Good morning. My name is Jessa, and I will be your conference operator today. At this time, I would like to welcome everyone to The New York Times Company First Quarter 2016 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, please press the pound key. Thank you. Mr. Harlan Toplitzky, Executive Director of Financial Planning and Analysis, you may begin your conference.
Thank you, and welcome to The New York Times Company's first quarter 2016 earnings conference call. On the call today, we have Mark Thompson, President and Chief Executive Officer, Jim Follo, Executive Vice President and Chief Financial Officer, and Meredith Kopit Levien, Executive Vice President and Chief Revenue Officer. Before we begin, I would like to remind you that management will make forward-looking statements during the course of this call, and our actual results could differ materially. Some of the risks and uncertainties that could impact our business are included in our 2015 10-K. In addition, our presentation will include non-GAAP financial measures, and we have provided reconciliations to the most comparable GAAP measures in our earnings press release, which is available on our website at investors.nytco.com. With that, I will turn the call over to Mark Thompson.
Thanks, Harlan, and good morning, everyone. 2016 is the first year of implementation of Our Path Forward, our new strategic direction for The New York Times Company. As you know, the plan calls for the doubling of our digital revenue. To achieve that, we need to more than double our audience, to deepen their engagement, and to innovate and develop our digital advertising and subscription models while running our cash-generative print platforms effectively and managing costs tightly across the whole company. Our big themes are innovation and creativity in storytelling and user experience, backed by continued investment in great journalism, audience and digital subscription growth driven by better use of data and clearer offers and customer journeys, innovation in digital advertising, where we're seeing great success with branded content and smartphone, international, where we've made some important recent announcements, and tough-mindedness about costs everywhere.
The first quarter of 2016 saw all of these themes playing out in the real world. Our audience grew strongly. At 113 million unique users in March, our global audience was the largest ever recorded for The Times. The balance of that audience is shifting, too. According to Comscore, we had 31 million U.S. millennials consuming Times journalism on digital in March, 11 million more than March in the year previous. Audience engagement is growing steadily as well. It's not surprising, then, that this was a very strong quarter for our digital subscription business. We added 67,000 net new digital subscriptions to our news products, the highest number of quarterly adds since Q4 2012, and a real achievement as our pay model reaches its fifth anniversary. The rate at which we're adding subscriptions is continuing to accelerate. Revenue for our digital news subscription business grew 13% year-over-year.
Perhaps this is a good moment to celebrate our other digital subscription business, which is the Times Crossword product. This separate subscription count reached 196,000 in the quarter, and since then has exceeded 200,000. Revenue from this business is, of course, much smaller than for the core. The quarterly total went past $2 million for the first time in Q1. At 59% growth year-over-year, it too is building strongly. From now on, we will disclose both the separate subscription counts and revenue figures for news and Crossword and the combined totals. The combined digital-only subscription total for the quarter, therefore, was 1,357,000 digital-only subscriptions. We expect this combined number to exceed 1.5 million by year's end. Digital advertising was a more uneven story. Our headline result of roughly flat was a blend of continued success with smartphone, branded content, and programmatic.
Smartphone, for instance, more than doubled compared to Q1 2015, with pressure on web homepage and other web display. We remain bullish about our strategy, however, and believe that our timely pivot from traditional digital advertising towards branded content and marketing services, video, and more seamlessly integrated ad formats on both mobile and desktop will deliver growth in the second half of 2016. Late in the quarter, we bought HelloSociety, a social influencer network, and the company's first acquisition in eight years, to add another element to the growing suite of content creation and distribution capabilities we can offer advertisers. Print advertising continues to experience strong secular headwinds and was down 9% in the quarter. Print circulation was down just under 1% year-over-year, though total circulation was up because of success on the digital side.
Revenues for the company as a whole were down 1% for the quarter, while adjusted operating profit was $52 million, down 13% compared to the same quarter last year due to that advertising revenue weakness and the initial impact of investment associated with Our Path Forward. On that topic, during the quarter, we announced our intention to invest more than $50 million over the next three years on exploiting the international digital potential of The New York Times. We have also announced a significant reorganization of the editing and preparation of the International New York Times, our global physical newspaper, to ensure its continued contribution.
