The New York Times Co. reported sharply higher net income for its first quarter on Thursday, helped by a large gain from the sale of its Regional Media Group and increases in print and digital circulation revenue.
The company said its latest results suggest that a switch to a paid subscription model for full access to Times' online content is paying off.
But print and digital advertising revenue declined amid what CEO Arthur Sulzberger Jr. called "the uneven U.S. economic environment and uncertain global conditions."
The newspaper company said net income grew to $42.1 million, or 28 cents per share, from $5.4 million, or 4 cents per share, a year earlier. Much of the increase came from one-time gains on the company's sale of its regional newspaper group and other one-time items.
Revenue declined less than half a percent to $499.4 million from $500.7 million a year ago.
Without one-time items, adjusted earnings were 8 cents per share in the latest quarter, easily beating Wall Street's expectations. Analysts, on average, were expecting earnings of 2 cents per share on revenue of $500.7 million, according to a survey by FactSet.
About a year ago, the Times implemented a so-called paywall on its website. Under the policy, the Times charges readers for monthly access to an unlimited number of articles. The strategy, closely-watched by executives in the industry, has helped to boost the Times' circulation and is being replicated at other newspapers. Starting this month, the Times cut the number of articles readers can access for free from 20 to 10 per month.
The Times Co. said circulation revenue grew nearly 10 percent to $227 million, from $206.9 million a year ago. Paid digital subscriptions totaled about 472,000 as of March 18. That's up 24 percent from about 380,000 at the end of 2011. The Times did not release revenue figures for digital subscriptions.
"Our readers have embraced digital subscriptions and we expect to build on this strong start as we embark on our second year of digital paid subscriptions," said Sulzberger, who also serves as chairman.
Advertising revenue fell 8 percent to $237.9 million, from $258.9 million a year ago.
Shares of the New York-based company climbed 29 cents, or 4.8 percent, to $6.40 in afternoon trading. The stock has traded in a 52-week range of $5.50 to $9.73.