UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~June 27,~~September 26, 2021

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___ to ___

Commission file number 1-5837

THE NEW YORK TIMES COMPANY

(Exact name of registrant as specified in its charter)


New York						13-1102020
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

620 Eighth Avenue, New York, New York 10018

(Address and zip code of principal executive offices)

Registrant’s telephone number, including area code 212-556-1234

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Class A Common Stock

NYT

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by the check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

Number of shares of each class of the registrant’s common stock outstanding as of ~~July 30,~~October 29, 2021 (exclusive of treasury shares):


Class A Common Stock	~~167,091,902~~167,093,950	shares
Class B Common Stock	781,724	shares

THE NEW YORK TIMES COMPANY

INDEX



PART I	PART I		Financial Information	1	PART I		Financial Information	1
Item	Item	1	Financial Statements	1	Item	1	Financial Statements	1
			Condensed Consolidated Balance Sheets as of June 27, 2021 (unaudited) and December 27, 2020	1			Condensed Consolidated Balance Sheets as of September 26, 2021 (unaudited) and December 27, 2020	1
			Condensed Consolidated Statements of Operations (unaudited) for the quarters and six months ended June 27, 2021 and June 28, 2020	3			Condensed Consolidated Statements of Operations (unaudited) for the quarters and nine months ended September 26, 2021 and September 27, 2020	3
			Condensed Consolidated Statements of Comprehensive Income (unaudited) for the quarters and six months ended June 27, 2021 and June 28, 2020	4			Condensed Consolidated Statements of Comprehensive Income (unaudited) for the quarters and nine months ended September 26, 2021 and September 27, 2020	4
			Condensed Consolidated Statements of Changes In Stockholders’ Equity (unaudited) for the quarters and six months ended June 27, 2021 and June 28, 2020	5			Condensed Consolidated Statements of Changes In Stockholders’ Equity (unaudited) for the quarters and nine months ended September 26, 2021 and September 27, 2020	5
			Condensed Consolidated Statements of Cash Flows (unaudited) for the six months ended June 27, 2021 and June 28, 2020	7			Condensed Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 26, 2021 and September 27, 2020	7
			Notes to the Condensed Consolidated Financial Statements	8			Notes to the Condensed Consolidated Financial Statements	8
Item	Item	2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20	Item	2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item	Item	3	Quantitative and Qualitative Disclosures about Market Risk	37	Item	3	Quantitative and Qualitative Disclosures About Market Risk	39
Item	Item	4	Controls and Procedures	38	Item	4	Controls and Procedures	40

PART II	PART II		Other Information	39	PART II		Other Information	41
Item	Item	1	Legal Proceedings	39	Item	1	Legal Proceedings	41
Item	Item	1A	Risk Factors	39	Item	1A	Risk Factors	41
Item	Item	2	Unregistered Sales of Equity Securities and Use of Proceeds	39	Item	2	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item	Item	6	Exhibits	40	Item	6	Exhibits	42

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

THE NEW YORK TIMES COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)


		June 27, 2021		December 27, 2020			September 26, 2021		December 27, 2020
		(Unaudited)					(Unaudited)
Assets	Assets					Assets
Current assets	Current assets					Current assets
Cash and cash equivalents	Cash and cash equivalents	$	320,871	$	286,079	Cash and cash equivalents	$	323,990	$	286,079
Short-term marketable securities	Short-term marketable securities	338,455		309,080		Short-term marketable securities	357,814		309,080
Accounts receivable (net of allowances of $12,269 in 2021 and $13,797 in 2020)		153,540		183,692
Accounts receivable (net of allowances of $12,069 in 2021 and $13,797 in 2020)						Accounts receivable (net of allowances of $12,069 in 2021 and $13,797 in 2020)	164,620		183,692
Prepaid expenses	Prepaid expenses	36,262		29,487		Prepaid expenses	38,839		29,487
Other current assets	Other current assets	32,110		27,497		Other current assets	40,391		27,497
Total current assets	Total current assets	881,238		835,835		Total current assets	925,654		835,835
Other assets	Other assets					Other assets
Long-term marketable securities	Long-term marketable securities	287,265		286,831		Long-term marketable securities	360,721		286,831
Property, plant and equipment (less accumulated depreciation and amortization of $891,635 in 2021 and $886,149 in 2020)		582,331		594,516
Property, plant and equipment (less accumulated depreciation and amortization of $903,699 in 2021 and $886,149 in 2020)						Property, plant and equipment (less accumulated depreciation and amortization of $903,699 in 2021 and $886,149 in 2020)	579,444		594,516
Goodwill	Goodwill	170,156		171,657		Goodwill	168,854		171,657
Deferred income taxes	Deferred income taxes	96,869		99,518		Deferred income taxes	95,824		99,518
Miscellaneous assets	Miscellaneous assets	330,148		319,332		Miscellaneous assets	338,915		319,332
Total assets	Total assets	$	2,348,007	$	2,307,689	Total assets	$	2,469,412	$	2,307,689

See Notes to Condensed Consolidated Financial Statements.

THE NEW YORK TIMES COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS-(Continued)

(In thousands, except share and per share data)


		June 27, 2021		December 27, 2020			September 26, 2021		December 27, 2020
		(Unaudited)					(Unaudited)
Liabilities and stockholders’ equity	Liabilities and stockholders’ equity					Liabilities and stockholders’ equity
Current liabilities	Current liabilities					Current liabilities
Accounts payable	Accounts payable	$	94,480	$	123,157	Accounts payable	$	118,871	$	123,157
Accrued payroll and other related liabilities	Accrued payroll and other related liabilities	101,637		121,159		Accrued payroll and other related liabilities	146,378		121,159
Unexpired subscriptions revenue	Unexpired subscriptions revenue	114,740		105,346		Unexpired subscriptions revenue	115,666		105,346

Accrued expenses and other	Accrued expenses and other	135,660		137,086		Accrued expenses and other	145,679		137,086
Total current liabilities	Total current liabilities	446,517		486,748		Total current liabilities	526,594		486,748
Other liabilities	Other liabilities					Other liabilities

Pension benefits obligation	Pension benefits obligation	317,543		326,555		Pension benefits obligation	312,881		326,555
Postretirement benefits obligation	Postretirement benefits obligation	35,712		38,690		Postretirement benefits obligation	34,344		38,690
Other	Other	129,448		127,585		Other	126,061		127,585
Total other liabilities	Total other liabilities	482,703		492,830		Total other liabilities	473,286		492,830
Stockholders’ equity	Stockholders’ equity					Stockholders’ equity
Common stock of $.10 par value:	Common stock of $.10 par value:					Common stock of $.10 par value:
Class A – authorized: 300,000,000 shares; issued: 2021 – 175,962,272; 2020 – 175,308,672 (including treasury shares: 2021 – 8,870,801; 2020 – 8,870,801)		17,596		17,531
Class A – authorized: 300,000,000 shares; issued: 2021 – 175,964,351; 2020 – 175,308,672 (including treasury shares: 2021 – 8,870,801; 2020 – 8,870,801)						Class A – authorized: 300,000,000 shares; issued: 2021 – 175,964,351; 2020 – 175,308,672 (including treasury shares: 2021 – 8,870,801; 2020 – 8,870,801)	17,597		17,531
Class B – convertible – authorized and issued shares: 2021 – 781,724; 2020 – 781,724	Class B – convertible – authorized and issued shares: 2021 – 781,724; 2020 – 781,724	78		78		Class B – convertible – authorized and issued shares: 2021 – 781,724; 2020 – 781,724	78		78
Additional paid-in capital	Additional paid-in capital	217,565		216,714		Additional paid-in capital	222,570		216,714
Retained earnings	Retained earnings	1,756,198		1,672,586		Retained earnings	1,799,023		1,672,586
Common stock held in treasury, at cost	Common stock held in treasury, at cost	(171,211)		(171,211)		Common stock held in treasury, at cost	(171,211)		(171,211)
Accumulated other comprehensive loss, net of income taxes:	Accumulated other comprehensive loss, net of income taxes:					Accumulated other comprehensive loss, net of income taxes:
Foreign currency translation adjustments	Foreign currency translation adjustments	7,092		8,386		Foreign currency translation adjustments	5,879		8,386
Funded status of benefit plans	Funded status of benefit plans	(412,315)		(421,698)		Funded status of benefit plans	(407,624)		(421,698)
Net unrealized gain on available-for-sale securities	Net unrealized gain on available-for-sale securities	1,779		3,131		Net unrealized gain on available-for-sale securities	1,215		3,131
Total accumulated other comprehensive loss, net of income taxes	Total accumulated other comprehensive loss, net of income taxes	(403,444)		(410,181)		Total accumulated other comprehensive loss, net of income taxes	(400,530)		(410,181)
Total New York Times Company stockholders’ equity	Total New York Times Company stockholders’ equity	1,416,782		1,325,517		Total New York Times Company stockholders’ equity	1,467,527		1,325,517
Noncontrolling interest	Noncontrolling interest	2,005		2,594		Noncontrolling interest	2,005		2,594
Total stockholders’ equity	Total stockholders’ equity	1,418,787		1,328,111		Total stockholders’ equity	1,469,532		1,328,111
Total liabilities and stockholders’ equity	Total liabilities and stockholders’ equity	$	2,348,007	$	2,307,689	Total liabilities and stockholders’ equity	$	2,469,412	$	2,307,689

See Notes to Condensed Consolidated Financial Statements.

THE NEW YORK TIMES COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)


		For the Quarters Ended				For the Six Months Ended					For the Quarters Ended				For the Nine Months Ended
		June 27, 2021		June 28, 2020		June 27, 2021		June 28, 2020			September 26, 2021		September 27, 2020		September 26, 2021		September 27, 2020
		(13 weeks)				(26 weeks)					(13 weeks)				(39 weeks)
Revenues	Revenues									Revenues
Subscription	Subscription	$	339,217	$	293,189	$	668,301	$	578,623	Subscription	$	342,609	$	300,950	$	1,010,910	$	879,573
Advertising	Advertising	112,774		67,760		209,890		173,897		Advertising	110,887		79,253		320,777		253,150
Other	Other	46,506		42,801		93,351		94,866		Other	55,607		46,692		148,958		141,558
Total revenues	Total revenues	498,497		403,750		971,542		847,386		Total revenues	509,103		426,895		1,480,645		1,274,281
Operating costs	Operating costs									Operating costs
Cost of revenue (excluding depreciation and amortization)	Cost of revenue (excluding depreciation and amortization)	251,358		229,913		502,355		473,397		Cost of revenue (excluding depreciation and amortization)	256,978		235,665		759,333		709,062
Sales and marketing	Sales and marketing	53,555		39,605		113,708		113,389		Sales and marketing	83,767		50,615		197,475		164,004
Product development	Product development	39,699		30,983		78,642		61,985		Product development	40,638		34,349		119,280		96,334
General and administrative	General and administrative	62,283		58,812		118,860		111,673		General and administrative	64,418		51,118		183,278		162,791
Depreciation and amortization	Depreciation and amortization	14,486		15,631		29,203		30,816		Depreciation and amortization	14,326		15,552		43,529		46,368
Total operating costs	Total operating costs	421,381		374,944		842,768		791,260		Total operating costs	460,127		387,299		1,302,895		1,178,559

Lease termination charge	Lease termination charge	3,831		0		3,831		0		Lease termination charge	—		—		3,831		—

Operating profit	Operating profit	73,285		28,806		124,943		56,126		Operating profit	48,976		39,596		173,919		95,722
Other components of net periodic benefit costs	Other components of net periodic benefit costs	2,598		2,149		5,197		4,463		Other components of net periodic benefit costs	2,599		2,272		7,796		6,735

Interest income and other, net	Interest income and other, net	1,873		2,786		3,384		16,640		Interest income and other, net	28,569		3,537		31,953		20,177
Income from continuing operations before income taxes	Income from continuing operations before income taxes	72,560		29,443		123,130		68,303		Income from continuing operations before income taxes	74,946		40,861		198,076		109,164
Income tax expense	Income tax expense	18,243		5,781		27,704		11,787		Income tax expense	20,290		7,283		47,994		19,070

Net income		54,317		23,662		95,426		56,516

Net income attributable to The New York Times Company common stockholders	Net income attributable to The New York Times Company common stockholders	$	54,317	$	23,662	$	95,426	$	56,516	Net income attributable to The New York Times Company common stockholders	$	54,656	$	33,578	$	150,082	$	90,094
Average number of common shares outstanding:	Average number of common shares outstanding:									Average number of common shares outstanding:
Basic	Basic	168,012		166,869		167,828		166,725		Basic	168,027		167,075		167,895		166,842
Diluted	Diluted	168,346		168,083		168,312		167,968		Diluted	168,546		168,059		168,492		167,943
Basic earnings per share attributable to The New York Times Company common stockholders	Basic earnings per share attributable to The New York Times Company common stockholders	$	0.32	$	0.14	$	0.57	$	0.34	Basic earnings per share attributable to The New York Times Company common stockholders	$	0.33	$	0.20	$	0.89	$	0.54
Diluted earnings per share attributable to The New York Times Company common stockholders	Diluted earnings per share attributable to The New York Times Company common stockholders	$	0.32	$	0.14	$	0.57	$	0.34	Diluted earnings per share attributable to The New York Times Company common stockholders	$	0.32	$	0.20	$	0.89	$	0.54
Dividends declared per share	Dividends declared per share	$	0	$	0	$	0.07	$	0.06	Dividends declared per share	$	0.07	$	0.12	$	0.14	$	0.18

See Notes to Condensed Consolidated Financial Statements.

THE NEW YORK TIMES COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)


		For the Quarters Ended				For the Six Months Ended					For the Quarters Ended				For the Nine Months Ended
		June 27, 2021		June 28, 2020		June 27, 2021		June 28, 2020			September 26, 2021		September 27, 2020		September 26, 2021		September 27, 2020
		(13 weeks)				(26 weeks)					(13 weeks)				(39 weeks)
Net income	Net income	$	54,317	$	23,662	$	95,426	$	56,516	Net income	$	54,656	$	33,578	$	150,082	$	90,094
Other comprehensive income, before tax:	Other comprehensive income, before tax:									Other comprehensive income, before tax:
Gain/(loss) on foreign currency translation adjustments		935		619		(1,767)		365
(Loss)/gain on foreign currency translation adjustments										(Loss)/gain on foreign currency translation adjustments	(1,654)		2,730		(3,421)		3,095
Pension and postretirement benefits obligation	Pension and postretirement benefits obligation	6,409		6,231		12,815		12,628		Pension and postretirement benefits obligation	6,405		6,354		19,220		18,982
Net unrealized (loss)/gain on available-for-sale securities	Net unrealized (loss)/gain on available-for-sale securities	(779)		4,075		(1,846)		4,790		Net unrealized (loss)/gain on available-for-sale securities	(770)		(854)		(2,616)		3,936
Other comprehensive income, before tax	Other comprehensive income, before tax	6,565		10,925		9,202		17,783		Other comprehensive income, before tax	3,981		8,230		13,183		26,013
Income tax expense	Income tax expense	1,756		2,848		2,465		4,763		Income tax expense	1,067		2,192		3,532		6,955
Other comprehensive income, net of tax	Other comprehensive income, net of tax	4,809		8,077		6,737		13,020		Other comprehensive income, net of tax	2,914		6,038		9,651		19,058

Comprehensive income attributable to The New York Times Company common stockholders	Comprehensive income attributable to The New York Times Company common stockholders	$	59,126	$	31,739	$	102,163	$	69,536	Comprehensive income attributable to The New York Times Company common stockholders	$	57,570	$	39,616	$	159,733	$	109,152

See Notes to Condensed Consolidated Financial Statements.

THE NEW YORK TIMES COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the Quarters Ended ~~June 27,~~September 26, 2021 and ~~June 28,~~September 27, 2020

(Unaudited)

(In thousands, except share data)


		Capital Stock - Class A and Class B Common		Additional Paid-in Capital		Retained Earnings		Common Stock Held in Treasury, at Cost		Accumulated Other Comprehensive Loss, Net of Income Taxes		Total New York Times Company Stockholders’ Equity		Non- controlling Interest		Total Stock- holders’ Equity			Capital Stock - Class A and Class B Common		Additional Paid-in Capital		Retained Earnings		Common Stock Held in Treasury, at Cost		Accumulated Other Comprehensive Loss, Net of Income Taxes		Total New York Times Company Stockholders’ Equity		Non- controlling Interest		Total Stock- holders’ Equity
																																			Capital Stock - Class A and Class B Common	Additional Paid-in Capital	Retained Earnings	Common Stock Held in Treasury, at Cost	Accumulated Other Comprehensive Loss, Net of Income Taxes	Total New York Times Company Stockholders’ Equity	Non- controlling Interest	Total Stock- holders’ Equity
Balance, March 29, 2020		$	17,552	$	199,933	$	1,635,473	$	(171,211)	$	(490,033)	$	1,191,714	$	1,860	$	1,193,574
Balance, June 28, 2020																		Balance, June 28, 2020	$	17,562	$	205,618	$	1,659,158	$	(171,211)	$	(481,956)	$	1,229,171	$	1,860	$	1,231,031

Net income	Net income	—		—		23,662		—		—		23,662		—		23,662		Net income	—		—		33,578		—		—		33,578		—		33,578
Dividends	Dividends	—		—		23		—		—		23		—		23		Dividends	—		—		(20,103)		—		—		(20,103)		—		(20,103)
Other comprehensive income	Other comprehensive income	—		—		—		—		8,077		8,077		—		8,077		Other comprehensive income	—		—		—		—		6,038		6,038		—		6,038
Issuance of shares:	Issuance of shares:																	Issuance of shares:
Stock options – 90,735 Class A shares		9		933		—		—		—		942		—		942
Restricted stock units vested – 6,516 Class A shares		1		(275)		—		—		—		(274)		—		(274)
Stock options – 372,508 Class A shares																		Stock options – 372,508 Class A shares	37		3,397		—		—		—		3,434		—		3,434
Restricted stock units vested – 635 Class A shares																		Restricted stock units vested – 635 Class A shares	—		(16)		—		—		—		(16)		—		(16)

Stock-based compensation	Stock-based compensation	—		5,027		—		—		—		5,027		—		5,027		Stock-based compensation	—		3,292		—		—		—		3,292		—		3,292

Balance, June 28, 2020		$	17,562	$	205,618	$	1,659,158	$	(171,211)	$	(481,956)	$	1,229,171	$	1,860	$	1,231,031
Balance, September 27, 2020																		Balance, September 27, 2020	$	17,599	$	212,291	$	1,672,633	$	(171,211)	$	(475,918)	$	1,255,394	$	1,860	$	1,257,254

Balance, March 28, 2021		$	17,670	$	212,802	$	1,701,860	$	(171,211)	$	(408,253)	$	1,352,868	$	2,594	$	1,355,462
Balance, June 27, 2021																		Balance, June 27, 2021	$	17,674	$	217,565	$	1,756,198	$	(171,211)	$	(403,444)	$	1,416,782	$	2,005	$	1,418,787

Net income	Net income	—		—		54,317		—		—		54,317		—		54,317		Net income	—		—		54,656		—		—		54,656		—		54,656
Dividends	Dividends	—		—		21		—		—		21		—		21		Dividends	—		—		(11,831)		—		—		(11,831)		—		(11,831)
Other comprehensive income	Other comprehensive income	—		—		—		—		4,809		4,809		—		4,809		Other comprehensive income	—		—		—		—		2,914		2,914		—		2,914
Issuance of shares:	Issuance of shares:																	Issuance of shares:

