NYT - Earnings call transcript Q3 2024 | The New York Times Company

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Operator

Good morning, and welcome to the New York Times Company's Third Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Anthony DiClemente, Senior Vice President, Investor Relations. Please go ahead.

Anthony DiClemente

Thank you, and welcome, everyone, to the New York Times Company's Third Quarter 2024 Earnings Conference Call.

we Will Lowell, and Bardeen, Officer. today, Executive and Chief call and Officer; Executive the have President Matthew Chief Financial On Vice President

we assumptions, this call. you statements are to forward-looking Before current during change These would expectations over on will and statements of management may make remind course the based I begin, which that like time.

SEC that XXXX results a number and subsequent uncertainties to XX-K differ company's of the due are materially could in Our actual described filings. and risks

In GAAP our non-GAAP release, measures, our addition, our will presentation financial to press on and include reconciliations provided website the we at which earnings measures have is available most investors.nytco.com. comparable in

results our In from to investors.nytco.com. also conclude. release, at posted With that, a that on And call shortly earnings finally, have will investor please our the call we copy morning's we to remarks our press over prepared addition our of Meredith. the website turn note website slide to be posted will a this to presentation I relating after

Meredith Kopit Levien

good Anthony, everyone. Thanks, morning, and

world. advertising to growth digital more understand than in for XX% subscribed accelerated engage whom third in more that, further quarter, every time Digital growth another with total of to now to growth was than person the X revenue strong the quarter passed products. We year-on-year. million other for total revenue bundle or propelled revenue. subscription multiple combined and toward million subscribers one And subscription in seeking becoming as progress we the the The with XX essential serious made and the healthy

out as our strategy designed. These playing results reflected

politics, people invoice. and news distinctive tens to were attract by our shopping beyond play. each in the week and international learn world-class listen, our First, read, affairs, Society, portfolio sports, and multiproduct to Cooking as as of stories entertainment in a of well drawn products major They games, watch, coverage millions continued of

each directly time even since Subscriber And the market landscape. sought by continues highest the headwinds out experience audience of as Second, measured share people shifts and reached relationship the the we grew engagement Times in by point engaged these driven platform significant direct as increasingly week, The its deeply. again visiting once to XXXX. subscribers

is that value of strong advantage, premium and believe in us the digital Third, products. we enduring together subscriber with enabled expectations. ARPU give sign And us delivering sustainably keep can and this means finally, in journalism of the engagement that growing all a our we're expert to we line taken areas our invest

multiproduct as we're AOP higher for generation. quarter, growing flow more products relationships and on the now and the year as and well of of subscribers. putting popularity our access and with are added to by the over subscribers. XXX,XXX on digital milestone along net next the new We our of of million in year. The starting of cash as generate details from expansion bundle next means to margin Those across for path strong well us total affiliate XX behind free revenue continuing account base all well licensing. end another further our turn year the to direct track us, track X subscriptions some as of I'll With half subscribers bundle advertising, quarters of quarter the

is our offer. in of find that much of easier stake report different redesign that dedicated with having race. Key moments people and meets and or York the To launched core end, users' them also headlines, our day the our complex. the news where is with how more to portfolio in everything stories evident At voters, like value September, to unmatched our subscribers more. long-running subscribers Times a matter and New offering strategy which coverage, election than election, our matters lifetime report news and panels puts ongoing the in find. That lives investments that and ensure the can follow a lifestyle expected of a our in making engage and have we difficult front of experience. The for redesign it in users any the of to arts easier coverage because That the of candidates, product commitment multiproduct culture our includes we storylines a coverage needs available state important today's integrated of is made to no Act core bundle single higher and the products product. to to times have make biggest We've comprehensive individual diversified issues, to

So a Wirecutter of and just Audio. Athletic, games, away users Cooking, the best The swipe are from

Beyond the innovate of formats across the a part the to quarter, other continue which redesign, part of time. video in to make strategy visual our audio, we bigger is and formats,

show, made We and modern love of weekly podcast more launched Wirecutter. listenable production automated increased latest of our news the availability headlines, voice, from coverage via expanded our of a the

also We a paid make direct Apple. available Spotify with of subscriptions through offerings to new more experimenting and began audio driver

in users, experimenting getting big in and growth reporters games both podcast again the on of direct played bring that NYT new them. putting stories often more In film once relationships of people games optimistic new role and versions video, camera millions our with daily to advertising. day. to we major to to new features, continue as subscriptions explain of around people time. we're engine innovating with propelled will keep many We're be a and our create growth ways gains beloved to the of This the by a

