Sales 2023: $ 12,000 billion (€ 11,400 billion)

Overview

Hearst was founded in 1887 and is considered the oldest media group in the world. Traditionally, the newspaper and magazine sector has been its core business, although today it places a strong emphasis on integration with online offerings. The repurposing of content and the provision of special interest publications are the two main pillars of its business. The US group's other areas of activity include television and radio, production, and distribution. The New York-based rating agency FitchRatings has also been owned by the Hearst Corporation since 2018.

General Information

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Headquarters
300 West 57th Street
New York, NY 10019
USA
Telephone: 001 212 6492000
website: hearst.com

Branches of trade: TV stations, TV production, newspapers, magazines, rating agencies
Legal form: Private Company
Financial year: 01.01 – 31.12
Founding year: 1887

Basic economic data*

	2023	2022	2021	2020	2019	2018
Sales (in billion US dollars)	12	12	11.5	11.5	11,5	11,4
Employees	24.000	24.000	24.000	24.000	24.000	20.000

* Estimates; Hearst, as a private company, is not obligated to release current financial figures.

Executives and Directors

Management:

• Steven R. Swartz, President & CEO, Hearst
• William Hearst III, Chairman of the Board, Hearst
• Frank A. Bennack, Jr., Executive Vice Chairman, Hearst
• Mark E. Aldam, Executive Vice President, Chief Operating Officer, Hearst
• Eve Burton, EVP & Chief Legal Officer, Hearst
• Richard P. Malloch, EVP, Hearst Business Media, Hearst
• Mitchell Scherzer, EVP & Chief Financial Officer, Hearst
• James M. Asher, SVP, Chief Development Officer, Hearst
• Katharine Barnett, SVP, Human Resources, Hearst
• Michelle P. Bennett, Senior Vice President, Talent Development, Hearst
• Frank Biancuzzo, EVP, Hearst Television

History

In 1850, farmer's son George Hearst (1820-1891) left Missouri for California, where he discovered some of America's most lucrative gold and silver mines and became one of the richest men in the country. In 1880, Hearst bought the daily newspaper "San Francisco Examiner" to support his political career, and in 1886, he went to Washington as a senator. The newspaper was making a loss and held little interest; he kept it only as a mouthpiece for emergencies. It was his son William Randolph (1863-1951), the main inspiration for the character of Charles Foster Kane, protagonist of Orson Welles' cinematic masterpiece "Citizen Kane" (1941), who transformed the company into a media conglomerate. Before taking over his father's newspaper in the summer of 1887, Hearst Jr. looked around in the larger editorial offices on the East Coast, but contrary to a persistent rumor, he himself never worked as a reporter for Joseph Pulitzer's "New York World."

From the "Examiner," Hearst Jr. built the world's largest media empire. After purchasing several newspapers, he invested in the film business and founded his own studio in 1918, in the midst of one of the worst newspaper crises in US history. After Charlie Chaplin's "United Artists" declined to partner with him, he found a congenial partner in the Hungarian Adolph Zukor for his production company, "Cosmopolitan Productions." The name Hearst and the film character Citizen Kane have since become synonymous with the aggressive, power-hungry media mogul.

Hearst increased circulation figures through free copies and the largest, most striking headlines on the entire West Coast. Along with Pulitzer, Hearst is considered the inventor of so-called "yellow journalism," whose success was based on exaggerating stories, emotionalizing them, and creating scandals. Hearst's correspondence with the illustrator Frederic Remington, whom he sent to Cuba in 1898 to illustrate the expected outbreak of war between Spain and the USA, is legendary. Remington found everything calm and peaceful upon his arrival in Havana and sent the following telegram: "All quiet here. There is no war. I want to go back." Hearst allegedly cabled in response: "Please stay. You provide the pictures. I'll provide the war." A short time later, the battleship USS Maine did explode (though this was not Hearst's fault). Remington supplied the pictures, and Hearst increased circulation.