Restricted stock units vested – 45,280 Class A shares		4		(390)		—		—		—		(386)		—		(386)
Stock options – 700 Class A shares																		Stock options – 700 Class A shares	—		4		—		—		—		4		—		4
Restricted stock units vested – 1,379 Class A shares																		Restricted stock units vested – 1,379 Class A shares	1		(48)		—		—		—		(47)		—		(47)

Stock-based compensation	Stock-based compensation	—		5,153		—		—		—		5,153		—		5,153		Stock-based compensation	—		5,049		—		—		—		5,049		—		5,049
Distributions		—		—		—		—		—		—		(589)		(589)

Balance, June 27, 2021		$	17,674	$	217,565	$	1,756,198	$	(171,211)	$	(403,444)	$	1,416,782	$	2,005	$	1,418,787

Balance, September 26, 2021																		Balance, September 26, 2021	$	17,675	$	222,570	$	1,799,023	$	(171,211)	$	(400,530)	$	1,467,527	$	2,005	$	1,469,532

THE NEW YORK TIMES COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the ~~Six~~Nine Months Ended ~~June 27,~~ September 26, 2021 and ~~June 28,~~September 27, 2020

(Unaudited)

(In thousands, except share data)


		Capital Stock - Class A and Class B Common		Additional Paid-in Capital		Retained Earnings		Common Stock Held in Treasury, at Cost		Accumulated Other Comprehensive Loss, Net of Income Taxes		Total New York Times Company Stockholders’ Equity		Non- controlling Interest		Total Stock- holders’ Equity			Capital Stock - Class A and Class B Common		Additional Paid-in Capital		Retained Earnings		Common Stock Held in Treasury, at Cost		Accumulated Other Comprehensive Loss, Net of Income Taxes		Total New York Times Company Stockholders’ Equity		Non- controlling Interest		Total Stock- holders’ Equity
																																			Capital Stock - Class A and Class B Common	Additional Paid-in Capital	Retained Earnings	Common Stock Held in Treasury, at Cost	Accumulated Other Comprehensive Loss, Net of Income Taxes	Total New York Times Company Stockholders’ Equity	Non- controlling Interest	Total Stock- holders’ Equity
Balance, December 29, 2019	Balance, December 29, 2019	$	17,504	$	208,028	$	1,612,658	$	(171,211)	$	(494,976)	$	1,172,003	$	1,860	$	1,173,863	Balance, December 29, 2019	$	17,504	$	208,028	$	1,612,658	$	(171,211)	$	(494,976)	$	1,172,003	$	1,860	$	1,173,863

Net income	Net income	—		—		56,516		—		—		56,516		—		56,516		Net income	—		—		90,094		—		—		90,094		—		90,094
Dividends	Dividends	—		—		(10,016)		—		—		(10,016)		—		(10,016)		Dividends	—		—		(30,119)		—		—		(30,119)		—		(30,119)
Other comprehensive income	Other comprehensive income	—		—		—		—		13,020		13,020		—		13,020		Other comprehensive income	—		—		—		—		19,058		19,058		—		19,058
Issuance of shares:	Issuance of shares:											—				—		Issuance of shares:											—				—
Stock options – 179,510 Class A shares		18		1,855		—		—		—		1,873		—		1,873
Restricted stock units vested – 141,501 Class A shares		14		(3,897)		—		—		—		(3,883)		—		(3,883)
Stock options – 552,018 Class A shares																		Stock options – 552,018 Class A shares	55		5,252		—		—		—		5,307		—		5,307
Restricted stock units vested – 142,136 Class A shares																		Restricted stock units vested – 142,136 Class A shares	14		(3,913)		—		—		—		(3,899)		—		(3,899)
Performance-based awards – 257,098 Class A shares	Performance-based awards – 257,098 Class A shares	26		(7,850)		—		—		—		(7,824)		—		(7,824)		Performance-based awards – 257,098 Class A shares	26		(7,850)		—		—		—		(7,824)		—		(7,824)
Stock-based compensation	Stock-based compensation	—		7,482		—		—		—		7,482		—		7,482		Stock-based compensation	—		10,774		—		—		—		10,774		—		10,774

Balance, June 28, 2020		$	17,562	$	205,618	$	1,659,158	$	(171,211)	$	(481,956)	$	1,229,171	$	1,860	$	1,231,031
Balance, September 27, 2020																		Balance, September 27, 2020	$	17,599	$	212,291	$	1,672,633	$	(171,211)	$	(475,918)	$	1,255,394	$	1,860	$	1,257,254

Balance, December 27, 2020	Balance, December 27, 2020	$	17,609	$	216,714	$	1,672,586	$	(171,211)	$	(410,181)	$	1,325,517	$	2,594	$	1,328,111	Balance, December 27, 2020	$	17,609	$	216,714	$	1,672,586	$	(171,211)	$	(410,181)	$	1,325,517	$	2,594	$	1,328,111

Net income	Net income	—		—		95,426		—		—		95,426		—		95,426		Net income	—		—		150,082		—		—		150,082		—		150,082
Dividends	Dividends	—		—		(11,814)		—		—		(11,814)		—		(11,814)		Dividends	—		—		(23,645)		—		—		(23,645)		—		(23,645)
Other comprehensive income	Other comprehensive income	—		—		—		—		6,737		6,737		—		6,737		Other comprehensive income	—		—		—		—		9,651		9,651		—		9,651
Issuance of shares:	Issuance of shares:																	Issuance of shares:
Stock options – 323,360 Class A shares		33		2,414		—		—		—		2,447		—		2,447
Restricted stock units vested – 187,987 Class A shares		18		(4,954)		—		—		—		(4,936)		—		(4,936)
Stock options – 324,060 Class A shares																		Stock options – 324,060 Class A shares	33		2,418		—		—		—		2,451		—		2,451
Restricted stock units vested – 189,366 Class A shares																		Restricted stock units vested – 189,366 Class A shares	19		(5,002)		—		—		—		(4,983)		—		(4,983)
Performance-based awards – 142,253 Class A shares	Performance-based awards – 142,253 Class A shares	14		(5,947)		—		—		—		(5,933)		—		(5,933)		Performance-based awards – 142,253 Class A shares	14		(5,947)		—		—		—		(5,933)		—		(5,933)
Stock-based compensation	Stock-based compensation	—		9,338		—		—		—		9,338		—		9,338		Stock-based compensation	—		14,387		—		—		—		14,387		—		14,387
Distributions	Distributions	—		—		—		—		—		—		(589)		(589)		Distributions	—		—		—		—		—		—		(589)		(589)

Balance, June 27, 2021		$	17,674	$	217,565	$	1,756,198	$	(171,211)	$	(403,444)	$	1,416,782	$	2,005	$	1,418,787
Balance, September 26, 2021																		Balance, September 26, 2021	$	17,675	$	222,570	$	1,799,023	$	(171,211)	$	(400,530)	$	1,467,527	$	2,005	$	1,469,532

THE NEW YORK TIMES COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)


		For the Six Months Ended					For the Nine Months Ended
		June 27, 2021		June 28, 2020			September 26, 2021		September 27, 2020
		(26 weeks)					(39 weeks)
Cash flows from operating activities	Cash flows from operating activities					Cash flows from operating activities
Net income	Net income	$	95,426	$	56,516	Net income	$	150,082	$	90,094
Adjustments to reconcile net income to net cash provided by operating activities:	Adjustments to reconcile net income to net cash provided by operating activities:					Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization	Depreciation and amortization	29,203		30,816		Depreciation and amortization	43,529		46,368
Lease termination charge	Lease termination charge	3,831		0		Lease termination charge	3,831		—
Amortization of right of use asset	Amortization of right of use asset	4,442		4,645		Amortization of right of use asset	7,069		6,446
Stock-based compensation expense	Stock-based compensation expense	9,338		7,482		Stock-based compensation expense	14,387		10,744

Gain on non-marketable equity investment	Gain on non-marketable equity investment	0		(10,074)		Gain on non-marketable equity investment	(27,156)		(10,074)

Long-term retirement benefit obligations		(8,866)		(8,524)
Change in long-term retirement benefit obligations						Change in long-term retirement benefit obligations	(13,440)		(11,635)

Other – net	Other – net	(289)		475		Other – net	(256)		(5,505)
Changes in operating assets and liabilities:	Changes in operating assets and liabilities:					Changes in operating assets and liabilities:
Accounts receivable – net	Accounts receivable – net	30,152		91,310		Accounts receivable – net	19,072		88,065
Other assets	Other assets	(8,027)		(1,292)		Other assets	(13,192)		3,816
Accounts payable, accrued payroll and other liabilities	Accounts payable, accrued payroll and other liabilities	(54,170)		(64,019)		Accounts payable, accrued payroll and other liabilities	15,311		(23,366)
Unexpired subscriptions	Unexpired subscriptions	9,394		11,255		Unexpired subscriptions	10,320		11,730
Net cash provided by operating activities	Net cash provided by operating activities	110,434		118,590		Net cash provided by operating activities	209,557		206,683
Cash flows from investing activities	Cash flows from investing activities					Cash flows from investing activities
Purchases of marketable securities	Purchases of marketable securities	(326,996)		(278,773)		Purchases of marketable securities	(550,649)		(460,117)
Maturities of marketable securities	Maturities of marketable securities	293,053		228,938		Maturities of marketable securities	421,679		331,786

Business acquisitions	Business acquisitions	0		(8,055)		Business acquisitions	—		(33,085)
Sales of investments – net	Sales of investments – net	271		4,074		Sales of investments – net	20,569		1,000
Capital expenditures	Capital expenditures	(14,677)		(21,510)		Capital expenditures	(23,750)		(29,236)
Other-net	Other-net	2,017		2,388		Other-net	2,466		2,388
Net cash used in investing activities	Net cash used in investing activities	(46,332)		(72,938)		Net cash used in investing activities	(129,685)		(187,264)
Cash flows from financing activities	Cash flows from financing activities					Cash flows from financing activities
Long-term obligations:	Long-term obligations:					Long-term obligations:

Dividends paid	Dividends paid	(21,825)		(18,359)		Dividends paid	(33,627)		(28,393)

Payment of contingent consideration						Payment of contingent consideration	(862)		(862)
Capital shares:	Capital shares:					Capital shares:
Proceeds from stock option exercises	Proceeds from stock option exercises	2,441		1,873		Proceeds from stock option exercises	2,451		5,307

Share-based compensation tax withholding	Share-based compensation tax withholding	(10,901)		(11,706)		Share-based compensation tax withholding	(10,916)		(11,723)
Net cash used in financing activities	Net cash used in financing activities	(30,285)		(28,192)		Net cash used in financing activities	(42,954)		(35,671)
Net increase in cash, cash equivalents and restricted cash		33,817		17,460
Net increase (decrease) in cash, cash equivalents and restricted cash						Net increase (decrease) in cash, cash equivalents and restricted cash	36,918		(16,252)
Effect of exchange rate changes on cash	Effect of exchange rate changes on cash	(280)		162		Effect of exchange rate changes on cash	(560)		349
Cash, cash equivalents and restricted cash at the beginning of the period	Cash, cash equivalents and restricted cash at the beginning of the period	301,964		247,518		Cash, cash equivalents and restricted cash at the beginning of the period	301,964		247,518
Cash, cash equivalents and restricted cash at the end of the period	Cash, cash equivalents and restricted cash at the end of the period	$	335,501	$	265,140	Cash, cash equivalents and restricted cash at the end of the period	$	338,322	$	231,615

See Notes to Condensed Consolidated Financial Statements.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1. BASIS OF PRESENTATION

In the opinion of management of The New York Times Company (the “Company”), the Condensed Consolidated Financial Statements present fairly the financial position of the Company as of ~~June 27,~~September 26, 2021, and December 27, 2020, and the results of operations, changes in stockholders’ equity and cash flows of the Company for the periods ended ~~June 27,~~September 26, 2021, and ~~June 28,~~September 27, 2020. The Company and its consolidated subsidiaries are referred to collectively as “we,” “us” or “our.” All adjustments necessary for a fair presentation have been included and are of a normal and recurring nature. All significant intercompany accounts and transactions have been eliminated in consolidation. The financial statements were prepared in accordance with the requirements of the Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain notes or other financial information that are normally required by accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted from these interim financial statements. These financial statements, therefore, should be read in conjunction with the Consolidated Financial Statements and related Notes included in our Annual Report on Form 10-K for the year ended December 27, 2020. Due to the seasonal nature of our business, operating results for the interim periods are not necessarily indicative of a full year’s operations. The fiscal periods included herein comprise 13 and 2639 weeks for the ~~second~~third quarter and ~~six~~nine months, respectively.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in our Condensed Consolidated Financial Statements. Actual results could differ from these estimates.

Certain prior period amounts have been reclassified to conform with the current period presentation.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Except as described herein, as of ~~June 27,~~September 26, 2021, our significant accounting policies, which are detailed in our Annual Report on Form 10-K for the year ended December 27, 2020, have not changed materially.

Recently Adopted Accounting Pronouncements


Accounting Standard Update(s)	Topic	Effective Period	Summary
2019-12	Simplifying the Accounting for Income Taxes (Topic 740)	Fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted.	Simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in Accounting Standards Codification 740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The standard also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The Company adopted this guidance on December 28, 2020. The adoption did not have a material impact on the Company’s consolidated financial statements.

Recently Issued Accounting Pronouncements

The Company considers the applicability and impact of all recently issued accounting pronouncements. Recent accounting pronouncements not specifically identified in our disclosures are either not applicable to the Company or are not expected to have a material effect on our financial condition or results of operations.

NOTE 3. REVENUE

We generate revenues principally from subscriptions and advertising. Subscription revenues consist of revenues from subscriptions to our digital and print products (which include our news product, as well as our Games, Cooking, Audm and ~~Audm products)~~Wirecutter (to which a subscription option was launched during the third quarter of 2021) products (“other digital-only products”)) and single-copy and bulk sales of our print products. Subscription revenues are based on both the number of copies of the printed newspaper sold and digital-only subscriptions, and the rates charged to the respective customers.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

business includes direct-sold website, mobile application, podcast, email and video advertisements. Direct-sold display advertising, a component of core digital advertising, includes offerings on websites and mobile applications sold directly to marketers by our advertising sales teams. Other digital advertising includes open-market programmatic advertising and creative services fees. Print advertising includes revenue from column-inch ads and classified advertising ~~including line-ads~~ as well as preprinted advertising, also known as freestanding inserts.

Other revenues primarily consist of revenues from licensing, Wirecutter affiliate referrals, commercial printing, the leasing of floors in the New York headquarters building located at 620 Eighth Avenue, New York, New York (the “Company Headquarters”), ~~commercial printing,~~ retail commerce, television and film, our student subscription sponsorship program and our live events business.

Subscription, advertising and other revenues were as follows:

For the Quarters Ended For the Six Months Ended
(In thousands) June 27, 2021 As % of total June 28, 2020 As % of total June 27, 2021 As % of total June 28, 2020 As % of total
Subscription $ 339,217 68.1 % $ 293,189 72.6 % $ 668,301 68.8 % $ 578,623 68.3 %
Advertising 112,774 22.6 % 67,760 16.8 % 209,890 21.6 % 173,897 20.5 %
Other (1)
46,506 9.3 % 42,801 10.6 % 93,351 9.6 % 94,866 11.2 %
Total $ 498,497 100.0 % $ 403,750 100.0 % $ 971,542 100.0 % $ 847,386 100.0 %


	For the Quarters Ended								For the Nine Months Ended
(In thousands)	September 26, 2021		As % of total		September 27, 2020		As % of total		September 26, 2021		As % of total		September 27, 2020		As % of total
Subscription	$	342,609	67.4	%	$	300,950	70.5	%	$	1,010,910	68.3	%	$	879,573	69.0	%
Advertising	110,887		21.7	%	79,253		18.6	%	320,777		21.6	%	253,150		19.9	%
Other (1)	55,607		10.9	%	46,692		10.9	%	148,958		10.1	%	141,558		11.1	%
Total	$	509,103	100.0	%	$	426,895	100.0	%	$	1,480,645	100.0	%	$	1,274,281	100.0	%

(1) Other revenues include building rental revenue, which is not under the scope of Revenue from Contracts with Customers (Topic 606). Building rental revenue was approximately $7 million for the ~~second~~third quarters of each of 2021 and 2020, ~~respectively,~~ and approximately ~~$13~~$20 million and ~~$15~~$22 million for the first ~~six~~nine months of 2021 and 2020, respectively.

The following table summarizes digital and print subscription revenues, which are components of subscription revenues above, for the ~~second~~third quarters and first ~~six~~nine months ended ~~June 27,~~September 26, 2021, and ~~June 28,~~September 27, 2020:

For the Quarters Ended For the Six Months Ended
(In thousands) June 27, 2021 June 28, 2020 June 27, 2021 June 28, 2020
Digital-only subscription revenues:
News product subscription revenues(1)
$ 170,893 $ 132,922 $ 332,181 $ 251,880
Other product subscription revenues(2)
19,252 13,062 37,564 24,114
Subtotal digital-only subscriptions 190,145 145,984 369,745 275,994
Print subscription revenues:
Domestic home delivery subscription revenues(3)
134,755 132,971 269,150 266,708
Single-copy, NYT International and other subscription revenues(4)
14,317 14,234 29,406 35,921
Subtotal print subscription revenues 149,072 147,205 298,556 302,629
Total subscription revenues $ 339,217 $ 293,189 $ 668,301 $ 578,623
(1) Includes revenues from subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games and Cooking products are also included in this category.
(2) Includes revenues from standalone subscriptions to the Company’s Games, Cooking and Audm products.
(3) Includes free access to some of the Company’s digital products.
(4) NYT International is the international edition of our print newspaper.

~~The following table summarizes digital and print advertising revenues for the second quarters and first six months ended June 27, 2021, and June 28, 2020:~~

For the Quarters Ended For the Six Months Ended
(In thousands) June 27, 2021 June 28, 2020 June 27, 2021 June 28, 2020
Advertising revenues:
Digital $ 70,995 $ 39,531 $ 130,491 $ 90,689
Print 41,779 28,229 79,399 83,208
Total advertising $ 112,774 $ 67,760 $ 209,890 $ 173,897


	For the Quarters Ended								For the Nine Months Ended
(In thousands)	September 26, 2021		As % of total		September 27, 2020		As % of total		September 26, 2021		As % of total		September 27, 2020		As % of total
Digital-only subscription revenues:
News product subscription revenues(1)	$	178,382	52.1	%	$	140,740	46.8	%	$	510,563	50.5	%	$	392,620	44.6	%
Other digital-only product subscription revenues(2)	20,251		5.9	%	14,546		4.8	%	57,815		5.7	%	38,660		4.4	%
Subtotal digital-only subscriptions	198,633		58.0	%	155,286		51.6	%	568,378		56.2	%	431,280		49.0	%
Print subscription revenues:
Domestic home delivery subscription revenues(3)	128,895		37.6	%	129,912		43.2	%	398,045		39.4	%	396,620		45.1	%
Single-copy, NYT International and other subscription revenues(4)	15,081		4.4	%	15,752		5.2	%	44,487		4.4	%	51,673		5.9	%
Subtotal print subscription revenues	143,976		42.0	%	145,664		48.4	%	442,532		43.8	%	448,293		51.0	%
Total subscription revenues	$	342,609	100.0	%	$	300,950	100.0	%	$	1,010,910	100.0	%	$	879,573	100.0	%
(1) Includes revenues from subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games, Cooking and Wirecutter products are also included in this category.
(2) Includes revenues from standalone subscriptions to the Company’s other digital-only products.
(3) Includes free access to some of the Company’s digital products.
(4) NYT International is the international edition of our print newspaper.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table summarizes digital and print advertising revenues, which are components of advertising revenues above, for the third quarters and first nine months ended September 26, 2021, and September 27, 2020:


	For the Quarters Ended								For the Nine Months Ended
(In thousands)	September 26, 2021		As % of total		September 27, 2020		As % of total		September 26, 2021		As % of total		September 27, 2020		As % of total
Advertising revenues:
Digital	$	66,981	60.4	%	$	47,763	60.3	%	$	197,472	61.6	%	$	138,452	54.7	%
Print	43,906		39.6	%	31,490		39.7	%	123,305		38.4	%	114,698		45.3	%
Total advertising	$	110,887	100.0	%	$	79,253	100.0	%	$	320,777	100.0	%	$	253,150	100.0	%

Performance Obligations

We have remaining performance obligations related to digital archive and other licensing and certain advertising contracts. As of ~~June 27,~~September 26, 2021, the aggregate amount of the transaction price allocated to the remaining performance obligations for contracts with a duration greater than one year was approximately ~~$104~~$128 million. The Company will recognize this revenue as performance obligations are satisfied. We expect that approximately ~~$24~~$13 million, ~~$36~~$40 million and ~~$44~~$75 million will be recognized in the remainder of 2021, 2022 and thereafter through 2028, respectively.

