The New York Times Company reached its goal of 10 million subscriptions ahead of schedule, the company said Wednesday, aided substantially by the 1.2 million it gained by buying the sports news website The Athletic.
The $550 million deal for The Athletic, which was announced last month, was completed on Tuesday, the company said.
In the final three months of 2021, before the Athletic acquisition, The Times added 375,000 digital subscriptions, the company said in its quarterly earnings report. Those additions included 171,000 to its core news product, meaning the majority were for The Times’s other digital offerings: Games, which includes crosswords; Cooking, its recipes app; Wirecutter, its product-recommendation site; and Audm, which produces audio versions of text-based journalism.
By the last week of December, The Times had almost 8.8 million subscriptions. Nearly 5.9 million were for digital news, more than two million were for the other digital products, and a shade under 800,000 were for the print newspaper.
The Times also announced a new goal on Wednesday: It will aim, it said, to have at least 15 million subscribers by the end of 2027.
One subscriber may account for more than one subscription. The subscriber metric, which will be included in The Times’s next earnings report, reflects the company’s desire to market a bundle of several digital subscriptions as a one-stop shop not only for news but other diversions and needs. At the end of last year, the company said, The Times had approximately 7.6 million subscribers paying for the 8.8 million subscriptions.
Meredith Kopit Levien, the company’s president and chief executive, said in a statement that The Times’s executives believed there were “at least 135 million” potential subscribers in the United States and around the world — adults “paying or willing to pay for one or more subscriptions to English-language news, sports coverage, puzzles, recipes or expert shopping advice.”
The Times established its earlier goal, of 10 million subscriptions by 2025, three years ago, when it had 4.3 million. As subscriptions to The Times’s core digital news app continued to grow and as Games and Cooking each amassed more than one million subscriptions, it became apparent the company would surpass the goal early.
Then, last month, The Times said it would buy The Athletic, whose 400 journalists cover more than 200 sports teams in the United States, Britain and Europe, in an all-cash deal worth $550 million. The Times said Wednesday that the deal had been financed by “cash on hand,” meaning without borrowing money.
In addition to closing on The Athletic, The Times said this week that it was acquiring the viral online puzzle Wordle, which will be added to the Games app (and remain free, at least initially).
For the fourth quarter of 2021, the company reported adjusted operating profit of $109.3 million, a 12 percent increase from a year earlier, and revenue of $594.2 million, a 16.7 percent rise. Operating costs rose at virtually the same rate, to $500.1 million. Subscription revenue rose about 11 percent, to $351.2 million.
For the year, revenue grew 16.3 percent, to $2.1 billion — making 2021 The Times’s first $2 billion year since 2012. Operating costs were up 12.2 percent, to $1.8 billion. While subscription revenue grew 13.9 percent, to $1.4 billion, the year also represented a rebound for advertising, where revenue grew to $497.5 million, a 26.8 percent increase from 2020, though still 6.2 percent less than it brought in before the pandemic, in 2019.
The company said it expected subscription revenue to increase 11 to 15 percent in the current quarter, which includes two months with The Athletic as part of the company. The Times added that it expected digital subscription revenue to rise 23 to 28 percent and ad revenue to gain 17 to 21 percent. Costs will rise 18 to 22 percent, the company said.
The company’s board of directors raised the dividend 2 cents per share, to 9 cents, and authorized a $150 million stock repurchase, the company said. While the buyback will affect only Class A shares, which are available to the public, the dividend will apply both to those shares and to Class B shares, which are primarily owned by the Ochs-Sulzberger family that controls The Times.