Hearst used his newspapers without hesitation to further his political ambitions; in the style of a baroque monarch, he ruled his media empire from Castle San Simeon, a vast country estate on the West Coast, where he resided with his mistress. He was a passionate collector of art and antiques, as evidenced by Castle San Simeon, now open to the public. This private citizen is certainly one of the biggest squanders in modern industrial history.

In 2000, the Federal Trade Commission forced the company to sell the long-running "San Francisco Examiner" newspaper. According to the antitrust watchdog, Hearst Corp. had established a monopoly position in the region by acquiring the rival "San Francisco Chronicle." This made a merger of the two major newspapers impossible, leading to the US newspaper crisis affecting both newspapers and pushing them to the brink of insolvency.

Whereas fifty years ago, print products contributed 77 percent of revenue, today that number is less than fifteen percent. What print titles remain is the result of a strategically incorrect decision made in 2006. At that time, Hearst bought several newspapers from its competitor MediaNews. In addition to the traditional Connecticut Post, these included The Darien News-Review, The Greenwich Citizen, Fairfield Citizen-News, New Canaan News-Review, New Milford Spectrum, Norwalk Citizen News, Westport News, The Stamford Advocate, Greenwich Time, and The News-Times of Danbury. Nothing was initially disclosed about the purchase price or any consequences for the newspapers' staff. But despite the fresh capital from Hearst, MediaNews Group Inc. was on the verge of collapse in December 2008. As the largest shareholder, Hearst was then required to assume responsibility for the majority of the loans.

Traditionally, the media company financed struggling newspapers through other projects until the restructuring process was completed. By the end of 2008, however, it became clear that this business policy had become a trap. MediaNews filed for bankruptcy, costing Hearst at least $155 million. This deal likely contributed to the 2008 departure of CEO Victor F. Ganzi and the recall of the near-legendary Frank A. Bennack, who led the company between 1979 and 2002. Ganzi had been brought in to manage the transition to the digital age, but Bennack was considered too old for the job.

In the 1980s, Hearst Corp. acquired three TV stations and, in 1991, a 20 percent stake in the sports cable network ESPN. Since the mid-1980s, magazine publishers such as Esquire and Redbook have been part of the portfolio, along with several business and industry services. By merging its TV division with Argyle Television, Hearst now controls almost three dozen local TV stations in the USA. In the fall of 2009, Hearst took advantage of the crisis, bought all of Argyle's freely tradable shares, and delisted the company. Hearst had already made an offer to shareholders in the summer of 2007, at just under $23 per share. The shareholders rejected the offer because they considered it too low. Two years later, Hearst bought the shares for $4.50 each. Since the last major acquisitions in the TV business, however, Hearst's business policy seems somewhat arbitrary. Hearst has become a private equity firm and collaborative partner, holding numerous minority stakes in startups and technology companies shaping the future of online publishing.

In 2003, construction began on the new $500 million headquarters, a spectacular glass structure atop the existing six-story Hearst building in Manhattan's Columbus Circle (built in 1928). Since the summer of 2007, all 2,000 Hearst employees in New York, previously spread across five locations, have been working in the 46-story building designed by London architect Norman Foster. The fact that Hearst doesn't have to finance such sums through loans demonstrates the financial strength of the family-run company.

In April 2018, Hearst acquired the remaining 20 percent of Fitch – one of the three major US rating agencies (along with Moody's and Standard & Poor's) – for $2.8 billion. In the financial sector, 2018 also saw exceptional achievements According to Hearst CEO Steven Swartz in his annual review at the beginning of 2019, software and financial data generated one-third of the group's profit.  

