The New York Times Co. ( NYSE: NYT ) rose 14% and tagged a 10-month high Wednesday as it again beat profit expectations on continuing growth in its online subscriber base.
It's the stock's first double-digit one-day gain since last August, when it rose 10% on activist speculation .
Revenues grew by double digits (to $667.5M), with a slower increase in ad revenues boosted by a near-18% boost to subscriptions.
Earnings per share grew year-over-year on an as-reported basis and an adjusted basis. Adjusted operating profit rose to $141.8M from $109.3M as the higher digital sub revenues (and an extra six days in the quarter) more than offset operating losses at The Athletic.
It reported 240,000 net digital-subscriber additions - more than a million adds for 2022, and landing at 8.8M digital subscribers in sum. The year marked its second-best for net digital adds, behind only the COVID-19 pandemic year of 2020.
The company credited its recent push for bundling core news with its games, cooking and podcast products.
"Importantly, with each passing quarter, we saw more proof that there is strong demand for a bundle of our news and lifestyle products, hitting records on both total bundle volume and the share of new subscribers choosing the bundle," said CEO Meredith Kopit Levien.
That marks "meaningful momentum" toward a goal of 15M subscribers by the end of 2027, she said, though "our path to getting there is unlikely to be linear."
The company also boosted its dividend by 22% and approved a new $250M share buyback program. The company says it will return at lease 50% of its free cash flow to shareholders via dividends and buybacks over the coming 3-5 years.
On the company's earnings commentary, Kopit Levien pointed out that more than 30% of new subscribers were taking the company's bundled offering - about six times more than in the prior year.
As for The Athletic, acquired just over a year ago, "our focus continues to be on building engagement for The Athletic as part of The Times bundle; significantly widening its audience funnel by further opening its hard paywall; and increasing overall awareness for The Athletic’s journalism," she said.
In 2023, the company plans to lean further into two areas intended to "press our advantage," she said. First is growing audience share, and second, "we’re intently focused on increasing [average revenue per user] through continued success at transitioning subscribers from promotions to full price, driving bundle uptake, and experimenting with price increases on individual products for tenured subscribers."
For further details see:
New York Times stock leaps 14% as digital growth paces earnings beat