Meredith Corporation will cut 180 jobs, including 130 employees from its local media group, which owns and operates 17 television stations, reports the Des Moines Register. The company’s local media brands are in large, fast-growing markets like Phoenix, Portland and Las Vegas, according to Meredith, and they produce approximately 745 hours of local news, information and programming weekly. The remaining cuts will come from Meredith’s national media group, the publisher of popular consumer magazines including Real Simple, Allrecipes, Shape, Better Homes & Gardens, and People. The company’s national brand portfolio serves approximately 120 million readers.
Job cuts due to COVID and strategic portfolio adjustments
The job cuts are due, in part, to impacts caused by COVID-19 on the company. For the period ended June 30, which was the company’s fourth quarter of fiscal year 2020, Meredith reported total revenue of $611 million, a 22% decline year-over-year. The company attributed the decrease in revenue to two primary drivers: pandemic-related advertising cancellations and delays of $136 million, and strategic adjustments to their portfolio to improve profitability which reduced advertising and related income by $40 million.
“Meredith’s strength lies with our brand depth and consumer reach, which have stood the test of time and have become even more relevant as consumers seek high quality content they can trust,” said Tom Harty, Meredith president and CEO in the fourth quarter earnings report. “While the current business environment is challenging, I am confident the strength and resilience of our portfolio of brands and businesses, and their strong engagement with tens of millions of consumers, will generate growth over the long term.”
Company seeks approval to separate local and national media groups
Meredith did not issue a press release about the layoffs but on, September 9, the company issued a news release saying they sought shareholder approval to separate their national and local media groups. The reason cited is to “increase options for a tax efficient separation” of the national and local media groups. Meredith said the amendment was not in response to “any specific conversations or events,” and they told the Des Moines Register a split is not imminent. The board of directors unanimously approved the amendment. It must also be approved by Class B and common shareholders which Meredith hopes will occur at its annual shareholder meeting on November 11.
Meredith sues The Maven for breach of contract
The news of the job cuts comes one month after Meredith sued the new owner of Sports Illustrated, The Maven, for $1 million for breach of contract. According to the 10-page complaint filed in the U.S. District Court of Delaware, the Maven owes Meredith money for services rendered under two separate agreements, an outsourcing agreement and a transition services agreement. Under the agreements, Meredith agreed to provide services to continue publishing Sports Illustrated and its websites without interruption for a specified period. Meredith held up its end of the deal, but they allege that The Maven has not paid them for their work.
Other media organizations cutting jobs
Meredith is not the only media organization in the midst of layoffs. Media Post reports that as many as 400 employees at News Corp could lose their jobs because the company is shifting its printing operations to The New York Times. In addition, Bloomberg is laying off 21 staffers. For the most up-to-date tally, Poynter has been tracking the newsroom layoffs, furloughs and closures at Poynter.org.
The pandemic has hit everyone hard, but some industries have been hit harder than others, including the media industry. Some media organizations may bounce back this fall because political ad spending is expected to be significant, particularly with the polarizing presidential race. That ad revenue boost is just a temporary fix though. Meredith and other media organizations have more issues to contend with besides the pandemic, including an evolving business model which companies must adapt to or die trying. Who will be next?