Because fourth-quarter advertising revenue did not meet market expectations, the New York Times' stock price fell by more than 10% on the day of the earnings report. Before the market opens on February 7, local time, the New York Times (Nasdaq: NYT) announced its fourth fiscal quarter results for fiscal year 2023 as of December 31, 2023. Fourth fiscal quarter revenue was US$676.2 million, an increase of 1.3% from the same period last year, slightly lower than market expectations of US$678.5 million; non-GAAP diluted net income per share (EPS) was US$0.70.
The New York Times’ full-year revenue in 2023 was US$2.426 billion, a year-on-year increase of 5.1%, and digital subscription revenue was US$1.099 billion, exceeding the US$1 billion mark for the first time.
The New York Times predicts that in the next fiscal quarter, the company's digital subscription revenue will increase between 11% and 14% year-on-year, and total subscription revenue will increase between 7% and 9% year-on-year.
The New York Times Performance Overview. Source: "New York Times" financial report
In the fourth quarter, although digital subscription revenue increased by 7.2% year-on-year to US$288.7 million, in terms of closely watched advertising revenue, the New York Times' total advertising revenue fell by 8.4% to US$164.1 million. Among them, digital advertising sales fell by 3.7% in the quarter to US$107.7 million, compared with US$111.9 million in the same period last year; print advertising sales fell by 16.2%.
William Bardeen, chief financial officer of The New York Times, said on the call that the company's advertising market is expected to continue to face uncertainty, especially in terms of declining sales of print advertising, and that "advertising and partnership revenue is subject to seasonal effects, and its growth will be concentrated in the second half of the year."
Meredith Kopit Levien, CEO of The New York Times, said on a post-earnings call: "The performance of our digital products, including podcasts, has been affected by marketers avoiding some hard news topics, such as conflicts in the Middle East."
The New York Times stated that as of the fourth quarter of 2023, it had a total of approximately 10.36 million paid subscribers, slightly lower than analysts' expectations of 10.37 million; of which, there were approximately 9.7 million digital subscribers, with an increase of approximately 300,000 in the fourth quarter; the company has set a goal to reach 15 million subscribers by 2027. The number of print media subscribers of The New York Times has dropped to 660,000 by the end of 2023.
As news media goes through difficult times, the New York Times has become a bright spot in the industry by actively promoting digitalization and strengthening digital marketing cooperation. Shares of The New York Times have risen 51% over the past year.
On the 7th, the share price of the New York Times fell by more than 10%; on February 8, the company's share price closed down 2.71% to US$43.74 per share, with a total market value of US$7.191 billion.
On December 27, 2023, the New York Times sued OpenAI and Microsoft for copyright infringement, saying that the defendants should be responsible for the "illegal copying and use of the New York Times' unique and valuable works" and the related "statutory and actual losses worth billions of dollars", and required the two companies to destroy any chatbot models and training data that use the New York Times' copyrighted materials.