The publisher of The Guardian and The Observer brought in 80% of its advertising revenues from digital in the past financial year, helping to offset print decline and post a modest increase of about £1m in total ad sales to hit an estimated £90m.
The disclosure came in newly published accounts for Guardian Media Group, which confirmed the financial turnaround at the previously loss-making publisher.
GMG had already said in May that its news arm, Guardian News & Media, had broken even on an operating basis as profit before exceptional items, known as Ebitda, was £800,000.
Breaking even was a three-year ambition after GNM introduced a voluntary reader contribution model in 2016. However, it still operates a free, ad-funded website, rather than launch a paywall.
The parent company’s accounts show GMG made a pre-tax profit of £31m in the year to 31 March against a £25m loss a year ago.
Revenues rose 3% to £224.5m as growth in both digital advertising and reader contributions offset print advertising decline.
Advertising was the most important single revenue stream, making up 40% of turnover or about £90m, although GNM did not give a sales figure.
Reader revenues brought in 28% and newsstand sales 24%.
This was the first year that GNM disclosed the proportion of advertising as part of the wider revenue mix and gave a breakdown between digital and print ad sales.
Digital grew to 80% of the estimated £90m ad take or about £72m and print dropped to 20% or about £18m.
Advertising was 41% of turnover in 2018, 42% in 2017 and 47% in 2016, the accounts showed.
That suggests ad sales were about £89m in 2018, which would mean there was an increase of about £1m in 2019.
GNM spent years betting on audience scale to drive digital ad sales, but saw revenues hit a wall in 2016 because the Google-Facebook duopoly was sucking up market share. It launched the reader contribution model to reduce dependence on advertising.
The Guardian had nearly a million paying supporters, including 655,000 regular payers and 300,000 one-off contributions, in the past 12 months.
David Pemsel, chief executive of GMG, told Campaign in June that advertising remained important, despite reducing its reliance on ad sales and introducing reader contributions.
"Some say that it’s going to be impossible for quality content creators or quality news organisations to be able to make an argument for ad revenue but we’ve shown that’s not the case," he said.
GMG now generates 56% of all revenues from digital after hitting the 50% mark a year ago, partly thanks to international growth in America and Australia.