These two announcements, demonstrating a willingness to invest substantially in digital growth while applying rigor and realism to the economics of our mature print platforms, illustrate the approach we are taking everywhere. As I noted in our last earnings call, we are fully committed to restoring the company to adjusted operating profit beyond 2016 and believe that we will achieve that through a combination of growing digital revenue and a continued focus on costs. We believe there is considerable scope for further savings in the company, and we'll be going after it in the coming months. Encouraging and accelerating progress on digital subscriptions. Exciting developments, but more to do on digital advertising. A commitment not just to build digital revenue, but to manage our costs to defend and grow profitability. Those are my headlines this morning. Now over to Jim.
Thanks, Mark, and good morning, everyone. As Mark said, the first quarter reflects solid digital subscriber growth, but a challenging advertising environment in both print and digital. Adjusted operating profit declined 13% in the quarter to $52 million, while adjusted diluted earnings per share was 10 cents in the first quarter, compared to 11 cents in the prior year. We reported a GAAP operating profit of $28 million, compared to an operating loss of $11 million for the same period in 2015. Overall, revenues are down 1% in the quarter, with weakness in advertising offsetting circulation and other revenue growth. Circulation revenues increased approximately 2% in the quarter, with digital-only subscription revenue growth more than offsetting print declines. As Mark mentioned, beginning this quarter, we have begun to report digital subscription revenues from our crossword product within circulation revenues. Previously, this revenue was reported in other revenues.
With this change, total digital-only subscription revenue accounted for 14%, grew 14% from the same quarter in 2015 to approximately $54 million. On the print circulation side, revenues were down 1%, driven by lower single copy revenues. We again implemented a home delivery price increase at the beginning of 2016 at a rate similar to recent annual increases, and we benefited from this, although higher revenue associated with the new rates were outweighed by overall print volume declines. Advertising revenues were down 7% in the quarter, with print advertising declining 9% and digital revenue declining 1%. As Mark noted earlier, digital advertising reflected the changing mix of advertising that we've been experiencing over the past several quarters. In the quarter, we saw strong growth in mobile and creative services revenue, while traditional web display advertising was weak.
Mobile revenues continue to grow at a rapid rate versus 2015 and now represent approximately 21% of total digital advertising revenues. We did record a small amount of digital advertising revenue in the quarter from our March acquisition of HelloSociety. The lower print advertising revenue is due to declines in The New York Times, while we experienced growth in the International New York Times. In The New York Times, luxury, technology and telecom, and media categories all performed well in the quarter, while entertainment and the financial categories were particularly weak. The growth in the International New York Times was driven mainly by an increase in the luxury category. As usual, we experienced significant month-to-month volatility in advertising revenues, as illustrated by the fact that overall advertising was down 1% in January, down 18% in February, and down 1% in March. Both print and digital experienced this volatility.
Finally, on the revenue side, other revenues are up 1% in the quarter, with NYT Live driving that growth. Operating costs remained relatively flat in the quarter, while adjusted operating costs increased 1%. The increase in adjusted operating costs was mainly due to higher spending in advertising, technology, and newsroom, which was substantially offset by print production and distribution efficiencies. Non-operating retirement costs were lower, while severance and depreciation and amortization increased. Our focus on reducing legacy costs remains a top priority, while at the same time, we will continue to invest in growing our digital revenue. We continue to focus efforts on our cost structure, and while we expect to experience an increase in operating costs in 2016, we will begin to make reductions to our structural cost base thereafter.
As I said, non-operating retirement costs were down in the quarter to $5 million from $9 million in the prior year due to a change in the methodology of calculating the discount rate applied to retirement costs. In the quarter, we incurred a loss of $41 million or $20 million after tax and net of non-controlling interest. This loss resulted from the decision to shut down a paper mill operated by Madison Paper Industries, in which the company has a 40% interest. This loss resulted from severance and other costs recorded in the first quarter by Madison Paper, of which we have recorded our proportionate share. We currently believe that Madison Paper has sufficient existing assets to settle all its obligations when taking into account proceeds from the expected sale of Madison Paper assets, which we anticipate to take place later in the year.
