The Athletic, the sports journalism subscription website that became a bright spot for a beleaguered industry in recent years, said in a memo Friday that it is laying off 46 employees in its editorial and business departments, amounting to 8 percent of its staff.
It also imposed a staffwide pay cut of at least 10 percent for all employees.
“In order to ensure we can be a viable business for many seasons to come, we have to make decisions that won’t jeopardize our future,” said Taylor Patterson, a spokeswoman for The Athletic.
The Athletic launched its first local site in 2016, in Chicago, and quickly grew to cover nearly every major professional sports team in the United States, as well as dozens of professional soccer teams abroad. As tech giants like Facebook and Google have gobbled up most online advertising dollars and the news media has steadily contracted, The Athletic represents the hopes of many in the sportswriting industry that an alternative business model can be found.
The company makes the vast majority of its revenue through subscriptions, which usually cost $60 a year but are frequently discounted. The Athletic has nearly a million subscribers according to Patterson. That rapid growth has been fueled by nearly $140 million in venture capital funding, including $50 million raised earlier this year.
That funding allowed The Athletic “to keep this layoff under 10 percent of the company,” according to Patterson.
The Athletic is just the latest news media company to face challenges related to the coronavirus pandemic. At least 36,000 workers at news companies have been furloughed, laid off or had their pay reduced during the outbreak. The company is insulated from some of the pandemic’s ravages because of its funding and because it receives most of its revenue from subscriptions, though it does receive podcast advertising money.
In some ways, The Athletic operates more like a Silicon Valley technology company than a traditional media company. It has launched new offerings, like video, only to rapidly shut them down and lay off those employees. It has also previously dramatically downsized its freelance coverage of soccer and women’s basketball.
While the layoffs affected reporters and editors across sports, they were particularly concentrated at The Athletic’s Arizona and South Florida subsites.
The Athletic is not the only sports news media organization struggling. SB Nation, which runs individual websites devoted to teams as well as a national site, furloughed dozens of employees in April, and many more accepted buyouts ahead of a Friday deadline.
The Maven, which purchased Sports Illustrated last year and has overseen multiple layoffs, said in a Securities and Exchange Commission filing Friday that it was instituting temporary staff-wide pay cuts.