A decline in standard of play and falling off of interest by the public made 1938-39 a depressing season and the club began to face a financial crisis. Key men Allen, Adams and Evans meant a lot of chopping and changing and a record 55 players were used. However there was one new back who was discovered - W. H. M. Baker of Rogiet/Bristol University, a centre of great promise. Jack Knowles came back from injury to be top try scorer with 21 followed by Jack Adams with 17. The other dependable back was full back Walter Legge.

A great pack led by Viv Law, who won his first Welsh cap, saved Newport time and again. Old stalwarts Travers, Jerman, Bale, Evans and Coleman were joined by Bernard Gough, Les Paul, Roger Phillips and A D Price. On 12th November 1938 Cardiff beat Newport 13 v 0 and so went ahead in victories for the first time. Bill Jones (39) and W. H. M. Baker (35) made most appearances.