Accordingly, we do not expect that we will be required to use any of our cash in the wind down of this investment. Moving to the balance sheet, our cash and marketable securities balance was $874 million at the end of the quarter, and our debt and capital lease obligations were approximately $432 million. The Hello Society acquisition was completed late in the quarter with a purchase price of approximately $12 million. The company has repurchased approximately 6.5 million Class A shares for $86 million to date under our previously announced $101 million share repurchase authorization. Now let me conclude with our outlook for the second quarter of 2016.
Circulation revenues are expected to increase at a rate similar to the first quarter trend, driven by the benefit of our digital subscription revenue growth, partially offset by lower print circulation revenues, despite the impact of the home delivery price increase. We expect approximately 45,000-50,000 net digital subscription additions to our news product and approximately 10-15 million net digital subscription additions to our crossword product.
Thousands, we should say.
Thousands.
Sorry.
Overall advertising revenues are currently expected to decrease at a rate similar to that of the first quarter, with digital advertising revenue expected to be about flat. Other revenues are expected to increase about 10%. Second quarter adjusted operating costs are expected to increase in the low single digits, while operating costs are expected to increase in the mid-single digits, as we expect to record a restructuring charge of $15 million in the quarter related to the proposed streamlining of our international print operations. Finally, we expect non-operating retirement costs to be approximately $5 million in the second quarter. With that, we'd be happy to open up for questions.
At this time, if you'd like to ask a question, please press star followed by the number 1 on your telephone keypad. Your first question comes from the line of Douglas Arthur from Huber Research Partners. Please go ahead.
Yeah, thanks. Two questions. Jim, in terms of your second quarter advertising guide, January was essentially flat, March down 1%, February was a real debacle. Are you expecting something similar to that in Q2? Or how is that setting up sort of month-to-month at this point? I know your visibility is limited. Then second, Meredith, on the digital side, I'm a little surprised on the flat guidance for Q2 to the extent that you have made the comment that project work can move the number quite a bit, and that was soft in the first quarter. Are you expecting a repeat of that in Q2? I'm surprised there's not more upside. Thanks.
Yeah. Jim, do you want me to go first?
I'll take the guidance. The guidance is based upon the visibility we have. I'd say, look, April is off to a bit of a slow start. That's embedded in our view.
Yeah
of the outlook. We think the May and June numbers will likely be better than April. That's the best visibility we have. It continues to be a bit of a choppy market, particularly on the print side.
It's worth saying, Doug, I've said on calls before that at the moment, our guide to month B, looking at month A and expecting to be sure that month B is going to follow month A is not true. You note we adjusted our guidance fairly soon after the last earnings call based on the dramatic switch, which is now reflected in the numbers between February and January, which was followed by a significant bounce back in March.
Yeah.
I think the truth is, this is a pretty volatile market, and the main caution is to say that not only do we have limited visibility, but the actual needle is moving all over the dial.
Yeah. I'll say a couple things about it, Doug. The first one, our digital comp for advertising in Q2 is actually our hardest comp of the year. We grew, I think, 14% and change last year in digital advertising in Q2. I will say, just to your very specific question, I think we're operating in a digital ad business that is broadly in transition, and I think we're pretty well positioned with our strategy, and we're confident about it. We're growing mobile, particularly smartphone, very quickly. We are very focused on scaling the branded content business, and we have good visibility into the year-long pipeline for that, and are optimistic about it. We're scaling programmatic business, which I think will continue to improve, and we're rounding out our marketing services. We are absolutely expecting growth in the back half of the year.
We've got pretty good visibility now into four things that represent meaningful change to the business. One is that pipeline for branded content and big branded content deals. The second is our pipeline for projects around virtual reality. The third is our pipeline around sort of broader sponsorships and video. The fourth is programmatic, which is now 18% of the business in Q2 and growing. As that grows, that also feels like a more stable business.
Okay, great. Thank you.
Your next question comes from the line of Alexia Quadrani from J.P. Morgan. Please go ahead.