We journey Premier at among and of on and Olympics fans with name also the to The sports quarter the great in strong household further Athletic's the of momentum a coverage League NFL the season. become start progress made English

important pleased began driver was deeply which The more directly it We starts offering web economic subscribers. overall of direction that subscription in component bundle performance Times domain continue and of our The we with more already with as Athletic completed to the an We integration and Athletic. QX, QX. is engaging technical testing of in a the by bundled in enabled be The we

guidance. the some performance across in reached in marketers. X% Ad lifestyle nearly line as set strong with up was advertisers news products we This a quarter, and even came offering continue to reflected revenue as wider advertising ad topics. all our certain of growth our broadened Digital avoid hard

Revenue also and good and met another licensing. advertising for beyond expectations, the subscriptions Wirecutter driven by our quarter

the cash healthy generation. disciplined flow experiences. in AOP of differentiate execution in another we continue premium the that resulted That business, investments with areas Finally, our how prioritizing world-class strong us, in journalism we quarter product and to combined be discipline, free growth and grow

of of and people plan every NBA do like the and that to go on that journalism loves, rise That Dinner. for coverage make reminding of happen. products direct Thanksgiving their All you and daily daily you Middle we're shopping to holiday the them many tips what follow investigations recommendations from by get name to and unrivaled people important wrapped East what seek team, family to their working watch. play issues, value the takes them relationships form ask or favorite by is or will game AI landmark out, day, valuable so read forms expert time where The whole

over growing big and keep resilient and, to power ability become changing sources time turn, We well All to user Times these in profitable and company. value media our in address makes value multiple a of needs is it adding The landscape streams. positioned portfolio believe larger revenue complementary to what a and more our

Now turn more let for details. me Will it over to

William Bardeen

morning, good everyone. and Meredith, Thanks,

generation. another year to results deliver and high-quality financial track expansion us working also QX margin our growth news AOP of economics. cash how is on flow keep portfolio lifestyle QX free products these demonstrated drive Our growth, revenue healthy to of and

increasing led we subscription aimed strong revenues. streams, differentiating at operating to even growth along subscriber with engagement continue high-quality to driven base, digital subscriber strategic in across And products. digital ARPU our prioritize leverage journalism growing further we've as multiple and Our our with growth and investments revenue our

digital AOP licensing We approximately grew and and as approximately offset affiliate to expanded quarter digital margin XX.X%. points year-over-year by than basis ongoing the more advertising, XX% declines approximately by X% grew overall revenue XXX subscription, print. in by in increasing third revenue AOP and

the first and to approximately of consistent same free allocation approximately million shareholders, strategy. approximately in share in returned We generated that $XXX months period, repurchases This $XXX $XX capital we flow our the dividends. in cash million with of Over year. million included X million $XX approximately

prior discuss year specified. I'll note period third the followed the otherwise for our comparisons XXXX. of financial outlook Now, quarter's by quarter unless key the to are that all results, Please fourth

subscribers will end now to multiple I'll digital-only start gives products, Total we've XX% modest subscribers the the for our to to at combined along digital of growth new ARPU subscribers pricing expansion up seeing the as of coming approximately XX% total The step path continue our over up to prices portfolio. approximately continue We number year. products year-over-year the nonbundled remainder value from our our base, to with of of results points, added added on our with raised the that prices higher bringing subscribers with XXX,XXX from subscription next year. tenured multi-product and total ARPU exceeding promotional encouraging X.X% we're step-up grew us in and net Bundle to across quarter, million, business. of $XX make the discussion by well the we subscribers. $X.XX confidence

revenues and digital-only approximately the provided ARPU both $XXX the As Both to quarter. grew and quarter, guidance subscription we $XXX higher last a subscription XX% million. total approximately line of revenues subscribers in result in million digital-only were digital to X% grew with third

our and Other an perform total approximately provided $XX ranges $XX X%. affiliate well approximately in digital Total advertising advertising million, revenues million revenues revenues Both the Now revenues to also increasing were licensing advertising within within X% last QX. advertising. as for range, turning of Wirecutter approximately the guidance revenues we were to were and X% Digital continued quarter. guidance increase to million. quarter $XXX advertising revenues to increased

X% Adjusted operating approximately our a guidance increase, X.X%. within by came range of to in costs X% growing

X% approximately costs and decreased increased approximately of Product Looking revenue costs at the marketing X% adjusted increased and line, development each approximately XX%. of G&A and Sales increased X%. approximately cost costs

in to $X.XX, interest Adjusted increased and by higher profit diluted primarily higher income. $X.XX driven EPS QX operating

turn like X Before to I'd I our QX to guidance, add notes.

