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Gannett Revenue Decline Hints at More Doom for Newspapers: JP Morgan

JP Morgan is forecasting that severe declines will continue at newspaper publisher Gannett in the second quarter.

Ad revenue will fall 32% in Q2, JP Morgan analysts have predicted, with consolidated EBITDA declining to a margin of 17%, compared to a margin of 25% in the second quarter of 2008, writes Editor & Publisher. Ad revenue fell 34% in the first quarter of the year.

Flagship publication USA Today will experience “severe declines,” the analysts say. They predict that Gannett’s weakness will “set the tone for another depressing reporting season in the newspaper universe.”

Gannett plans to cut between 1,000 and 2,000 positions, after having cut 10% of its work force last year, according to a source, the Wall Street Journal writes.

The cuts are not expected to affect USA Today.

In the first quarter of 2009, local newspaper ad spend declined 25.1%, while national newspaper ad revenue slipped 28.5%, according to TNS Media Intelligence.