Pay Cuts Come to Condé Nast, the Glossy Publisher of Vogue and Vanity Fair

In 2019, Condé Nast united its American and international arms into a single entity. The company has operations in France, Italy, Germany and Spain, as well as Asia, with half its employees based in the United States.

Condé Nast would be one of the first major publishers to take advantage of government programs set up to make funds available to people whose jobs have been affected by the pandemic. Those programs were designed to help companies avoid layoffs, and some of the programs require the employer to request funds. Requesting government assistance would be an unusual move for a company whose high-paid editors have enjoyed perks such as town cars and clothing allowances. It could also risk alienating readers, for whom the idea of a glossy magazine publisher requesting funds for certain employees may be anathema.

Recently, two of Condé Nast’s most prominent clients, the luxury groups LVMH Moët Hennessy Louis Vuitton and Kering, told furloughed employees that they would be part of the “partial activity” government programs in France. Both companies backpedaled after peers such as Chanel announced that they would bear the costs themselves, rather than tap into the public purse.

Magazines were on rocky ground before the coronavirus started spreading across the globe, and the industry is now in free fall. Luxury companies, who provide the ads that are the lifeblood of fashion and lifestyle publications, have cut or frozen their marketing budgets. At a time when more than 16 million Americans are newly out of work, people are turning away from fantasy purchases and saving up for necessities.

Condé Nast had already been re-evaluating its media strategy, refashioning itself to cater to an online audience attuned to Instagram and TikTok. It has sold off certain titles and turned once-mighty glossies like Glamour into digital-only enterprises. Following the subscription success of The New Yorker, paywalls went up around Vanity Fair and Wired. Vogue has started to embrace digital publishing, though it is still highly dependent on advertising revenue.

As a result, and after several years of losses, the company was on a pace to turn a profit this year. The global pandemic has altered that trajectory, as it has for other publishers.

“We aren’t alone in needing to take actions like this,” Mr. Lynch said in the memo. “Companies around the world are all facing similar challenges and responding accordingly. But that doesn’t make this process any easier.”