• Digital Subscription Revenue Growth: Increased 14% for the full year 2024.
• Digital Advertising Revenue Growth: Increased 9.5% in Q4 2024.
• Adjusted Operating Profit (AOP) Growth: Increased 17% year-over-year to $455 million in 2024.
• AOP Margin Expansion: Expanded by approximately 150 basis points to 17.6% in 2024.
• Free Cash Flow: Generated approximately $381 million in 2024.
• Shareholder Returns: Returned approximately $168 million, including $85 million in share repurchases and $83 million in dividends in 2024.
• Quarterly Dividend Increase: Increased from $0.13 to $0.18.
• Digital-Only ARPU Growth: Grew 4.4% to $9.65 in Q4 2024.
• Total Subscription Revenue Growth: Grew approximately 8% to $467 million in Q4 2024.
• Total Advertising Revenue: Increased approximately 1% to $165 million in Q4 2024.
• Other Revenue Growth: Increased approximately 16% to $95 million in Q4 2024.
• Adjusted Operating Costs: Grew 6.5% in Q4 2024.
• Adjusted Diluted EPS: Increased $0.10 to $0.80 in Q4 2024.

Release Date: February 05, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• New York Times Co (NYSE:NYT) added over 1.1 million digital subscribers in 2024, furthering their goal of reaching 15 million total subscribers.
• Digital subscription revenue increased by 14%, driven by high subscriber engagement and growth in digital advertising, Wirecutter, and licensing.
• Adjusted operating profit grew by approximately 17% year-over-year, with margin expansion to 17.6%.
• Free cash flow generation was strong, amounting to approximately $381 million in 2024.
• The company announced an increase in the quarterly dividend from $0.13 to $0.18 and a new share repurchase authorization of $350 million.

Negative Points

• Print revenue continues to decline, partially offsetting growth in digital subscription and advertising revenues.
• Adjusted operating costs grew by 6.5% in the fourth quarter, slightly above the guidance range due to increased marketing investments.
• Some advertisers continue to avoid hard news topics, impacting advertising revenue potential.
• The company faces a dynamic and rapidly evolving ecosystem, which presents ongoing challenges.
• Despite strong digital growth, the company must continue to navigate the complexities of transitioning subscribers from promotional to higher prices.

Q & A Highlights

Q: How has the business changed since the last Analyst Day, and how should we think about long-term targets? A: Meredith Kopit Levien, CEO, emphasized confidence in their strategy to be the essential subscription. The strategy is working as designed, evident in strong engagement and revenue growth across digital subscriptions, advertising, and licensing. CFO William Bardeen added that they are on track to achieve midterm targets for subscriber growth and capital returns.

Q: Do you anticipate that bundled ARPU can grow sustainably from here? A: William Bardeen, CFO, stated that the primary driver of bundled ARPU growth is the step-ups in bundle and multi-product subscriptions. The strategy of improving journalism and products is leading to higher engagement and value, supporting a strong ARPU trajectory.

Q: How does the focus on growing the engaged pool across verticals translate into investments? A: Meredith Kopit Levien, CEO, highlighted opportunities to grow engaged audiences across the portfolio, including news, games, sports, cooking, and Wirecutter. Investments will focus on deploying journalists on important stories and expanding formats like video and audio to attract and engage users.

Q: What are the opportunities for digital advertising growth, particularly in lifestyle products? A: Meredith Kopit Levien, CEO, noted that there is more supply to roll out in lifestyle products, with strong demand from marketers. The Times has effective ad products, first-party data, and targeting capabilities, with opportunities in both direct sold and programmatic advertising.

Q: With a cash balance approaching $1 billion, how should we think about optionality and potential M&A? A: William Bardeen, CFO, explained that the cash balance provides strategic optionality in a dynamic ecosystem. While M&A is considered, there is a high bar for opportunities that align with the strategy and offer attractive returns. The focus remains on organic investment and returning at least 50% of free cash flow to shareholders.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.