Thank you. Just sort of digging in a bit more to the digital advertising in the quarter, I guess. How quickly is that shift to mobile, away from desktop sort of is happening? I think you mentioned mobile is now about 21% of digital advertising. Has it been a rapid shift? Do you anticipate it to being a sort of a rapid shift? Just sort of, logistically, it just seems like mobile might be a bit more constrained in terms of the advertising ability, but at the same time, obviously a great advertising medium. Do you think the opportunity on mobile potentially is as great as it has been or it was on display, digital, I mean, desktop display?
Sure. All very good questions. I think our growth in Q4 on mobile and Q1 is consistent. What I will say is, I think we're seeing a great deal more demand in the market for mobile ad solutions, and I think we're meeting that demand with far better products. I'll make three specific comments about that. One, in September of last year, we launched Flex Frames on mobile, which is the name of our larger canvas in-feed ad unit, and we've seen real progress selling that directly. The market response to that product has been very good. At the end of the first quarter of this year, we launched, we tested, and it tested very well, video in that product. I think there's a lot more running room there. Then we're also seeing a real uptick in mobile programmatic. Programmatic itself is changing.
The business is getting, for us, more direct, so less open market, more direct, which gives us some optimism around CPM. In general, I think broadly, we have a lot of optimism around smartphone continuing to be a big part of the growth engine, and we do think that there is still more demand to move to it, and I wouldn't say that it doesn't hold. I think the opportunities will be different from desktop, but sort of could be equally potent.
Yeah.
We also see smartphone, real success with our branded content product on smartphone. The stories themselves are all designed and optimized for mobile experience now, and our ability to drive distribution and traffic for branded content on smartphone is working very well.
You heard me say, Alexia, that smartphone advertising revenue doubled in the quarter, significantly more than doubled in fact over the quarter.
Yes.
We saw really dramatic increases in programmatic year-over-year.
Yeah
... indeed in Paid Post year-over-year. The areas we've been investing and focusing on are growing very rapidly indeed.
Yeah. I think the idea of mobile advertising that has video in it is one that's just at the beginning, and I think we have a lot of running room there.
Okay. Thank you very much.
Your next question comes from the line of Craig Huber from Huber Research Partners. Please go ahead.
Yes, good morning. A few questions. First, I guess I'd be curious to hear in the first quarter, can you just break down, if you would, how digital did, the various components for the ad revenues there on a year-over-year basis? However you want to break that down. Would particularly like to hear how the traditional display did year-over-year. How poor was that?
I can definitely talk about. I can do a little more on what we just did in that last answer, but mobile is up 81%, now 22% of all the digital revenue. Of that, I think the more notable piece is smartphone is up just inside of 150%, which is exciting. Video was down a little bit, but that's a moment in time issue. We're very optimistic about video for the rest of the year. Programmatic is up 81%. Again, we think that's going to keep growing. We've got new leadership there. We're adding to the team there, and the market is certainly moving quite a bit of demand there. Branded content, just the Paid Post piece of it is up just inside of 100%. Very big gains there. I'm quoting on just the actual sort of ad product piece of that.
We're also seeing nice growth, although you'll see it more in the numbers in the back half of the year in marketing services around the branded content creative product.
What about the traditional digital advertising piece?
Jim, I'll let you do the numbers, but as Jim and Mark both said, we're seeing pressure on web length.
Yeah, we've not tended to break down that number, which still is a significant number of the total.
Yeah
there were some declines in the quarter there, which were.
Yeah
The reason we got to flat was compensated by the growth in the areas that Meredith just said.
Yep. We think all of those areas still have meaningful running room for more growth.
What % is the business of right now the traditional display?
Well, when we say traditional display, I would call it branded content.
Yeah.
There's a complication because branded content, some of the media branded content plays out on web display as well.
Yeah, it could be 40%-50%.
40%-50%, yeah.
Total digital advertising would come from kind of traditional.
Yeah
sales.
Okay.
Banners on article pages and on desktop. Yeah.
Appreciate that. If we could maybe just switch over to costs, if we could. There's been a decent number of stories recently about potentially New York Times looking at taking out some more costs over in Europe and/or here in the States. Can you talk about that a little bit? If that is true, would that help you more at the 2017 timeframe as opposed to this year?
