The New York Times Co. suffered a 55 percent plunge in Q2 2014 net to $9.1M on flat revenues of $388.7M.

mark thompsonCEO Mark Thompson blames the profit shortfall on hefty investments made for strategic initiatives associated with the launch of new digital offerings.

A 6.5 percent drop in national advertising was the main culprit for the lackluster revenue performance.

Total ad revenues declined 4.1 percent to $156.3M, while circulation sales advanced 1.4 percent to $209.9M.

Thompson is buoyed by growth in the NYT's digital sector, but knows "we still have more work to do to transform our business and deliver long-term sustainable growth for the company," he said in a statement.

The NYT added 32K digital subscriptions, up 39 percent from the comparable period of a year ago. 

New products such as NYT Now, NYT Opinion and Times Premier got credit for luring new customers.

The Times chief expects accelerated growth in digital subs during the next few months as the NYTC refines the new offerings and upgrades marketing efforts.

Of the much-ballyhooed innovation of the future of journalism blueprint, Thompson said the company is implementing its recommendations so "we can significantly grow our digital audience, which in turn, will contribute to improved digital subscription and advertising monetizaton."

Thompson also commented on the "paid content" or native advertising "Paid Posts" program, saying he's "particularly encouraged by its growing success."

The company expects third-quarter revenues to be flat once again, while advertising will inch downward in the low- to mid-single digit range.