The New York Times Company (NYT - Free Report) has come a long way from being a sole provider of news content and advertising on print publications. The company is no longer restricted to print. As readers swarmed to the Internet, advertisers followed suit and so did newspaper companies. Trimmed print operations paved way for online publications that led to the development of paywalls.
Industry experts cited that focus on new avenues of revenue generation is necessary to counter the dwindling print advertising revenues. Surely, The New York Times Company has succeeded in this space. The company’s efforts in this direction have led the stock surge roughly 37.4% in the past six months, outperforming the industry’s growth of 18.9%.
The company is fast acclimatizing to the changing face of the multiplatform media universe and has already included mobile and reader application products in portfolio. The company had earlier highlighted that it intends to double its pure-play digital revenues to at least $800 million by 2020.
The New York Times Company is concentrating on online activities, as evident from its pay-and-read model. It has also launched The New York Times Crossword app for Android users, whereby subscribers have access to the daily puzzle and the daily Mini puzzles.
The company recently declared that it has now more than 400,000 standalone subscribers to The New York Times Crossword. The company notified that the number of paid digital subscribers reached 2,783,000 at the end of the first quarter of 2018 — rising 139,000 sequentially and 25.5% year over year. Of the 139,000 subscriptions, 99,000 came from digital news products, while the balance came from Cooking and Crossword products.
Subscription revenue grew 7.5% during the first quarter, primarily due to increase in the number of subscriptions to the digital-only products. Revenue from digital-only subscriptions products surged 25.8%. Management now projects total subscription revenue in the second quarter of 2018 to increase in the mid-single digits.
The New York Times Company is not only gearing up to become an optimum destination for news and information but is also now focusing on service journalism, with verticals like Cooking, Watching and Well. In this regard, it acquired The Wirecutter and its sister site, The Sweethome that recommends people about technology gear, home products and other consumer services. The company also acquired a digital marketing agency and portfolio company, HelloSociety, from Science Inc., which complements its T Brand Studio that helps in creating digital ad innovation and branded content. Further, it has launched digital subscriptions for NYT Cooking, its popular recipe site and app.
The New York Times Company is diversifying business, adding new revenue streams, strengthening balance sheet and restructuring portfolio. It had offloaded assets in order to re-focus on its core newspapers and pay more attention to online activities.
Other publishing companies such as New Media Investment Group Inc. (NEWM - Free Report) , Gannett Co., Inc. (GCI - Free Report) and The McClatchy Company (MNI - Free Report) are also trying to adapt to different revenue generating ways.
The New York Times Company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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