The Athletic is the latest news outlet to be subject to cutbacks. On Monday, The New York Times-owned company said they would lay off about 20 reporters, representing about 4% of its newsroom. In addition, 20 other journalists will receive new assignments, said The New York Times who covered the story. Staff received the announcement in a note from David Perpich, publisher, and Steven Ginsberg, executive editor of The Athletic, who called this a “significant reorganization.”

“Even with the changes being announced today, the size of our newsroom will grow this year compared to last, as will our overall investments in our editorial group in the years ahead,” said Perpich and Ginsberg in the note to staff. “At the end of this process, we will have more than 100 beat reporters on teams.”

Continued losses

In their quest to diversify revenue streams, The New York Times acquired The Athletic, a digital sports news outlet, for $550 million in an all-cash deal in the spring of 2022.

“Acquiring The Athletic puts us in a position to be a global leader in sports journalism and offer English speakers around the world another reason to turn to the Times Company to meet their daily news and life needs. The Times already provides distinctive sports coverage for a general interest audience as part of our core report,” said Meredith Kopit Levien, president and CEO of The New York Times Co., in a January 6, 2022 news release.

“As a stand-alone product, The Athletic will enable us to offer much more — extensive coverage for fans who seek a deep connection to and understanding of their favorite teams, leagues and players. With one of the largest dedicated teams of reporters covering sports globally and a commitment to everyday reporting, The Athletic is a great complement to The Times,” Levien added.

Copyright © 2023 Authority Media Network, LLC. All rights reserved. Reproduction without permission is prohibited.

Prior to the acquisition, in 2021, The Athletic finished the year with 1.2 million subscribers, had $65 million revenue, and $55 million in operating losses. In the fourth quarter of 2022, The Athletic had an operating loss of $6.9 million. Revenue has increased since the acquisition, but the popular sports outlet is still running at a loss. Between the time of the deal and the end of 2022, The Athletic had lost about $36 million.

In the first quarter of 2023, The Athletic brought in $28.6 million in revenue and had nearly 3.3 million subscribers. They also reported a loss of $7.8 million.

The Athletic and StubHub partnership

The news comes about a month after The Athletic announced a new strategic partnership with online ticket marketplace StubHub. The goal of the strategic alliance could potentially propel The Athletic toward profitability by introducing innovative revenue streams and enhancing the overall user experience. StubHub will be integrated into The Athletic’s product, content and subscriber offerings, creating a seamless way to buy tickets to live sporting events, the companies said.

“Millions of sports fans around the world trust The Athletic for the latest, and most accurate, sports news and content, just as StubHub is trusted to give fans access to the sporting events they love,” said Cris Miller, Chief Business Officer at StubHub, in a May 11 news release. “By partnering with The Athletic, we can reach an engaged and motivated audience of sports fans and help connect them to the experiences they’re interested in.”

Insider Take

Since its launch, the subscription-based Athletic has gained the respect – and subscription dollars – of millions of sports lovers by providing ad-free, quality reporting on teams in all the major sports leagues. Unfortunately, the company continues to lose money, and it is trying to find new ways to stem those losses. In September 2022, The Athletic brought premium ads to the site to help grow revenue. In addition, The Times has added The Athletic to its all-access subscription bundle. These layoffs, of course, are a blow to those affected, and to the readers who love their work. This is particularly painful because The Athletic said it will continue to grow this year. However, The New York Times is a smart organization. They can’t continue to let The Athletic run at a loss no matter how well respected and beloved it is.

Copyright © 2023 Authority Media Network, LLC. All rights reserved. Reproduction without permission is prohibited.