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While The Athletic co-founders Alex Mather and Adam Hansmann are probably happy the New York Times rescued their floundering sports website for a cool $550 million, Wall Street apparently hated the buy.
As the final market bell revealed, the Times’ stock price dropped nearly 11% after The Athletic acquisition announcement, reflecting a stock market valuation decline of $700 million. In addition, it was the only news to move the stock.
Translation: Wall Street likely hates the buy and wanted something else to happen with the New York Times’ billion in cash.
The Times takeover of The Athletic came after a previous round of failed talks, as subscription-based Athletic had lost close to $100 million over the past two years alone. The Times reportedly made the purchase to try to boost its own subscription base.
But it’s definitely not been all rainbows and unicorns. When a website fails as miserably as The Athletic has financially, it comes with a lot of uncertainty and massive risk.
Earlier this week, multiple high-profile writers and several editors at The Athletic told OutKick the Times’ purchase has them fearing for their jobs.
“Obviously, you’re always nervous with news like this,” one national writer told OutKick. “It could turn out to be nothing, not impact us at all. Or maybe it’s good news. But that’s not usually how it works. People usually lose jobs.”
From the looks of things, Wall Street isn’t all that enamored with the Times’ decision to buy The Athletic, either. Quite the opposite, actually.