The New York Times Co. added new digital subscribers at a record rate as the coronavirus spread in the first quarter, helping offset shrinking ad revenues.
The newspaper publisher said it was "well positioned to ride out this storm and thrive in a post-pandemic world" because of its shift to relying more on subscriptions from readers than on advertising. While the Times and a few other national publishers like the Wall Street Journal have successfully built up digital subscription models, local news publishers are largely struggling to do so.
Many news organizations are cutting pay, jobs or even shutting down as advertising craters. On a conference call Wednesday morning, Times CEO Mark Thompson said the Times will also have to cut costs and a "comparatively small number" of jobs in the coming months, although he said the company would not cut newsroom positions.
For the Times, advertising sales fell 15.2% in the first quarter, to $106.1 million, despite a surge in traffic to its website that led to record online audience numbers. The company said that in March, more than half of U.S. adults visited its site. Readers viewed 2.5 billion pages, nearly double the normal statistics. More traffic would usually lead to more ad revenue, but advertisers are pulling or halting campaigns. The company expects a huge decline of 50% to 55% in ad revenues in the current quarter.
The Times said it added 587,000 new digital subscriptions in the first quarter, with more than 5 million digital subscriptions and more than 6 million total across digital and print. Subscription revenue rose 5.4% to $285.4 million and the company expects growth to continue in the current quarter.
First-quarter profit rose 8.9% to $32.9 million, or 20 cents per share. Revenue rose 1% to $443.6 million.
Shares rose 6.5% to $35.54 in morning trading. New York Times shares have climbed almost 4% since the beginning of the year.