Yeah, I think you're probably referring to some of the restructuring that's taking place in our international print operation, which I referred to in my remark. We'll actually take a charge in the second quarter, but that charge will be a little bit ahead of when the cost savings will actually be achieved, just because of the process in which we have to work through. I would be looking more towards 2016 for a decent amount of costs coming out on the print side. Now, Mark mentioned in his comments, and Mark and I were very focused on structural cost issues. We'll be investing throughout this year in areas we think we need to grow.
International is an area we'll need to grow, but underneath that, we still think there's opportunity for areas where we don't think are the growth areas to look at some of the structural cost issues, and we'll continue to do that. I think our history has been good on that. As we said on the last call, we'll see some cost growth this year, but thereafter, we think there's some opportunity there to look at some structural cost issues.
That's right. I'm committed, although we're going to see some quarters where investment means that operating profit is slightly lower than it was last year. I've said we're very committed to getting back to growth, and we think that we can do that in part by revenue growth, but also partly by taking a further look at costs in the U.S. There's essentially two things going on there. One is something very specific, already announced, already in progress, which is related to making sure that the international physical newspaper remains very high quality, but also remains contribution positive. More broadly, we will be looking at costs in every part of the company to see whether there are, as we believe there is, further scope for cost reductions to defend and grow profitability.
Finally, I have two quick housekeeping questions. One for the print circulation volume, what was the daily and Sunday percent change there year-over-year? I have one more after.
Sure. I'll do those. Daily was down 5.7% and Sunday 3.8%, and that is despite a price increase.
My last question, Jim, newsprint, what was the average price or % change year-over-year in consumption? What about overall newsprint costs? Thank you.
Newsprint costs year-over-year were down. I think the total raw material cost decline was about $2.4 million. About 75% of that was price related. On a year-over-year basis, it's down, and I'll just quote some RISI numbers. I think the RISI price was down year-over-year about 7%. I will say, though, that the trend in the market beginning part of this year was increasing newsprint prices. While we're still on a year-over-year basis below where we were last year, the trend off of fourth quarter is growth. There's been some recent announcements on price increases. We'll see whether that actually sticks and happens. If it does, we'd see a small increase in those prices midyear-ish. We'll see how that goes. For right now, it was a benefit in the quarter.
As we go deeper into the year, it will become less of a benefit, and that's the way we think that thing plays out.
Great. Thank you.
Your next question comes from the line of John Janedis from Jefferies. Please go ahead.
Hi. Thanks. Two questions. One is maybe somewhat related to Alexia's earlier. Just wanted to ask maybe for Meredith, to what extent do the advertisers or the budgets from digital and print overlap? Then on the digital side, I think the first quarter was your best first quarter of ads since the paywall rollout back in 2011. Can you talk about what you're seeing in terms of churn? Has it improved, and which offerings are the most popular with the new subs?
Sure. I'll do the advertising question first, which is to say that we do sell a lot of our big programs across all platforms, so it varies by category. In some categories, print and digital tend to be bought separately. In other categories, they tend to be brought together and around big programs. I do think the shift in the market is marketers are thinking much more holistically about their buy with a particular place. Over time, there will be fewer separate budgets and more what's my overall spend and how much of it is with "The New York Times" versus someone else. That's the answer to the first question. On the second question, it was our best quarterly net adds, I think, since Q4 2012. Your question with that is what's underneath that?
Happily, we saw improvement in both starts and stops, so starts up, stops down, and we're doing quite a bit of work on the retention side. You're asking about offers. What I'll say is we are doing quite a bit of testing around offers generally, and we are getting better at putting better retaining offers in the market. A big part of the retention story is offers that retain better. I don't know if you're asking a more specific question than that, but I would say broadly, our deployment of different kinds of offers has improved, and execution in every part of our marketing organization is improving and still has more room to improve. We're still bringing new talent into the team and testing new approaches, and we feel very optimistic about it for the rest of the year.
Maybe just another question on that one, Meredith, is does that mean the read-through in terms of, say, print to digital budget, is that to the extent that print slows the correlation to digital slowing is low and really depends on a specific program and their time?
