Operator: The next question comes from Ashton Welles from Evercore ISI. Please go ahead.
Ashton Welles: Thank you. I know it’s early to talk about 2024 at this point. But can you talk a bit about how you’re thinking about the puts and takes for expense growth next year? Is the low to mid-single-digit rate we’ve seen this year the right run rate to think about for the business going forward?
William Bardeen: Ashton, I’m happy to take that. I mean we don’t guide on 2024, but I think it’s fair to say that we feel good about our cost performance, both our ability to continue to invest strategically in the key areas of our journalism and product development, while also being relentlessly focused on efficiency and making sure we’re reallocating our resources to areas of highest impact. We feel like we’re definitely on track to be doing what we telegraphed at the beginning of the year as to sort of see that cost growth moderate. And that’s our general expectation as we head into next year – into Q4 and into next year.
Ashton Welles: Thank you.
Operator: The next question comes from Doug Arthur from Huber Research Partners. Please go ahead.
Douglas Arthur: Yes. Thanks. Meredith, you called out the strong advertising results at The Athletic, which was really quite a surprising number. I guess the flip side is digital advertising backing out The Athletic was kind of a push year-over-year. Was that a bit of a disappointment? Or is that the podcasting reference you made? And then I’ve got a follow-up.
Meredith Kopit Levien: It’s certainly more the second than the first in your – in the way you’re answering it. I’ll say, again, remember, we sort of did better than our own guide there. And the thing that we pay closest attention to, even setting aside The Athletic, Doug, is how is core display on The New York Times and within the group doing, which is premium ad canvases plus first-party data. And I would say that remains resilient in the face of a really complicated market. So most of what – where you’re seeing the pressure is in podcasting, and then just broadly less money moving around in the market in the biggest categories that we play in.
Douglas Arthur: Okay. Thank you. And then as a follow-up, I mean it looked like the investment and expense growth at The Athletic was pretty robust in the quarter. Is that just investment in the marketing? Is it content? Are you hiring people? What’s happening there?
Meredith Kopit Levien: Let me give a kind of broad answer. Will, you should provide any more detail you think is appropriate. I would say, on The Athletic, things are going, broadly, kind of according to plan and as we suggested they would at the point of acquisition. And where you see us investing, it is in the two things that we think are going to drive the most value on The Athletic, which is ensuring that the coverage is widely appealing and widely seen. So that’s a place of investment, and we’ve talked about that on prior calls. I think the biggest opportunity at The Athletic is to get many more people to know it exists and to read it and to engage with it. That’s one, and that’s the single biggest area of expense. And so anywhere you’d see sort of increased investment, it’s going to play out there.
And then in the digital product and making – creating more opportunity technologically in the product experience to engage people. So I think that’s where you’re seeing it. But it’s all – and a little bit, I’ll just add one more beat. The ad business is going very, very well. And there are some number of things you’re doing there, less so, but some number of things you see us doing there to throw gas on that fire.
William Bardeen: I might just add one more thing, which is that the success of the bundle and the growth of the bundle is in part also a sign of the success of The Athletic as part of the bundle. And one of the things we are doing is allocating the expenses from that growth back to The Athletic as well. So as The Athletic grows, you’re going to see expense growth at The Athletic.
Operator: The next question comes from Vasily Karasyov from Cannonball Research. Please go ahead.
Vasily Karasyov: Thank you. Good morning. Just wanted to follow-up with a bigger picture question on, Meredith, your comments about ARPU growth and your confidence in how that will continue. So you did provide longer-term goal of 15 million subscribers, and I’m sure that internally you also have estimates of what ARPU would look like. Now of course, I don’t expect you to share that estimate with us. But maybe you can help us think how to – where is the right sort of directions along which to think what that ARPU could be? Can it be teens – in teens, can it be in double digits? And what sort of puts and takes we should be thinking about when estimating what kind of ARPU the 15 million subscribers New York Times would have? Thank you so much.
Meredith Kopit Levien: Yes. Great. Let me just make a couple of broad comments, and Will, I suspect you’ll have a more satisfyingly detailed answer on ARPU. On the path to 15 million, you should expect us to really be aiming for more than half over the next few years of the total subscriber base to be on the bundle, and that has economic benefit in myriad ways to the whole business, not just subs, but you’re asking about subs. So continuing the push to more bundled penetration both for starts and also for existing stand-alone subscribers to news or any of our other products. So that’s going to play a big role in the ARPU trajectory. And then I’ll just make sort of one more broad comment, which is you have a number of, Will, I think, referenced this earlier, you have a number of things going on around price rises, that so far, I’d say, we are executing well on: one is bring people in at promotional prices, step them up over time, either in a year or across a multiyear period as they engage more, as they realize more value.
And as I said earlier, our ability to execute against that, our tech is getting better and better, the AI we use to power that is getting better and better. So that’s one. Two, as we get more people to understand The Times isn’t just the product they came for, and that presents most in news, but we’ve got Cooking subscribers and Games subscribers and Athletic subscribers, getting people to take the whole gives them more of a reason to pay us – engage more and then pay us more over time. We really like what we see there so far. And then three, and this has played a big role this year and I think will continue to over time. We now have a good history of – at the point of tenure in news and executed in Games for the first time, and we talked about doing it in Cooking as well and are beginning to do that, at a certain point of tenure for certain subscribers, based on engagement level, we can do a price increase and exercise our pricing power.
So all of those things, successful execution on all of those things would point toward how we expect ARPU to go up over time as we’re growing volume and bearing down path to 15 million. Will, what did I miss there?
