While The New York Times Company (NYSE: NYT) reported a net loss of $57.8 million, or $0.35 per diluted share, in the fourth quarter of 2017, the company also experienced some impressive growth. Total revenue for Q4 was $484.1 million, or 10.1 percent higher, than $439.7 million in revenue reported for Q4 2016. Subscription revenue grew 19.2 percent, other revenues increased 12.0 percent, and advertising revenue decreased 1.3 percent.

‘2017 was a year marked by growth and innovation both in our groundbreaking journalism and in our thriving business. We had our best revenue growth in many years, driven by strong digital subscription revenues, which increased by over $100 million year-over-year,’ said Mark Thompson, president and CEO, in a press release. ‘Subscription revenues were over $1 billion in 2017, or 60 percent of the year’s total revenues, and is a clear sign that our subscription-first business model is proving to be an effective way to support our broad journalistic ambitions.’

‘In Q4 we added 99,000 net digital news subscriptions and 157,000 total net digital-only subscriptions, with news, Cooking and Crosswords products all contributing to growth. We’re pleased with the continued rate of growth and particularly pleased to be seeing strong retention from the large group of new subscribers who came to The Times late last year. We believe there remains a large opportunity to continue to extend our subscription reach and will continue to invest in areas of the business that will allow us to achieve that growth,’ Thompson added.

Other highlights for the fourth quarter* were:

• Revenue from digital-only subscriptions increased 51.2 percent to $96.3 million.
• Excluding the extra week of estimated revenue, digital-only revenue grew 40.1 percent to $89.2 million.
• At the end of Q4 2017, digital-only subscribers were approximately 2.64 million, a net increase of 157,000 subscriptions. Of that total, 99,000 were from news products; the remainder were from Cooking and Crosswords.
• Digital advertising revenue increased 8.5 percent to $84.2 million, or 46.1 percent of total ad revenue. The company attributed increases to smartphone and branded content.
• Print advertising revenue decreased 8.4 percent.
• Other revenues grew 12.0 percent, primarily from affiliate revenue from Wirecutter.
• Operating costs were $393.2 million, compared to $362.8 million, mostly due to higher compensation and marketing costs and the impact of having an extra week in the quarter.
• Due to volume declines, raw materials costs decreased to $17.8 million from $19.2 million in Q4 2016.
• The company recorded a loss of $14.8 million from joint ventures including an $8.4 million loss from Madison’s settlement of pension obligations.
• Capital expenditures were $37 million in Q4 and $104 million for the full year, mostly related to the redesign and consolidation of space in the company’s headquarters and at the printing and distribution facility.

The company shared the following guidance for 2018:

• Total subscription revenue will increase in the mid to high single digits in Q1 2018.
• Total advertising revenue will decrease in the mid to high single digits in Q1 2018.
• Operating costs and adjusted operating costs will increase in the low single digits in Q1 2018.

[Editor’s note: Because of the company’s fiscal calendar, Q4 2017 had 14 weeks and the full year had 53 weeks, compared to 13 weeks and 52 weeks, respectively, in 2016.]

Company investors were impressed with the financial results. On February 7, 2018, the day before financials were reported, Class A stock was valued at $22.15 per share. On February 8, stock price per share peaked at $24.40 before dipping to $24.10 per share yesterday at 4:51 PM EST.

Insider Take: 

Setting aside the one-time charges and the extra week in the fourth quarter of 2017, The New York Times Company’s Q4 financials were impressive, particularly in terms of digital growth. The New York Times continues to do well with its digital-only subscriptions and has experienced success with stand-along subscriptions. The company has also done well with affiliate revenue from its acquisition of Wirecutter, diversifying its assets to put it in a better position long-term.