Can a New CEO Save The New York Times?
The New York Times (NYSE: NYT) is reportedly searching for a "tech-savvy" chief executive to steer the company toward profitability.
According to Bloomberg, three prominent names were discussed as possible hires. They include Mark Thompson, the director-general of the BBC; Paul Sagan, the CEO of Akamai Technologies (NASDAQ: AKAM); and L. Gordon Crovitz, a former executive VP at Dow Jones and a former publisher of the Wall Street Journal. Bloomberg's sources claim that Sagan and other, unnamed executives have already been eliminated, either because they declined an offer or because the New York Times decided to go in another direction.
Over the past six months, the New York Times has lost roughly 15% of its value, closing Friday at $6.89. On Monday afternoon the stock traded down more than 2%, but it is still above the New York Times' year-to-date low of $5.98, which occurred on May 4. However, the company has been unable to approach its year-to-date high of $8.08, which was achieved more than six months ago on January 13.
For the six-month period ended in March, online subscriptions for the New York Times experienced a 73% gain in circulation. That has not been enough to offset the company's "years of declining sales," Bloomberg reports.
Joichi Ito, a research director at MIT, and Brian McAndrews, a venture capitalist, have been added to the New York Times' board of directors. Ito is credited as an early investor in Twitter, Flickr and Kickstarter, while McAndrews specializes in technology startups.
Despite these impressive hires, it could be difficult for the New York Times to acquire a top-tier CEO. According to Bloomberg, any chief executive that the publication hires would have limited autonomy when going up against its chairman, Arthur Sulzberger Jr. Sulzberger's father and grandfather served as publishers of the New York Times. With the Sulzberger family still in control of the publication, the next CEO may be unable to overrule company decisions.
Follow me @LouisBedigianBZ
(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.