New York Times (NYSE:NYT) will release its quarterly earnings on April 19. It has seen its revenue from traditional sources such as print advertising decline in the last year while it focuses on increasing revenue from subscriptions and online advertising, a market where it competes with giants like Facebook, Google (NASDAQ:GOOG) and Yahoo (NASDAQ:YHOO). While it faces an uphill task in the digital content space, we expect digital revenue to eventually surpass print revenue and become New York Times’ most valuable business.
Digital Subscriptions and Advertising
New York Times reached nearly 500,000 digital subscriptions in 2011, and we expect its subscriber count to keep growing, reaching nearly 550,000 by the end of 2012. We also expect its digital advertising revenue to increase, driven by an increase in page views as well as the total number of unique visitors to its website.
NYT is betting on the increase in digital revenues to compensate for the decrease in print revenue and a slowdown its overall revenue decline. Even About.com is expected to show revenue growth in the coming years, driven primarily by an increase in unique visitors. We will watch the earnings call closely for any hints or updates related to its digital strategy.
While New York Times has been able to maintain its market share in the print advertising U.S. market, its revenue from print ads is being hammered due to a decline in the print medium and the overall market shrinking. NYT is expected to increasingly focus on online content and reduce its reliance on physical circulation of newspapers in the coming years.
We currently have a $7.50 Trefis price estimate for New York Times. Print Ads account for around 23% of its overall value, while Online Ads and Digital Subscriptions account for 21%. About.com, one of its largest web properties, accounts for 12%, by our analysis.