Contract Assets

As of ~~June 27,~~September 26, 2021, and December 27, 2020, the Company had ~~$1.9~~$3.1 million and $1.8 million, respectively, in contract assets recorded in the Condensed Consolidated Balance Sheets related to digital archiving licensing revenue. The contract asset is reclassified to Accounts receivable when the customer is invoiced based on the contractual billing schedule.

NOTE 4. MARKETABLE SECURITIES

The Company accounts for its marketable securities as available for sale (“AFS”). The Company recorded ~~$2.4~~$1.7 million and $4.3 million of net unrealized gains in Accumulated other comprehensive income (“AOCI”) as of ~~June 27,~~September 26, 2021, and December 27, 2020, respectively.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following tables present the amortized cost, gross unrealized gains and losses, and fair market value of our AFS securities as of ~~June 27,~~September 26, 2021, and December 27, 2020:


		June 27, 2021									September 26, 2021
(In thousands)	(In thousands)	Amortized Cost		Gross unrealized gains		Gross unrealized losses		Fair Value		(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value

Short-term AFS securities	Short-term AFS securities									Short-term AFS securities
U.S. Treasury securities										U.S. Treasury securities	$	108,696	$	898	$	(2)	$	109,592
Certificates of deposit										Certificates of deposit	109,253		—		—		109,253
Corporate debt securities	Corporate debt securities	$	110,415	$	496	$	(12)	$	110,899	Corporate debt securities	100,627		361		(14)		100,974
Certificates of deposit		105,954		0		0		105,954
U.S. Treasury securities		74,984		547		(3)		75,528
U.S. governmental agency securities	U.S. governmental agency securities	26,137		16		0		26,153		U.S. governmental agency securities	19,964		10		—		19,974
Commercial paper	Commercial paper	19,921		0		0		19,921		Commercial paper	18,021		—		—		18,021
Total short-term AFS securities	Total short-term AFS securities	$	337,411	$	1,059	$	(15)	$	338,455	Total short-term AFS securities	$	356,561	$	1,269	$	(16)	$	357,814
Long-term AFS securities	Long-term AFS securities									Long-term AFS securities
Corporate debt securities	Corporate debt securities	$	161,767	$	725	$	(123)	$	162,369	Corporate debt securities	$	233,971	$	594	$	(274)	$	234,291
U.S. Treasury securities	U.S. Treasury securities	60,377		861		(15)		61,223		U.S. Treasury securities	71,722		200		(61)		71,861
U.S. governmental agency securities	U.S. governmental agency securities	51,591		6		(67)		51,530		U.S. governmental agency securities	42,497		—		(43)		42,454
Municipal securities	Municipal securities	12,142		7		(6)		12,143		Municipal securities	12,123		5		(13)		12,115
Total long-term AFS securities	Total long-term AFS securities	$	285,877	$	1,599	$	(211)	$	287,265	Total long-term AFS securities	$	360,313	$	799	$	(391)	$	360,721


		December 27, 2020									December 27, 2020
(In thousands)	(In thousands)	Amortized Cost		Gross unrealized gains		Gross unrealized losses		Fair Value		(In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value

Short-term AFS securities	Short-term AFS securities									Short-term AFS securities
U.S. Treasury securities										U.S. Treasury securities	$	79,467	$	39	$	(3)	$	79,503
Certificates of deposit										Certificates of deposit	36,525		—		—		36,525
Corporate debt securities	Corporate debt securities	$	129,805	$	504	$	(8)	$	130,301	Corporate debt securities	129,805		504		(8)		130,301
Certificates of deposit		36,525		0		0		36,525
U.S. Treasury securities		79,467		39		(3)		79,503
U.S. governmental agency securities	U.S. governmental agency securities	25,113		61		(3)		25,171		U.S. governmental agency securities	25,113		61		(3)		25,171
Commercial paper	Commercial paper	37,580		0		0		37,580		Commercial paper	37,580		—		—		37,580

Total short-term AFS securities	Total short-term AFS securities	$	308,490	$	604	$	(14)	$	309,080	Total short-term AFS securities	$	308,490	$	604	$	(14)	$	309,080
Long-term AFS securities	Long-term AFS securities									Long-term AFS securities
Corporate debt securities	Corporate debt securities	$	134,296	$	1,643	$	(5)	$	135,934	Corporate debt securities	$	134,296	$	1,643	$	(5)	$	135,934
U.S. Treasury securities	U.S. Treasury securities	95,511		2,054		0		97,565		U.S. Treasury securities	95,511		2,054		—		97,565
U.S. governmental agency securities	U.S. governmental agency securities	48,342		19		(13)		48,348		U.S. governmental agency securities	48,342		19		(13)		48,348
Municipal securities	Municipal securities	4,994		0		(10)		4,984		Municipal securities	4,994		—		(10)		4,984
Total long-term AFS securities	Total long-term AFS securities	$	283,143	$	3,716	$	(28)	$	286,831	Total long-term AFS securities	$	283,143	$	3,716	$	(28)	$	286,831

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following tables represent the AFS securities as of ~~June 27,~~September 26, 2021, and December 27, 2020, that were in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by investment category and the length of time that individual securities have been in a continuous unrealized loss position:


		June 27, 2021													September 26, 2021
		Less than 12 Months				12 Months or Greater				Total					Less than 12 Months				12 Months or Greater				Total
(In thousands)	(In thousands)	Fair Value		Gross unrealized losses		Fair Value		Gross unrealized losses		Fair Value		Gross unrealized losses		(In thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses

Short-term AFS securities	Short-term AFS securities													Short-term AFS securities
U.S. Treasury securities														U.S. Treasury securities	$	32,611	$	(2)	$	—	$	—	$	32,611	$	(2)
Corporate debt securities	Corporate debt securities	$	28,033	$	(12)	$	0	$	0	$	28,033	$	(12)	Corporate debt securities	28,090		(14)		—		—		28,090		(14)
U.S. Treasury securities		22,670		(3)		0		0		22,670		(3)

Total short-term AFS securities	Total short-term AFS securities	$	50,703	$	(15)	$	0	$	0	$	50,703	$	(15)	Total short-term AFS securities	$	60,701	$	(16)	$	—	$	—	$	60,701	$	(16)
Long-term AFS securities	Long-term AFS securities													Long-term AFS securities
Corporate debt securities	Corporate debt securities	$	50,552	$	(123)	$	0	$	0	$	50,552	$	(123)	Corporate debt securities	$	128,315	$	(274)	$	—	$	—	$	128,315	$	(274)
U.S. Treasury securities	U.S. Treasury securities	11,212		(15)		0		0		11,212		(15)		U.S. Treasury securities	54,539		(61)		—		—		54,539		(61)
U.S. governmental agency securities	U.S. governmental agency securities	42,428		(67)		0		0		42,428		(67)		U.S. governmental agency securities	42,454		(43)		—		—		42,454		(43)
Municipal securities	Municipal securities	5,141		(6)		0		0		5,141		(6)		Municipal securities	5,114		(13)		—		—		5,114		(13)
Total long-term AFS securities	Total long-term AFS securities	$	109,333	$	(211)	$	0	$	0	$	109,333	$	(211)	Total long-term AFS securities	$	230,422	$	(391)	$	—	$	—	$	230,422	$	(391)


		December 27, 2020													December 27, 2020
		Less than 12 Months				12 Months or Greater				Total					Less than 12 Months				12 Months or Greater				Total
(In thousands)	(In thousands)	Fair Value		Gross unrealized losses		Fair Value		Gross unrealized losses		Fair Value		Gross unrealized losses		(In thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses

Short-term AFS securities	Short-term AFS securities													Short-term AFS securities
U.S. Treasury securities														U.S. Treasury securities	$	20,133	$	(3)	$	—	$	—	$	20,133	$	(3)
Corporate debt securities	Corporate debt securities	$	33,735	$	(8)	$	0	$	0	$	33,735	$	(8)	Corporate debt securities	33,735		(8)		—		—		33,735		(8)
U.S. Treasury securities		20,133		(3)		0		0		20,133		(3)
U.S. governmental agency securities	U.S. governmental agency securities	4,999		(2)		8,749		(1)		13,748		(3)		U.S. governmental agency securities	4,999		(2)		8,749		(1)		13,748		(3)

Total short-term AFS securities	Total short-term AFS securities	$	58,867	$	(13)	$	8,749	$	(1)	$	67,616	$	(14)	Total short-term AFS securities	$	58,867	$	(13)	$	8,749	$	(1)	$	67,616	$	(14)
Long-term AFS securities	Long-term AFS securities													Long-term AFS securities
Corporate debt securities	Corporate debt securities	$	6,717	$	(5)	$	0	$	0	$	6,717	$	(5)	Corporate debt securities	$	6,717	$	(5)	$	—	$	—	$	6,717	$	(5)

U.S. governmental agency securities	U.S. governmental agency securities	26,236		(13)		0		0		26,236		(13)		U.S. governmental agency securities	26,236		(13)		—		—		26,236		(13)
Municipal securities	Municipal securities	4,984		(10)		0		0		4,984		(10)		Municipal securities	4,984		(10)		—		—		4,984		(10)
Total long-term AFS securities	Total long-term AFS securities	$	37,937	$	(28)	$	0	$	0	$	37,937	$	(28)	Total long-term AFS securities	$	37,937	$	(28)	$	—	$	—	$	37,937	$	(28)

We assess AFS securities on a quarterly basis or more often if a potential loss-triggering event occurs.

As of ~~June 27,~~September 26, 2021, and December 27, 2020, we did not intend to sell and it was not likely that we would be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. Unrealized losses related to these investments are primarily due to interest rate fluctuations as opposed to changes in credit quality. Therefore, as of ~~June 27,~~September 26, 2021, and December 27, 2020, we have recognized 0no losses or allowance for credit losses related to AFS securities.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

As of ~~June 27,~~September 26, 2021, and December 27, 2020, our short-term and long-term marketable securities had remaining maturities of less than one month to 12 months and 13 months to 36 months, respectively. See Note 8 for more information regarding the fair value of our marketable securities.

~~THE NEW YORK TIMES COMPANY~~

~~NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

NOTE 5. GOODWILL AND INTANGIBLES

The changes in the carrying amount of goodwill as of ~~June 27,~~September 26, 2021, and since December 27, 2020, were as follows:


(In thousands)	Total Company
Balance as of December 27, 2020	$	171,657
Foreign currency translation	~~(1,501)~~(2,803)
Balance as of ~~June 27,~~September 26, 2021	$	~~170,156~~168,854

The foreign currency translation line item reflects changes in goodwill resulting from fluctuating exchange rates related to the consolidation of certain international subsidiaries.

The aggregate carrying amount of intangible assets of ~~$15.2~~$14.6 million is included in Miscellaneous assets in our Condensed Consolidated Balance Sheets as of ~~June 27,~~September 26, 2021.

NOTE 6. INVESTMENTS

Non-Marketable Equity Securities

Our non-marketable equity securities are investments in privately held companies/funds without readily determinable market values. Gains and losses on non-marketable securities revalued, sold or impaired are recognized in Interest income and other, net.in our Condensed Consolidated Statements of Operations.

As of ~~June 27,~~September 26, 2021, and December 27, 2020, non-marketable equity securities included in Miscellaneous assets in our Condensed Consolidated Balance Sheets had a carrying value of ~~$20.6~~$27.4 million and $20.9 million, respectively. The carrying value includes $15.3 million of unrealized gains as of September 26, 2021. During the third quarter of 2021, we recorded a $27.2 million gain related to a non-marketable equity investment transaction. The gain consists of a $15.2 million realized gain due to the partial sale of the investment and a $11.9 million unrealized gain due to the mark to market of the remaining investment. During the first ~~six~~nine months of 2020, we recorded a $10.1 million gain related to a non-marketable equity investment transaction. The gain ~~is comprised~~consists of a $2.5 million realized gain due to the partial sale of the investment and a $7.6 million unrealized gain due to the mark to market of the remaining ~~investment, and is included in~~ ~~Interest income and other, net~~ ~~in our Condensed Consolidated Statements of Operations.~~investment.

NOTE 7. OTHER

Capitalized Computer Software Costs

Amortization of capitalized computer software costs included in Depreciation and amortization in our Condensed Consolidated Statements of Operations ~~were $2.4~~was $2.1 million and $3.9 million in the ~~second~~third quarters of 2021 and 2020, respectively, and ~~$5.0~~$7.1 million and ~~$7.7~~$11.6 million in the first ~~six~~nine months of 2021 and 2020, respectively.

Interest income and other, net

Interest income and other, net, as shown in the accompanying Condensed Consolidated Statements of Operations, was as follows:


		For the Quarters Ended				For the Six Months Ended					For the Quarters Ended				For the Nine Months Ended
(In thousands)	(In thousands)	June 27, 2021		June 28, 2020		June 27, 2021		June 28, 2020		(In thousands)	September 26, 2021		September 27, 2020		September 26, 2021		September 27, 2020
Interest income and other expense, net ~~(1)~~	Interest income and other expense, net ~~(1)~~	$	2,053	$	2,965	$	3,743	$	17,004	Interest income and other expense, net ~~(1)~~	$	1,598	$	3,720	$	5,342	$	10,650
Gain on non-marketable equity investment (1)										Gain on non-marketable equity investment (1)	27,156		—		27,156		10,074
Interest expense	Interest expense	(180)		(179)		(359)		(364)		Interest expense	(185)		(183)		(545)		(547)

Total interest income and other, net	Total interest income and other, net	$	1,873	$	2,786	$	3,384	$	16,640	Total interest income and other, net	$	28,569	$	3,537	$	31,953	$	20,177

(1)~~The six months ended June 28, 2020 includes a $10.1 million gain~~ Represents gains related to a non-marketable equity investment transaction.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Restricted Cash

A reconciliation of cash, cash equivalents and restricted cash as of ~~June 27,~~September 26, 2021, and December 27, 2020, from the Condensed Consolidated Balance Sheets to the Condensed Consolidated Statements of Cash Flows is as follows:


(In thousands)	(In thousands)	June 27, 2021		December 27, 2020		(In thousands)	September 26, 2021		December 27, 2020
Reconciliation of cash, cash equivalents and restricted cash	Reconciliation of cash, cash equivalents and restricted cash					Reconciliation of cash, cash equivalents and restricted cash
Cash and cash equivalents	Cash and cash equivalents	$	320,871	$	286,079	Cash and cash equivalents	$	323,990	$	286,079
Restricted cash included within other current assets	Restricted cash included within other current assets	299		686		Restricted cash included within other current assets	—		686
Restricted cash included within miscellaneous assets	Restricted cash included within miscellaneous assets	14,331		15,199		Restricted cash included within miscellaneous assets	14,332		15,199
Total cash, cash equivalents and restricted cash shown in the Condensed Consolidated Statements of Cash Flows	Total cash, cash equivalents and restricted cash shown in the Condensed Consolidated Statements of Cash Flows	$	335,501	$	301,964	Total cash, cash equivalents and restricted cash shown in the Condensed Consolidated Statements of Cash Flows	$	338,322	$	301,964

Substantially all of the amount included in restricted cash is set aside to collateralize workers’ compensation obligations.

Revolving Credit Facility

In September 2019, the Company entered into a $250.0 million five-year unsecured revolving credit facility (the “Credit Facility”). Certain of the Company’s domestic subsidiaries have guaranteed the Company’s obligations under the Credit Facility. Borrowings under the Credit Facility bear interest at specified rates based on our utilization and consolidated leverage ratio. The Credit Facility contains various customary affirmative and negative covenants. In addition, the Company is obligated to pay a quarterly unused commitment fee of 0.20%.

As of ~~June 27,~~September 26, 2021, there were 0no outstanding borrowings under the Credit Facility and the Company was in compliance with the financial covenants contained in the documents governing the Credit Facility.

Severance Costs

We recognized ~~0 severance costs in the second quarter of 2021 and $6.3~~$0.5 million in severance costs in the ~~second~~third quarter of 2021 and no severance costs in the third quarter of 2020, and ~~$0.4~~$0.9 million and $6.7 million in the first ~~six~~nine months of 2021 and 2020, respectively. These costs are recorded in General and administrative costs in our Condensed Consolidated Statements of Operations.

We had a severance liability of ~~$2.4~~$2.6 million and $5.0 million included in Accrued expenses and other in our Condensed Consolidated Balance Sheets as of ~~June 27,~~September 26, 2021, and December 27, 2020, respectively.

NOTE 8. FAIR VALUE MEASUREMENTS

Fair value is the price that would be received upon the sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date. The transaction would be in the principal or most advantageous market for the asset or liability, based on assumptions that a market participant would use in pricing the asset or liability. The fair value hierarchy consists of three levels:

Level 1–quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date;

Level 2–inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and

Level 3–unobservable inputs for the asset or liability.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Assets/Liabilities Measured and Recorded at Fair Value on a Recurring Basis

The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of ~~June 27,~~September 26, 2021, and December 27, 2020:


(In thousands)	(In thousands)	June 27, 2021								December 27, 2020								(In thousands)	September 26, 2021								December 27, 2020
		Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3			Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Assets:	Assets:																	Assets:
Short-term AFS securities (1)	Short-term AFS securities (1)																	Short-term AFS securities (1)
U.S. Treasury securities																		U.S. Treasury securities	$	109,592	$	—	$	109,592	$	—	$	79,503	$	—	$	79,503	$	—
Certificates of deposit																		Certificates of deposit	109,253		—		109,253		—		36,525		—		36,525		—
Corporate debt securities	Corporate debt securities	$	110,899	$	0	$	110,899	$	0	$	130,301	$	0	$	130,301	$	0	Corporate debt securities	100,974		—		100,974		—		130,301		—		130,301		—
Certificates of deposit		105,954		0		105,954		0		36,525		0		36,525		0
U.S. Treasury securities		75,528		0		75,528		0		79,503		0		79,503		0
U.S. governmental agency securities	U.S. governmental agency securities	26,153		0		26,153		0		25,171		0		25,171		0		U.S. governmental agency securities	19,974		—		19,974		—		25,171		—		25,171		—
Commercial paper	Commercial paper	19,921		0		19,921		0		37,580		0		37,580		0		Commercial paper	18,021		—		18,021		—		37,580		—		37,580		—
Total short-term AFS securities	Total short-term AFS securities	$	338,455	$	0	$	338,455	$	0	$	309,080	$	0	$	309,080	$	0	Total short-term AFS securities	$	357,814	$	—	$	357,814	$	—	$	309,080	$	—	$	309,080	$	—
Long-term AFS securities (1)	Long-term AFS securities (1)																	Long-term AFS securities (1)
Corporate debt securities	Corporate debt securities	$	162,369	$	0	$	162,369	$	0	$	135,934	$	0	$	135,934	$	0	Corporate debt securities	$	234,291	$	—	$	234,291	$	—	$	135,934	$	—	$	135,934	$	—
U.S. Treasury securities	U.S. Treasury securities	61,223		0		61,223		0		97,565		0		97,565		0		U.S. Treasury securities	71,861		—		71,861		—		97,565		—		97,565		—
U.S. governmental agency securities	U.S. governmental agency securities	51,530		0		51,530		0		48,348		0		48,348		0		U.S. governmental agency securities	42,454		—		42,454		—		48,348		—		48,348		—
Municipal securities	Municipal securities	12,143		0		12,143		0		4,984		0		4,984		0		Municipal securities	12,115		—		12,115		—		4,984		—		4,984		—
Total long-term AFS securities	Total long-term AFS securities	$	287,265	$	0	$	287,265	$	0	$	286,831	$	0	$	286,831	$	0	Total long-term AFS securities	$	360,721	$	—	$	360,721	$	—	$	286,831	$	—	$	286,831	$	—
Liabilities:	Liabilities:																	Liabilities:
Deferred compensation (2)(3)	Deferred compensation (2)(3)	$	19,754	$	19,754	$	0	$	0	$	22,245	$	22,245	$	0	$	0	Deferred compensation (2)(3)	$	19,998	$	19,998	$	—	$	—	$	22,245	$	22,245	$	—	$	—
Contingent consideration	Contingent consideration	$	7,450	$	0	$	0	$	7,450	$	8,431	$	0	$	0	$	8,431	Contingent consideration	$	7,450	$	—	$	—	$	7,450	$	8,431	$	—	$	—	$	8,431

(1) We classified these investments as Level 2 since the fair value is based on market observable inputs for investments with similar terms and maturities.

