Net income jumps to $42.1 million from $5.4 million thanks to sales of regional newspapers
Print and digital revenue fell during the first quarter of 2012 at the New York Times Company due to sluggish advertising sales.
In an otherwise lackluster quarter, net income for the New York Times Co. jumped to $42.1 million or 28 cents per share, compared to $5.4 million or 4 cents per share in the same quarter last year.
The reason for the massive increase in profits was due to the sales of some of the company's regional newspapers and its stake in Fenway Sports Group, the owner of the Boston Red Sox.
Overall revenue for the media company was flat, dropping by 0.3 percent to $499.4 million for the period and just missing Wall Street's expectations. Analysts had projected revenue of $500.3 million. It was the fifth consecutive quarter in which the New York Times Company reported declining revenue.
Print advertising revenue fell 7.2 percent and digital advertising revenue dropped 10.3 percent.
Though the company has tried to diversify away from legacy media products and into the digital space in recent years, revenue from its online business was a weak spot on the quarterly balance sheet. Overall, digital revenue slid 23.1 percent to $23.9 million.
The media company ascribed the drop in online revenue to declines in cost-per-click advertising rates at About.com, the consumer advice site it acquired in 2005.
"Our readers have embraced digital subscriptions and we expect to build on this strong start as we embark on our second year of digital paid subscriptions," Arthur Sulzberger, Jr., chairman and chief executive officer of The New York Times Company, said in a statement. "At the same time, the uneven U.S. economic environment and uncertain global conditions continued to present challenges to the advertising marketplace.
One bright spot for media companies hoping that online readers will pay for access to content was the increase in the Times' digital subscriptions. Digital subscription packages for The Times and the International Herald Tribune jumped 16 percent since last quarter to 454,000. Paid digital subscribers to the company's BostonGlobe.com and The Boston Globe's e-readers and replica editions lagged behind that, but still jumped 13 percent to 18,000 since the fourth quarter of 2011.