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Robert Sauerberg, Condé Nast C.E.O., to Step Down Condé Nast, Its Luster Dimmed by Losses, Is Looking for a New Chief
(about 1 hour later)
Robert A. Sauerberg Jr., Condé Nast’s chief executive, is stepping down as the magazine publisher confronts declines in circulation and advertising that have forced it to cease publication of some titles, trim the staffs at others and take additional steps to cut costs. Condé Nast, the once-flush publisher of Vogue, Vanity Fair, The New Yorker and other magazines, is looking for a new business leader after years of losses.
The company, whose publications include Vogue, Vanity Fair and The New Yorker, said on Tuesday that Mr. Sauerberg would relinquish his role after a successor is found. The next person to fill the job will hold the title of global chief executive, a new position at the head of both Condé Nast and Condé Nast International. The two units have historically operated as separate sister companies. The company said on Tuesday that its chief executive, Robert A. Sauerberg Jr., will step down after his successor is found. The announcement came months after Mr. Sauerberg announced a sweeping plan to address the struggles at Condé Nast.
The change in leadership at the company comes months after Mr. Sauerberg announced a sweeping plan to address the struggles at Condé Nast, which is based in New York and has its headquarters at One World Trade in Lower Manhattan. A corporate restructuring will go along with the change in leadership. The next person to fill the top job will hold the title of global chief executive, a new position at the head of both Condé Nast and Condé Nast International. The two entities have historically operated as separate sister companies.
A note sent to employees on Tuesday morning on behalf of the Condé Nast board said the company had spent the past year developing strategies to “meet the rapidly evolving media landscape,” acknowledging that the industry “is increasingly becoming more global.” Last year, Condé Nast lost more than $120 million. It has put three magazines, Brides, Golf Digest and W, up for sale, and announced that it would end regular print publication of Glamour after a nearly 80-year history.
Last year, Condé Nast lost more than $120 million. It has put three magazines, Brides, Golf Digest and W, up for sale. Last week, it said it would end regular print publication of Glamour after a nearly 80-year history. In recent years, the magazine publisher has addressed declines in circulation and advertising by closing other titles or reducing their frequency, laying off employees and leasing six floors of office space at its headquarters in One World Trade Center in Lower Manhattan.
Condé Nast, which was run for years by the publishing mogul S.I. Newhouse, is a subsidiary of Advance Publications, which is privately owned by the billionaire Newhouse family and controlled by Donald Newhouse, 89, and his son, Steven O. Newhouse, 61. The troubles increased the pressure on Mr. Sauerberg. The publisher did brisk business in the beginning of 2018, particularly from digital video, but hit a stumbling block in the third quarter, when the print editions of its magazines fell short of goals, two people with knowledge of the company’s financial performance said.
Condé Nast International, which is also part of the Advance family, has had its own leadership team, with Jonathan Newhouse, 66, as the chief executive. A cousin of S.I. Newhouse, Jonathan Newhouse will leave his Condé Nast International position once the global chief executive is hired, and will become chairman of the board, the company said. Condé Nast’s September issues are especially important to the publisher’s financial health. This time around, the once-dependable international fashion and luxury houses did not fatten the glossies with enough advertising to stem the bleeding. The company is expecting financial losses for this year, the people said.
While Condé Nast has struggled, its European counterpart, whose publications include British Vogue and Vanity Fair Italia, has thrived. Its president is a rising star at the company, Wolfgang Blau, 50, who joined as chief digital officer in 2015 and rose to his current position in 2017. Condé Nast was run for years by the publishing mogul S.I. Newhouse, who died last year, and has long been the glittering jewel of the Newhouse family empire. Its parent company, Advance Publications, is a privately held media company controlled by Si’s brother, Donald Newhouse, 89, and Donald’s son, Steven O. Newhouse, 61.
Earlier this year, Condé Nast said it would merge the American and international versions of its Condé Nast Traveler magazine. Much of Vogue’s photo production, backstage videos, social media posts and other digital coverage of fashion week will be centralized in London. As Mr. Sauerberg prepares to make his exit, Condé Nast International — also part of the Advance family — will take on new importance. A note sent to employees on Tuesday morning on behalf of the Condé Nast board said the company had been developing strategies to “meet the rapidly evolving media landscape,” acknowledging that the industry “is increasingly becoming more global.”
