For The New York Times Company the first quarter of this year has been the best quarter in history when it comes to digital subscriptions. The Times gained more digital subscribers during the first quarter of this year compared to any quarter since 2011 when it started charging readers for its online content. The Times was able to set this record despite the fact that it is allowing audiences to access the majority of its coverage related to the coronavirus outside of its pay model.
During the first quarter of 2020 The Times added 587,000 net new digital subscriptions, resulting in the highest number of net new subscriptions in a quarter in its history. Of the 587,000 net adds, 468,000 were to its core news product, with 119,000 to other digital products. As of the end of April, The Times has more than four million subscriptions to its digital-only news product; more than five million digital-only subscriptions in all; and more than six million total subscriptions across digital and print.
“The Times’s business model, with its growing focus on digital subscription growth and diminishing reliance on advertising, is very well positioned to ride out this storm and thrive in a post-pandemic world. We’ve seen historic audience levels and an unprecedented rate of subscriber growth as well as real pressure on advertising revenue,” Mark Thompson, president and chief executive officer, The New York Times Company, said.
Despite the record number of subscriptions, the company’s operating profit decreased to USD 27.3 million in the first quarter of 2020 from USD 34.6 million in the same period of 2019. This is because the higher digital-only subscription and other revenues were more than offset by lower advertising revenues and higher costs.
“We saw advertising fall rapidly towards the end of the quarter and believe that advertising in the second quarter will fall between 50% and 55% compared to a year ago with limited visibility beyond that,” Thompson said.
First-quarter digital advertising revenue decreased 7.9%, while print advertising revenue decreased 20.9%. Digital advertising revenue was USD 51.2 million, or 48.2% of total company advertising revenues, compared with USD 55.5 million, or 44.4%, in the first quarter of 2019. Print advertising revenue decreased as the COVID-19 pandemic further accelerated, largely impacting the luxury, media, entertainment and financial categories.
The Times expects the trend of increasing digital subscription to continue. It expects total subscription revenues in the second quarter of 2020 to increase in the mid- to high-single digits compared with the second quarter of 2019, with digital-only subscription revenue expected to increase in the high-twenties.