entitlements After regards the fourth we our subscriber of to of The supplemental plan Athletic. disclosure note first our disclosures. have XXXX, quarter discontinue subscribers who to The

Athletic will The part remarks, in As her included bundle company continue now subscription starts. Meredith report products. well our digital-only subscribers The Athletic as is to contributor our just a to in as bundle both as our other of disclosures of total offering noted be we subscriber a subscribers

regards our of range a known scenarios. by union of a note second of work technology was prepared commenced representing certain this employees. for have We've possibility The stoppage today and

incorporates our our developments, While best our further depend and operations guidance estimates. effects QX on current will the on and for revenue cost results

track We record unions contract. effectively a have aim continue with for a fair to and of working

ahead I'll expected Times now are quarter revenues fourth New look X% to to the expected with subscription compared XX% Company. Digital X%. XX% consolidated increase are QX the York revenues to increase XXXX to total and to of subscription for only

advertising of in effectively are best to increase expect digits that X% continuing digits, are are and to to of be low expected to and products. increase we our for while some licensing investing journalism sustainable single from Adjusted advertising news recognition increase revenues low to the total growth, to strong growth expect revenue a to single benefit are high revenues us revenues operating related costs also to Other world-class are increase driver manage the double strategically expected to as position X% Digital QX. to Wirecutter lifestyle costs including in we revenues timing affiliate continue areas expected XX% as and XX% to expected digits. revenue

returns. results demonstrate subscribers, achieve as on keeps and our our capital designed to growth our strategy previously midterm working summary, AOP targets In is track and stated subscription essential us for

With questions. that, we're happy to take your

Operator

comes question with from Bank. Deutsche first Soff Today's Benjamin Instructions] [Operator

Benjamin Soff

wanted about came strength in that to It of first like I digital from supply. sounds ask growth the bringing some advertising. new on

as maybe up can that the it's about showing in on to we portfolio of I base? you relative the was you wondering, talk supply with where and is advertising? are new So how part your your where that, talk games about with rollout performing And can

Meredith Kopit Levien

to happy take that I'm one.

places. we're more and X ad So would as from we put marketers. products, into I more say, digital came lifestyle more think I broadly, the valuable number just advertising products our One,

rollout four each of And So suggest, more steadily out are supply point And into. we that actually, sort And we can two, tap the that The one to we rolling more or early, more have to would to continues our but that's to say you as specifically, all in also it. products. come we Athletic, new come the there app, come which ads case opportunities. of this in grow have of of products I in online you in another supply and at games year saw continues lifestyle demand those it's and more excited games grow is we're the which audience about on ad

The lifestyle the really in the where here, Athletic games portfolio are products have But the in opportunity. terms we can from of all four of in but biggest within terms certainly biggest go opportunity,

Anthony DiClemente

or are Ben, Okay. follow-up? do all you have set you a

Benjamin Soff

more One time. have if you

to You basis decline talk growth step-ups seeing moderated. ARPU pretty the back and see both bundle a saw what on and in Can ARPU, how nice on about you step-up sequential year-over-year a you then path year-over-year bundle with the getting you're a to basis? promo

William Bardeen

time revenue mean what on making on any And we're kind reiterate digital-only line on of that our the important specifically, growth, I total that. that. the I overall focused increases in our year-over-year say ourselves focused what we and ARPU is to really sure you driving modest se. long-term ARPU about thing Sure. think we I per focus not is is and is talking can ARPU most take target

of disclosure the do have playing you to allows and We strategy that lot that sort of levers a to out. see

To trajectory. your been are the confidence as of year saying towards and sort rest the looking of that are ARPU what year, multiple us we're our question on there seeing, factors of giving certainly, throughout sort real in the we've

are and see transitioning bundle those the continue to results as The we prices. higher subscribers first is to bundle the encouraging

still feeling there. increases our tenured good second single So product And the are subscription subscribers there. of groups for what about seeing we're then price really certain tenured

good our confident use of As the we to just really that raising prices. over all And we're in products, feel trajectory ARPU you lever keep adding the value we up, add into the when ability about time. continually

Operator

comes Yeh with from question Morgan Thomas next Our Stanley.