(2) The deferred compensation liability, included in Other liabilities—other in our Condensed Consolidated Balance Sheets, consists of deferrals under The New York Times Company Deferred Executive Compensation Plan (the “DEC”), which previously enabled certain eligible executives to elect to defer a portion of their compensation on a pre-tax basis. The deferred amounts are invested at the executives’ option in various mutual funds. The fair value of deferred compensation is based on the mutual fund investments elected by the executives and on quoted prices in active markets for identical assets. Participation in the DEC was frozen effective December 31, 2015.

(3) The Company invests the assets associated with the deferred compensation liability in life insurance products. Our investments in life insurance products are included in Miscellaneous assets in our Condensed Consolidated Balance Sheets, and were ~~$51.1~~$51.2 million as of ~~June 27,~~September 26, 2021, and $49.2 million as of December 27, 2020. The fair value of these assets is measured using the net asset value per share (or its equivalent) and has not been classified in the fair value hierarchy.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Level 3 Liabilities

The contingent consideration liability is related to the 2020 acquisition of substantially all the assets and certain liabilities of Serial Productions, LLC (the “Serial acquisition”) and represents contingent payments based on the achievement of certain operational targets, as defined in the acquisition agreement, over the 5five years following the acquisition. The Company estimated the fair value using a probability-weighted discounted cash flow model. The estimate of the fair value of contingent consideration requires subjective assumptions to be made regarding probabilities assigned to operational targets and the discount rate. As the fair value is based on significant unobservable inputs, this is a Level 3 liability.

The following table presents changes in the contingent consideration balances for the quarter and ~~six~~nine months ended ~~June 27,~~September 26, 2021:


		Quarter ended		Six months ended			Quarter ended				Nine months ended
(In thousands)	(In thousands)	June 27, 2021		June 27, 2021		(In thousands)	September 26, 2021		September 27, 2020		September 26, 2021		September 27, 2020
Balance at the beginning of the period ~~(1)~~	Balance at the beginning of the period ~~(1)~~	$	7,728	$	8,431	Balance at the beginning of the period ~~(1)~~	$	7,450	$	9,293	$	8,431	$	9,293

Payments	Payments	(862)		(862)		Payments	—		(862)		(862)		(862)
Fair value adjustments ~~(2)~~(1)	Fair value adjustments ~~(2)~~(1)	584		(119)		Fair value adjustments ~~(2)~~(1)	—		—		(119)		—
Contingent consideration at the end of the period	Contingent consideration at the end of the period	$	7,450	$	7,450	Contingent consideration at the end of the period	$	7,450	$	8,431	$	7,450	$	8,431

(1) There were no transactions involving contingent consideration during the quarter and six months ended June 28, 2020. The contingent consideration reflected above relates to the Serial acquisition, which was completed during the third quarter of 2020.

~~(2)~~ Fair value adjustments are included in General and administrative expenses in our Condensed Consolidated Statements of Operations.

The remaining contingent consideration balances as of ~~June 27,~~September 26, 2021, and December 27, 2020, of $7.5 million and $8.4 million, respectively, are included in Accrued expenses and other, for the current portion of the liability, and Other non-current liabilities, for the long-term portion of the liability, in our Condensed Consolidated Balance Sheets.

NOTE 9. PENSION AND OTHER POSTRETIREMENT BENEFITS

Pension

Single-Employer Plans

We maintain The New York Times Companies Pension Plan, ~~(the “Pension Plan”),~~ a frozen single-employer defined benefit pension plan. The Company also jointly sponsors a defined benefit plan with The NewsGuild of New York known as the Guild-Times Adjustable Pension Plan (the “APP”) that continues to accrue active benefits.

We also have a foreign-based pension plan for certain employees (the “foreign plan”). The information for the foreign plan is combined with the information for U.S. non-qualified plans. The benefit obligation of the foreign plan is immaterial to our total benefit obligation.

The components of net periodic pension cost were as follows:


		For the Quarters Ended													For the Quarters Ended
		June 27, 2021						June 28, 2020							September 26, 2021						September 27, 2020
(In thousands)	(In thousands)	Qualified Plans		Non- Qualified Plans		All Plans		Qualified Plans		Non- Qualified Plans		All Plans		(In thousands)	Qualified Plans		Non- Qualified Plans		All Plans		Qualified Plans		Non- Qualified Plans		All Plans
Service cost	Service cost	$	2,276	$	0	$	2,276	$	2,607	$	0	$	2,607	Service cost	$	2,276	$	—	$	2,276	$	2,608	$	—	$	2,608
Interest cost	Interest cost	7,629		1,088		8,717		11,742		1,649		13,391		Interest cost	7,630		1,087		8,717		11,742		1,648		13,390
Expected return on plan assets	Expected return on plan assets	(12,678)		0		(12,678)		(17,745)		0		(17,745)		Expected return on plan assets	(12,678)		—		(12,678)		(17,741)		—		(17,741)
Amortization of actuarial loss	Amortization of actuarial loss	5,057		1,822		6,879		5,655		1,522		7,177		Amortization of actuarial loss	5,056		1,821		6,877		5,655		1,521		7,176
Amortization of prior service credit	Amortization of prior service credit	(486)		0		(486)		(486)		0		(486)		Amortization of prior service credit	(486)		—		(486)		(486)		—		(486)

Net periodic pension cost (1)	Net periodic pension cost (1)	$	1,798	$	2,910	$	4,708	$	1,773	$	3,171	$	4,944	Net periodic pension cost (1)	$	1,798	$	2,908	$	4,706	$	1,778	$	3,169	$	4,947

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


		For the Six Months Ended													For the Nine Months Ended
		June 27, 2021						June 28, 2020							September 26, 2021						September 27, 2020
(In thousands)	(In thousands)	Qualified Plans		Non- Qualified Plans		All Plans		Qualified Plans		Non- Qualified Plans		All Plans		(In thousands)	Qualified Plans		Non- Qualified Plans		All Plans		Qualified Plans		Non- Qualified Plans		All Plans
Service cost	Service cost	$	4,552	$	0	$	4,552	$	5,214	$	0	$	5,214	Service cost	$	6,828	$	—	$	6,828	$	7,822	$	—	$	7,822
Interest cost	Interest cost	15,258		2,176		17,434		23,484		3,297		26,781		Interest cost	22,888		3,263		26,151		35,226		4,945		40,171
Expected return on plan assets	Expected return on plan assets	(25,355)		0		(25,355)		(35,481)		0		(35,481)		Expected return on plan assets	(38,033)		—		(38,033)		(53,222)		—		(53,222)
Amortization of actuarial loss	Amortization of actuarial loss	10,113		3,642		13,755		11,310		3,043		14,353		Amortization of actuarial loss	15,169		5,463		20,632		16,966		4,564		21,530
Amortization of prior service credit	Amortization of prior service credit	(972)		0		(972)		(972)		0		(972)		Amortization of prior service credit	(1,458)		—		(1,458)		(1,459)		—		(1,459)

Net periodic pension cost (1)	Net periodic pension cost (1)	$	3,596	$	5,818	$	9,414	$	3,555	$	6,340	$	9,895	Net periodic pension cost (1)	$	5,394	$	8,726	$	14,120	$	5,333	$	9,509	$	14,842

(1) The service cost component of net periodic pension cost is recognized in Total operating costs, while the other components are included in Other components of net periodic benefit costs in our Condensed Consolidated Statements of Operations, below Operating ~~profit.~~profit.

During the first ~~six~~nine months of 2021 and 2020, we made pension contributions of ~~$4.2~~$6.5 million and ~~$4.6~~$6.9 million, respectively, to the APP. We expect to make contractual contributions in 2021 ~~to total~~of approximately $9 million, towhich more than satisfy minimum funding requirements.

Other Postretirement Benefits

The components of net periodic postretirement benefit cost/(income) were as follows:


		For the Quarters Ended				For the Six Months Ended					For the Quarters Ended				For the Nine Months Ended
(In thousands)	(In thousands)	June 27, 2021		June 28, 2020		June 27, 2021		June 28, 2020		(In thousands)	September 26, 2021		September 27, 2020		September 26, 2021		September 27, 2020
Service cost	Service cost	$	13	$	7	$	26	$	14	Service cost	$	14	$	7	$	40	$	21
Interest cost	Interest cost	141		257		282		513		Interest cost	141		257		423		770
Amortization of actuarial loss	Amortization of actuarial loss	852		763		1,704		1,526		Amortization of actuarial loss	851		763		2,555		2,289
Amortization of prior service credit	Amortization of prior service credit	(836)		(1,223)		(1,672)		(2,279)		Amortization of prior service credit	(837)		(1,099)		(2,509)		(3,378)
Net periodic postretirement benefit cost/(income) (1)	Net periodic postretirement benefit cost/(income) (1)	$	170	$	(196)	$	340	$	(226)	Net periodic postretirement benefit cost/(income) (1)	$	169	$	(72)	$	509	$	(298)

(1) The service cost component of net periodic postretirement benefit cost/(income) is recognized in Total operating costs, while the other components are included in Other components of net periodic benefit costs in our Condensed Consolidated Statements of Operations, below Operating profit.

NOTE 10. INCOME TAXES

The Company had income tax expense of ~~$18.2~~$20.3 million and ~~$27.7~~$48.0 million in the ~~second~~third quarter and first ~~six~~nine months of 2021, respectively. The Company had income tax expense of ~~$5.8~~$7.3 million and ~~$11.8~~$19.1 million in the ~~second~~third quarter and first ~~six~~nine months of 2020, respectively. The Company’s effective tax rates from continuing operations were ~~25.1%~~27.1% and ~~22.5%~~24.2% for the ~~second~~third quarter and first ~~six~~nine months of 2021, respectively. The Company’s effective tax rates from continuing operations were ~~19.6%~~17.8% and ~~17.3%~~17.5% for the ~~second~~third quarter and first ~~six~~nine months of 2020, respectively. The increase in income tax expense in the ~~second~~third quarter and first ~~six~~nine months of 2021 is primarily due to higher income from continuing operations in those periods. The Company received a tax benefit in the ~~second~~first quarter of ~~2020 from a reduction in the Company’s reserve for uncertain tax positions,~~2021 and in the first ~~quarter~~and third quarters of ~~both 2021 and~~ 2020 from stock price appreciation on stock-based awards that settled in the quarter, which in the case of 2020, resulted in ~~lower than statutory~~lower-than-statutory tax rates in the ~~second~~third quarter and first ~~six~~nine months of 2020.

NOTE 11. EARNINGS PER SHARE

We compute earnings per share ~~using a~~based upon the lower of the two-class method ~~which~~or the treasury stock method. The two-class method is an earnings allocation method used when a company’s capital structure includes either two or more classes of common stock or common stock and participating securities. This method determines earnings per share based on dividends declared on common stock and participating securities (i.e., distributed earnings), as well as participation rights of participating securities in any undistributed earnings.

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Earnings per share is computed using both basic shares and diluted shares. The difference between basic and diluted shares is that diluted shares include the dilutive effect of the assumed exercise of outstanding securities. Our stock options,

~~THE NEW YORK TIMES COMPANY~~

~~NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

stock-settled long-term performance awards and restricted stock units could have a significant impact on diluted shares. The difference between basic and diluted shares of approximately ~~0.3~~0.5 million and ~~0.5~~0.6 million in the ~~second~~third quarter and first ~~six~~nine months of 2021, respectively, and ~~1.2~~1.0 million and 1.1 million in ~~each of~~ the ~~second~~third quarter and first ~~six~~nine months of 2020, respectively, resulted primarily from the dilutive effect of certain stock options, performance awards and restricted stock units.

Securities that could potentially be dilutive are excluded from the computation of diluted earnings per share when a loss from continuing operations exists or when the exercise price exceeds the market value of our Class A Common Stock because their inclusion would result in an anti-dilutive effect on per share amounts.

There were ~~approximately 0.2 million~~no anti-dilutive stock options, stock-settled long-term performance awards or restricted stock units excluded from the computation of diluted earnings per share in the third quarters and first ~~six~~nine months of 2021 and 2020, respectively, because they were anti-dilutive, and 0 anti-dilutive stock options or stock-settled long-term performance awards excluded in the same periods. There were approximately 0.3 million restricted stock units excluded from the computation of diluted earnings per share in the second quarter of 2021, because they were anti-dilutive, and 0 anti-dilutive stock options or stock-settled long-term performance awards excluded in the same period.respectively.

NOTE 12. SUPPLEMENTAL STOCKHOLDERS’ EQUITY INFORMATION

In 2015, the Board of Directors authorized up to $101.1 million of repurchases of shares of the Company’s Class A Common Stock. As of ~~June 27,~~September 26, 2021, repurchases under this authorization totaled $84.9 million (excluding commissions) and $16.2 million remained. Our Board of Directors has authorized us to purchase shares from time to time, subject to market conditions and other factors. There is no expiration date with respect to this authorization. There have been no purchases under this authorization since 2016.

The following table summarizes the changes in AOCI by component as of ~~June 27,~~September 26, 2021:


(In thousands)	(In thousands)	Foreign Currency Translation Adjustments		Funded Status of Benefit Plans		Net Unrealized Gain on Available-For-Sale Securities		Total Accumulated Other Comprehensive Loss		(In thousands)	Foreign Currency Translation Adjustments		Funded Status of Benefit Plans		Net Unrealized Gain on Available-For-Sale Securities		Total Accumulated Other Comprehensive Loss
Balance as of December 27, 2020	Balance as of December 27, 2020	$	8,386	$	(421,698)	$	3,131	$	(410,181)	Balance as of December 27, 2020	$	8,386	$	(421,698)	$	3,131	$	(410,181)
Other comprehensive income before reclassifications, before tax	Other comprehensive income before reclassifications, before tax	(1,767)		0		(1,846)		(3,613)		Other comprehensive income before reclassifications, before tax	(3,421)		—		(2,616)		(6,037)
Amounts reclassified from accumulated other comprehensive loss, before tax	Amounts reclassified from accumulated other comprehensive loss, before tax	0		12,815		0		12,815		Amounts reclassified from accumulated other comprehensive loss, before tax	—		19,220		—		19,220
Income tax (benefit)/expense	Income tax (benefit)/expense	(473)		3,432		(494)		2,465		Income tax (benefit)/expense	(914)		5,146		(700)		3,532
Net current-period other comprehensive (loss)/ income, net of tax	Net current-period other comprehensive (loss)/ income, net of tax	(1,294)		9,383		(1,352)		6,737		Net current-period other comprehensive (loss)/ income, net of tax	(2,507)		14,074		(1,916)		9,651

Balance as of June 27, 2021		$	7,092	$	(412,315)	$	1,779	$	(403,444)
Balance as of September 26, 2021										Balance as of September 26, 2021	$	5,879	$	(407,624)	$	1,215	$	(400,530)

The following table summarizes the reclassifications from AOCI for the ~~six~~nine months ended ~~June 27,~~September 26, 2021:

(In thousands)

Detail about accumulated other comprehensive loss components

Amounts reclassified from accumulated other comprehensive loss

Affects line item in the statement where net income is presented

Funded status of benefit plans:

Amortization of prior service credit(1)

~~(2,644)~~(3,967)

Other components of net periodic benefit costs

Amortization of actuarial loss(1)

~~15,459~~23,187

Other components of net periodic benefit costs

Total reclassification, before tax(2)

~~12,815~~19,220

Income tax expense

~~3,432~~5,146

Income tax expense

Total reclassification, net of tax

~~9,383~~14,074

(1) These AOCI components are included in the computation of net periodic benefit cost for pension and other postretirement benefits. See Note 9 for more information.

(2) There were no reclassifications relating to noncontrolling interest for the ~~six~~nine months ended ~~June 27,~~September 26, 2021.

~~THE NEW YORK TIMES COMPANY~~

~~NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(Unaudited)~~

NOTE 13. SEGMENT INFORMATION

The Company identifies a business as an operating segment if: (i) it engages in business activities from which it may earn revenues and incur expenses; (ii) its operating results are regularly reviewed by the Chief Operating Decision Maker (who

THE NEW YORK TIMES COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

is the Company’s President and Chief Executive Officer) to make decisions about resources to be allocated to the segment and assess its performance; and (iii) it has available discrete financial information. The Company has determined that it has 1 reportable segment. Therefore, all required segment information can be found in the Condensed Consolidated Financial Statements.

NOTE 14. CONTINGENT LIABILITIES

Legal Proceedings

We are involved in various legal actions incidental to our business that are now pending against us. These actions generally have damage claims that are greatly in excess of the payments, if any, that we would be required to pay if we lost or settled the cases. Although the Company cannot predict the outcome of these matters, it is possible that an unfavorable outcome in one or more matters could be material to the Company’s consolidated results of operations or cash flows for an individual reporting period. However, based on currently available information, management does not believe that the ultimate resolution of these matters, individually or in the aggregate, is likely to have a material effect on the Company’s financial position.

NOTE 15. SUBSEQUENT EVENTS

On ~~June~~September 30, 2021, our Board of Directors approved a quarterly dividend of $0.07 per share on our Class A and Class B common stock that was paid on ~~July~~October 22, 2021, to all stockholders of record as of the close of business on ~~July 12,~~October 11, 2021.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

EXECUTIVE OVERVIEW

We are a global media organization that includes digital and print products and related businesses. We have one reportable segment with businesses that include our core news product and other interest-specific products, and related content and services.

We generate revenues principally from subscriptions and advertising. In addition, we generate other revenues primarily consisting of revenues from licensing, Wirecutter affiliate referrals, commercial printing, the leasing of floors in our New York headquarters building located at 620 Eighth Avenue, New York, New York (the “Company Headquarters”), ~~commercial printing,~~ retail commerce, television and film, our student subscription sponsorship program and our live events business.

Our main operating costs are employee-related costs.