Based in London, Condé Nast International has had its own leadership team, with Jonathan Newhouse, 66, as the chief executive. A cousin of S.I. Newhouse, Jonathan will leave his post once the global chief executive is hired, and will become the chairman of the board, the company said.
While Condé Nast has struggled, its international counterpart, whose publications include British Vogue and Vanity Fair Italia, has thrived. One reason for its success is that print titles — on the wane in the United States — are still doing robust business in other parts of the world. The president of Condé Nast International is a rising star at the company, Wolfgang Blau, 50, who joined as chief digital officer in 2015 and rose to his current position in 2017.
[Read more about Wolfgang Blau’s tenure at Condé Nast International.]
The plan to combine the company’s two publishing arms fits into its larger aim to cut costs and unify its advertising and content strategies. Having one lead account executive sell worldwide advertising for a single title could have certain advantages.
“Our brands have worldwide influence and impact, and our business is increasingly becoming more global,” Steven and Jonathan Newhouse said in the memo to employees. “We have concluded that the time is right for us to combine our U.S. and international companies to realize the full potential of Condé Nast for our audiences and our business partners.”
Earlier this year, in what has proved to be a sign of things to come, Condé Nast said it would merge the American and international versions of one of its magazines, Condé Nast Traveler. And much of Vogue’s photo production, backstage videos, social media posts and other digital coverage of fashion week will be centralized in London.
Condé Nast International, which the company says is profitable, has also embarked on an ambitious expansion, creating new editions of Vogue in Czech Republic, Slovakia, Greece and Hong Kong.
But combining the company’s worldwide ambitions will be difficult, and the Newhouse family is seeking someone with experience running international businesses to replace Mr. Sauerberg. That makes it less likely that it will elevate someone from inside the company.
Mr. Blau, the Condé Nast International president, tried to calm any speculation that he was a contender for the job in a post on Twitter. “No, I will not move to New York and will not apply for the global CEO role,” he said. “I am happy with what I am doing here and thankful for the opportunity to support our global growth and the future global CEO from here in London.”
Mr. Sauerberg will leave the company after 13 years, less than three of them as chief executive. He will continue to represent Advance on the board of Reddit, the social media platform spun off by Condé Nast in 2011, the company said.Mr. Sauerberg will leave the company after 13 years, less than three of them as chief executive. He will continue to represent Advance on the board of Reddit, the social media platform spun off by Condé Nast in 2011, the company said.
The belt-tightening and downsizing at Condé Nast seem out of kilter with its lavish image. Editorial budgets ballooned in the days when S.I. Newhouse was in charge. His mentor, the onetime editorial director of Condé Nast, Alexander Liberman, summed up the company’s ethos when he said, “I believe in waste. Waste is very important in creativity.”
Condé Nast editors like Diana Vreeland, Tina Brown, Anna Wintour and Graydon Carter became cultural arbiters, often traveling in the same circles as the people whose lives were chronicled in their pages. Ms. Wintour, the editor of Vogue who has been the company’s artistic director since 2013, has been not only a front-row fixture at fashion shows, but something of a one-woman judge and jury for designers. And Mr. Carter, who was replaced last year as the editor of Vanity Fair by Radhika Jones, made his magazine practically synonymous with Hollywood glitter, thanks to the annual Oscars party.
But a recession and the rise of digital media led to a change in the company’s identity. In recent years, it has hired consultants, who recommended cuts, and closed Details magazine, as well as the print versions of Self and Teen Vogue. Layoffs went along with the austerity program, and the company combined the photo and research departments of different magazines.
This year, trade publications and gossip columns were rife with speculation that Ms. Wintour was looking to leave. In an attempt to tamp down such talk in July, Condé Nast issued a statement from Mr. Sauerberg himself: “She is integral to the future of our company’s transformation and has agreed to work with me indefinitely in her role as editor in chief, Vogue, and artistic director of Condé Nast,” he said.