New York Times Posts Highest Digital Users Growth in 2 YearsGerry Smith
New York Times Co. reported its biggest quarterly increase in digital subscribers in two years, partly by bringing more traffic to its website from social media.
The publisher added 47,000 digital subscribers last quarter and now has 957,000 in total. The gains helped Times Co. post first-quarter earnings that beat analysts’ estimates even as overall advertising revenue continues to drop.
Times Co. has been investing in video, mobile and marketing messages designed to resemble news stories to offset declines in print advertising and circulation as more readers shift to the Web. The company said this month it would stop charging for its mobile app NYT Now in May, an acknowledgment that its attempt to attract more young digital readers with a fee-based subscription hasn’t been working.
The app will get more users now that it’s free, Times Chief Executive Officer Mark Thompson said.
“A bigger audience means we can think about building advertising revenue from it,” he said on an earnings call.
Times Co. shares rose 4.5 percent to $13.39 at the close in New York. The shares were down 3.1 percent this year through Wednesday, while the Standard and Poor’s 500 Index gained 2.3 percent.
Earnings excluding some items were 11 cents a share in the first quarter, the New York-based company said. That compares with the 8-cent average of estimates compiled by Bloomberg.
Ad revenue dropped 5.8 percent, dragged down by print advertising, which slumped 11 percent. Digital ad sales increased 11 percent in the quarter.
More than 10 percent of digital advertising revenue now comes from mobile devices, said Meredith Kopit Levien, the newly-appointed chief revenue officer.
“We expect that number to keep going up,” she said. “It’s a big area of focus for us in advertising right now.”
In recent months, the company introduced a redesigned New York Times Magazine and a monthly men’s style section to bolster print advertising, which still makes up a large part of revenue. It also discontinued the newspaper’s homes and autos sections.
The results showed “good digital subscriber progress and cost discipline,” William Bird, an analyst at FBR Capital Markets, wrote in a note to clients.
Revenue dropped 1.6 percent to $384.2 million, in line with the average estimate of $384 million.
Circulation revenue rose 0.8 percent to $211.5 million as an increase in digital subscriptions and higher newspaper prices more than offset declines in the number of print copies sold, the company said.