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The 'Failing' New York Times Now Has More Than 3 Million Subscribers, Still Has Long-Term Concerns

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The 'Failing' New York Times Now Has More Than 3 Million Subscribers, Still Has Long-Term Concerns

President Donald Trump has taken shot after shot at the media, and now he has a wider target to fire at.

The New York Times Co (NYSE: NYT) reported growth in reach and, consequently, public influence Thursday in its quarterly and annual earnings.

The Times added 276,000 new digital subscribers during the fourth quarter — its best figures since 2011 — and beat revenue estimates by $2.7 million. Results were attributed to an 11-percent growth in digital ad revenue and 5-percent rise in circulation revenue compared to the fourth quarter of 2015.

Throughout the entire year, digital ad revenue rose 6 percent and digital-only subscriptions shot to 1.6 million.

And the company’s good news continued.

Apart from its reported progress, the Times got a much-needed nod from global elite on Friday when Mexican billionaire Carlos Slim denied rumors that he had been selling corporate stock and essentially affirmed its value.

Nonetheless, the company has met and continues to endure its share of trials.

But It’s Not All Good News

Print ad revenue fell 20 percent over the quarter, while total revenue fell 2 percent for the year. And while EPS met estimates at $0.24, that number was down 22.5 percent from the fourth quarter of 2015.

Meanwhile, quarterly operating profit fell from $87.7 million in 2015 to $55.6 million in 2016. The Times attributed the decline to a pension settlement charge, higher costs and a 20.4-percent year-over-year decline in print ad revenue.

For the entire year, 2016 saw operating profit of $101.6 million compared with 2015’s rate of $136.6 million. Print ad revenue declined 15.8 percent compared to a rise in digital ad revenue of only 5.9 percent.

“We continue to experience significant headwinds in print advertising,” President and CEO Mark Thompson said in a press release.

That luck is not expected to reverse in the coming year.

Although corporate anticipates a 6-percent increase in first-quarter total circulation revenue over the same period in 2016, it also foresees a decrease in total ad revenue in high single digits.

Does The Report Merit An ‘F?’

And, on top of that, the Times could continue to feel the wrath of a top critic.

Trump has repeatedly tweeted about the time-tested Times as a “failing” company. Here is a recap of his comments over the last few months (all errors are in the original texts):

Times On The Rise

Despite internal and external heat, the Times is taking pointed measures to expand business and reach additional subscribers.

On Thursday, management announced a partnership with Snapchat to produce a daily Discover report, and in mid-January, the staff reported an internal overhaul of editorial processes.

It is yet to be seen whether these efforts are enough to keep the company from realizing Trump’s prophecy.

As one staff writer noted in a Thursday report, “The overall financial results announced Thursday are unlikely to assuage the tangible anxiety among journalists at The Times.”

Image Credit: By DonkeyHotey (Donald Trump - Caricature) [CC BY-SA 2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Wikimedia Commons

Posted-In: Donald TrumpEarnings News Politics Movers Media Trading Ideas General Best of Benzinga

 

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