The New York Times Company (NYT) reported earnings of $0.03 a share in the third quarter of 2014, exceeding Wall Street forecasters that predicted the paper to break even. Digital advertising was a big part of the company's success, with online advertising rising 17 percent to help minimize losses in print.
Operating profit fell to $4 million, down from $12.9 million in the previous third quarter. The company cited severance pay expenses for workplace reductions as a factor in the dip. Adjusted operating profit fell to $40 million compared with $45 million during last year's third quarter.
The Times also beat Wall Street's expectations on revenues. Total revenues rose less than 1 percent to $364.7 million from $361.7 million. Forecasters predicted revenues of $357 million. Circulation revenues grew 1.3 percent and other revenues increased 2.7 percent, but advertising revenues declined 0.1 percent. Print advertising revenue slipped 5.3 percent, while digital advertising revenue increased nearly 17 percent.
44,000 new online subscribers were added, and combined online and print ad revenue remained little unchanged at $137.9 million.
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"Our third-quarter performance was better than we anticipated, reflecting broad digital strength that more than offset print revenue declines, leading to overall revenue growth of approximately 1 percent," said President and CEO Mark Thompson. "Digital advertising revenue saw its third consecutive quarter of positive growth - up nearly 17 percent year-over-year - and print advertising revenue rallied in September as well, putting overall advertising revenues at roughly flat, despite a difficult prior-year comparison. Our solid year-to-date digital advertising performance is the result of deliberate execution on our strategic plan, including the introduction of Paid Posts, recent investments in areas such as video, growth on the smartphone platform and the momentum of our restructured advertising team."
"On the digital subscription side, we finished the quarter with 44,000 net new additions, a 20 percent year-over-year increase and our best quarterly result in nearly two years, with our core products making the larger contribution to the total this time around. We saw strength across all marketing channels, most notably in the consumer education and international segments. This week we announced a reorganization that is intended to accelerate the development of our digital consumer business by creating separate marketing and digital divisions. Our audience development efforts also remain a top priority, with the goal of extending our already broad reach and deepening the engagement of our readers."
"In addition to our revenue-generating initiatives, we recently announced some cost-cutting efforts, as we focus on strengthening our operating efficiencies while continuing to safeguard our unparalleled journalism and invest in our digital products and initiatives."