February 6, 2014 / 1:55 PM / 4 years ago

UPDATE 2-Digital ad trends improve at N.Y. Times; shares rise

By Jennifer Saba
    Feb 6 (Reuters) - The New York Times Co reported
better-than-expected quarterly revenue and profit on Thursday as
advertising sales improved and more subscribed to its flagship
    Shares of the New York Times rose 5.3 percent to $14.58 in
Thursday morning trade after results were released.
    The company, which is now comprised of its namesake
newspaper only has struggled in recent quarters as advertisers
pulled back spending. 
    But during the fourth quarter, the company made some
progress, especially with digital advertising revenue.
    Print and digital advertising revenue decreased 1.6 percent
and 0.2 percent respectively excluding an extra week in the
fourth quarter 2012. That is an improvement from the third
quarter, when digital advertising revenue fell 3.4 percent.
    The company said it expects advertising revenue to trend at
the same level this quarter as in the fourth quarter.
    The New York Times had been particularly hit by changing
trends in digital advertising - once a bright spot - as
advertising exchanges drove the price of ads down.
    New York Times CEO Mark Thompson said in a statement that
advertising revenue had the best quarterly performance in more
than three years. 
    To help mitigate the drain of print advertising, the New
York Times rolled out a digital subscription pay model that is
nearing its third year anniversary.
    Subscription revenue grew 2.7 percent to $207.6 million and
now represents more than 45 percent of total revenue.
    Revenue from digital-only subscription packages increased
13.7 percent to $39.1 million. The company plans to launch a new
tier of digital subscriptions to help attract new readers this
    Evercore analyst Doug Arthur said the new packages could be
a "game changer" for the company, especially the "lower costs
    Total fourth quarter revenue fell 5.2 percent to $443.9
million, beating analysts estimates for $441 million, according
to Thomson Reuters I/B/E/S.
    Excluding an extra week in the same period last year, total
revenue inched up 0.4 percent. 
    Net income from continuing operations fell to $38.6 million,
or 24 cents per share, from $118 million, or 76 cents per share,
in the same period a year earlier.
    Excluding special items such as the sale of employment
website Indeed.com in the fourth quarter of 2012, earnings per
share were 26 cents compared with analysts' forecast of 16

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