The New York Times reported a strong second quarter of 2022, driven by double-digit revenue and subscriber growth. For the quarter ended June 26, 2022, The New York Times had total revenue of $555.7 million, an 11.5% increase year-over-year. Subscription revenue was $383.6 million, a 13.1% increase; advertising revenue was $117.4 million, a 4.1% increase; and other revenue of $54.7 million, a 17.6% increase.
However, operating profit for the quarter was $51.7 million, a 29.5% decrease, and adjusted operating profit was $76.2 million, a 18.0% decrease year-over-year. The New York Times attributes the decrease in profit to anticipated operating losses at The Athletic, which the media company acquired earlier this year for $550 million in an all-cash deal.
President and CEO comments
Meredith Kopit Levien, president and CEO of The New York Times Company, commented on the media organization’s second quarter results.
“Our second quarter results demonstrate that we are making palpable progress on our strategy of becoming the essential subscription for every English-speaking person seeking to understand and engage with the world,” Levien said in an August 3 news release.
“In the quarter, we brought in 180,000 net digital-only subscribers, including the highest-ever number of new starts to our All Digital Access Bundle, and saw an approximately 70% increase in net digital-only subscriber additions relative to the second quarter of 2021. These results are a product of our deliberate efforts to drive more volume, penetrate the addressable market, and ultimately increase ARPU, all while leading with the Bundle,” added Levien.
Other highlights for the quarter include the following:
- The New York Times Group revenue was $536.1 million. The Athletic’s revenue was $19.5 million.
- The company attributed subscription revenue growth to the number of subscribers to their digital-only products, the shift of some subscribers from promotional pricing to standard pricing, and including subscription revenue from The Athletic in their quarterly results.
- Subscription revenue from digital-only products was $238.7 million, a 25.5% increase.
- Print subscription revenue was $144.9 million, a 2.8% decrease. The company attributed this to the 2.7% decline in domestic home delivery revenue.
- At the end of the second quarter, the company had 9.17 million paid subscribers with approximately 10.56 million paid subscribers across print and digital products. This is a net increase of 180,000 digital-only subscribers and 230,000 digital-only subscriptions compared to the end of the first quarter of 2022. This was a net increase of 1.2 million digital-only subscribers year-over-year, not including the 1.03 million subscribers from The Athletic.
- During the quarter, The Athletic had a net increase of 50,000 standalone subscribers. Also, The New York Times Company gave Bundle subscribers access to The Athletic, adding approximately 420,000 subscribers.
- Digital ad revenue decreased 2.4% while print ad revenue grew 15.1%. Other revenue increased 17.6% from higher revenue in commercial printing, live events, TV and film projects, Wirecutter affiliate revenue and licensing.
- Total operating costs for the quarter were $504.0 million, a 19.6% increase.
- The company reported net income of $61.8 million, a 13.7% increase year-over-year, or $0.37 diluted earnings per share, a 15.6% increase year-over-year.
“Given the strength of our strategy, we are reaffirming our full-year profit outlook and remain confident in our ability to drive enhanced shareholder value, despite market uncertainties. With continued strength in converting new subscribers, a long runway of audience still to be penetrated, and an increasingly valuable product portfolio including a breadth of new offerings in games and The Athletic, we are well on our way to achieving our next mile marker of 15 million subscribers by 2027,” said Levien.
Overall, The New York Times second quarter was strong with increases in most revenue categories and continued subscription growth. The Athletic is still operating at a loss, but that was true when the company was independent. The New York Times anticipated losses initially. At the same time, The Times is benefiting from subscriber growth, access to new audiences and subscription revenue from The Athletic. Despite a lackluster economy, The New York Times Company is holding its own and shouldn’t have any trouble achieving its 15 million subscriber goal on time, if not early.