New York Times Finances: A Bleak Pit of DespairS

The New York Times Co. released its fourth quarter financial results this morning. They are bad, bad, bad, and apparently without any upside on any front anywhere. Observe:

—Advertising revenue in the company's News Media Group (the newspapers) was down more than 18% in the fourth quarter.

—Operating income for the company at large is down close to 50%—disproving the idea that the company throws off plenty of cash, just not enough.

—And in maybe the most sickeningly portentous stat of all, the company's internet advertising revenues decreased 3.5% in the fourth quarter. That's the one area that's supposed be going, you know, up.

Just as bad as expected, if not worse.

Coincidentally, today the NYT runs an op-ed from Yale's hallowed money manager David Swensen, in which he recommends that newspapers turn themselves into non-profits with endowments (we agree, philosophically at least). "As long as newspapers remain for-profit enterprises, they will find no refuge from their financial problems." He's talking to you, NYT!

Swensen says the NYT would need about a $5 billion endowment to operate in perpetuity as a non-profit. The problem, of course, is once you get an endowment like that, you essentially turn into a hedge fund. And as Swensen—who lost billions this year for Yale—knows, hedge fund money is never guaranteed.