Thomas Yeh

to ask I ads with net wanted the about entitlement. news

smoother years volatility the and historical of down. up seeing subscriptions of opportunity consumers in I maybe providing you're broadening cycle news some a just cadence you in just offering you days. a a to pulling on in and paid to plays volatility see you're that think those recent given kind role that quarters much heavy in given cycle the comes more just quarterly these effect new these that it's or been quarterly, bundle still seeing relative Can how relative to the that moments about talk holistic a of

Meredith Kopit Levien

say that about the Thomas, designed wherever I'm is to news just from, we of to this and the better would doing kind the happy or in feel highest quarter. In news cover I at should model are comes And present of such because have start. it's it and in in always Will, that free the different that. will the you wherever specifically, But say I harness demand add news anything. differently case model we that the to prepared working innovative is a product broad deep different way demand say I would invested as intended asking and different that I to we're products time whatever all better we story to. have getting And is cycle, news and you're the year, very news. because would moments, quarters within of think the level, and goes.

about year, reporters increasing you've I And innovation. more do and which engagement. good great to formats. of the And their stories, think format talking formats, that particularly visual In of is on-camera got at over array in an been sort video last for we've

got coverage. on election visual formats You've more the

for offer And more sophisticated had audio, more operation you all engagement. the more wherever more to just and in getting that pulling we're and and Times. previously better kind think have to live apply The ways I that we story and that shows that at got goes, You've to people better we a of take if

a in subscriber to as like the strong matters. where whole model. engagement high-octane I my The very in keep the since last pointing quarter we gas gotten been this XXXX. strongest say it's remarks, thing enterprise it that to really in said point because is was we've the last prepared I'll And That's

Thomas Yeh

juice pricing some gives terms year step-ups? in expectation more to benefit of a to digital I of XQ in maybe subscribers? That's Or the I how more an down think, up trailed continued buildup acceleration little is guidance, reflected just from subscription you If embedding the for a the just bit ads typically, in to ability revenue inflection are cohorts coming helpful. your net much a that growth of bit accelerate and function in you bring of for

William Bardeen

Thomas, I'll take that.

guide As you specifically. on don't we net ad know,

I guide. to straightforward. explanation is to XX% both XX% I that is pretty and volume out designed -- mean, It's the highlighting growth you're revenue playing think digital when rate. subscription strategy the

as talked the already we've about well we're be step-up in to we're seeing, question, with passing growth as people been the million pleased through our at higher continuing well when approach moments the previous as the are subscriber So products the about asking monetizing, in on stand-alone promotional as talked quarter I we XX pleased which to to year, as subscribers prices. pay total engagement, with bundle the performance

it's revenue designed we're So is to that that model the in when growth adding you're underpin all QX. working guiding that up, to

Operator

from comes David Karnovsky with question next Our JPMorgan.

David Karnovsky

just one verticals, for on or healthy Athletic results a now And Will. delivered you news, a traffic social Meredith, of complex impact traffic. not how we're then website whole about impacted any Are today, terms on prior but AI. only Wirecutter. search these amount you of the calls, not The include commented seeing of at changes couple news including quarters in like search interested, but I'm lot other content for with media that result, a in Times, in a as to

You mentioned I past in just of could the strike, so. you terms you cost like in But impact line? your for cost QX clarify hour within disruptions, just literally know the forecast can what which any started it's the built top or

Meredith Kopit Levien

like I'll I'll AI, years been to sending including back, and we've platforms your This it ChatGPT a say talking we I'll Thanks, name of products whole those generally, are the relationships ask and them. stepping by less are is But resilience do habits harder. that that first. are AI about say headwinds. for by question close to aspects about David. said fact and to them new. publishers. that dynamics that, the headwinds our having strategy And I daily in just so believe On X those sort people now and role audience playing of that traffic not overviews making direct intended out good makes go seek business less think, is build and for, certainly them to products with build

William Bardeen

strike. the my And to don't beyond the on I'm have I take remarks. prepared think anything happy I to follow-up here add really

While today, surprised. how it terms we are QX, just will we've our think for of We're play -- prepared in possibility. as out. was guide, a not scenarios. of a known range the best estimate announced we about think I And And we're of this definitely what it represents it

the bit operations will guide the on effects we course, developments, see depend Of today. contemplating on is what results a but further

Operator

And Kannan comes our question Venkateshwar next today Barclays. with from

Kannan Venkateshwar

sequentially it But QX. see of mean, course, some like And tailwind little tend this election X QX you looks bit. quarter. trends. ads guys in then, actually net slowed Maybe an is versus to on typically, also subscriber a I

an guidance. of when you terms churn delta And context degree also feels little of which QX. normally bit But typically just in in wondering acceleration slowed is implicit the look just then guess, I you on if for usual. why thing you some and see is maybe at and of the QX, in see, And it some than embedded I'm provide sequential guidance increases same the trends degree acceleration in little the price bit. down it Will QX, in a a I I that could the obviously mean, So lower

