New York Times Lifts Profit as Digital Subscription Growth Accelerates
Revenue rose 11.2% to $762.5 million as subscriptions and advertising advanced.
The New York Times Co. (NYT), the news and lifestyle publisher, reported a 16.1% increase in adjusted operating profit as stronger digital pricing offset slower subscriber additions.
Digital-only subscription revenue grew 16.4%, accelerating slightly from 16.1% in the first quarter and 13.9% in the fourth quarter. Net additions slowed to 280,000 from 310,000 in the prior quarter, while the digital-only subscriber base reached 12.80 million.
Second-quarter revenue increased 11.2% from a year earlier, compared with 12.0% growth in the first quarter. Diluted earnings rose to $0.57 a share from $0.50, while adjusted earnings increased to $0.69 a share from $0.58.
Digital-only average revenue per user climbed to $9.94 from $9.77 in the first quarter as promotional subscribers moved to higher prices and some longer-tenured subscribers received increases. Total subscription revenue rose 11.7% to $537.9 million, with digital growth outweighing a 0.8% decline in print subscription revenue.
Digital advertising revenue increased 20.7% to $114.0 million, though its growth slowed from 31.6% in the first quarter. Print advertising fell 11.1% to $35.2 million, leaving total advertising revenue up 11.3%.
Adjusted operating profit reached $155.3 million, and the adjusted operating margin expanded about 90 basis points to 20.4%. Sales and marketing costs rose 23.6% as total operating-cost growth accelerated to 11.2% from 7.7% in the preceding quarter.
The quarter included a $9.2 million charge tied to withdrawal from a multiemployer pension plan, reducing after-tax earnings by $6.8 million, or $0.04 a share. First-half operating cash flow rose to $286.5 million from $212.7 million, while free cash flow increased to $265.7 million despite the year-earlier period benefiting from about $33 million tied to a land transaction.