Business Context and Reporting Period
Company: The New York Times Company (NYSE: NYT)
Filing Type: Form 10-Q (Quarterly Report)
Reporting Period: Quarter and six months ended June 30, 2026
Business Overview: A global media organization generating revenue primarily through digital and print subscriptions, advertising, and affiliate/licensing activities. The Company operates as a single reportable segment.
Key Financial Metrics
| Metric (in millions, except per share) | Q2 2026 | Q2 2025 | 6 Months 2026 | 6 Months 2025 |
|---|---|---|---|---|
| Total Revenues | $762.5 | $685.9 | $1,474.7 | $1,321.8 |
| Operating Profit | $118.0 | $106.6 | $208.6 | $165.2 |
| Net Income | $93.4 | $82.9 | $181.3 | $132.5 |
| Diluted EPS | $0.57 | $0.50 | $1.11 | $0.80 |
| Operating Cash Flow (6mo) | $286.5 | $212.7 | $286.5 | $212.7 |
| Free Cash Flow (6mo) | $265.7 | $193.2 | $265.7 | $193.2 |
| Cash & Marketable Securities | $1.22 billion (as of June 30, 2026) | |||
| Debt | $0 borrowings on $400M Revolving Credit Facility |
Material Changes vs. Prior Period
- Revenue Growth: Total revenue increased 11.2% year-over-year (YoY) in Q2 2026. Subscription revenue grew 11.7% to $537.9M, driven by a 16.4% increase in digital-only subscriptions. Advertising revenue rose 11.3% to $149.1M, with digital advertising up 20.7%.
- Subscriber Metrics: Digital-only subscribers reached 12.80 million (up 1.5 million YoY). Digital-only Average Revenue Per User (ARPU) increased 3.1% YoY to $9.94. Print subscribers declined slightly to 550,000.
- Profitability: Operating profit increased 10.8% YoY. Adjusted operating profit (non-GAAP) increased 16.1% to $155.3M, with margins expanding to 20.4% from 19.5%.
- Cost Increases: Operating costs rose 11.2% YoY. Notable increases included Sales and Marketing (+23.6%) and Product Development (+10.0%), largely due to higher compensation and cloud infrastructure costs.
- Special Items: The Company recorded $9.2M in multiemployer pension plan liability adjustments and $4.6M in Generative AI litigation costs in Q2 2026.
Guidance, Outlook, and Risks
- Capital Allocation: The Board declared a quarterly dividend of $0.23 per share (up from $0.18 in Q2 2025). Share repurchases totaled $91.8M in the first six months of 2026, fully utilizing the 2023 authorization. Approximately $258.4M remains available under the 2025 authorization.
- Tax Impact: The "One Big Beautiful Bill Act" (OBBBA) is expected to reduce cash tax payments by approximately $60M in fiscal year 2026.
- Legal Contingencies: Significant ongoing litigation against Microsoft/OpenAI and Perplexity AI regarding copyright infringement and unauthorized use of content for generative AI. The Company recorded $8.8M in related costs for the first six months of 2026.
- Risk Factors: Risks include competition from AI companies, secular declines in print advertising, economic volatility affecting ad spend, and supply chain disruptions for printing.
Investor Verification Checklist
- Subscriber Quality: Verify the sustainability of the 16.4% digital subscription growth and the 3.1% ARPU increase amidst a competitive media landscape.
- AI Litigation Exposure: Assess the potential financial impact of ongoing lawsuits against Microsoft, OpenAI, and Perplexity AI, noting the $8.8M in costs incurred YTD.
- Pension Obligations: Review the $9.2M multiemployer pension withdrawal charge and the funded status of benefit plans ($355.9M obligation in AOCI).
- Advertising Mix: Confirm the shift in revenue mix toward digital advertising (76.4% of total ad revenue) and the resilience of digital ad rates.
- Cash Flow Sustainability: Evaluate the $265.7M free cash flow generation against capital return commitments (dividends and buybacks).