Ukraine War, Wordle Help New York Times Draw More Subscribers

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News company’s profit drops 89% on Athletic-related acquisition costs

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During the company’s earnings call, Chief Executive Meredith Kopit Levien said coverage of the war in Ukraine helped bolster engagement and subscriptions, but the conflict also weighed on its advertising business because she said it led some marketers to pull back. She said the company’s 13% digital-advertising growth was lower than expected, in part due to reduced spending by technology advertisers. It was somewhat offset by an influx of print-advertising spending from entertainment and luxury advertisers, Ms. Kopit Levien said. Print advertising grew by 31%.

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“While we experienced real momentum in news, it was not the only driver of strength in the quarter,” Ms. Kopit Levien said. “Wordle brought an unprecedented tens of millions of new users to The Times, many of whom stayed to play other games which drove our best quarter ever for net subscriber additions to Games.” She also said the company’s work with the Athletic was “off to a great start.”

In the second half of the year, the company plans to include the Athletic in a broader Times subscription bundle, it said, as well as introduce new ad products for the Athletic, which has largely been a subscription-driven business.

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Net profit decreased 89% to $4.7 million, or 3 cents a share, from $41.1 million, or 24 cents a share, a year earlier, weighed down by $34.7 million in pretax costs related to the company’s acquisition of the Athletic. Revenue rose 14% to $537.4 million.

New York Times shares were 2.6% higher in early trading Wednesday.

Subscription revenue increased 13% to $372 million. The company didn’t break down the number of subscribers to its digital products including Games, Cooking and Wirecutter, a product-recommendation website, which costs less than the company’s core-news offering. Last quarter, the Times said that for the first time, its lower-cost digital products attracted more new digital subscriptions than its core news product.

Advertising revenue rose 20% to $116.3 million. Other revenue—which includes live events, commercial printing and television series—increased 5% to $49.2 million.

The company last quarter surpassed 10 million subscriptions ahead of its stated goal of reaching that target by 2025, thanks in part to its recent $550 million acquisition of the Athletic. The news organization set a new target of at least 15 million total subscribers by year-end 2027.

Write to Alexandra Bruell at [email protected]

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Credit: www.wsj.com /

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