Reach, the UK's largest commercial news publisher, said it remained on track to meet full-year profit expectations despite a sharp fall in digital revenues, as disruption to Google's search referral traffic continued to drag on its online business.
Group revenue fell 14.1% in the third quarter and 10.8% over the nine months to 30 September, with digital revenues down 20.3% in the quarter and 14.5% for the year to date.
The headline digital figure masked two very different stories within it.
Direct revenues, which come from advertisers engaging directly with Reach's titles, fell a relatively modest 5.5% in the quarter.
Indirect revenues, earned programmatically through on-platform advertising or via social platforms, collapsed by 29.7%, reflecting the sharp drop in online audiences flowing through from Google's search results.
Google has made a series of changes to its search algorithm and results pages in recent years that have significantly reduced the volume of traffic it sends to third-party news publishers.
The shift began in earnest with a series of core algorithm updates that progressively deprioritised publisher content in favour of AI-generated summaries displayed directly within search results.
Users who once clicked through to a news article for an answer increasingly find that answer served on Google's own page, never reaching the publisher.
For ad-funded news businesses such as Reach, which relies on page views to generate programmatic advertising income, the effect has been direct and damaging.
Reach said lower on-platform audiences were partly offset by improved off-platform revenue growth, including AI licensing income supported by a recently signed agreement with a major technology platform, which it did not name.
Print revenues fell 12% in the quarter, though advertising within print held up better than circulation, with the FIFA World Cup providing a boost.
The group launched a restructuring during the period and said full-year cost savings would exceed the 10% delivered in the first half, with total cash restructuring charges estimated at between £35 million and £40 million, including costs related to print site closures.
Chief executive Piers North said the group would maintain strict financial discipline until pension deficit payments ended in 2028.
Full-year results are due on 2 March, with consensus adjusted operating profit for the year set at £95.1 million.
