The big problem for BuzzFeed is that Q3 looks like it’s going to be a tough one. According to Peretti:

Looking ahead, amid the dual dynamics of the ongoing platform shift and macroeconomic uncertainty, we expect Q3 revenues and profits to trend below Q2 levels. That being said, we are hearing clear consistent feedback from our clients that they need help to deploy limited budgets in the most efficient way possible.

It is now guiding third-quarter revenue to grow 4 to 8 percent year-over-year in its release. Considering the Q2 it had, this is likely a disappointment for the brand and will contribute to continued losses. At some point, it’ll need to correct that.

Dow Jones/News Corp

News Corp is a massive entity with various businesses, so I want to zero in and focus on the Dow Jones component because I think it’s most relevant to what we’re discussing. For context, News Corp announced its Q4/FY earnings, so its cycles are slightly different.

According to its earnings release:

Advertising revenue increased $13 million, or 13%, including a $9 million benefit from the additional week. In the quarter, digital advertising revenues grew 16% and print advertising revenues grew 9%. Digital advertising accounted for 58% of total advertising revenues in the quarter, compared to 56% in the prior year period.

Not one to miss a jab at its competitor, CEO Robert Thomson said:

As a point of comparison, digital advertising at Dow Jones rose 16% in the most recent quarter, while it shrank, it contracted, it diminished at the New York Times. In what was a resounding performance for News Corp, Dow Jones really is worthy of note.

He’s right. I think a significant contributor to this is that, of all four publications discussed here, Dow Jones is a finance and business-focused entity through and through. And so, unlike the Times, which saw a pullback in advertising next to news, Dow Jones and WSJ more specifically likely saw business advertisers continuing to spend despite it being news-related.


And to cap it all off, I thought I’d share this interesting note from a recent memo Bloomberg Media CEO, M. Scott Havens, sent to the team:

The industry-wide reporting signals a clear softening in advertising revenue, likely driven by a slowing economy and recession fears, but Bloomberg Media is bucking this trend. In the first half of 2022, our advertising business grew an incredible 29%, with Q2 growing 27% YoY. This is our eighth consecutive quarter of ad growth and the fifth straight increase of more than 20%. Very few, if any, media companies can say that. Our sales & marketing teams have transformed a business that lagged the industry three years ago into one that leads it.

Bloomberg is not publicly traded, so it’s all unaudited self-reporting. That said, it doesn’t surprise me. If Dow Jones sees that significant growth, then, of course, Bloomberg should also see it. Moreover, it leads me to believe that business advertising has become much stickier for many major business publications.

And so, while retail, CPG, and other consumer-facing advertisers are likely struggling due to inflation and other macroeconomic considerations, big business advertising continues to push forward. Will it last into the second half of the year? It’s hard to say.

But I can say that, even when the economy is rough, not all media is created equal. News Corp and Bloomberg are doing very well for their size. BuzzFeed is seeing growth slow considerably and still isn’t profitable. The Times doesn’t depend on advertising to survive but is still seeing more weakness than it has in the past. And Dotdash Meredith will likely see things strengthen when it finishes its migrations.

All of this is to say… focus on what you can control. If the economy is strong, excellent. If it’s weak, what can you do to ensure your business continues to operate efficiently? You can’t control the economy; you can manage your business.

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