Hearst CEO Warns of ‘Massive Drop Off’ in Political Ads After 2024 Election

Hearst CEO Steve Swartz on Tuesday lauded his company for achieving a record $13 billion profit last year, but warned the media giant will have a difficult time repeating that success in 2025, due in part to an expected “massive drop off” in political advertising.

Swartz made those comments in his annual letter to staff.

“Looking forward, the current environment and our early forecasts suggest it will be difficult to achieve another year of profit growth in 2025,” Swartz said. “Among the headwinds we face is a massive drop off in election advertising at our television stations, as the U.S. holds major elections every other year. This recurring and expected decline is accompanied by an increasingly competitive advertising market that challenges linear television with data-rich offerings from streaming platforms and social networks.”

Swartz added the “tougher ad market, along with continued cord cutting, is also significantly impacting A+E.”

Still, his letter offset those bleak warnings with several upbeat points about Hearst’s business.

Hearst — which includes magazines like Cosmopolitan and Esquire, dozens of TV stations, and a 20% stake in ESPN under its large media umbrella — reported a company-best sales and profit year in 2024; its $13 billion in sales in 2024 represented a 9% increase from the year prior.

Swartz credited the company’s “superior quality” of local journalism in helping drive local TV ad sales, and he also pointed to Fitch, Hearst’s bond-rating and data company, as a strong performer last year.

The veteran CEO, who is entering his 12th year in charge of Hearst, noted the company has used artificial intelligence tools to help bolster its HR, sales, marketing, data, and software programming teams.

“These efforts are not aimed at replacing our colleagues with machines but at making our colleagues more efficient, allowing more time for much needed innovation around inventing new products and making our existing products better,” Swartz said.

He did not mention Hearst’s Oct. 2024 partnership with OpenAI, allowing the ChatGPT parent company to integrate Hearst’s newspaper and magazine content into its artificial intelligence products.

Moving forward, Swartz said Hearst’s push into industries beyond the media world does not reflect “a reduction” in its “comittment to the consumer media side of our company.” That is “in our DNA,” he said.

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