In the accompanying analysis of financial information, we present certain information derived from consolidated financial information but not presented in our financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). We are presenting in this report supplemental non-GAAP financial performance measures that exclude depreciation, amortization, severance, non-operating retirement costs or multiemployer pension plan withdrawal costs, and certain identified special items, as applicable. These non-GAAP financial measures should not be considered in isolation from or as a substitute for the related GAAP measures, and should be read in conjunction with financial information presented on a GAAP basis. For further information and reconciliations of these non-GAAP measures to the most directly comparable GAAP measures, see “Non-Operating Items—Non-GAAP Financial ~~Measurements.~~Measures.”

Financial Highlights

•Diluted earnings per share from continuing operations were $0.32 and ~~$0.14~~$0.20 for the ~~second~~third quarters of 2021 and 2020, respectively. Diluted earnings per share from continuing operations excluding severance, non-operating retirement costs and special items discussed below under “Non-Operating Items – Non-GAAP Financial Measures” (or “adjusted diluted earnings per share,” a non-GAAP measure) were ~~$0.36~~$0.23 and ~~$0.18~~$0.22 for the ~~second~~third quarters of 2021 and 2020, respectively.

•The Company had an operating profit of ~~$73.3~~$49.0 million in the ~~second~~third quarter of 2021, compared with ~~$28.8~~$39.6 million in the ~~second~~third quarter of 2020. Operating profit before depreciation, amortization, severance, multiemployer pension plan withdrawal costs and special items discussed below under “Non-Operating Items – Non-GAAP Financial Measures” (or “adjusted operating profit,” a non-GAAP measure) increased to ~~$92.9~~$65.1 million in the ~~second~~third quarter of 2021 ~~from $52.1~~compared with $56.5 million in the ~~second~~third quarter of 2020.

•Total revenues increased ~~23.5%~~19.3% to ~~$498.5~~$509.1 million in the ~~second~~third quarter of 2021 from ~~$403.8~~$426.9 million in the ~~second~~third quarter of 2020.

•Subscription revenues increased ~~15.7%~~13.8% in the ~~second~~third quarter of 2021 compared with the same prior-year period. Paid digital-only subscriptions totaled approximately ~~7,133,000~~7,588,000 at the end of the third quarter of 2021, a net increase of 455,000 subscriptions compared with the end of the second quarter of 2021 and a net increase of ~~142,000 subscriptions~~1,525,000 compared with the end of the ~~first~~third quarter of ~~2021.~~2020. Of the ~~142,000~~455,000 total net additions, ~~77,000~~320,000 came from the Company’s digital news product, while ~~65,000~~135,000 came from the Company’s Cooking, Games, Audm and ~~Audm products. We expect total net~~Wirecutter (to which a subscription ~~additions in 2021 to be in~~option was launched during the ~~range~~third quarter of ~~the number of total net subscription additions in 2019, though it remains difficult to predict with precision.~~2021) products (“other digital-only products”).

•Total advertising revenues increased ~~66.4%~~39.9% in the ~~second~~third quarter of 2021 compared with the same prior-year period, due to an increase of ~~79.6%~~40.2% in digital advertising revenues and an increase of ~~48.0%~~39.4% in print advertising revenues.

•Operating costs increased ~~12.4%~~18.8% to ~~$421.4~~$460.1 million in the ~~second~~third quarter of 2021 from ~~$374.9~~$387.3 million compared with the ~~second~~third quarter of 2020. Operating costs before depreciation, amortization, severance and multiemployer pension plan withdrawal costs (or “adjusted operating costs,” a non-GAAP measure) increased ~~15.4%~~19.9% in the ~~second~~third quarter of 2021 to ~~$405.6~~$444.1 million from ~~$351.6~~$370.4 million in the ~~second~~third quarter of 2020.

Impact of Covid-19 Pandemic

Given the impact of the Covid-19 pandemic on our business in 2020, we believe that certain comparisons of our operating results in 2021 to 2019 provide useful context for our 2021 results. We have included supplemental tables comparing the operating results in 2021 to 2020 and to 2019 (see “Supplemental Financial Information”), as well as discussion comparing the ~~second~~third quarter and first ~~six~~nine months in 2021 to 2020 and 2019.

The Covid-19 pandemic has impacted our business in various ways, including impacts on both our operating revenues and operating expenses. ~~Beginning in the first quarter of~~During 2020, we experienced significant growth in the number of subscriptions to our digital news and

other products, which we believe was attributable in part to an increase in traffic given the news

environment and as a result of the ~~pandemic. More recently, we have seen these pandemic-related trends subside~~pandemic, and we do not expect ~~total net subscription additions in 2021~~the 2020 growth rate to be ~~in the range~~sustainable or indicative of ~~the number of total net subscription additions in 2019, though it remains difficult to predict with precision.~~results for future periods. Revenues from the single-copy and bulk sales of our print newspaper (which include our international edition and collectively represent less than 5% of our total subscription revenues) were adversely affected as a result of widespread business closures, increased remote working and reductions in travel. The worldwide economic slowdown caused by the pandemic also led to a significant decline in our advertising revenues in 2020 as advertisers reduced their spending. More recently, we experienced increasing demand for advertising with the recovery of the broader market. Our live events business was and continues to be adversely affected by the impacts of the Covid-19 pandemic.

In 2020 we incurred less media expense as we decreased marketing spend due to a heightened news cycle, lower print production and distribution costs due to less demand for print copies of the newspaper, lower costs related to our advertising business as a result of lower variable expenses in connection with lower advertising revenues and lower travel and entertainment costs as a result of the Covid-19 pandemic. More recently we have begun increasing some of our spending in these ~~areas.~~areas, and as referenced below, media expenses to promote our subscription business in the third quarter of 2021 were higher than the third quarters of both 2020 and 2019. We also incurred some additional expenses in response to the pandemic, including certain enhanced employee benefits; however these expenses have not yet been significant. We have invested and expect to ~~incur additional costs as we prepare for~~continue to invest in our ~~employees to return to our headquarters building~~Company Headquarters and other offices as well as technological improvements as we transition to hybrid work with employees working both from the office and ~~may incur significant additional costs as circumstances evolve, including in connection with potential operational changes.~~remotely.

At this time, the full impact that the Covid-19 pandemic will have on our business, operations and financial results is uncertain. The extent to which the pandemic will continue to impact us will depend on numerous evolving factors and future developments, including the scope and duration of the pandemic (including the extent of ~~a resurgence)~~variants and resurgences); the effect of ongoing vaccination and mitigation efforts; the impact of the pandemic on economic conditions and the companies with which we do business; governmental, business and other actions; the status of travel restrictions; and changes in consumer behavior in response to the pandemic, among many other factors. We will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal, state, local or foreign authorities, or that we determine are appropriate. Please see “Item 1A — Risk Factors” in our Annual Report on Form 10-K for the year ended December 27, 2020, for more information.

RESULTS OF OPERATIONS

The following table presents our consolidated financial results:


		For the Quarters Ended						For the Six Months Ended							For the Quarters Ended						For the Nine Months Ended
(In thousands)	(In thousands)	June 27, 2021		June 28, 2020		% Change		June 27, 2021		June 28, 2020		% Change		(In thousands)	September 26, 2021		September 27, 2020		% Change		September 26, 2021		September 27, 2020		% Change
Revenues	Revenues													Revenues
Subscription	Subscription	$	339,217	$	293,189	15.7	%	$	668,301	$	578,623	15.5	%	Subscription	$	342,609	$	300,950	13.8	%	$	1,010,910	$	879,573	14.9	%
Advertising	Advertising	112,774		67,760		66.4	%	209,890		173,897		20.7	%	Advertising	110,887		79,253		39.9	%	320,777		253,150		26.7	%
Other	Other	46,506		42,801		8.7	%	93,351		94,866		(1.6)	%	Other	55,607		46,692		19.1	%	148,958		141,558		5.2	%
Total revenues	Total revenues	498,497		403,750		23.5	%	971,542		847,386		14.7	%	Total revenues	509,103		426,895		19.3	%	1,480,645		1,274,281		16.2	%
Operating costs	Operating costs													Operating costs
Cost of revenue (excluding depreciation and amortization)	Cost of revenue (excluding depreciation and amortization)	251,358		229,913		9.3	%	502,355		473,397		6.1	%	Cost of revenue (excluding depreciation and amortization)	256,978		235,665		9.0	%	759,333		709,062		7.1	%
Sales and marketing	Sales and marketing	53,555		39,605		35.2	%	113,708		113,389		0.3	%	Sales and marketing	83,767		50,615		65.5	%	197,475		164,004		20.4	%
Product development	Product development	39,699		30,983		28.1	%	78,642		61,985		26.9	%	Product development	40,638		34,349		18.3	%	119,280		96,334		23.8	%
General and administrative	General and administrative	62,283		58,812		5.9	%	118,860		111,673		6.4	%	General and administrative	64,418		51,118		26.0	%	183,278		162,791		12.6	%
Depreciation and amortization	Depreciation and amortization	14,486		15,631		(7.3)	%	29,203		30,816		(5.2)	%	Depreciation and amortization	14,326		15,552		(7.9)	%	43,529		46,368		(6.1)	%
Total operating costs	Total operating costs	421,381		374,944		12.4	%	842,768		791,260		6.5	%	Total operating costs	460,127		387,299		18.8	%	1,302,895		1,178,559		10.5	%

Lease termination charge	Lease termination charge	3,831		—		*		3,831		—		*		Lease termination charge	—		—		—		3,831		—		*
Operating profit	Operating profit	73,285		28,806		*		124,943		56,126		*		Operating profit	48,976		39,596		23.7	%	173,919		95,722		81.7	%
Other components of net periodic benefit costs	Other components of net periodic benefit costs	2,598		2,149		20.9	%	5,197		4,463		16.4	%	Other components of net periodic benefit costs	2,599		2,272		14.4	%	7,796		6,735		15.8	%

Interest income and other, net	Interest income and other, net	1,873		2,786		(32.8)	%	3,384		16,640		(79.7)	%	Interest income and other, net	28,569		3,537		*		31,953		20,177		58.4	%
Income from continuing operations before income taxes	Income from continuing operations before income taxes	72,560		29,443		*		123,130		68,303		80.3	%	Income from continuing operations before income taxes	74,946		40,861		83.4	%	198,076		109,164		81.4	%
Income tax expense	Income tax expense	18,243		5,781		*		27,704		11,787		*		Income tax expense	20,290		7,283		*		47,994		19,070		*

Net income		54,317		23,662		*		95,426		56,516		68.8	%

Net income attributable to The New York Times Company common stockholders	Net income attributable to The New York Times Company common stockholders	$	54,317	$	23,662	*		$	95,426	$	56,516	68.8	%	Net income attributable to The New York Times Company common stockholders	$	54,656	$	33,578	62.8	%	$	150,082	$	90,094	66.6	%

* Represents a change equal to or in excess of 100% or not meaningful.

SUPPLEMENTAL FINANCIAL INFORMATION


		Second Quarter											For the Quarters Ended
		2021		2020		2021 vs 2020 % Change		2019		2021 vs 2019 % Change			September 26, 2021		September 27, 2020		2021 vs 2020 % Change		September 29, 2019		2021 vs 2019 % Change

Revenues	Revenues											Revenues
Digital	Digital	$	190,145	$	145,984	30.3	%	$	112,635	68.8	%	Digital	$	198,633	$	155,286	27.9	%	$	115,864	71.4	%
Print	Print	149,072		147,205		1.3	%	157,821		(5.5)	%	Print	143,976		145,664		(1.2)	%	151,438		(4.9)	%
Subscription revenues	Subscription revenues	339,217		293,189		15.7	%	270,456		25.4	%	Subscription revenues	342,609		300,950		13.8	%	267,302		28.2	%
Digital	Digital	70,995		39,531		79.6	%	58,026		22.4	%	Digital	66,981		47,763		40.2	%	54,653		22.6	%
Print	Print	41,779		28,229		48.0	%	62,735		(33.4)	%	Print	43,906		31,490		39.4	%	58,878		(25.4)	%
Advertising revenues	Advertising revenues	112,774		67,760		66.4	%	120,761		(6.6)	%	Advertising revenues	110,887		79,253		39.9	%	113,531		(2.3)	%
Other revenues	Other revenues	46,506		42,801		8.7	%	45,041		3.3	%	Other revenues	55,607		46,692		19.1	%	47,668		16.7	%
Total revenues	Total revenues	498,497		403,750		23.5	%	436,258		14.3	%	Total revenues	509,103		426,895		19.3	%	428,501		18.8	%
Operating costs	Operating costs											Operating costs
Cost of revenue (excluding depreciation and amortization)	Cost of revenue (excluding depreciation and amortization)	251,358		229,913		9.3	%	244,939		2.6	%	Cost of revenue (excluding depreciation and amortization)	256,978		235,665		9.0	%	244,891		4.9	%
Sales and marketing	Sales and marketing	53,555		39,605		35.2	%	62,280		(14.0)	%	Sales and marketing	83,767		50,615		65.5	%	64,209		30.5	%
Product development	Product development	39,699		30,983		28.1	%	25,526		55.5	%	Product development	40,638		34,349		18.3	%	26,886		51.1	%
General and administrative	General and administrative	62,283		58,812		5.9	%	50,400		23.6	%	General and administrative	64,418		51,118		26.0	%	50,015		28.8	%
Depreciation and amortization	Depreciation and amortization	14,486		15,631		(7.3)	%	15,180		(4.6)	%	Depreciation and amortization	14,326		15,552		(7.9)	%	15,450		(7.3)	%
Total operating costs	Total operating costs	421,381		374,944		12.4	%	398,325		5.8	%	Total operating costs	460,127		387,299		18.8	%	401,451		14.6	%
Lease termination charge		3,831		—		*		—		*

Restructuring charge												Restructuring charge	—		—		—		4,008		*
Gain from pension liability adjustment												Gain from pension liability adjustment	—		—		—		(2,045)		*
Operating profit	Operating profit	$	73,285	$	28,806	*		$	37,933	93.2	%	Operating profit	$	48,976	$	39,596	23.7	%	$	25,087	95.2	%

* Represents a change equal to or in excess of 100% or not meaningful.	* Represents a change equal to or in excess of 100% or not meaningful.											* Represents a change equal to or in excess of 100% or not meaningful.

Six Months
2021 2020 2021 vs 2020 % Change 2019 2021 vs 2019 % Change
Revenues
Digital $ 369,745 $ 275,994 34.0 % $ 222,494 66.2 %
Print 298,556 302,629 (1.3) % 318,772 (6.3) %
Subscription revenues 668,301 578,623 15.5 % 541,266 23.5 %
Digital 130,491 90,689 43.9 % 113,569 14.9 %
Print 79,399 83,208 (4.6) % 132,280 (40.0) %
Advertising revenues 209,890 173,897 20.7 % 245,849 (14.6) %
Other revenues 93,351 94,866 (1.6) % 88,205 5.8 %
Total revenues 971,542 847,386 14.7 % 875,320 11.0 %
Operating costs
Cost of revenue (excluding depreciation and amortization) 502,355 473,397 6.1 % 484,125 3.8 %
Sales and marketing
113,708 113,389 0.3 % 137,094 (17.1) %
Product development 78,642 61,985 26.9 % 49,433 59.1 %
General and administrative 118,860 111,673 6.4 % 102,039 16.5 %
Depreciation and amortization 29,203 30,816 (5.2) % 30,098 (3.0) %
Total operating costs 842,768 791,260 6.5 % 802,789 5.0 %
Lease termination charge 3,831 — * — *
Operating profit $ 124,943 $ 56,126 * $ 72,531 72.3 %
* Represents a change equal to or in excess of 100% or not meaningful.


	For the Nine Months Ended
	September 26, 2021		September 27, 2020		2021 vs 2020 % Change		September 29, 2019		2021 vs 2019 % Change
Revenues
Digital	$	568,378	$	431,280	31.8	%	$	338,358	68.0	%
Print	442,532		448,293		(1.3)	%	470,210		(5.9)	%
Subscription revenues	1,010,910		879,573		14.9	%	808,568		25.0	%
Digital	197,472		138,452		42.6	%	168,222		17.4	%
Print	123,305		114,698		7.5	%	191,158		(35.5)	%
Advertising revenues	320,777		253,150		26.7	%	359,380		(10.7)	%
Other revenues	148,958		141,558		5.2	%	135,873		9.6	%
Total revenues	1,480,645		1,274,281		16.2	%	1,303,821		13.6	%
Operating costs
Cost of revenue (excluding depreciation and amortization)	759,333		709,062		7.1	%	729,016		4.2	%
Sales and marketing	197,475		164,004		20.4	%	201,303		(1.9)	%
Product development	119,280		96,334		23.8	%	76,320		56.3	%
General and administrative	183,278		162,791		12.6	%	152,054		20.5	%
Depreciation and amortization	43,529		46,368		(6.1)	%	45,548		(4.4)	%
Total operating costs	1,302,895		1,178,559		10.5	%	1,204,241		8.2	%
Lease termination charge	3,831		—		*		—		*
Restructuring charge	—		—		—		4,008		*
Gain from pension liability adjustment	—		—		—		(2,045)		*
Operating profit	$	173,919	$	95,722	81.7	%	$	97,617	78.2	%

* Represents a change equal to or in excess of 100% or not meaningful.

2324

Revenues

Subscription Revenues

Subscription revenues consist of revenues from subscriptions to our digital and print products (which include our news product, as well as our ~~Games, Cooking and Audm~~other digital-only products), and single-copy and bulk sales of our print products (which represent less than 5% of these revenues). Subscription revenues are based on both the number of copies of the printed newspaper sold and digital-only subscriptions, and the rates charged to the respective customers.

2021 Compared with 2020

Subscription revenues increased ~~15.7%~~13.8% in the ~~second~~third quarter and increased ~~15.5%~~14.9% in the first ~~six~~nine months of 2021 compared with the same prior-year periods. The increase in the ~~second~~third quarter and first ~~six~~nine months was primarily due to ~~year-over-year~~ growth ~~of 25.8%~~ in the number of subscriptions to the Company’s digital-only products as well as digital subscriptions graduating to higher prices from introductory promotional pricing. ~~Subscription revenues also benefited from an increase~~The increases in digital-only subscription revenue ~~from our domestic home delivery print subscription products during~~in both periods ~~primarily due to an increase in home delivery prices.However, for the first six months of 2021 compared with the same prior-year period, the increase attributable to higher home delivery subscription prices was more than~~were partially offset by a decrease in print subscription revenue ~~from~~primarily attributable to lower single-copy and bulk sales as a result of ~~business closures,~~ increased levels of remote working and reductions in travel due to the Covid-19 pandemic as well as ongoing secular trends. Subscription revenues from domestic home delivery decreased 0.8% in the third quarter of 2021 compared with the same prior year period due to a decrease in the number of subscriptions, partially offset by an increase in subscription prices. Revenues from domestic home delivery in the first nine months compared with the same period in the prior year increased 0.4% as the increase in subscription prices offset the decrease in the number of subscriptions.

Paid digital-only subscriptions totaled approximately ~~7,133,000~~7,588,000 at the end of the ~~second~~third quarter of 2021, a net increase of ~~142,000~~455,000 subscriptions ~~compared with the end of the first quarter of 2021 and a net increase of 1,463,000~~ compared with the end of the second quarter of 2021 and a net increase of 1,525,000 subscriptions compared with the end of the third quarter of 2020. ~~We experienced significant~~The year-over-year growth in ~~the number of~~our digital subscriptions is attributable in part to initiatives we have undertaken to drive subscriptions, including adjustments to our digital-only products in 2020, and we do not expect the 2020 growth rate to be sustainable or indicative of results for future periods. Net subscription additions for our digital-only products were modest in the second quarter of 2021, especially in comparison to the significant growth in the number of subscriptions we saw in the second quarter of 2020 at the beginning of the Covid-19 pandemic. In the second quarter, which is traditionally our slowest quarter of the year for net digital subscription additions, we saw improvement in net additions each month during the quarter since a low in March. We expect total net subscription additions in 2021 to be in the range of the number of total net subscription additions in 2019, although it remains difficult to predict with precision.access model.

