The Global Media Weekly for executives and entrepreneurs

How the FT became much more than a newspaper

The Financial Times is on top of the world. Twenty-two years after introducing an almost-revolutionary paywall, it has 1.4mn paying subscribers, 93% of which are digital and 70% are outside the UK. That’s a 35% increase in subscribers since 2018, when its 1mn subs breakthrough marked the highest number of paying readers in the newspaper’s history. Nine years after it was acquired for £844mn by Nikkei, Inc, of Japan, the FT generates some 70% of its revenue from readers.

That’s a mirror of the New York Times which increased revenue by 30% during 2019-23 – but the FT achieved almost 50% growth.

The UK economic pains of Brexit (which the FT strenuously opposed) helped to turbocharge the UK-based business news brand just as the Trump presidency did for the New York Times. And Covid / WFH helped too: During the first UK lockdown, the FT’s weekly page views increased 97% and it achieved its annual digital subscriptions target in just three months. But neither of what are, arguably, the leaders in the race to be the world’s news brands, have succeded simply because of the tailwinds. Both have been building subscriptions by painstakingly managing the customer data, and producing vertical newsletters, personalised content and networking across print, online text, video, audio, and events.

The Financial Times under 18-year CEO (and former FT journalist) John Ridding has had a distinctive strategy.

Among all else, it has sought to measure the levels of subscriber engagement based on how Recently, how Frequently and the Volume of content they have consumed (RFV). Its become expert at tweaking, nudging and evolving the “right” experience for readers and tracking the performance of content. Live data has been at the heart of the FT digital transformation including “Quality Reads” which identify the content where readers have read more than 50% of the article. Editors get weekly reports of how they’re doing. They are also working hard to get the attention of under-weight readership groups like women (one-third of all subscribers) and millennials by targeting them with print and multimedia content, especially audio. Nobody doubts that AI tools can enhance this drive for reader-user engagement and FT executives (and their journalists) are all over that too.

That strategy has produced the readership and revenue growth of the last five years. It has also, incidentally, supported an aggressive pricing strategy under which “premium digital” UK subscribers are paying almost £600. In 2023, Press Gazette named the FT as the most expensive digital news subscription in the UK and US for the second consecutive year:

Financial Times
Op profit 452931(21)1.0
Margin 9%6%7% —
Paying readers mn (% digital)1.3 (92%)1.2 (91%)1.1 (88%)1.1 (87%)1.1 (87%)
Headcount 2,9002,6692,2962,1822,130
** Flashes & Flames estimates

Behind the financials and steady growth in digital subscriptions are other strategic milestones:

International: The UK, which as recently as 2016 accounted for 50% of revenue, is now 36%, not much more than North America which has more than doubled revenue in the past five years. Some 280k (20%) of FT subscribers are now in the US which is also the FT’s biggest audio market (notably with FT News Briefing and Unhedged), with 800k regular listeners – tripled in less than two years. It is now targeting similar growth in India.

Headcount: In addition to increasing staffing steadily (with no reduction in journalist jobs) during five years of almost universal news industry retrenchment, the FT group’s total remuneration costs have increased by double-digits in each of the last three years.

Payback: In 2023, the FT (which had been acquired for 2.5x revenue and 35x operating profit) accounted for 23% of Nikkei’s £2.3bn revenue – up from 14% in 2018, a trend likely to be perpetuated by the FT’s international growth. The UK-based business is becoming an increasingly important global partner for its parent.

But something else is also happening at the FT.

In 2023, when the revenue is known to have exceeded £500mn for the first time, more than 20% – and likely most of the 11% increase – came from beyond the Financial Times itself, notably:

FT Specialist: The c£70-80mn-revenue division publishes 19, mostly-digital brands for 430k paying subscribers in 10 audience groups. It is thought to generate some 70% of its revenue from digital subscriptions – 50% from the US, with the UK next. Less than 20% of its revenue comes from advertising. Its major brands include: FDI (foreign direct investment), MandateWire, Ignites, FundFire and Endpoints. The US biopharma newsletter Endpoints, which is believed to have a revenue of some $15mn, was acquired last year and seems to signal a step-up in acquisitions of digital-only B2B media after a track-record of £2-3mn deals. Although FT Specialist continues to publish The Banker and the consumerist Investors’ Chronicle out of London, it has closed or sold almost a dozen other magazines in the past decade; print is now only about 5% of revenue. The development increasingly resembles that of other media in B2B verticals, which is one reason why we might expect it to increase events revenue (with FT Live) beyond the current 10%. Interestingly, the Endpoints founders were former executives of Fierce Markets – like the founders of Industry Dive, acquired by Informa for $389mn in 2022. That would have been too rich a deal for the FT at this stage (not least with its dependance on advertising, although the single-sector Endpoints resembles Industry Dive in this respect). But you can see the direction of travel for the FT’s expanding B2B newsletter portfolio which is believed to have tried to acquire The Information tech newsletter.

