New York Times Shares Plummet 11% on Missed Q4 Forecasts

The New York Times (NYSE: NYT) shares took a nosedive on Wednesday, plummeting 11% in the morning session after the company reported fourth-quarter results that missed analysts' expectations. The newspaper and digital media giant added 350,000 net digital-only subscribers in the quarter, narrowly beating the FactSet consensus estimate of 300,000. However, this was below the 400,000 subscribers added in the previous quarter, indicating a slowdown in subscriber growth. Revenue of $726.6 million was just shy of the analyst expectation of $726.8 million, while adjusted earnings of 80 cents a share beat the FactSet consensus estimate of 75 cents a share.

The company's guidance for Q1 2025 indicates continued double-digit digital subscription revenue growth, but total advertising revenue could range from a slight decline to a small increase. This uncertainty in ad performance, combined with the slowdown in subscriber growth and revenue shortfall, has raised concerns among investors. Two analysts asked executives about a step-up in paid media expenses, which is the money the company uses to promote and advertise its news, sports, and gaming brands. This increase in expenses, combined with the slowdown in subscriber growth and advertising revenue, may have raised concerns about the company's ability to maintain its growth trajectory.



New York Times CEO Meredith Kopit Levien said the company has "confidence that we can deliver another year of healthy growth in subscribers, revenue, and profitability." However, the stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy The New York Times? Access our full analysis report here, it's free.

In conclusion, The New York Times' shares sank 11% on Wednesday after the company reported weak fourth-quarter results that missed analysts' expectations. The slowdown in subscriber growth, revenue shortfall, and uncertainty in ad performance raised concerns among investors. However, the company's guidance for Q1 2025 indicates continued double-digit digital subscription revenue growth, and its CEO expressed confidence in the company's ability to deliver another year of healthy growth. Investors should consider the company's long-term prospects and strategic initiatives to improve its advertising revenue and subscriber growth before making a decision on whether to buy the stock.