Billionaires wanted to save the news industry. They lose a fortune.

There's an old saying about the news business: If you want to make a small fortune, start with a big fortune.

As the prospects for news publishers deteriorated over the past decade, billionaires moved to buy some of the country's most storied brands. Jeff Bezos, the founder of Amazon, bought The Washington Post in 2013 for about $250 million. Dr. Patrick Soon-Shiong, a biotech and startup billionaire, bought The Los Angeles Times in 2018 for $500 million. Marc Benioff, the founder of software giant Salesforce, bought Time Magazine with his wife Lynne for $190 million in 2018.

Each time, newsrooms greeted their new owners with cautious optimism that their business acumen and technical knowledge would help answer the confusing question of how to monetize a digital publication.

But it increasingly appears that billionaires are struggling like almost everyone else. Time, The Washington Post and The Los Angeles Times all lost millions of dollars last year, people with knowledge of the companies' finances say, after significant investments by owners and intensive efforts to tap new revenue streams.

“Wealth does not insulate an owner from the serious challenges facing many media companies, and it turns out that being a billionaire is not a predictor of solving those problems,” said Ann Marie Lipinski, curator of the Nieman Foundation for Journalism at Harvard. University. “We have seen that there is a lot of naive hope attached to these owners, often from employees.”

The losses may have the most immediate impact at The Los Angeles Times, where journalists brace for bad news. Kevin Merida, the paper's widely respected editor, announced last week that he would resign, a decision that came after tensions with Mr. Soon-Shiong over editorial and business priorities, according to two people familiar with the matter.

By the middle of last year, The Times was on track to lose between $30 million and $40 million by 2023, according to three people with knowledge of the forecasts. The company cut about 74 jobs last year, and executives have met in recent days to discuss the possibility of deep job cuts, according to two other people familiar with the talks. Members of The Los Angeles Times union called an emergency meeting on Thursday to discuss the possibility of another “big” round of layoffs: “This is the big one,” read the email to employees.

A spokeswoman for Mr. Soon-Shiong declined to comment on specific financial figures provided by The Los Angeles Times, but said in an email that the company had “a significant gap between revenues and expenses,” even with the layoffs and other cost-cutting measures taken last year. year.

She said his family had invested “tens of millions of dollars” every year since acquiring The Times in 2018. “They are committed to continuing to invest,” spokeswoman Jen Hodson said in a statement. “But depending on a willing owner to cover costs year after year is not a viable long-term plan.”

Mr. Bezos has not fared much better at The Washington Post. Like many news organizations, The Post has struggled to maintain the momentum it gained in the wake of the 2020 election. Declining subscriptions and advertising revenue led to losses of about $100 million last year. At the end of the year, the company cut 240 of its 2,500 jobs through buyouts, including some of its highly regarded journalists.

Patty Stonesifer, who took over as CEO last year, called the buyouts “difficult” but said they were necessary to “invest in our top growth priorities.” The Post staffers in recent weeks sent a letter to their top editor, Sally Buzbee, and their new permanent CEO, Will Lewis, expressing concern about the lack of investigative power for their stories in the wake of the buyouts.

A spokesperson for Mr. Bezos did not respond to repeated requests to arrange an interview for this article. In the past, Mr. Bezos has said he bought The Post because it was an important institution but wanted the company to be profitable.

“I said to myself, 'If this were a financially upside-down salty snack company, the answer would be no,'” Mr. Bezos said of his decision to buy The Post in 2011. an interview from 2018.

Time faces similar headwinds. The publication lost about $20 million in 2023, according to two people with knowledge of the publication's financial picture. Time has weighed on cost cuts in the first quarter of the year to offset some of the losses, one of the people said.

A Time spokeswoman had no comment on the company's 2023 finances a note to associates of Jessica Sibley, the CEO, who touts a growing audience and advertising income. In a statement, Mr. Benioff said Ms. Sibley was “implementing many exciting changes based on an amazing vision.”

“We are fortunate to have a great new CEO, Jessica Sibley, and she has done a fantastic job restructuring the company over the past year,” Mr. Benioff wrote. “We've never had a bigger year, including Taylor Swift, driven by Jessica's vision for the company.”

Time is exploring brand licensing deals abroad, according to a person with knowledge of the discussions, who said the efforts mirror similar approaches by magazine companies like Forbes and Condé Nast, which have been reliable moneymakers.

Still, there are some bright spots in the firmament of traditional news organizations owned by billionaires. The Boston Globe, purchased in 2013 by Boston Red Sox owner John W. Henry from The New York Times Company for $70 million, has been profitable for years, according to a person familiar with the company's finances. Those profits have been reinvested in the Globe, the person said.

The Atlantic, which was purchased by Laurene Powell Jobs in 2017, has set a goal of reaching a combined digital and print subscriber base and achieving profitability. The company has said it had more than 925,000 subscribers as of last summer, although it is not yet profitable.

The problems facing companies are only becoming more serious. Web traffic has declined for many publishers as referrals from search engines like Google decline, and the rise of new applications powered by artificial intelligence has the potential to further erode readership.

“These critically important news publications are still in the process of 'transitioning' from print to digital – with large ongoing operating costs – as they build brick by brick toward a primarily digital future,” said Ken Doctor, analyst and media entrepreneur.

Mr Doctor said the news industry's billionaires were showing “greater signs of fatigue”, due to challenges such as “news fear and avoidance and intense advertising competition”.

“The very wealthy find it very difficult to lose money year after year,” Mr. Doctor said, “even if they can afford it.”