After reporting strong results in early May, The New York Times Company (NYSE:NYT) saw its stock price rise throughout the month of June. The company saw increases in both profitability and circulation.
The news company saw first-quarter revenue of $0.13 compared to $0.08 in the same period a year ago. Operating profit increased to $34.1 million, up from $27.8 million in Q1 2017. The best news, however, might be the company's circulation gains, which CEO Mark Thompson explained in his remarks in the earnings release.
"The strong demand for the high quality, independent journalism that The Times produces resulted in a 139,000 net increase in digital-only subscriptions for the quarter," Thompson said. "We're seeing good retention of new cohorts of subscribers and continue to believe there is a big opportunity to further grow this increasingly important part of our business."
Subscription revenue, Thompson noted, "accounted for nearly two-thirds of the company's revenues and, as we continue to adapt our subscription model and introduce new products, we expect that trend to continue."
While the newspaper business has struggled, the Times has shown that it can transition from a print product into one that's largely consumed digitally. It's not fully there yet, but these numbers are encouraging and investors took note. After closing May at $22.71, shares of the company rose to $25.90 at the end of June, a 14% increase according to data provided by S&P Global Market Intelligence.
The Times has to show that it can keep growing revenue and that it can stabilize advertising. In Q1, ad revenue dropped by 2% overall and digital advertising dropped by 6%. Some of that has to do with Q1 last year, which contained strong post-election revenue.
It's also worth noting that the current political climate has likely helped the paper add subscribers. That may not be sustainable if the power structure shifts again, but it's likely to last through the term of the current president.
And while President Donald Trump likes to call The New York Times "failing," these numbers show that moniker isn't accurate. The paper might be called "struggling" or "adjusting," but it makes money and appears to be finding more solid footing for ongoing operations.