A dramatic decline in advertising revenue contributed to a “painful” year for The Economist as it suffered an 11% drop in profits despite raising subscription prices by 20%.
In its annual report, the weekly magazine said nearly a fifth of sales came from advertising, compared with 23% in 2015 and 40% seven years earlier. Chris Stibbs, chief executive, said magazine sales were the largest contributor to profits for the first time, thanks to a 52% jump in profits.
He said this was due to the “tremendous strides” the company had taken, but also a result of the downturn in advertising revenues.
“A significant price rise was introduced early in the year and expertly handled so that there was little impact on total volume or new starts,” Mr Stibbs said. Despite the price increase, the company said the number of subscribers had grown in the year.
The company said it had “seemed immune” to the global decline in the first five years, but added that “the virus eventually caught up with us, and how”.