Core Viewpoint - The New York Times Co. reported strong Q4 earnings with notable digital growth and resilient multi-revenue streams, despite facing challenges in print advertising and rising operating costs [1][2]. Financial Performance - Adjusted earnings per share (EPS) for Q4 2024 were $0.80, exceeding analysts' consensus of $0.75, while total revenue was $726.6 million, slightly below the estimate of $726.8 million [1][3]. - Year-over-year revenue growth was 7.5%, up from $676.2 million in Q4 2023 [3]. - Digital-only subscription revenue increased by 16% year-over-year to $334.9 million [3][7]. - Adjusted operating profit rose to $170.5 million, a 10.7% increase from the previous year [3][8]. - Digital advertising revenue grew by 9.5% to $117.9 million, aided by The Athletic's contribution [3][7]. Subscriber Growth - The company added approximately 350,000 net new digital-only subscribers in Q4, bringing the total to 11.43 million, an annual increase of 1.10 million [6]. - Digital-only average revenue per user (ARPU) increased by 4.4% to $9.65, driven by pricing adjustments [6]. Operational Insights - Operating costs increased by 6%, with marketing and sales expenses rising by 21.3% due to higher promotional activities [8]. - The company faced a 7.1% decline in print subscription revenue, consistent with industry trends towards digital preferences [7]. Strategic Focus - The New York Times Co. emphasizes digital transformation, focusing on increasing digital subscriptions and diversifying content offerings beyond traditional news [4]. - Investments in technology, particularly data management, are crucial for enhancing user engagement and operational efficiency [5]. Future Outlook - The company forecasts digital-only subscription revenue growth of 14% to 17% for Q1 2025, with a mid-single-digit increase anticipated in other revenue streams [12]. - Adjusted operating costs are expected to grow by 5% to 6%, reflecting planned investments in technology and content enhancements [12]. - The company plans to reward shareholders with a 38% increase in dividends and has approved a $350 million Class A share repurchase program [10].

Core Insights - New York Times Co. reported quarterly earnings of $0.80 per share, exceeding the Zacks Consensus Estimate of $0.74 per share, and showing an increase from $0.70 per share a year ago, resulting in an earnings surprise of 8.11% [1] - The company achieved revenues of $726.63 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.22% and increasing from $676.22 million year-over-year [2] - New York Times shares have increased approximately 7.4% since the beginning of the year, outperforming the S&P 500's gain of 2.7% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.32 on revenues of $634.52 million, while for the current fiscal year, the estimate is $2.05 on revenues of $2.74 billion [7] - The estimate revisions trend for New York Times is favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Publishing - Newspapers industry, to which New York Times belongs, is currently ranked in the bottom 15% of over 250 Zacks industries, which may impact stock performance [8] - Another company in the same industry, Lee Enterprises, is expected to report a quarterly loss of $0.40 per share, reflecting a significant year-over-year decline of 433.3% [9]

Subscriber Growth - The New York Times Company added approximately 350,000 net digital-only subscribers in Q4 2024, bringing the total to 11.43 million subscribers[4] - Average number of digital-only subscribers reached 10.8 million in Q4 2024, up from 9.7 million in Q4 2023[53] - Digital-only subscribers for The Athletic increased to 5,830 in Q4 2024, up from 4,650 in Q4 2023, representing a growth of 25.2% year-over-year[57] Revenue Growth - Digital subscription revenues grew 16.0% year-over-year to $334.9 million, contributing to an overall subscription revenue increase of 8.4% to $466.6 million[11] - Total revenues for Q4 2024 increased 7.5% to $726.6 million compared to $676.2 million in Q4 2023[15] - The New York Times Group revenues grew 6.1% in Q4 2024 to $677.5 million, with subscription revenues increasing 7.6% to $434.4 million[21] - The Athletic revenues grew 29.0% in Q4 2024 to $49.7 million from $38.5 million in Q4 2023, with subscription revenues up 19.8% to $32.2 million[24] Profitability - Operating profit increased 13.6% year-over-year to $146.6 million, with an operating profit margin of 20.2%[4] - Adjusted diluted earnings per share for Q4 2024 was $0.80, a $0.10 increase year-over-year[4] - NYTG adjusted operating profit increased 5.4% to $167.0 million from $158.4 million in Q4 2023, driven by higher digital subscription and advertising revenues[23] - Adjusted operating profit for The Athletic increased to $3.5 million from a loss of $4.4 million in Q4 2023, primarily due to higher digital subscription and advertising revenues[26] Costs and Expenses - Total operating costs increased 6.0% year-over-year to $580.0 million, with adjusted operating costs rising 6.5% to $556.2 million[16] - Total adjusted operating costs for The New York Times Company rose to $556,161,000 in Q4 2024, a 6.5% increase from $522,259,000 in Q4 2023[67] - The Athletic's adjusted operating costs increased by 7.6% to $46,214,000 in Q4 2024, compared to $42,930,000 in Q4 2023[67] Cash Flow and Financial Position - Net cash provided by operating activities in 2024 was $410.5 million, compared to $360.6 million in 2023, while free cash flow increased to $381.3 million from $337.9 million[31] - As of December 31, 2024, the company had cash and marketable securities of $911.9 million, an increase of $202.7 million from $709.2 million a year earlier[30] - The company repurchased 453,080 shares for approximately $24.7 million in Q4 2024, with $155.7 million remaining authorized for repurchases[32] Future Outlook - The company expects digital-only subscription revenues to increase by 14-17% in Q1 2025 compared to Q1 2024, while total subscription revenues are projected to rise by 7-10%[36] - The company continues to focus on product development and marketing, with significant investments in subscriber servicing expenses allocated to The Athletic[61] Special Items and Adjustments - The company reported Generative AI Litigation Costs of $3,208 in Q4 2024 and $10,800 for the full year 2024, which are considered special items[78] - Non-operating retirement costs were excluded from adjusted results to provide better transparency regarding the company's operating performance[73] - The company plans to exclude Generative AI Litigation Costs from future operating performance metrics starting Q1 2024, as they are deemed outside the ordinary course of operations[71] Dividends and Shareholder Returns - The Board approved a $350 million Class A share repurchase program and declared a 5 cent increase in the dividend to $0.18 per share[4] - Dividends declared per share increased by 18.2% to $0.13 in Q4 2024, compared to $0.11 in Q4 2023[46]