FT Live: The c£30-40mn-revenue division is the organiser of some 200 events, including: Commodities Summit, Banking Summit and Future of the Car but the portfolio includes other strong brands including: Global Banking Summit, The Global Boardroom, Hydrogen Summit, Women in Business, and the FT Weekend Festivals in London and Washington DC. It also organises highly-profitable, one-hour webinars on behalf of sponsors (some of which are said to pay £40k+ for the privilege). Separately, the FT’s TNW (“the next web”) annual conference and exhibition in Amsterdam next month will attract some 10,000 delegates and 200 exhibitors, a 16-year-old mecca for European startups and investors.

Together, these B2B divisions are believed to account for £100-120mn (20-25%) of the FT Group revenue and (maybe) more than 50% of the operating profit in 2023. They both share a double-digit profit margin and growth rate.

Their combined revenue may exceed £120mn in 2024, spearheading the group’s growth in North America. They have a combined headcount of some 500 (15% of the FT group total). FT Strategies (consulting) and FT Longtitude (thought leadership) account for a further 120 people. So, although the extended FT network of owned companies and investments totals some 2,200 people, it is clear that more than 40% of direct employees are now accounted for by the group’s non-news businesses.

The importance of what were once ancillary businesses is underlined by the fact that their 1.2mn global audience now almost matches the reach of the Financial Times itself – and produces the whole group’s eye-catching “global paying audience” of 2.6mn.

The salmon-pink newspaper is the brand platform for the group’s worldwide expansion with its reputation for quality journalism far beyond the financial services. But it’s no longer all about a newspaper.

The FT’s latest audited numbers in the UK show that, on weekdays, the newspaper is now selling just 12k copies (4.9k of them paid single copies, 7.4k subscriptions) – about 20% less than two years ago and 50% down since 2019. The promoted numbers are embellished by some 31k “multiple” copies, provided free for travellers at airports, rail stations, and hotels. But weekends are another story. The distinctive FT Weekend edition sells some 65k copies, at a cover price of £5.10 (compared with £3.50 on weekdays). The Weekend’s 5x sales at a 45% higher cover price and advertising-stuffed leisure supplements and magazines (including How to Spend/ Save It) means the FT’s average revenue on Saturday is more than the combined revenue for all five weekday editions.

Like other UK daily newspapers, the FT makes virtually all its profit on Saturday. They all deny thoughts of reducing the papers to just the profitable days around the weekend but you can imagine the scenario planning.

The FT is still printed at sites across Europe, North America and Asia, and distributes some 60k copies around the world each day, in addition to the 40k (paid and free) in the UK. It continues to be the home of so much great journalism even as its parent company shifts the emphasis to specialist business services.

The FT has a history of ancillary publications (its published The Banker and Investors’ Chronicle for almost 100 years) and has long dabbled in B2B magazines and newsletters. But this time it’s different. The shift in the group’s revenue from a UK-centric daily business newspaper to global digital information services has brought a new focus on business and professional audiences, notably through the vertical products and services of FT Specialist and FT Live.

These divisions already account for much of the group’s growth and are spearheading the expansion in North America in particular. That’s why the double-digit purchase of Endpoints may have been so significant. The FT’s overall performance since its own pricey acquisition has persuaded Nikkei of the potential for a step-change in the operations especially in Asia and the Americas. That might be expected to lead to many more investments across FT ‘home ground’ sectors including energy, law, technology, education and public policy – as well as global expansion of the existing brands in pharma, insurance and finance. There’s a lot of room to grow and insiders have long hinted at a £100mn fund for acquisitions.

The B2B emphasis is further cemented by the three-year-old FT Strategies, a subscription consultancy that works with media and other companies worldwide. It tells customers: “We transformed the FT from a 130-year-old legacy print brand into a thriving digital model. We’ve learnt from our mistakes, and built up practical best-in-class expertise – which we’re sharing with subscriptions businesses like yours to help you thrive in the digital economy.”

With the FT group’s increased emphasis on B2B verticals, we might expect a more unified approach to its global operations. This might include a broad membership network, enabling subscribers seamlessly to access the whole range of FT products, services and events. It could become the ultimate, content-rich membership organisation for business people worldwide. It could be a big step-up from existing training courses for board directors and member-only communities for company chairs and women. 

Such a move towards “One FT” could provide the impetus to create a single, group-wide content platform to maximise the sharing of resources and the development of proprietary data services and reader-user networks. It is notable that, although FT Specialist media share the branding and editorial code of the Financial Times, they seldom share either content or people.The prize of ‘unification’ might be the equivalent of the dominant and all-knowing Bloomberg Terminal, to create the ultimate membership dependance. For the FT in its third century, the rapid change might have only just begun.

Financial Times