All in all, 2018 was a record year with revenues of $11.4 billion. The most lucrative business segment remains the TV business. The Walt Disney Company's (with which it jointly operates the ESPN and A&E networks) plans to distribute ESPN and A&E content via its own streaming platforms are viewed positively and promisingly. And, bucking the trend, even the print magazines remain profitable. Men's Health, Women's Health, and Runner's World were added to the Hearst portfolio in 2018.

management

CEO Steven Swartz began his career as a journalist at the Wall Street Journal, where he quickly rose to senior editor. He founded the business magazine Smart Money before moving into management at Hearst, where he worked his way up to Chief Operating Officer. He then assumed the CEO position in 2013.

Frank A. Bennack, Jr., now Executive Vice Chairman, was Hearst CEO from 1979 to 2013. During a sabbatical from 2002 to 2009, when his longtime confidant Victor Ganzi stepped in as CEO, he managed the New York City Opera. Bennack was Hearst's longest-serving and most important corporate leader after the legendary William Randolph Hearst (1863-1951). Under his leadership, Hearst acquired Redbook and Esquire and founded the History Channel, Lifetime, and A&E together with ABC. He was assisted as chairman by George Randolph Hearst, grandson of the company's founder, who died in the summer of 2012 at the age of 84 after more than 40 years with the company.

Business segments

Hearst is divided into nine business units, including:

–       BroadcastingHearst Television is a multimedia company with over 30 TV and radio stations, with over 70 channels reaching one in five households in the United States – primarily on the East Coast, in the Southern United States, and in California. The division produces news, weather, sports, and entertainment programs for every available platform.

- the Entertainment & SyndicationThe division includes various investments in TV broadcasters such as ESPN (20 percent) and A&E Networks (50 percent; A&E in turn holds a ten percent stake in Vice Media) and production companies such as NorthSouth Productions.

–       MagazinesOne of the world's largest magazine publishers, with nearly 250 publications and 200 websites worldwide. Major titles include Cosmopolitan, ELLE, Esquire, Harper's Bazaar, Men's Health, Car and Driver, Country Living, and HGTV.

–       Daily newspapers: 24 daily newspapers and 52 weeklies such as The Advocate (Stamford), Albany Times Union, Beaumont Enterprise, Connecticut Post, Edwardsville Intelligencer, Greenwich Time, Houston Chronicle, Huron Daily Tribune, Laredo Morning Times, Midland Daily News, Midland Reporter-Telegram, The News-Times (Danbury, Connecticut), Plainview Daily Herald, San Antonio Express-News, San Francisco Chronicle.

–       Fitch Group,one of the "big three rating agencies" (alongside Moody's and Standard & Poor's).On 5 May 2021, it was announced that the Fitch Group had replaced the independent Credit market observer CreditSights takes over.

        The business area Ventures Hearst has invested approximately one billion dollars in various venture capital investments to date, including investments in over 20 startups.

Current developments

Although Hearst was able to avoid layoffs at the beginning of the coronavirus pandemic, in early May 2021, it was forced to lay off Magazines' sales and marketing staff. voluntary cash compensation offers The hope is that 600 to 2,200 employees will accept the offer, thus avoiding compulsory layoffs. Editors are not affected.

Otherwise, the 2021 financial year as a whole was very satisfactory for Hearst, as CEO Steven R. Swartz noted in his annual review published on February 2, 2022. While, as mentioned, Hearst, as a private company, is not required to disclose financial results, Swartz nevertheless cannot help but write: "Through extraordinary dedication, we remained true to our mission to serve others, as our quality journalism, analytics, data, software, and entertainment have never been needed more. And we have been rewarded for our work in many ways, including by achieving new highs in revenue and profit."

literature

» David Nasaw: The Chief: William Randolph Hearst – The Rise
   and Fall of the Real Citizen Cane, 2002
» Jeffrey Toobin: American Heiress: The Wild Saga of the Kidnapping, Crimes and Trial of Patty Hearst, 2017
» Louis Pizzitola: Hearst over Hollywood, 2002
» Nancy Frazier: William Randolph Hearst: Modern Media Tycoon, 2001
» Nancy Whitelaw: William Randolph Hearst and the American Century, 1999