Ben Sherwood and Joanna Coles, after cutting back staff at The Daily Beast, have managed to swing the digital news and opinion site to its first profitable quarter.
The Daily Beast is majority owned by Barry Diller’s IAC holding company, which said third-quarter 2024 revenue at the site increased 81% year over year and turned a profit for the first time. IAC does not break out results of The Daily Beast, which is included in its “Emerging & Other” business segment.
IAC CEO Joey Levin, in an internal company memo about the Q3 earnings Monday, wrote, “Even little Daily Beast had a great quarter, growing revenue over 80% and, for the first quarter ever, profitable!”
In April, Sherwood and Coles inked a deal to lead The Daily Beast, under which the media veterans were granted a 49% stake in the news and opinion site. Sherwood, a former president of the Disney ABC Television Group, serves as The Daily Beast’s publisher and CEO. Coles, previously Hearst Magazines’ chief content officer, is chief creative and content officer. The deal came after Diller had unsuccessfully tried to find a buyer for the Daily Beast.
To get the Daily Beast into financial shape, Sherwood and Coles made a series of cuts, including a voluntary buyout program targeting a $1.5 million reduction in expenses. As of the beginning of July, The Daily Beast’s headcount was down about 35% through the buyouts and a “handful of layoffs,” per a New York Times report.
“Our focus is to be an intelligent tabloid,” Coles told Variety in a recent interview. “What we have seen is that the audience responds to sharp, short, relevant pieces.” Sherwood said, “We want this to be a sustainable business, an actual sustainable business that grows and can support even more independent, distinctive journalism,” adding that “Many of our peers in this space have had to close down, shut down, go out of business.”
Coles and Sherwood said they have recruited dozens of new contributors for The Daily Beast, including Samantha Bee, TV writers such as Jill Twiss, Jennifer Crittenden and Gaby Allan, former Twitter CEO Dick Costolo, writer/producers such as Larry Wilmore and Phoebe Robinson, and even Daily Beast founding editor Tina Brown.
After the Daily Beast was launched in 2008 by Brown, IAC became 50% owner of the merged Newsweek Daily Beast Co. IAC then bought a controlling stake in the venture before selling Newsweek to IBT Media in 2013.
Separately, in reporting Q3 results, IAC said it is considering a spin-off of its 85% ownership stake in home services company Angi to shareholders.
On Tuesday, shares of Angi had plummeted more than 20%. A spin-off of Angi would make it the 10th fully standalone public company to come out of IAC. “With the spin of Angi, we would effectively exercise an option, as we have throughout our history, giving Angi a more liquid currency and distinct shareholder base to pursue its ambitions,” Levin wrote in a letter to shareholders.
Meanwhile, Q3 revenue at Dotdash Meredith, formed in the fall of 2021 through IAC’s acquisition of Meredith, rose 5% to $439.5 million and operating profit came in at $22.1 million (versus an operating loss of $3.6 million a year earlier). Digital revenue increased 16% to $246 million, the third consecutive quarter of double-digit growth, while print revenue declined 6% to $199 million.
