New York Times reaches 9.1 million subscribers

New York Times reaches 9.1 million subscribers

Aided by the recent addition of sports website The Athletic, The New York Times Company said Wednesday that it added 387,000 net digital subscribers in the first quarter.

The company now has 9.1 million subscribers, it said, including those of The Athletic, which the Times Company bought on Feb. 1.

As the leap brings The Times closer to its stated goal of 15 million subscribers by the end of 2027, The Athletic is eating into the company’s profits. The site, which the Times bought for $550 million in cash, lost $6.8 million in February and March.

Overall, the company reported adjusted operating income of $60.9 million for the quarter, down from $68.1 million a year ago, hampered by operating losses at The Athletic.

Subscription and advertising growth helped increase total revenue by 13.6% to $537.4 million. While total advertising revenue increased nearly 20 percent, digital advertising revenue for the quarter increased 12.6 percent, below the company’s forecasts.

Total operating costs increased nearly 18% to $496.4 million.

“We are starting strong on the next phase of our strategy, which is to become the essential signature for all English-speaking people looking to understand and engage with the world,” Meredith Kopit Levien, President and CEO of The Times Company, said in a statement.

Mrs. Levien previously said that Times executives believed the market was “at least 135 million” of potential subscribers.

In February, The Times announced that it had reached its existing target of 10 million subscribers and set the new target of at least 15 million subscribers.

As of the end of 2021, the company said it had around 7.6 million subscribers with 8.8 million subscriptions. The acquisition of Athletic this year brought in about 1.1 million subscribers. The company said Athletic has added about 16,000 net subscribers in the two months since its acquisition.

Mrs. Levien described subscription growth as the best results of the first quarter, aside from the first quarter of 2020, which was driven by widespread interest in news about the coronavirus pandemic.

The company made a distinction between subscribers and subscriptions – a subscriber can have more than one subscription – in its earnings report for the first time on Wednesday. It reflects the company’s strategy of selling people subscription packages that give people access to news and lifestyle products, like Cooking and Wirecutter, a reviews and recommendations site.

This strategy was in evidence with the company’s acquisitions of The Athletic and, in January, of Wordle, a game that gives players six chances to figure out a five-letter word.

Mrs. Levien said that Wordle attracted tens of millions of new users to the Times Company, “many of whom stayed to play other games, which drove our best-ever quarter for net subscriber additions to Games.”

For the current quarter, the company expects digital-only subscription revenue to increase 23% to 27% year-on-year, while digital advertising revenue is expected to increase in the “low digits.”

Adjusted operating costs for The New York Times Group, which does not include The Athletic, are expected to rise 12 to 15 percent in the quarter and then decline in the second half of the year, the company said. Athletic’s estimated operating losses last year were $55 million on revenue of $65 million, and the Times said it expects a slight improvement in those losses in 2022.

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