New York Times 2021 Q2 Earnings: 8 Million Subscribers
Readers, readers around the world are what The New York Times Company sees: 100 million, to be precise.
For now, the publisher has eight million subscribers and hopes to add as many this year as in 2019, when President Donald J. Trump made headlines and a pandemic had yet to melt the global economy. The company estimates that it will have 8.5 million by the end of 2021.
In a statement released Wednesday announcing the company’s second quarter results, Meredith Kopit Levien, chief executive officer, said the performance was “a testament to the success of our strategy” of focusing on digital subscriptions. She estimated the potential size of the Times’ readership market at 100 million, adding that there was an opportunity to keep investing when “daily habits have to be learned.”
The Times Company reported modest growth in the April-June quarter – usually the weakest – adding 142,000 new digital subscribers, including 77,000 for the News app and 65,000 for Cooking and Games. At the end of June, the Times had a total of 7.9 million subscribers, of which 7.1 million paid for its digital products. Among digital subscribers, 5.3 million have subscribed to the News app.
The publisher reported adjusted operating income of $ 93 million on revenue of $ 499 million. Investors were looking for $ 73 million in adjusted operating income on $ 488 million in sales. Overall activity grew 24% year over year, helped by a steady 16% increase in subscription dollars and a 66% increase in advertising as marketers returned to levels of pre-pandemic spending.
Wall Street investors and news executives across the country see The Times as both an indicator and a stand-alone tool: The company’s digital performance shows what is possible for a media organization. information in the age of Facebook and Google, but not everyone in publishing (digital or print) will be able to emulate its success. The Times’ online revenues – particularly from advertising and subscriptions – jumped 41% to $ 261 million.
For the current quarter ending in September, the company expects digital subscription revenue to grow 25-30% from the previous year and online ad sales to grow 40-45%. %. Total subscription revenue is expected to increase by 13-15% and advertising by 30-35%.
This is probably the reason why the company’s shares, like those of a Silicon Valley giant, are trading at a high premium.
Investors pay about $ 41 for every $ 1 of expected profit to own the shares of The Times. That’s more than what people pay to own Facebook, at $ 21, and Google, at $ 25. Rupert Murdoch’s News Corp, which publishes the Wall Street Journal, is trading at $ 40 for every $ 1 of expected profit. Only shares of Netflix (another subscription service similarly priced to The Times) cost more, at $ 62 for every $ 1 of future income.
Despite this, Times shares have fallen nearly 17% this year as a new administration took control of the White House in January. The S&P 500 Index, by comparison, rose almost 18%.
The Times continues to invest in its digital business and expects costs to increase 18-20% in the current quarter, with capital spending for the entire year totaling $ 50 million. That pales in comparison to the cash held by the company: $ 947 million at the end of June.
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