Buzzfeed UK, the subsidiary of the US internet media company, has reported a pre-tax loss of £3.3 million last year.
This is despite more than doubling its turnover to £20.5 million on the previous years. This is the first year that the company’s accounts have been published in full at Companies House. Figures for 2015 show that the company reported a pre-tax profit of 338,395 and a turnover of £9.8 million.
Prior to 2016, the UK arm of the global media giant was still a small enough entity that it was only required to publish abbreviated accounts.
So, what accounts for the loss? One principle reason could be the company’s fairly aggressive expansion into new territories. Buzzfeed UK acts as a holding company for the wider business’ operation in India, Mexico, Japan, Spain, France and Germany.
The UK company has come a long way since its inception as Buzzfeed’s first international site in 2013, when it had three members of staff. It now employs 204 people, with its editorial staff now standing at 138.
Implementing banner ads
As a primarily online publisher, Buzzfeed does not have the overheads that its more established, print-based peers do. The rising cost of printing and distribution have been blamed for the guardian reporting a loss of £44.7 million for the financial year ending April 2017.
In August, the company decided to implement conventional banner advertising, a move it had long resisted, in order to ease the pressure of trying to drive large volumes of traffic to promoted posts. This will likely feed into next year’s figures in a positive way.
In a statement, the company said that it generated revenue primarily through “social content advertising sold to leading brands” and that advertising revenue made up a “significant” proportion of its total revenue.