Core Viewpoint - The New York Times Company (NYT) is expected to report its fourth-quarter 2024 earnings on February 5, with a focus on subscription growth, advertising revenue patterns, and recent strategic initiatives [1] Financial Performance - The Zacks Consensus Estimate for fourth-quarter revenues is $725.1 million, reflecting a 7.2% increase from the previous year [1] - The consensus estimate for earnings per share (EPS) is 74 cents, indicating a 5.7% rise year-over-year [2] - NYT has a trailing four-quarter average earnings surprise of 27.1%, having surpassed EPS estimates by 7.1% in the last quarter [2] Subscription Growth - The company emphasizes subscription growth and digital innovation, which have been key to its sustained progress [4] - Subscription revenues are projected to reach $466.3 million, suggesting an 8.3% growth, with digital-only subscription revenues estimated at $333.3 million, indicating a 15.5% increase [7] - The digital-only subscriber count is expected to reach 10.9 million by the end of the fourth quarter, enhancing its market position [8] Advertising Revenue - NYT is reducing reliance on traditional advertising, focusing on digital avenues, with digital advertising revenues estimated at $118.3 million, reflecting a 9.8% increase [9] - Management anticipates high-single-digit to low-double-digit growth in digital advertising revenues [9] Challenges - Print subscription revenues are expected to decline, with estimates at $132.9 million, down 6.2%, and print advertising revenues projected to fall 12.9% to $49.1 million [10] - Increased spending on product development, marketing, and administrative functions may impact margins, with adjusted operating costs expected to rise by 5-6% for the quarter [10]

Zacks Premium and Style Scores Overview - Zacks Premium offers tools like daily updates of Zacks Rank and Zacks Industry Rank, full access to the Zacks 1 Rank List, Equity Research reports, and Premium stock screens to help investors make informed decisions [1] - Zacks Style Scores are complementary indicators that help investors pick stocks likely to outperform the market over the next 30 days, with ratings from A (best) to F (worst) based on value, growth, and momentum characteristics [2] Style Score Categories - **Value Score**: Focuses on identifying undervalued stocks using metrics like P/E, PEG, Price/Sales, and Price/Cash Flow ratios [3] - **Growth Score**: Analyzes a company's future prospects and financial health, considering projected and historic earnings, sales, and cash flow [4] - **Momentum Score**: Identifies stocks with upward or downward trends using factors like one-week price change and monthly percentage change in earnings estimates [5] - **VGM Score**: Combines Value, Growth, and Momentum Scores to provide a comprehensive indicator for stock selection [6] Zacks Rank and Style Scores Integration - Zacks Rank uses earnings estimate revisions to help investors build successful portfolios, with 1 (Strong Buy) stocks delivering an average annual return of +25.41% since 1988, outperforming the S&P 500 [7][8] - Over 800 stocks are rated as 1 (Strong Buy) or 2 (Buy) on any given day, making it challenging to select the best stocks without additional tools like Style Scores [9] - Stocks with a Zacks Rank 1 or 2 and Style Scores of A or B offer the highest probability of success, while 3 (Hold) stocks should also have A or B scores for maximum upside potential [10] - Stocks with a 4 (Sell) or 5 (Strong Sell) rating, even with high Style Scores, are likely to underperform due to downward-trending earnings outlooks [11] Case Study: New York Times Co (NYT) - NYT is a diversified media company with a Zacks Rank of 2 (Buy) and a VGM Score of B, making it a strong candidate for momentum investors [12] - NYT shares have risen 2.9% over the past four weeks, with a Momentum Style Score of B and an average earnings surprise of 27.1% [12][13] - One analyst revised their earnings estimate higher for fiscal 2024, and the Zacks Consensus Estimate increased to $1.84 per share [13]

