Phoenix Media Investment, one of China’s most influential media companies, had some bad financial news of its own on Friday. The company’s loss in the first six months of the year widened to HK$202 million, or $26 million, from red ink of HK$8.7 million a year earlier.
Revenue from mainstay broadcasting declined by 28% from a year earlier to HK$395.7 million, according to a filing at the Hong Kong Stock Exchange. That helped to pull down total revenue by 10.6% from a year earlier, to HK$1.6 billion.
Revenue fell amid “severe deterioration in the traditional media business environment,” Phoenix said. The expansion of Internet media has continued to challenge to conventional media, the company said.
Phoenix’s broadcasting operations posted a HK$89 million loss in the first six months of 2019, compared with a HK$53.6 million profit a year earlier. Overall, Phoenix had an operating loss of HK$477 million in the first six months of 2019, compared with a loss of HK$113 million a year earlier. The company, which on July 25 had warned of a more than HK$400 million operating profit loss, said it nonetheless had upgraded its strategic positioning.
Phoenix’s Hong Kong-listed shares closed at HK$0.63 before the announcement on Friday-- a loss of more than 10% from a year ago and a plunge of nearly 80% since mid-2015. Shares in its new media arm, New York-listed Phoenix New Media, have lost more than a quarter of their value in the past year, lowering its market capitalization to $229 million. Phoenix Media was worth HK$3.1 billion on Friday. Chairman Liu Changle owns 37% of the company.
Phoenix Media isn’t alone traditional media facing pressure to adapt to a changing industry environment. In the U.S., New Media Investment Group NEWM NY and Gannett GCI NY, two traditional U.S. publishers, announced plans to merge this month. Shares in the New York Times have lost a fifth of their value since Aug. 6 after an advertising forecast that disappointed some investors.
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