The New York Times Company added about 180,000 net digital-only subscribers in the second quarter of the year, but generated less digital ad revenue, it said Wednesday.
The Times now has 9.17 million paid subscribers. It has a target of 15 million by the end of 2027.
The company reported $76 million in adjusted operating profit, 18 percent less than the same quarter last year. It generated total revenue of $555.7 million, an increase of 11.5 percent from the previous year. Digital subscriptions accounted for $238.7 million of these revenues, an increase of 25.5 percent.
The hit to operating profit came mainly from losses at The Athletic, the sports news website that The Times bought in February for $550 million. Adjusted operating loss at The Athletic was $12.6 million for this quarter, from April to June, down from about $19.4 million in the first quarter.
The Times reported 9.107 million subscribers at the end of the first quarter of 2022. This figure was revised in this quarter’s results down to 9.01 million.
A central part of The Times’ strategy is to distinguish between subscribers and subscriptions. One subscriber may have a subscription to more than one of the company’s products, which include The Athletic, Cooking and Wirecutter. The Times aims to combine digital offers with its news report to reach new target groups with a range of interests.
“News remains at the core of our value proposition, but the package helps ensure The Times is indispensable to an ever-wider group of people, even as news engagement ebbs and flows,” Meredith Kopit Levien, president and CEO of The Times Company, said at a conversation with analysts.
In the second quarter, the company had the highest number of new subscribers ever on the All Digital Access tier, which includes The Times’ News Report, Games, Cooking, Wirecutter and The Athletic, Levien said.
The net gain of 180,000 digital-only subscribers was an increase of 70 percent from the net gain in the second quarter of 2021. The company added far more in the first quarter of the year, 418,000. The Athletic added a net increase of 50,000 independent subscribers in the most recent quarter.
The vast majority of The Times’ subscribers pay only for digital access. The number of print subscribers continued to shrink in the second quarter, down nearly 7 percent from a year earlier, to about 761,000.
Digital ad revenue for the Times Company in the quarter fell 2.4 percent from a year earlier, to $69.3 million, as marketers cut spending in the face of economic uncertainty. Print advertising rose 15.1 percent, to $48.1 million, from the same quarter last year, as the entertainment and luxury categories began to recover from the pandemic.
Total operating costs increased by 19.6 percent to 504 million dollars. The company also recorded a $34.2 million gain from the sale of land at The Times’ printing plant in College Point, Queens.
The company said it expected third-quarter digital subscription revenue to grow 21 to 25 percent from a year ago. It said it expected a flat or small decline in total advertising revenue and a 9 to 13 percent increase in adjusted operating expenses in that period.
The company’s shares fell around 1 percent in early trading on Wednesday.