NYT says Wordle acquisition added "tens of millions of new users"
The New York Times on Wednesday reported its second-best first quarter subscription growth since introducing a digital subscription in 2017, thanks in part to the acquisitions of The Athletic and Wordle in January.
Why it matters: Executives remain bullish that the Times will be able to meet its new goal of 15 million subscribers by the end of 2027.
- Investments in the company's core news product, lifestyle products — like its cooking, games and audio subscriptions — as well as its subscription bundle will fuel that growth.
- CEO Meredith Kopit Levien said the company "intends to begin to introduce" The Athletic into the Times' subscription bundle "in the back half of this year."
Yes, but: The acquisition of The Athletic resulted in a year-over-year loss in operating profit, which was expected. The Athletic lost $6.8 million in the first quarter.
- Executives expect The Athletic to dilute operating profit for the next three years, but say it will become smaller this year compared to 2021.
Details: While a smaller investment than The Athletic, executives touted the success of Wordle, the viral online game that it paid "in the low seven figures" for in January.
- Wordle brought in "an unprecedented tens of millions of new users to The Times," the company said.
- Many Wordle users "stayed to play other games" with the Times, which helped drive the best quarter ever for net subscriber additions to Games, the company said.
By the numbers: Overall, The Times added 387,000 net new digital subscribers in the first quarter, bringing its total number of subscribers to New York Times products to 9.1 million.
- It reported a total of 10,390,000 paid subscriptions, of which, 9,620,000 are paid digital-only subscriptions. The Times first announced that it surpassed its goal of 10 million subscriptions years ahead of schedule last quarter.
- Net increases included roughly 16,000 new subscribers and 24,000 new subscriptions to The Athletic since the acquisition.
Between the lines: Revenues from advertising grew 20% year-over-year in the first quarter, although digital advertising grew slower than expected, due in part to macro-economic factors, like inflation.
- Levien noted that the Times' print advertising revenues grew more than expected, in part due to the strength of print advertising categories, like luxury and live entertainment.
The big picture: The Times believes that the total addressable market for potential subscribers is 135 million globally.
- "We think about 50 million of those people are outside of the U.S," Kopit Levien told investors.