The New York Times reported surprisingly strong profits despite declining ad sales on Thursday, and said revenue from online-only subscriptions surpassed its print revenue for the first time ever.
The Gray Lady, which like most media has gotten a boost in a quarter dominated by the presidential election and COVID-19, said it added 393,000 paid digital-only subscribers during the third quarter. Revenue from subscriptions rose 12.6 percent to $301 million, even as ad revenue dropped 30 percent to $79 million.
Advertising sales — which have been sapped by competition with Google and Facebook — have been especially unpredictable this year as companies slashed ad budgets to cope with a sharp drop in business due to coronavirus-led lockdowns.
Nevertheless, the Times said revenue from digital-only products surged 34 percent, to $155 million. Demand for news accounted for 275,000 new subscriptions during the quarter, while the balance was driven by the company’s sites for food, cooking, games, and audio products.
“The news cycle certainly played a role, but as we are increasingly seeing with each passing quarter, so too did the breadth of our coverage and our improving ability to mean more to more people,” chief executive Meredith Kopit Levien said.
The audio sites, however, hit a speed bump last month when the company admitted it was investigating one of its biggest podcast series, Caliphate, after one of its primary sources was arrested in Canada last month on charges of being a terrorist hoaxer.
The Times said its digital-only subscriptions took the lead in October, after the third quarter ended on Sept. 30, and said it expects digital-only subscription revenue to rise about 35 percent and ad sales to decline about 30 percent in the fourth quarter.
Total revenue slipped 0.4 percent to $426.9 million, but came in above analysts’ estimates of $411.8 million, according to IBES data from Refinitiv.
Excluding items, the company earned 22 cents per share, beating analysts’ estimates of 11 cents.