Digital-only news product subscriptions totaled approximately ~~5,334,000~~5,654,000 at the end of the ~~second~~third quarter of 2021, a ~~77,000~~320,000 net ~~increase compared with the end of the first quarter of 2021 and a 944,000~~ increase compared with the end of the second quarter of 2021 and a 989,000 increase compared with the end of the third quarter of 2020. Other ~~product~~digital-only products subscriptions ~~(which include our Games, Cooking and Audm products)~~ totaled approximately ~~1,799,000~~1,934,000 at the end of the ~~second~~third quarter of 2021, an increase of ~~65,000 subscriptions compared with the end of the first quarter of 2021 and an increase of 519,000~~135,000 subscriptions compared with the end of the second quarter of 2021 and an increase of 536,000 subscriptions compared with the end of the third quarter of 2020.

Print domestic home delivery subscriptions totaled approximately ~~803,000~~795,000 at the end of the third quarter of 2021, a net decrease of 8,000 compared with the end of the second quarter of 2021 and a net decrease of ~~22,000~~36,000 compared with the end of the ~~first quarter of 2021 and a net decrease of 37,000 compared with the end of the second~~third quarter of 2020.

2021 Compared with 2019

Subscription revenues increased ~~25.4%~~28.2% in the ~~second~~third quarter and increased ~~23.5%~~25.0% in the first ~~six~~nine months of 2021 compared with the same ~~prior-year~~ periods in 2019. The increase in the ~~second~~third quarter and first ~~six~~nine months of 2021 was primarily due to ~~year-over-year~~ growth ~~of 88.7%~~ in the number of subscriptions to the Company’s digital-only products. These increases were partially offset by a decrease in print subscription revenue from single-copy and bulk sales as a result of ~~business closures,~~ increased levels of remote working and reductions in travel due to the Covid-19 pandemic as well as secular trends. Single-copy and bulk sales decreased ~~38.9%~~34.1% and ~~38.8%~~37.3% in the ~~second~~third quarter and the first ~~six~~nine months, respectively.

2425

The following table summarizes digital and print subscription revenues for the ~~second~~third quarters and first ~~six~~nine months of 2021 and 2020:


		For the Quarters Ended						For the Six Months Ended							For the Quarters Ended						For the Nine Months Ended
(In thousands)	(In thousands)	June 27, 2021		June 28, 2020		% Change		June 27, 2021		June 28, 2020		% Change		(In thousands)	September 26, 2021		September 27, 2020		% Change		September 26, 2021		September 27, 2020		% Change
Digital-only subscription revenues:	Digital-only subscription revenues:													Digital-only subscription revenues:
News product subscription revenues(1)	News product subscription revenues(1)	$	170,893	$	132,922	28.6	%	$	332,181	$	251,880	31.9	%	News product subscription revenues(1)	$	178,382	$	140,740	26.7	%	$	510,563	$	392,620	30.0	%
Other product subscription revenues(2)		19,252		13,062		47.4	%	37,564		24,114		55.8	%
Other digital-only product subscription revenues(2)														Other digital-only product subscription revenues(2)	20,251		14,546		39.2	%	57,815		38,660		49.5	%
Subtotal digital-only subscription revenues	Subtotal digital-only subscription revenues	190,145		145,984		30.3	%	369,745		275,994		34.0	%	Subtotal digital-only subscription revenues	198,633		155,286		27.9	%	568,378		431,280		31.8	%
Print subscription revenues:	Print subscription revenues:													Print subscription revenues:
Domestic home delivery subscription revenues(3)	Domestic home delivery subscription revenues(3)	134,755		132,971		1.3	%	269,150		266,708		0.9	%	Domestic home delivery subscription revenues(3)	128,895		129,912		(0.8)	%	398,045		396,620		0.4	%
Single-copy, NYT International and other subscription revenues(4)	Single-copy, NYT International and other subscription revenues(4)	14,317		14,234		0.6	%	29,406		35,921		(18.1)	%	Single-copy, NYT International and other subscription revenues(4)	15,081		15,752		(4.3)	%	44,487		51,673		(13.9)	%
Subtotal print subscription revenues	Subtotal print subscription revenues	149,072		147,205		1.3	%	298,556		302,629		(1.3)	%	Subtotal print subscription revenues	143,976		145,664		(1.2)	%	442,532		448,293		(1.3)	%
Total subscription revenues	Total subscription revenues	$	339,217	$	293,189	15.7	%	$	668,301	$	578,623	15.5	%	Total subscription revenues	$	342,609	$	300,950	13.8	%	$	1,010,910	$	879,573	14.9	%
(1) Includes revenues from subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games and Cooking products are also included in this category.
(2) Includes revenues from standalone subscriptions to the Company’s Games, Cooking and Audm products.
(1) Includes revenues from subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games, Cooking and Wirecutter products are also included in this category.														(1) Includes revenues from subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games, Cooking and Wirecutter products are also included in this category.
(2) Includes revenues from standalone subscriptions to the Company’s other digital-only products.														(2) Includes revenues from standalone subscriptions to the Company’s other digital-only products.
(3) Includes free access to some of the Company’s digital products.	(3) Includes free access to some of the Company’s digital products.													(3) Includes free access to some of the Company’s digital products.
(4) NYT International is the international edition of our print newspaper.	(4) NYT International is the international edition of our print newspaper.													(4) NYT International is the international edition of our print newspaper.

The following table summarizes digital and print subscriptions as of the end of the ~~second~~third quarters of 2021 and 2020:


		Quarters Ended					Quarters Ended
(In thousands)	(In thousands)	June 27, 2021	June 28, 2020	% Change		(In thousands)	September 26, 2021	September 27, 2020	% Change
Digital-only subscriptions:	Digital-only subscriptions:					Digital-only subscriptions:
News product subscriptions(1)	News product subscriptions(1)	5,334	4,390	21.5	%	News product subscriptions(1)	5,654	4,665	21.2	%
Other product subscriptions(2)		1,799	1,280	40.5	%
Other digital-only product subscriptions(2)						Other digital-only product subscriptions(2)	1,934	1,398	38.3	%
Subtotal digital-only subscriptions	Subtotal digital-only subscriptions	7,133	5,670	25.8	%	Subtotal digital-only subscriptions	7,588	6,063	25.2	%
Print subscriptions	Print subscriptions	803	840	(4.4)	%	Print subscriptions	795	831	(4.3)	%
Total subscriptions	Total subscriptions	7,936	6,510	21.9	%	Total subscriptions	8,383	6,894	21.6	%
(1) Includes subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games and Cooking products are also included in this category.
(2) Includes standalone subscriptions to the Company’s Games, Cooking and Audm products.
(1) Includes subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games, Cooking and Wirecutter products are also included in this category.						(1) Includes subscriptions to the Company’s news product. News product subscription packages that include access to the Company’s Games, Cooking and Wirecutter products are also included in this category.
(2) Includes standalone subscriptions to the Company’s other digital-only products. During the third quarter of 2021, the Company launched a Wirecutter subscription option.						(2) Includes standalone subscriptions to the Company’s other digital-only products. During the third quarter of 2021, the Company launched a Wirecutter subscription option.

2526

We believe that the significant growth over the last several years in subscriptions to our products demonstrates the success of our “subscription-first” strategy and the willingness of our readers to pay for high-quality journalism. The following charts illustrate the growth in net digital-only ~~subscription additions~~subscriptions and corresponding subscription revenues as well as the relative stability of our print domestic home delivery subscription products since the launch of the digital pay model in 2011.

(1) Amounts may not add due to rounding.

(2) Print domestic home delivery subscriptions include free access to some of our digital products.

(3) Print Other includes single-copy, NYT International and other subscription revenues.

Note: Revenues for 2012 and 2017 include the impact of an additional week.

2627

Advertising Revenues

Advertising revenue is principally from advertisers (such as technology, financial and luxury goods companies) promoting products, services or brands on digital platforms in the form of display ads, audio and video, and in print, in the form of column-inch ads. Advertising revenue is primarily derived from offerings sold directly to marketers by our advertising sales teams. A smaller proportion of our total advertising revenues is generated through programmatic auctions run by third-party ad exchanges. Advertising revenue is primarily determined by the volume (e.g., ~~impressions)~~impressions or column inches), rate and mix of advertisements. Digital advertising includes our core digital advertising business and other digital advertising. Our core digital advertising business includes direct-sold website, mobile application, podcast, email and video advertisements. Direct-sold display advertising, a component of core digital advertising, includes offerings on websites and mobile applications sold directly to marketers by our advertising sales teams. Other digital advertising includes open-market programmatic advertising and creative services fees. Print advertising includes revenue from column-inch ads and classified advertising, ~~including line-ads~~ as well as preprinted advertising, also known as freestanding inserts.

The following table summarizes digital and print advertising revenues for the ~~second~~third quarters and first ~~six~~nine months of 2021 and 2020:


		For the Quarters Ended						For the Six Months Ended							For the Quarters Ended						For the Nine Months Ended
(In thousands)	(In thousands)	June 27, 2021		June 28, 2020		% Change		June 27, 2021		June 28, 2020		% Change		(In thousands)	September 26, 2021		September 27, 2020		% Change		September 26, 2021		September 27, 2020		% Change
Advertising revenues:	Advertising revenues:													Advertising revenues:
Digital	Digital	$	70,995	$	39,531	79.6	%	$	130,491	$	90,689	43.9	%	Digital	$	66,981	$	47,763	40.2	%	$	197,472	$	138,452	42.6	%
Print	Print	41,779		28,229		48.0	%	79,399		83,208		(4.6)	%	Print	43,906		31,490		39.4	%	123,305		114,698		7.5	%
Total advertising	Total advertising	$	112,774	$	67,760	66.4	%	$	209,890	$	173,897	20.7	%	Total advertising	$	110,887	$	79,253	39.9	%	$	320,777	$	253,150	26.7	%

2021 Compared with 2020

Digital advertising revenues, which represented ~~63.0%~~60.4% of total advertising revenues in the ~~second~~third quarter of 2021, increased ~~$31.5~~$19.2 million, or ~~79.6%~~40.2%, to ~~$71.0~~$67.0 million compared with ~~$39.5~~$47.8 million in the same prior-year period. The increase was primarily driven by higher direct-sold advertising, including traditional display and podcasts, as well as the impact of the comparison to weak digital advertising revenues in the prior year period caused by reduced advertiser spending during the ~~start~~earlier stages of the Covid-19 pandemic. Core digital advertising revenue increased ~~$27.6~~$16.1 million due to growth in direct-sold display advertising and podcast advertising revenues. Direct-sold display impressions increased ~~77%~~33%, while the average rate grew 24%. Other digital advertising revenue increased ~~$3.9~~$3.1 million, primarily due to a ~~78%~~44% increase in creative services fees, as well as a ~~12.3%~~7.1% increase in open-market programmatic advertising revenue. Programmatic impressions decreased by ~~47%~~39%, while the average rate increased ~~107%~~63%.

Digital advertising revenues, which represented ~~62.2%~~61.6% of total advertising revenues in the first ~~six~~nine months of 2021, increased ~~$39.8~~$59.0 million, or ~~43.9%~~42.6%, to ~~$130.5~~$197.5 million compared with ~~$90.7~~$138.5 million in the same prior-year period. The increase was primarily driven by higher direct-sold advertising, including traditional display and podcasts, as well as the impact of the comparison to weak digital advertising revenues in the prior year period caused by reduced advertiser spending during the ~~start~~earlier stages of the Covid-19 pandemic. Core digital advertising revenue increased ~~$37.1~~$53.1 million due to growth in direct-sold display advertising revenue and podcast advertising revenues. Direct-sold display impressions increased ~~16%~~21%, while the average rate grew ~~31%~~29%. Other digital advertising revenue increased ~~$2.7~~$5.9 million, primarily due to a ~~31%~~36% increase in creative services ~~fees. Open-market~~fees, as well as a 2.7% increase in open-market programmatic advertising ~~revenue was flat to prior year as programmatic~~revenue. Programmatic impressions decreased by 39% offsetting the average rate increase of 63%.

Print advertising revenues, which represented ~~37.0%~~39.6% of total advertising revenues in the ~~second~~third quarter of 2021, increased ~~$13.6~~$12.4 million, or ~~48.0%~~39.4%, to ~~$41.8~~$43.9 million compared with $28.2 million in the same prior-year period. Print advertising revenues, which represented 37.8% of total advertising revenues in the first six months of 2021, declined $3.8 million, or 4.6%, to $79.4 million compared with $83.2$31.5 million in the same prior-year period. The increase in the ~~second~~third quarter of 2021 was primarily in the luxury ~~media~~ and ~~technology~~entertainment categories, largely due to the impact of the comparison to weak print advertising revenues in the ~~second~~third quarter of 2020 caused by reduced advertiser spending by businesses negatively impacted by the ~~start~~earlier stages of the Covid-19 pandemic. The increase in the ~~second~~third quarter of 2021 was partially offset by secular trends. ~~The decline~~Print advertising revenues, which represented 38.4% of total advertising revenues in the first ~~six~~nine months of 2021, ~~reflected reduced spending~~increased $8.6 million, or 7.5%, to $123.3 million compared with $114.7 million in the same prior-year period.The increase in the first ~~quarter~~nine months of 2021 ~~on print~~was primarily in the luxury and media categories and was partially offset by a decrease in the entertainment category and as a result of secular trends. We expect reduced advertising spending by businesses that continue to be negatively impacted by the Covid-19 pandemic, and secular trends, partially offset by higher print advertising revenues in the second quarter of 2021 due to the impact of the comparison to weak print advertising revenues in the second quarter of 2020. Decreases, primarily in the entertainment, travel and real estate categories were partially offset by an increase in the media category. We expect reduced advertising spending by these businesses, along with secular trends, to continue to adversely affect our print advertising revenues. Some of our print advertising revenues may not return to pre-pandemic ~~levels once economic conditions improve.~~levels.

2728

2021 Compared with 2019

Digital advertising revenues for the ~~second~~third quarter of 2021 increased ~~$13.0~~$12.3 million, or ~~22.4%~~22.6%, to ~~$71.0~~$67.0 million compared with ~~$58.0~~$54.7 million in the ~~second~~third quarter of 2019. The increase was primarily driven by higher direct-sold advertising, including traditional display and podcasts. Core digital advertising revenue increased ~~$18.5~~$16.4 million due to growth in ~~podcast~~direct-sold display advertising revenues and ~~direct-sold display~~podcast advertising revenues. Direct-sold display impressions increased ~~13%~~7%, while the average rate grew ~~24%~~43%. Other digital advertising revenue decreased ~~$5.5~~$4.1 million, primarily due to the closure of our HelloSociety and Fake Love digital marketing agencies, partially offset by a ~~4.0%~~8.1% increase in open-market programmatic advertising revenue. Programmatic impressions decreased by ~~24%~~29%, while the average rate increased ~~31%~~50%.

Digital advertising revenues for the first ~~six~~nine months of 2021 increased ~~$16.9~~$29.3 million, or ~~14.9%~~17.4%, to ~~$130.5~~$197.5 million compared with ~~$113.6~~$168.2 million in the first ~~six~~nine months of 2019. The increase was primarily driven by higher direct-sold advertising, including traditional display and podcasts. Core digital advertising revenue increased ~~$26.5~~$43.0 million due to growth in ~~podcast advertising revenues and~~ direct-sold display advertising ~~revenue.~~revenue and podcast advertising revenues. Direct-sold display impressions ~~decreased 4%,~~were flat, while the average rate grew ~~25%~~31%. Other digital advertising revenue decreased ~~$9.6~~$13.7 million, primarily due to the closure of our HelloSociety and Fake Love digital marketing agencies, partially offset by a ~~7.2%~~7.5% increase in open-market programmatic advertising revenue. Programmatic impressions decreased by 3%12%, while the average rate increased ~~10%~~21%.

Print advertising revenues for the ~~second~~third quarter of 2021 declined ~~$20.9~~$15.0 million, or ~~33.4%~~25.4%, to ~~$41.8~~$43.9 million compared with ~~$62.7~~$58.9 million in the same period of 2019. Print advertising revenues for the first ~~six~~nine months of 2021 declined ~~$52.9~~$67.9 million, or ~~40.0%~~35.5%, to ~~$79.4~~$123.3 million compared with ~~$132.3~~$191.2 million in the same period of 2019. The declines in both periods reflected reduced spending on print advertising by businesses negatively impacted by the Covid-19 pandemic as well as continued secular trends.

Other Revenues

Other revenues primarily consist of revenues from licensing, Wirecutter affiliate referrals, commercial printing, the leasing of floors in the Company Headquarters, ~~commercial printing,~~ retail commerce, television and film, our student subscription sponsorship program and our live events business.

2021 Compared with 2020

Other revenues increased ~~8.7%~~19.1% in the ~~second~~third quarter of 2021 and ~~decreased 1.6%~~increased 5.2% in the first ~~six~~nine months of 2021, compared with the same prior-year periods. The increase in the ~~second~~third quarter of 2021 was primarily a result of higher licensing and commercial printing revenue. The increase in the first nine months of 2021 was primarily a result of higher Wirecutter affiliate referral ~~revenues. The decrease in the first six months of 2021 was primarily a result of fewer television episodes as well as lower building rental revenue, live events revenue~~revenues and ~~commercial printing revenue,~~licensing revenues, partially offset by ~~higher Wirecutter affiliate referral~~lower television series revenues.

Building rental revenue from the leasing of floors in the Company Headquarters totaled ~~$6.6 million and $7.3~~$7.1 million in the ~~second~~third quarters of 2021 and 2020, respectively, and ~~$12.8~~$20.0 million and ~~$15.2~~$22.3 million in the first ~~six~~nine months of 2021 and 2020, respectively.

2021 Compared with 2019

Other revenues increased ~~3.3%~~16.7% in the ~~second~~third quarter of 2021 and increased ~~5.8%~~9.6% in the first ~~six~~nine months, compared with the same periods in 2019. The increase in the ~~second~~third quarter of 2021 was primarily a result of higher Wirecutter affiliate referral revenues and licensing revenue related to Facebook News partially offset by ~~fewer~~lower television ~~episodes~~series and ~~lower~~ live events ~~and commercial printing revenue.~~ revenues. The increase in the first ~~six~~nine months of 2021 was primarily a result of higher Wirecutter affiliate referral revenues and licensing revenue primarily related to Facebook News, partially offset by lower revenues from television series, live events ~~revenue, lower~~and commercial ~~printing revenue and fewer television episodes.~~printing.