Core Insights - The New York Times Company (NYT) is currently trading at a forward 12-month price-to-earnings (P/E) ratio of 25.19, which is below the industry average of 27.69, raising questions about whether the stock is undervalued or reflects underlying challenges [1][12] Company Performance - NYT shares have declined by 5.2% over the past three months, slightly underperforming the industry's 4.7% drop, which may have contributed to its discounted trading status [3] - The company has successfully leveraged enhanced subscription offerings and technological advancements to broaden its audience base, despite facing challenges from declining print advertising revenues [3][6] Subscriber Growth and Revenue - NYT has made significant strides in growing its subscriber base, which is a key driver of revenue expansion, particularly through digital subscriptions [6][10] - Management projects a 7-9% year-over-year increase in total subscription revenues for the fourth quarter, with digital-only subscription revenues expected to rise by 14-17% [9] - The digital-only subscriber count is anticipated to reach 10.9 million by the end of the fourth quarter, enhancing its market standing and attractiveness to advertisers [10] Digital Advertising Focus - The company is reducing its dependence on traditional advertising by focusing on digital avenues, with management guiding for high-single-digit to low-double-digit growth in digital advertising revenues for the final quarter [11][12]

Company Performance - New York Times Co. (NYT) has returned about 0.1% year-to-date, outperforming the Consumer Staples sector, which has returned an average of -4.4% [4] - The Zacks Consensus Estimate for NYT's full-year earnings has moved 0.3% higher in the past quarter, indicating improving analyst sentiment and a positive earnings outlook trend [4] Industry Context - NYT is part of the Publishing - Newspapers industry, which includes 2 companies and currently ranks 218 in the Zacks Industry Rank; this industry has gained an average of 9.5% year-to-date, indicating that NYT is slightly underperforming its industry [6] - In contrast, United Natural Foods (UNFI), another Consumer Staples stock, has returned 3.4% year-to-date and belongs to the Food - Miscellaneous industry, which is ranked 203 and has moved -11.3% year-to-date [5][6] Zacks Rank - NYT currently holds a Zacks Rank of 2 (Buy), which suggests it has characteristics to outperform the market over the next one to three months [3] - The Zacks Rank system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks, which applies to NYT [3]

Core Insights - The New York Times Company has successfully transitioned to a digital subscription model, driving significant revenue growth and reducing reliance on volatile advertising revenues [2][5][10] Subscription Revenue Growth - Subscription revenues reached $453.3 million in the third quarter, reflecting an 8.3% year-over-year increase [1] - Digital-only subscription revenues surged by 14.2% to $322.2 million, indicating strong demand for bundled and multi-product offerings [1] Future Expectations - The company anticipates continued growth in subscription revenues for the fourth quarter of 2024, projecting an increase of 7-9% overall and 14-17% for digital-only subscriptions [2] Subscriber Base - As of the end of the third quarter of 2024, The New York Times Company had approximately 11.09 million subscribers, with 10.47 million being digital-only subscribers [7] - The company added 260,000 net digital-only subscribers compared to the previous quarter, demonstrating a steady growth trajectory [7] Average Revenue Per User (ARPU) - The digital-only average revenue per user (ARPU) increased to $9.45 in the third quarter from $9.28 in the same period last year, driven by subscribers moving to higher rate plans [8] Strategic Focus - The New York Times has expanded its digital ecosystem to include various content types, contributing to overall subscription growth and enhancing its market position [5][6][10] - The company's strategy includes offering diverse subscription packages, which has been crucial for expanding its reach and building a loyal subscriber base [6]

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Company Overview - The New York Times Company (NYT) operates as a diversified media company, encompassing newspapers, internet businesses, and other investments [12]. Zacks Rank and Style Scores - NYT holds a Zacks Rank of 3 (Hold) with a VGM Score of B, indicating a moderate investment potential [13]. - The Growth Style Score for NYT is A, forecasting a year-over-year earnings growth of 12.9% for the current fiscal year [13]. - Analysts have revised NYT's earnings estimate upwards, with the Zacks Consensus Estimate increasing by $0.01 to $1.84 per share [13]. - NYT has an average earnings surprise of 27.1%, suggesting a strong performance relative to expectations [13]. Investment Potential - With a solid Zacks Rank and top-tier Growth and VGM Style Scores, NYT is recommended for investors seeking growth opportunities [14].