The New York Times Company (NYT) Q4 2016 earnings summary

Executive summary

• 2016 marked continued digital transformation: paid print and digital subscriptions reached ~2.9 million at year-end and surpassed 3 million in early 2017.

• Subscription growth and digital advertising gains were offset by print advertising declines and higher costs; total revenue fell 1.5% and operating profit fell 25.6% YoY.

• Strategic priorities remain quality journalism, audience growth, digital innovation, cost discipline and long-term profitability.

Financial highlights

• Revenue was $1.555 billion, down 1.5% YoY; circulation rose 3.4%, advertising declined 9.1% and other revenue grew 6.0%.

• Operating profit was $101.6 million, down 25.6%; net income attributable to common stockholders was $29.1 million, down 54.0%.

• Diluted EPS from continuing operations was $0.19 vs. $0.38; adjusted diluted EPS, excluding severance, non-operating retirement costs and special items, was $0.57 vs. $0.71.

• Adjusted operating profit was $240.9 million vs. $289.0 million; adjusted operating costs rose 1.9% to $1.314 billion.

• Operating cash flow was $94.2 million vs. $175.3 million, reflecting higher tax and compensation payments, higher marketing costs and lower revenue.

Outlook and guidance

• Target remains doubling digital revenue by 2020, improving long-term profitability and increasing shareholder value.

• Election-related digital subscription growth came late in 2016; revenue from those additions is expected to be more fully reflected in 2017.

• Expected 2017 qualified pension contributions are ~$9 million; cash, marketable securities and operating cash flow are expected to cover financing needs over the next 12 months.

• Headquarters redesign and leasing of eight vacated floors are expected to generate significant rental income and create a more collaborative workplace.