2829

Operating Costs

Operating costs were as follows:


		For the Quarters Ended						For the Six Months Ended							For the Quarters Ended						For the Nine Months Ended
(In thousands)	(In thousands)	June 27, 2021		June 28, 2020		% Change		June 27, 2021		June 28, 2020		% Change		(In thousands)	September 26, 2021		September 27, 2020		% Change		September 26, 2021		September 27, 2020		% Change
Operating costs:	Operating costs:													Operating costs:
Cost of revenue (excluding depreciation and amortization)	Cost of revenue (excluding depreciation and amortization)	$	251,358	$	229,913	9.3	%	$	502,355	$	473,397	6.1	%	Cost of revenue (excluding depreciation and amortization)	$	256,978	$	235,665	9.0	%	$	759,333	$	709,062	7.1	%
Sales and marketing	Sales and marketing	53,555		39,605		35.2	%	113,708		113,389		0.3	%	Sales and marketing	83,767		50,615		65.5	%	197,475		164,004		20.4	%
Product development	Product development	39,699		30,983		28.1	%	78,642		61,985		26.9	%	Product development	40,638		34,349		18.3	%	119,280		96,334		23.8	%
General and administrative	General and administrative	62,283		58,812		5.9	%	118,860		111,673		6.4	%	General and administrative	64,418		51,118		26.0	%	183,278		162,791		12.6	%
Depreciation and amortization	Depreciation and amortization	14,486		15,631		(7.3)	%	29,203		30,816		(5.2)	%	Depreciation and amortization	14,326		15,552		(7.9)	%	43,529		46,368		(6.1)	%
Total operating costs	Total operating costs	$	421,381	$	374,944	12.4	%	$	842,768	$	791,260	6.5	%	Total operating costs	$	460,127	$	387,299	18.8	%	$	1,302,895	$	1,178,559	10.5	%

Cost of Revenue (excluding depreciation and amortization)

Cost of revenue includes all costs related to content creation, subscriber and advertiser servicing, and print production and distribution as well as infrastructure costs related to delivering digital content, which include all cloud and cloud-related costs as well as compensation for employees that enhance and maintain ~~our platforms.~~that infrastructure.

2021 Compared with 2020

Cost of revenue increased in the ~~second~~third quarter of 2021 by ~~$21.4~~$21.3 million, or ~~9.3%~~9.0%, compared with the ~~second~~third quarter of 2020, largely due to higher journalism costs of ~~$17.9~~$15.1 million, higher subscriber servicing costs of ~~$2.9~~$3.6 million, ~~and~~ higher advertising servicing costs of ~~$2.8 million. The increases were partially offset by lower~~$1.4 million, and higher print production and distribution costs of ~~$2.5~~$1.2 million. The increase in journalism costs was largely driven by growth in the number of employees who work in the newsroom and on our Games, Cooking and audio products, costs in connection with the production of audio content and a higher incentive compensation accrual. The increase in subscriber servicing costs was primarily due to higher credit card processing fees and third-party commissions due to increased subscriptions. Advertising servicing costs increased ~~primarily due~~as a result of costs to produce higher ~~incentive compensation and higher outside~~creative services ~~costs.~~revenues. The ~~decrease~~increase in print production and distribution costs was largely due to an increase in compensation and benefits, newsprint pricing, and higher utilities and maintenance costs partially offset by lower outside printing and distribution costs.

Cost of revenue increased in the first ~~six~~nine months of 2021 by ~~$29.0~~$50.3 million, or ~~6.1%~~7.1%, compared with the first ~~six~~nine months of 2020, largely due to higher journalism costs of ~~$27.1~~$42.2 million, higher subscriber servicing costs of ~~$7.6~~$11.3 million, ~~and~~ higher digital content delivery costs of ~~$4.2~~$4.1 million, and higher advertising servicing costs of $3.2 million. The increases were partially offset by lower print production and distribution costs of ~~$11.7~~$10.5 million. The increase in journalism costs was largely driven by growth in the number of employees who work in the newsroom and on our Games, Cooking and audio products, a higher incentive compensation accrual and costs in connection with the production of audio ~~content and a higher incentive compensation accrual.~~content. This cost growth was partially offset by lower content creation costs as a result of fewer television episodes. The increase in subscriber servicing costs was primarily due to higher credit card processing fees and third-party commissions due to increased subscriptions. Digital content delivery costs increased due to a higher incentive compensation accrual and higher cloud storage costs. Advertising servicing costs increased as a result of costs to produce higher creative services revenues. The decrease in print production and distribution costs was largely due to lower ~~newsprint consumption~~outside printing and ~~pricing,~~distribution costs, as well as lower ~~outside printing~~newsprint consumption and ~~distribution costs.~~pricing.

2930

2021 Compared with 2019

Cost of revenue increased in the ~~second~~third quarter of 2021 by ~~$6.4~~$12.1 million, or ~~2.6%~~4.9%, compared with the ~~second~~third quarter of 2019, largely due to higher journalism costs of ~~$19.8~~$19.2 million, higher subscriber servicing costs of ~~$5.7~~$6.7 million, and higher digital content delivery costs of ~~$5.3~~$5.1 million. The increases were partially offset by lower print production and distribution costs of ~~$20.0~~$12.4 million and lower advertising servicing costs of ~~$4.4~~$6.5 million. The increase in journalism costs was largely driven by growth in the number of employees who work in the newsroom and on our Games, Cooking and audio ~~costs in connection with the production of audio content~~products, and a higher incentive compensation accrual. The increase in subscriber servicing costs was primarily due to higher credit card processing fees and third-party commissions due to increased subscriptions. Digital content delivery costs increased due to higher cloud-related costs and an increase in the number of ~~employees and higher cloud-related costs.~~employees. The decrease in print production and distribution costs was largely due to lower ~~distribution costs, lower~~ newsprint consumption and pricing, lower distribution costs, and lower outside printing costs. Advertising servicing costs decreased primarily as a result of the closure of our HelloSociety and Fake Love digital marketing agencies, as well as lower volume of creative services campaigns and live events.

Cost of revenue increased in the first ~~six~~nine months of 2021 by ~~$18.2~~$30.3 million, or ~~3.8%~~4.2%, compared with the first ~~six~~nine months of 2019, largely due to higher journalism costs of ~~$42.8~~$61.9 million, higher subscriber servicing costs of ~~$11.8~~$18.5 million, and higher digital content delivery costs of ~~$11.5~~$16.6 million. The increases were partially offset by lower print production and distribution costs of ~~$40.0~~$52.4 million and lower advertising costs of ~~$7.8~~$14.3 million. The increase in journalism costs was largely driven by growth in the number of employees who work in the newsroom and on our Games, Cooking and audio ~~costs in connection with the production of audio content~~products, and a higher incentive compensation accrual. The increase in subscriber servicing costs was primarily due to higher credit card processing fees and third-party commissions due to increased subscriptions. Digital content delivery costs increased due to higher cloud storage costs and growth in the number of ~~employees and higher cloud storage costs.~~employees. The decrease in print production and distribution costs was largely due to ~~fewer print copies produced and~~ lower newsprint consumption and pricing, as well as lower distribution costs and outside printing costs. Advertising servicing costs decreased primarily as a result of the closure of our HelloSociety and Fake Love digital marketing agencies as well as fewer live events.

Sales and Marketing

Sales and marketing includes costs related to the Company’s marketing efforts as well as advertising sales costs.

~~2021 Compared with 2020~~

Sales and marketing costs in the second quarter of 2021 increased by $14.0 million, or 35.2%, compared with the second quarter of 2020, primarily due to higher subscription-related media spending, which the Company had reduced during the start of the Covid-19 pandemic.

Sales and marketing costs in the first six months of 2021 remained relatively flat compared with the first six months of 2020. The increase in marketing costs resulting from higher subscription-related media Media expenses ~~was partially offset by lower advertising sales costs.~~

~~Media expenses,~~is a component of sales and marketing costs that represents the cost to promote our subscription ~~business,~~business.

2021 Compared with 2020

Sales and marketing costs in the third quarter of 2021 increased by $33.2 million, or 65.5%, compared with the third quarter of 2020, primarily due to higher media expenses.

Sales and marketing costs in the first nine months of 2021 increased by $33.5 million, or 20.4%, compared with the first nine months of 2020. The increase in marketing costs resulting from higher media expenses was partially offset by lower advertising sales costs.

Media expenses increased to ~~$29.0~~$55.3 million in the ~~second~~third quarter of 2021 from ~~$16.5~~$27.3 million in the ~~second~~third quarter of 2020 and increased to ~~$64.9~~$120.2 million in the first ~~six~~nine months of 2021 from ~~$61.9~~$89.2 million in the first ~~six~~nine months of ~~2020 as the~~2020. The Company increased media expenses in the third quarter of 2021 as we were able to profitably scale media spend as a result of strong demand for news and success in converting readers to subscribers. The Company had reduced its marketing ~~spend.~~expense in 2020 during the earlier stages of the Covid-19 pandemic.

2021 Compared with 2019

Sales and marketing costs in the ~~second~~third quarter of 2021 increased by $19.6 million, or 30.5%, compared with the third quarter of 2019, primarily due to higher media expenses.

Sales and marketing costs in the first nine months of 2021 decreased by ~~$8.7~~$3.8 million, or ~~14.0%~~1.9%, compared with the ~~second quarter~~first nine months of ~~2019,~~2019. The decrease in sales and marketing costs is primarily as a result of the closure of our HelloSociety and Fake Love digital marketing agencies, partially offset by higher media expenses and ~~lower media expenses.~~the growth in the number of marketing employees.

~~Sales~~Media expenses increased to $55.3 million in the third quarter of 2021 from $35.9 million in the third quarter of 2019 and ~~marketing costs~~increased to $120.2 million in the first ~~six~~nine months of 2021 ~~decreased by $23.4~~from $114.6 million ~~or 17.1%, compared with~~in the first ~~six~~nine months of 2019. The ~~decrease~~Company increased media expenses in ~~sales and marketing costs are primarily~~the third quarter of 2021 as we were able to profitably scale media spend as a result of ~~the factors identified above.~~

~~Media expenses decreased~~strong demand for news and success in converting readers to $29.0 million in the second quarter of 2021 from $33.9 million in the second quarter of 2019 and decreased to $64.9 million in the first six months of 2021 from $78.7 million in the first six months of 2019 as the Company reduced its marketing spend during the Covid-19 pandemic.subscribers.

Product Development

Product development includes costs associated with the Company’s investment into developing and enhancing new and existing product technology, including engineering, product development and data insights.

3031

2021 Compared with 2020

Product development costs in the ~~second~~third quarter of 2021 increased by ~~$8.7~~$6.3 million, or ~~28.1%~~18.3%, compared with the ~~second~~third quarter of 2020, largely due to growth in the number of digital product development employees in connection with digital subscription strategic initiatives as well as a higher incentive compensation accrual.

Product development costs in the first ~~six~~nine months of 2021 increased by ~~$16.7~~$22.9 million, or ~~26.9%~~23.8%, compared with the first ~~six~~nine months of 2020, largely due to the factors identified above.

2021 Compared with 2019

Product development costs in the ~~second~~third quarter of 2021 increased by ~~$14.2~~$13.8 million, or ~~55.5%~~51.1%, compared with the ~~second~~third quarter of 2019, largely due to growth in the number of digital product development employees to support our digital subscription strategic initiatives as well as a higher incentive compensation accrual.

Product development costs in the first ~~six~~nine months of 2021 increased by ~~$29.2~~$43.0 million, or ~~59.1%~~56.3%, compared with the first ~~six~~nine months of 2019, largely due to the factors identified above.

General and Administrative Costs

General and administrative costs include general management, corporate enterprise technology, building operations, unallocated overhead costs, severance and multiemployer pension plan withdrawal costs.

2021 Compared with 2020

General and administrative costs in the ~~second~~third quarter of 2021 increased by ~~$3.5~~$13.3 million, or ~~5.9%~~26.0%, compared with the ~~second~~third quarter of 2020, primarily due to a higher incentive compensation accrual, growth in the number of employees, stock price appreciation on stock-based awards and higher ~~outside services and a higher incentive compensation accrual, partially offset by severance expense in the second quarter of 2020 compared with no expense in the second quarter of 2021.~~consulting costs.

General and administrative costs in the first ~~six~~nine months of 2021 increased by ~~$7.2~~$20.5 million, or ~~6.4%~~12.6%, compared with the first ~~six~~nine months of 2020, primarily due to a higher incentive compensation accrual, higher ~~outside services~~consulting costs and growth in the number of employees, partially offset by a severance charge in the second quarter of 2020, ~~a favorable fair market value adjustment in 2021,~~ and lower building operations and maintenance costs in 2021.

2021 Compared with 2019

General and administrative costs in the ~~second~~third quarter of 2021 increased by ~~$11.9~~$14.4 million, or ~~23.6%~~28.8%, compared with the ~~second~~third quarter of 2019, primarily due to growth in the number of employees, mainly in the enterprise technology and human resources departments in support of employee growth in other areas, ~~higher outside services and~~ a higher incentive compensation ~~accrual.~~accrual, stock price appreciation on stock-based awards and higher consulting costs.

General and administrative costs in the first ~~six~~nine months of 2021 increased by ~~$16.8~~$31.2 million, or ~~16.5%~~20.5%, compared with the first ~~six~~nine months of 2019, largely due to the factors identified ~~above, partially offset by a favorable fair market value adjustment.~~above.

Depreciation and Amortization

2021 Compared with 2020

Depreciation and amortization costs in the ~~second~~third quarter and first ~~six~~nine months of 2021 decreased ~~$1.1~~$1.2 million, or ~~7.3%~~7.9%, and ~~$1.6~~$2.8 million, or ~~5.2%~~6.1%, respectively, compared with the same prior-year ~~period.~~periods. The decrease in both periods is due to lower depreciation of software assets.

2021 Compared with 2019

Depreciation and amortization costs in the ~~second~~third quarter and first ~~six~~nine months of 2021 decreased $1.1 million, or 7.3%, and $2.0 million, or 4.4%, respectively, compared with the same periods in ~~2019~~2019. The decrease in both periods is due to lower depreciation of software assets, partially offset by equipment and building projects that were ~~flat.~~placed in service.

See Note 7 of the Notes to the Condensed Consolidated Financial Statements for additional information regarding other items.

NON-OPERATING ITEMS

Other Components of Net Periodic Benefit Costs

See Note 9 of the Notes to the Condensed Consolidated Financial Statements for information regarding other components of net periodic benefit costs.

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Interest Income and other, net

See Note 7 of the Notes to the Condensed Consolidated Financial Statements for information regarding interest ~~income/(expense)~~income and other, net.

Income Taxes

See Note 10 of the Notes to the Condensed Consolidated Financial Statements for information regarding income taxes.

Non-GAAP Financial Measures

We have included in this report certain supplemental financial information derived from consolidated financial information but not presented in our financial statements prepared in accordance with GAAP. Specifically, we have referred to the following non-GAAP financial measures in this report:

•diluted earnings per share from continuing operations excluding severance, non-operating retirement costs and the impact of special items (or adjusted diluted earnings per share from continuing operations);

•operating profit before depreciation, amortization, severance, multiemployer pension plan withdrawal costs and special items (or adjusted operating profit); and

•operating costs before depreciation, amortization, severance and multiemployer pension plan withdrawal costs (or adjusted operating costs).

The special ~~item~~items in 2021 consisted of:

•a $27.2 million gain ($19.8 million after tax or $0.12 per share) in the third quarter related to a non-marketable equity investment transaction. The gain consists of a $15.2 million realized gain due to the partial sale of the investment and an $11.9 million unrealized gain due to the mark to market of the remaining investment, and is included in Interest income and other, net in our Condensed Consolidated Statements of Operations; and

•a $3.8 million charge ($2.8 million or $0.02 per share after tax) in the second quarter resulting from the termination of a tenant’s lease in ~~our headquarters building.~~the Company Headquarters.

The special item in 2020 consisted of:

•a $10.1 million gain ($7.4 million after tax or $0.04 per share) in the first quarter related to a non-marketable equity investment transaction. The gain ~~is comprised~~consists of a $2.5 million realized gain due to the partial sale of the investment and a $7.6 million unrealized gain due to the mark to market of the remaining investment, and is included in Interest income and other, net in our Condensed Consolidated Statements of Operations.

~~There were no~~The special items in ~~2019.~~2019 consisted of:

•a $4.0 million charge ($3.0 million after tax or $0.02 per share) in the third quarter related to restructuring charges, including impairment and severance charges related to the closure of our digital marketing agency, HelloSociety, LLC; and

•a $2.0 million gain ($1.5 million after tax or $0.01 per share) in the third quarter from a multiemployer pension plan liability adjustment.

We have included these non-GAAP financial measures because management reviews them on a regular basis and uses them to evaluate and manage the performance of our operations. We believe that, for the reasons outlined below, these non-GAAP financial measures provide useful information to investors as a supplement to reported diluted earnings/(loss) per share from continuing operations, operating profit/(loss) and operating costs. However, these measures should be evaluated only in conjunction with the comparable GAAP financial measures and should not be viewed as alternative or superior measures of GAAP results.

Adjusted diluted earnings per share provides useful information in evaluating the Company’s period-to-period performance because it eliminates items that the Company does not consider to be indicative of earnings from ongoing operating activities. Adjusted operating profit is useful in evaluating the ongoing performance of the Company’s businesses as it excludes the significant non-cash impact of depreciation and amortization as well as items not indicative of ongoing operating activities. Total operating costs include depreciation, amortization, severance and multiemployer pension plan withdrawal costs. Total operating costs, excluding these items, provide investors with helpful supplemental information on the Company’s underlying operating costs that is used by management in its financial and operational decision-making.

Management considers special items, which may include impairment charges, pension settlement charges and other items that arise from time to time, to be outside the ordinary course of our operations. Management believes that excluding these items provides a better understanding of the underlying trends in the Company’s operating performance and allows more

accurate comparisons of the Company’s operating results to historical performance. In addition, management excludes severance costs, which may fluctuate significantly from quarter to quarter, because it believes these costs do not necessarily reflect expected future operating costs and do not contribute to a meaningful comparison of the Company’s operating results to historical performance.

Included in our non-GAAP financial measures are non-operating retirement costs which are primarily tied to financial market performance and changes in market interest rates and investment performance. Management considers non-operating retirement costs to be outside the performance of the business and believes that presenting adjusted diluted earnings per share from continuing operations excluding non-operating retirement costs and presenting adjusted operating results excluding multiemployer pension plan withdrawal costs, in addition to the Company’s GAAP diluted earnings per share from continuing

operations and GAAP operating results, provide increased transparency and a better understanding of the underlying trends in the Company’s operating business performance.

Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are set out in the tables below.


Reconciliation of diluted earnings per share from continuing operations excluding severance, non-operating retirement costs and special items (or adjusted diluted earnings per share from continuing operations)	Reconciliation of diluted earnings per share from continuing operations excluding severance, non-operating retirement costs and special items (or adjusted diluted earnings per share from continuing operations)													Reconciliation of diluted earnings per share from continuing operations excluding severance, non-operating retirement costs and special items (or adjusted diluted earnings per share from continuing operations)
		For the Quarters Ended						For the Six Months Ended							For the Quarters Ended						For the Nine Months Ended
		June 27, 2021		June 28, 2020		% Change		June 27, 2021		June 28, 2020		% Change			September 26, 2021		September 27, 2020		% Change		September 26, 2021		September 27, 2020		% Change
Diluted earnings per share from continuing operations	Diluted earnings per share from continuing operations	$	0.32	$	0.14	*		$	0.57	$	0.34	67.6	%	Diluted earnings per share from continuing operations	$	0.32	$	0.20	60.0	%	$	0.89	$	0.54	64.8	%
Add:	Add:													Add:
Severance	Severance	—		0.04		*		—		0.04		*		Severance	—		—		—		0.01		0.04		(75.0)	%
Non-operating retirement costs:	Non-operating retirement costs:													Non-operating retirement costs:
Multiemployer pension plan withdrawal costs	Multiemployer pension plan withdrawal costs	0.01		0.01		—		0.02		0.02		—		Multiemployer pension plan withdrawal costs	0.01		0.01		—		0.02		0.02		—
Other components of net periodic benefit costs	Other components of net periodic benefit costs	0.02		0.01		*		0.03		0.03		—		Other components of net periodic benefit costs	0.02		0.01		*		0.05		0.04		25.0	%
Special items:	Special items:													Special items:

Gain from non-marketable equity security	Gain from non-marketable equity security	—		—		*		—		(0.06)		*		Gain from non-marketable equity security	(0.16)		—		*		(0.16)		(0.06)		*
Lease termination charge	Lease termination charge	0.02		—		*		0.02		—		*		Lease termination charge	—		—		—		0.02		—		*
Income tax expense of adjustments	Income tax expense of adjustments	(0.01)		(0.02)		(50.0)	%	(0.02)		(0.01)		*		Income tax expense of adjustments	0.04		(0.01)		*		0.02		(0.01)		*
Adjusted diluted earnings per share from continuing operations(1)	Adjusted diluted earnings per share from continuing operations(1)	$	0.36	$	0.18	*		$	0.62	$	0.35	77.1	%	Adjusted diluted earnings per share from continuing operations(1)	$	0.23	$	0.22	4.5	%	$	0.84	$	0.57	47.4	%

(1)Amounts may not add due to rounding.