Meredith Kopit Levien

would Why And can useful. anything that be you start, feel Kannan? don't I you add Will,

on about me in X We've the ads been net both and in the headline think, that results I in are across general, also, rest strong I start And the number year of is working. and getting well. One the point, of then just kind And subscribers to portfolio. XXX,XXX things, saying all is really cylinders an funnels value to have to we're portfolio to bringing by that optimism we the going on newer of getting are Let show that's very, secondly, and engagement and kind good such products of model, your important feel have subscriber quarter firing begin of powerful our portfolio. say the been on our would the very this enterprise quarter all focused lifestyle drive And focused is part and and year, news a be more that of focus the really confidence product and the the the we we this bundle. to there. a intently for lot very those

on So to would we where are volume anything? revenue. do Will, good both we want about you feel say just add very and I

William Bardeen

think, whether pay pleased engagement know what and we too every that year, high see lot product subscription -- with as as else and Meredith single on product the that's into add. think people to or don't I mean, been this we're I value I see, been continuing levels that Kannan, fundamentally really a translating what to subs the that adding digital the more. bundle I it's time much attractive rates. with said, really guide throughout the underpin We've of we've revenue step-ups to and we or it's built growth see asking guide, continue just of pleased QX we to into what

Operator

today our Research. Cannonball Karasyov Vasily from next with And comes question

Vasily Karasyov

and and here, to audience may about wanted on you growth. something prepared headwinds but you your to I you said misquote and remarks, in you your elaborate follow up ask audience I platforms Meredith, other said something impacting

how this you to worse feel planning up, trend that getting on exactly there? tell did please us needed you And you're bring with is and that? what for you you could meant dealing So that you

Meredith Kopit Levien

X say and we've it that I plays question. for close in I'll answered the of and a to role that. publishers, are to think a more question and for how making I think consistently step-back prior sending Thanks already just less less years a platforms or years it's been AI I the about point, traffic X

engagement our important how the the that. multiproduct is takeaway think resilience good from the driving both have. subscribers have we that terms model designed bring to ability of that, And build of really, call this is to to I to new us already to feel we're doing about really already in portfolio action and relationships direct relationships we reasons and direct the we

to can people I'll just regard also working. there. I'll the saying really keenly of mean quarters, X, You to leave as And it us I us. platforms from our ways finish the we've didn't by maybe direction probably to And come for and building than been intend we anything further own now think X to understanding saying travel get that's what

Anthony DiClemente

have one we for last Operator, time question.

Operator

Arthur Research at And Doug our question last comes Partners. Huber from

Douglas Arthur

Actually, X Post questions. the been Times. seeing I've chaos that? any churn amount got benefit of Washington the One from and L.A. first at question, and fair Are there's you a --

Meredith Kopit Levien

through Doug. most importantly, and I'm take happy institution no I go difficult. anything joy say, other watching in any want to take independent quality that first journalism to we one,

of for places reasons, our on I'll laser-focused sorts are we of subscribers we all it we'll all know, sorts there. you own attract strategy our and expect continue leave growth And own from trajectory. and to As

Douglas Arthur

Got it.

G&A. if the there take cost XX% The of in movement unusually look these and cost just year was Athletic in a The out movement on breakdown, and and you quarter? It the Will, the and lot sales categories There development at was expenses, Is anything I marketing, unusual product And down marketing sales a Okay. up this driving was Times. think quarter, ago. just at

William Bardeen

bit. we've the given our move a can way think costs, in to as any think always things said, quarter, about around I

and expansion most I healthy to think areas for that a just investing AOP revenue margin revenues like for the terms, sustaining us really journalism We've sustainable the thing costs the on growth, growth. important and kind stepping we're long And world-class of the in than approach manages in growth repeatedly, focused position in growing products. over places term G&A, back that faster doing say is cost. both we're long-term investment lifestyle while best strategically closely news that identified simple

that AOP that enable us been year-over-year it's So intend growth We continue should executing. expansion we to to and forward. target margin have to disciplined continue going approach and

Operator

our session. concludes Anthony for to to closing any question-and-answer remarks. conference this like And the I'd turn DiClemente over back

Anthony DiClemente

and it. you Thank That's quarter. Great. you see us joining all this for morning, next we'll

Operator

This you presentation. call. thank all today's concludes for attending today's We

disconnect wonderful lines, now and may a your You have day.

The New York Times Company (NYT) 4 Nov 242024 Q3 Earnings call transcript