Nielsen has reported an 8.1% drop in second quarter revenue (-5.9% on a constant currency basis) to $1.49 billion compared with $1.63bn in the prior year period; while net loss was $30m, compared with net income of $123m in Q2 2019.
Last month, Nielsen announced it is carrying out an 'optimization plan' to drive permanent cost savings and 'operational efficiencies', which will result in the loss of around 3,500 of its c.46,000 jobs. The firm also plans to exit several smaller, underperforming markets and non-core businesses in the second half of 2020. Nielsen expects the plan to be largely completed in 2020 and says that restructuring and other initiatives should drive c.$250m in pre-tax savings.
As the company continues to make progress toward its planned separation of Nielsen Global Media and Nielsen Global Connect, with the spin-off transaction expected to close in early 2021, the former business reported a 5.3% fall in revenues to $811m (-4.6% in constant currency terms). Audience Measurement revenues were down 3.1% (-2.4% on a constant currency basis - CCB), which the firm said reflected the impact of the Covid-19 pandemic on sports and non-contracted revenue, as well as ongoing pressure in local television. Plan/Optimize revenues dropped 11.1% (-10.3% CCB).
Meanwhile, Nielsen Global Connect revenues fell 11.3% to $685m (-7.4% CCB): within this, Measure revenues were down 9.3% (-5.0% CCB), reflecting the impact of Covid-19 on retail measurement services; and Predict/Activate revenues dropped 15.9% (-13.2% on a CCB).
Overall for the group, Adjusted EBITDA for the second quarter decreased 9.4% to $426m (down 7.6% CCB). CEO David Kenny (pictured) comments: 'In July, we announced a broad-based plan to accelerate our business transformation. We are prioritizing resources to focus on key strategic initiatives, higher margin products and services, and greater efficiency, which will drive agility and scale. Importantly, we expect our actions will permanently reduce our cost structure, driving margin expansion, increased cash generation and providing added flexibility to invest in key growth initiatives that will enable us to better serve our clients in rapidly evolving ecosystems'.
Markets reacted favourably to the news, with the company's share price climbing slightly, but at less than $15 it remains well below mid-February levels (above $20), placing it alongside some more traditional research firms, while some other top tech research names have recovered all their losses.
Web site: www.nielsen.com .
All articles 2006-20 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.