* Represents a change equal to or in excess of 100% or not meaningful.

Reconciliation of operating profit before depreciation and amortization, severance, multiemployer pension plan withdrawal costs and special items (or adjusted operating profit)
For the Quarters Ended
2021 2020 2021 vs 2020 % Change 2019 2021 vs 2019 % Change
Operating profit $ 73,285 $ 28,806 * $ 37,933 93.2 %
Add:
Depreciation and amortization 14,486 15,631 (7.3) % 15,180 (4.6) %
Severance — 6,305 * 672 *
Multiemployer pension plan withdrawal costs 1,301 1,400 (7.1) % 1,801 (27.8) %
Special items:
Lease termination charge 3,831 — * — *
Adjusted operating profit $ 92,903 $ 52,142 78.2 % $ 55,586 67.1 %
* Represents a change equal to or in excess of 100% or not meaningful.

3334

Reconciliation of operating costs before depreciation and amortization, severance and multiemployer pension plan withdrawal costs (or adjusted operating costs)
For the Quarters Ended
2021 2020 2021 vs 2020 % Change 2019 2021 vs 2019 % Change
Operating costs $ 421,381 $ 374,944 12.4 % $ 398,325 5.8 %
Less:
Depreciation & amortization 14,486 15,631 (7.3) % 15,180 (4.6) %
Severance — 6,305 * 672 *
Multiemployer pension plan withdrawal costs 1,301 1,400 (7.1) % 1,801 (27.8) %
Adjusted operating costs $ 405,594 $ 351,608 15.4 % $ 380,672 6.5 %
* Represents a change equal to or in excess of 100% or not meaningful.


Reconciliation of operating profit before depreciation and amortization, severance, multiemployer pension plan withdrawal costs and special items (or adjusted operating profit)	Reconciliation of operating profit before depreciation and amortization, severance, multiemployer pension plan withdrawal costs and special items (or adjusted operating profit)											Reconciliation of operating profit before depreciation and amortization, severance, multiemployer pension plan withdrawal costs and special items (or adjusted operating profit)

		For the Six Months Ended											For the Quarters Ended
		2021		2020		2021 vs 2020 % Change		2019		2021 vs 2019 % Change			September 26, 2021		September 27, 2020		2021 vs 2020 % Change		September 29, 2019		2021 vs 2019 % Change
Operating profit	Operating profit	$	124,943	$	56,126	*		$	72,531	72.3	%	Operating profit	$	48,976	$	39,596	23.7	%	$	25,087	95.2	%
Add:	Add:											Add:
Depreciation and amortization	Depreciation and amortization	29,203		30,816		(5.2)	%	30,098		(3.0)	%	Depreciation and amortization	14,326		15,552		(7.9)	%	15,450		(7.3)	%
Severance	Severance	406		6,675		(93.9)	%	2,075		(80.4)	%	Severance	476		—		*		367		29.7	%
Multiemployer pension plan withdrawal costs	Multiemployer pension plan withdrawal costs	2,627		2,823		(6.9)	%	3,250		(19.2)	%	Multiemployer pension plan withdrawal costs	1,275		1,376		(7.3)	%	1,204		5.9	%
Special items:	Special items:											Special items:
Lease termination charge		3,831		—		*		—		*

Restructuring charge												Restructuring charge	—		—		—		4,008		*
Gain from pension liability adjustment												Gain from pension liability adjustment	—		—		—		(2,045)		*
Adjusted operating profit	Adjusted operating profit	$	161,010	$	96,440	67.0	%	$	107,954	49.1	%	Adjusted operating profit	$	65,053	$	56,524	15.1	%	$	44,071	47.6	%

* Represents a change equal to or in excess of 100% or not meaningful.	* Represents a change equal to or in excess of 100% or not meaningful.											* Represents a change equal to or in excess of 100% or not meaningful.


Reconciliation of operating costs before depreciation and amortization, severance and multiemployer pension plan withdrawal costs (or adjusted operating costs)	Reconciliation of operating costs before depreciation and amortization, severance and multiemployer pension plan withdrawal costs (or adjusted operating costs)											Reconciliation of operating costs before depreciation and amortization, severance and multiemployer pension plan withdrawal costs (or adjusted operating costs)

		For the Six Months Ended											For the Quarters Ended
		2021		2020		2021 vs 2020 % Change		2019		2021 vs 2019 % Change			September 26, 2021		September 27, 2020		2021 vs 2020 % Change		September 29, 2019		2021 vs 2019 % Change
Operating costs	Operating costs	$	842,768	$	791,260	6.5	%	$	802,789	5.0	%	Operating costs	$	460,127	$	387,299	18.8	%	$	401,451	14.6	%
Less:	Less:											Less:
Depreciation & amortization		29,203		30,816		(5.2)	%	30,098		(3.0)	%
Depreciation and amortization												Depreciation and amortization	14,326		15,552		(7.9)	%	15,450		(7.3)	%
Severance	Severance	406		6,675		(93.9)	%	2,075		(80.4)	%	Severance	476		—		*		367		29.7	%
Multiemployer pension plan withdrawal costs	Multiemployer pension plan withdrawal costs	2,627		2,823		(6.9)	%	3,250		(19.2)	%	Multiemployer pension plan withdrawal costs	1,275		1,376		(7.3)	%	1,204		5.9	%
Adjusted operating costs	Adjusted operating costs	$	810,532	$	750,946	7.9	%	$	767,366	5.6	%	Adjusted operating costs	$	444,050	$	370,371	19.9	%	$	384,430	15.5	%

* Represents a change equal to or in excess of 100% or not meaningful.	* Represents a change equal to or in excess of 100% or not meaningful.											* Represents a change equal to or in excess of 100% or not meaningful.

3435


Reconciliation of operating profit before depreciation and amortization, severance, multiemployer pension plan withdrawal costs and special items (or adjusted operating profit)

	For the Nine Months Ended
	September 26, 2021		September 27, 2020		2021 vs 2020 % Change		September 29, 2019		2021 vs 2019 % Change
Operating profit	$	173,919	$	95,722	81.7	%	$	97,617	78.2	%
Add:
Depreciation and amortization	43,529		46,368		(6.1)	%	45,548		(4.4)	%
Severance	882		6,675		(86.8)	%	2,441		(63.9)	%
Multiemployer pension plan withdrawal costs	3,902		4,198		(7.1)	%	4,454		(12.4)	%
Special items:
Lease termination charge	3,831		—		*		—		*
Restructuring charge	—		—		—		4,008		*
Gain from pension liability adjustment	—		—		—		(2,045)		*
Adjusted operating profit	$	226,063	$	152,963	47.8	%	$	152,023	48.7	%

* Represents a change equal to or in excess of 100% or not meaningful.


Reconciliation of operating costs before depreciation and amortization, severance and multiemployer pension plan withdrawal costs (or adjusted operating costs)

	For the Nine Months Ended
	September 26, 2021		September 27, 2020		2021 vs 2020 % Change		September 29, 2019		2021 vs 2019 % Change
Operating costs	$	1,302,895	$	1,178,559	10.5	%	$	1,204,241	8.2	%
Less:
Depreciation and amortization	43,529		46,368		(6.1)	%	45,548		(4.4)	%
Severance	882		6,675		(86.8)	%	2,441		(63.9)	%
Multiemployer pension plan withdrawal costs	3,902		4,198		(7.1)	%	4,454		(12.4)	%
Adjusted operating costs	$	1,254,582	$	1,121,318	11.9	%	$	1,151,798	8.9	%

* Represents a change equal to or in excess of 100% or not meaningful.

LIQUIDITY AND CAPITAL RESOURCES

We believe our cash balance and cash provided by operations, in combination with other sources of cash, will be sufficient to meet our financing needs over the next twelve months. Although there is uncertainty related to the anticipated continued effect of the Covid-19 pandemic on our business (as referenced above and in “Item 1A — Risk Factors” in our Annual Report on Form 10-K for the year ended December 27, 2020), given the strength of our balance sheet and based on the information currently available to us, we do not expect the impact of the pandemic to have a material ~~impact~~effect on our liquidity position. As of ~~June 27,~~September 26, 2021, we had cash, cash equivalents and short- and long-term marketable securities of ~~$946.6 million.~~$1.04 billion. Our cash and marketable securities balances between the end of 2020 and ~~June 27,~~September 26, 2021, increased primarily due to cash proceeds from operating activities and proceeds from the sale of investments, partially offset by dividend payments, capital expenditures and share-based compensation tax withholding.

We have paid quarterly dividends on the Class A and Class B Common Stock each quarter since late 2013. In February 2021, the Board of Directors approved an increase in the quarterly dividend to $0.07 per share, which was paid in April 2021. OnIn June ~~30,~~and September 2021, the Board of Directors declared a quarterly ~~dividend~~dividends of $0.07 per share on the Class A and Class B Common Stock, which ~~was~~were paid in July and October 2021. We currently expect to continue to pay comparable cash dividends in the future, although changes in our dividends will be considered by our Board of Directors in light of our earnings, capital requirements, financial condition and other factors considered relevant.

Capital Resources

Sources and Uses of Cash

Cash flows provided by/(used in) by category were as follows:


		For the Six Months Ended							For the Six Months Ended
(In thousands)	(In thousands)	June 27, 2021		June 28, 2020		% Change		(In thousands)	September 26, 2021		September 27, 2020		% Change
Operating activities	Operating activities	$	110,434	$	118,590	(6.9)	%	Operating activities	$	209,557	$	206,683	1.4	%
Investing activities	Investing activities	$	(46,332)	$	(72,938)	(36.5)	%	Investing activities	$	(129,685)	$	(187,264)	(30.7)	%
Financing activities	Financing activities	$	(30,285)	$	(28,192)	7.4	%	Financing activities	$	(42,954)	$	(35,671)	20.4	%

Operating Activities

Cash from operating activities is generated by cash receipts from subscriptions, advertising sales and other revenue. Operating cash outflows include payments for employee compensation, pension and other benefits, raw materials, marketing expenses and income taxes.

Net cash provided by operating activities ~~decreased~~increased in the first ~~six~~nine months of 2021 compared with the same prior-year period primarily due to ~~lower cash collections from accounts receivable, an increase in other assets and lower cash payments received from prepaid subscriptions, partially offset by~~ higher net income adjusted for non-cash items and lower cash payments made to settle accounts payable, accrued payroll and other ~~liabilities.~~liabilities, partially offset by lower cash collections from accounts receivable, an increase in other assets and lower cash payments received from prepaid subscriptions.

Investing Activities

Cash from investing activities generally includes proceeds from marketable securities that have matured and the sale of assets, investments or a business. Cash used in investing activities generally includes purchases of marketable securities, payments for capital projects and acquisitions of new businesses and investments.

Net cash used in investing activities in the first ~~six~~nine months of 2021 was primarily related to ~~$33.9~~$129.0 million in net purchases of marketable securities and ~~$14.7~~$23.8 million in capital expenditures ~~payments.~~payments, partially offset by $20.6 million related to a non-marketable equity investment transaction.

Financing Activities

Cash from financing activities generally includes borrowings under third-party financing arrangements, the issuance of long-term debt and funds from stock option exercises. Cash used in financing activities generally includes the repayment of amounts outstanding under third-party financing arrangements, the payment of dividends, the payment of long-term debt and finance lease obligations and share-based compensation tax withholding.

Net cash used in financing activities in the first ~~six~~nine months of 2021 was primarily related to dividend payments of ~~$21.8~~$33.6 million and share-based compensation tax withholding payments of $10.9 million.

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Restricted Cash

We were required to maintain ~~$14.6~~$14.3 million of restricted cash as of ~~June 27,~~September 26, 2021, and $15.9 million as of December 27, 2020, substantially all of which is set aside to collateralize workers’ compensation obligations.

Capital Expenditures

Capital expenditures totaled approximately ~~$15~~$26 million and ~~$17~~$25 million in the first ~~six~~nine months of 2021 and 2020, respectively. The ~~decrease~~increase in capital expenditures was primarily driven by improvements at our Company Headquarters and newsroom bureaus, partially offset by lower expenditures related to improvements at our College Point, ~~N.Y.,~~New York, printing and distribution facility and lower ~~investments~~expenditures on computer hardware. The improvements in ~~technology, partially offset by improvements at~~ our ~~newsroom bureaus~~Company Headquarters are intended to address growth in the number of employees and ~~Company Headquarters.~~to enhance technologies that support our transition to hybrid work with employees working both from the office and remotely. The cash payments related to capital expenditures totaled approximately ~~$15~~$24 million and ~~$22~~$29 million in the first ~~six~~nine months of 2021 and 2020, respectively.

Third-Party Financing

In September 2019, we entered into a $250 million five-year unsecured credit facility (the “Credit Facility”). Certain of our domestic subsidiaries have guaranteed our obligations under the Credit Facility. As of ~~June 27,~~September 26, 2021, there were no outstanding borrowings under the Credit Facility and the Company was in compliance with the financial covenants contained in the Credit Facility.

CRITICAL ACCOUNTING POLICIES

Our critical accounting policies are detailed in our Annual Report on Form 10-K for the year ended December 27, 2020. Other than as described in Note 2 of the Notes to the Condensed Consolidated Financial Statements, as of ~~June 27,~~September 26, 2021, our critical accounting policies have not changed from December 27, 2020.

CONTRACTUAL OBLIGATIONS & OFF-BALANCE SHEET ARRANGEMENTS

Our contractual obligations and off-balance sheet arrangements are detailed in our Annual Report on Form 10-K for the year ended December 27, 2020. As of ~~June 27,~~September 26, 2021, our contractual obligations and off-balance sheet arrangements have not changed materially from December 27, 2020.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Terms such as “aim,” “anticipate,” “believe,” “confidence,” “contemplate,” “continue,” “conviction,” “could,” “drive,” “estimate,” “expect,” “forecast,” “future,” “goal,” “guidance,” “intend,” “likely,” “may,” “might,” “objective,” “opportunity,” “optimistic,” “outlook,” “plan,” “position,” “potential,” “predict,” “project,” “seek,” “should,” “strategy,” “target,” “will,” “would” or similar statements or variations of such words and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such terms. Forward-looking statements are based upon our current expectations, estimates and assumptions and involve risks and uncertainties that change over time; actual results could differ materially from those predicted by such forward-looking statements. These risks and uncertainties include, but are not limited to: the impact of the Covid-19 pandemic; significant competition in all aspects of our business; our ability to improve and scale our technical infrastructure and respond and adapt to changes in technology and consumer behavior; our ability to continue to retain and grow our subscriber base; numerous factors that affect our advertising revenues, including economic conditions, market dynamics, audience fragmentation, evolving digital advertising trends and the evolution of our strategy; damage to our brand or reputation; economic, geopolitical and other risks associated with the international scope of our business and foreign operations; our ability to attract and maintain a highly skilled and diverse workforce; adverse results from litigation or governmental investigations; the risks and challenges associated with investments we make in new and existing products and services; risks associated with acquisitions, divestitures, investments and other transactions; the effects of the fixed cost nature of significant portions of our expenses; the effects of the size and volatility of our pension plan obligations; liabilities that may result from our participation in multiemployer pension plans; the impact of labor negotiations and agreements; increases in the price of newsprint or significant disruptions in our newsprint supply chain or newspaper printing and distribution channels; security breaches and other network and information systems disruptions; our ability to comply with laws and regulations, including with respect to privacy, data protection and consumer marketing practices; payment processing risk; defects, delays or interruptions in the cloud-based hosting services we utilize; our ability to protect our intellectual property; claims of intellectual property infringement that we have been, and may be in the future be, subject to; the effects of restrictions on our operations as a result of the terms of our credit facility; our future access to capital markets and other financing options; and the concentration of control of our company due to our dual-class capital structure.

More information regarding these risks and uncertainties and other important factors that could cause actual results to differ materially from those in the forward-looking statements is set forth in “Item 1A — Risk Factors” in our Annual Report

on Form 10-K for the year ended December 27, 2020, and “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Form 10-Q. Investors are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our Annual Report on Form 10-K for the year ended December 27, 2020, details our disclosures about market risk. As of ~~June 27,~~September 26, 2021, there were no material changes in our market risks from December 27, 2020.

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Item 4. Controls and Procedures

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Our management, with the participation of our principal executive officer and our principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) as of ~~June 27,~~September 26, 2021. Based upon such evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective to ensure that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

During the ~~second~~third quarter of 2021, we completed the implementation of ~~(i) a new cloud-based procure-to-pay system relating to our procurement suppliers, and (ii)~~ a new cloud-based system for ~~digital~~print advertising billing. In connection with ~~these systems implementations,~~this system implementation, we updated our internal control over financial reporting to accommodate the resulting changes to our existing controls, systems and procedures.

There were no other changes in our internal control over financial reporting during the quarter ended ~~June 27,~~September 26, 2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Item 1A. Risk Factors

There have been no material changes to our risk factors as set forth in “Item 1A—Risk Factors” in our Annual Report on Form 10-K for the year ended December 27, 2020.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

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Item 6. Exhibits


Exhibit No.

31.1						Rule 13a-14(a)/15d-14(a) Certification.

31.2						Rule 13a-14(a)/15d-14(a) Certification.

32.1						Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2						Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS						XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH						Inline XBRL Taxonomy Extension Schema Document.

101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document.

101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document.

104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

4042

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		THE NEW YORK TIMES COMPANY
		(Registrant)

Date:	~~August 4,~~November 3, 2021	/s/ Roland A. Caputo
		Roland A. Caputo Executive Vice President and Chief Financial Officer (Principal Financial Officer)

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	Six Months
	2021		2020		2021 vs 2020 % Change		2019		2021 vs 2019 % Change
Revenues
Digital	$	369,745	$	275,994	34.0	%	$	222,494	66.2	%
Print	298,556		302,629		(1.3)	%	318,772		(6.3)	%
Subscription revenues	668,301		578,623		15.5	%	541,266		23.5	%
Digital	130,491		90,689		43.9	%	113,569		14.9	%
Print	79,399		83,208		(4.6)	%	132,280		(40.0)	%
Advertising revenues	209,890		173,897		20.7	%	245,849		(14.6)	%
Other revenues	93,351		94,866		(1.6)	%	88,205		5.8	%
Total revenues	971,542		847,386		14.7	%	875,320		11.0	%
Operating costs
Cost of revenue (excluding depreciation and amortization)	502,355		473,397		6.1	%	484,125		3.8	%
Sales and marketing	113,708		113,389		0.3	%	137,094		(17.1)	%
Product development	78,642		61,985		26.9	%	49,433		59.1	%
General and administrative	118,860		111,673		6.4	%	102,039		16.5	%
Depreciation and amortization	29,203		30,816		(5.2)	%	30,098		(3.0)	%
Total operating costs	842,768		791,260		6.5	%	802,789		5.0	%
Lease termination charge	3,831		—		*		—		*
Operating profit	$	124,943	$	56,126	*		$	72,531	72.3	%

* Represents a change equal to or in excess of 100% or not meaningful.