Investors are excited about the latest earnings report from the New York Times (NYSE:NYT). The Times reported revenue and earnings that exceeded expectations before trading started on Wednesday. The company increased net income to $13.2 million, or 8 cents per share, in the first quarter. The Times recorded a loss of $8.3 million, or 5 cents per share, in the same period a year earlier. On an adjusted basis, the company earned 11 cents per share.
The company posted revenue of $398.8 million in the period, topping the $379.5 million reported for the same period last year. It was its biggest quarterly revenue growth in six years. Operating costs rose 4.5 percent to $367.4 million in the quarter.
In the first quarter, the New York Times added a record number of digital subscribers, adding 308,000 new subscribers in the period. It was its best quarter since it began offering digital-only subscriptions in 2011. The company reported gaining 276,000 new digital subscribers in the previous quarter.
New York Times CEO Mark Thompson said that “there is no question we have got some rocket fuel in the subscription business in recent quarters.” Thompson also noted that digital subscriptions were accelerating even before the 2016 presidential election took over the news cycle.
The New York Times has been investing heavily to boost its digital offerings, focusing on mobile devices, brand marketing, and new services to attract readers. The Times’ new “Truth” campaign urges readers to sign up in order to support its fair and accurate reporting. Thompson said of the campaign, “Even the President of the United States was kind enough to draw attention to it.”
Digital-only subscription revenues were 40 percent higher than the first quarter of 2016 while advertising revenue for digital was 19 percent higher. Digital ads now make up 38 percent of total ad revenue and rose 18.9 percent year over year to $49.7 million. The company also reported that its quarterly circulation revenue increased by 11.2 percent. However, print ad revenue declined by 17.9 percent to $80.4 million.
Thompson said, “These results show the current strength and future potential of our digital strategy not just to reach a large audience, but also to deliver substantial revenue.” Thompson also noted a number of new hires at the company this quarter, including Wall Street Journal veteran Rebecca Blumenstein and Bloomberg Businessweek’s Ellen Pollock. The company has plans to recruit even more talent in the current quarter.
Investors pushed the stock 11 percent higher in morning trading, reaching $15.90 a share. The company’s shares have increased about 20 percent since the beginning of the year and have risen 28 percent in the past 12 months.