The New York Times Company (NYSE:NYT) announced today second-quarter 2018 diluted earnings per share from continuing operations of $.14 compared with $.09 earnings per share in the same period of 2017. Adjusted diluted earnings per share from continuing operations (defined below) was $.17 in the second quarter of 2018 compared with $.17 in the second quarter of 2017.
Operating profit rose to $40.0 million in the second quarter of 2018 from $26.5 million in the same period of 2017, principally driven by strong digital subscription and other revenues as well as lower operating costs, which were partially offset by lower advertising revenues. Adjusted operating profit (defined below) decreased to $59.4 million in the second quarter of 2018 compared with $64.7 million in the second quarter of 2017 as lower advertising revenues and higher marketing costs more than offset growth in both digital subscription and other revenues.
Mark Thompson, president and chief executive officer, The New York Times Company, said, “In the second quarter, we saw increases in revenue and overall profitability and continued growth in our digital subscription business. We added 109,000 net new digital-only subscriptions, of which 68,000 were to our core news bundle. At the end of Q2, we had 3.8 million total subscriptions, 2.9 million of which were digital-only. Our subscribers who came to us around the 2016 Election and post-Election periods continue to retain better than previous cohorts.
“Subscription revenues accounted for nearly two-thirds of the Company’s revenues, a trend we expect to continue. We continue to believe that there is significant runway to expand that base substantially.
“Turning to advertising, this was a subdued quarter for digital advertising as we predicted, but we remain confident that we will return to strong year-over-year growth in the third quarter.”
Results from Continuing Operations
Total revenues for the second quarter of 2018 increased 1.8 percent to $414.6 million from $407.1 million in the second quarter of 2017. Subscription revenues increased 4.2 percent, while advertising revenues decreased 9.9 percent and other revenues increased 40.0 percent.
Subscription revenues in the second quarter of 2018 rose primarily due to growth in recent quarters in the number of subscriptions to the Company’s digital-only products. Revenue from the Company’s digital-only subscription products (which include our news product, as well as our Crossword and Cooking products) increased 19.6 percent compared with the second quarter of 2017, to $98.7 million.
Paid digital-only subscriptions totaled approximately 2,892,000 at the end of the second quarter of 2018, a net increase of 109,000 subscriptions compared with the end of the first quarter of 2018 and a 24.0 percent increase compared with the end of the second quarter of 2017. Of the 109,000 additions, 68,000 came from the Company’s digital news products, while the remainder came from the Company’s Cooking and Crossword products.
Second-quarter digital advertising revenue decreased 7.5 percent, while print advertising revenue decreased 11.5 percent. Digital advertising revenue was $51.0 million, or 42.8 percent of total Company advertising revenues, compared with $55.2 million, or 41.7 percent, in the second quarter of 2017. The decrease in digital advertising revenue reflected a smaller audience as well as a decline in creative service revenues.
Other revenues rose 40.0 percent in the second quarter primarily as a result of growth in our commercial printing operations, four additional floors of rental income from our New York headquarters building and affiliate referral revenue associated with the product review and recommendation website, Wirecutter.
Operating costs decreased in the second quarter of 2018 to $373.3 million compared with $378.6 million in the second quarter of 2017, largely due to lower severance costs, which were partially offset by higher marketing costs as well as costs related to growth in commercial printing. Adjusted operating costs increased to $355.2 million from $342.4 million in the second quarter of 2017 primarily as a result of higher marketing and commercial printing costs.
Raw materials costs were $17.8 million in the second quarter of 2018 compared with $15.8 million in the second quarter of 2017, due to higher newsprint prices and, to a lesser extent, higher volume as a result of growth in commercial printing operations.
more detail at: https://investors.nytco.com/press/press-releases/press-release-details/2018/The-New-York-Times-Company-Reports-2018-Second-Quarter-Results/default.aspx