To think about that question, but I think broadly the answer is yes. What I will say is The Times has a very strong offering sort of anywhere a marketer might have a budget to spend with us. If they philosophically are choosing to leave print or for practical reasons choosing to leave print, one of the great things about The Times is we have a very scaled offering in digital. We have a scaled offering in mobile. We are building a scaled offering in video, and we have a very strong offering in marketing services. We have an opportunity, unlike lots of other legacy media companies, we have a very strong opportunity to make up those dollars. I don't know if that's what you're asking.
I think there's something else to say. I think that particularly with some of the branded content work we've done.
Yeah
Some of the VR work, it felt like large-scale brand building work by major advertising partners, which feels more like a television.
Yes. Happening in digital.
a television-like play.
Yeah.
Unconnected to the, as it were, any kind of print.
Yeah
digital zero sum or
Yeah. I do think there's a big strategic question around can you make up the print dollars in digital? I would say broadly, we have the scale, and we are building out the products to do that. I will also say, I think that there is going to be strength in print in particular categories for a long time because for those categories, print is still a very meaningful part of the mix. Luxury and culture would be at the top of my list there. We're continuing to reimagine the product offering in print to continue to make print relevant to those marketers.
Just on luxury, Meredith, is that category, say, still somewhere in that 10%-15% range, or has that moved around?
It's bigger than 10%-15%.
Yeah, we aggregate up a number of categories.
Yeah
We look at that as 20+% of our total advertising.
Yeah. Just inside of 20%. If you could even arguably add a few more categories to it that others would consider luxury that
It is far and away our largest category.
Yes.
Great. Thanks so much.
Yeah.
Your next question comes from the line of Kannan Venkateshwar from Barclays. Please go ahead.
Thank you. Just a couple of questions. Jim, on the Madison Paper-related write-off, are there other investments which might lead to some cash impact at some point in the future? Then secondly, when you think about cost, looks like you guys still have a lot of room to cut cost. Why not be more aggressive about this process given that you've been doing this over the last couple of years, and the process still seems ongoing? Then one last question-
I would say I feel like we have been pretty aggressive on cost. This is a year where some of that work will be masked by. We're not taking cost out, and we're still managing pretty aggressively, but in the face of investing in things like international, you will see cost growth. It's hard to invest ahead of revenues without seeing some impact on cost. We are aggressive. We will continue to be aggressive. We're very mindful of profitability.
Yeah.
I think in its different ways, automation and the arrival of low-cost cloud services, I think understanding our business more clearly, developing a more integrated approach to our digital platforms, closer working between the newsroom and the rest of the organization, more effective interdepartmental working across our revenue and our digital product design and technology functions. All of these things potentially yield savings. I think this work is never done, to be honest. The business side of The New York Times I think has already seen a headcount reduction of something like 60%-65%. I think a lot has been done, but I think the more we understand our business, the greater clarity we have about the direction, the more scope we have. On your question on investments, we only have one other kind of major joint venture investment, and that's in a...
We own about 49% of a machine in a plant that produces newsprint in Canada. It's actually quite positive cash flow. We don't believe that there's a scenario by which there would be anything other than cash coming out of that partnership. There are some smaller investments we make that kind of fall below the radar screen, and yeah, we make those with an eye towards generating a decent return, but they tend to be smaller in scale. Yeah.
We don't tend to call them out because they're generally pretty small.
Of the two paper mill related assets, net-net, we don't expect a significant cash impact. If there is one, it's more likely to be positive than negative.
That's right.
Mm-hmm.
One more follow-up on the revenue side. It looks like the Crossword product has some scale now and is still growing fast. Are there other opportunities on the product side or something that's already in your other revenue line which could scale over time that we should look forwards?
Yeah. No, we're very pleased with Crossword, and we are absolutely exploring whether we can off the back of Crossword, as we grow that business through new Crossword products and potentially other word puzzle and other puzzle products. That in itself, we think, has actually got significant growth. By the way, standing today at around 200,000 digital subscribers, this is one of the most popular and successful newspaper-based digital subscription models in the world. I think it's.
Just on its own.
Just on its own. Forget the main news thing.
Right.
It's one of the most successful subscription models of its own. In addition, we certainly think that there are other opportunities. We have a very successful cooking app. We've talked, and indeed announced, that we're launching some more interesting products in the broader sense in the lifestyle and features area. We have a television-related product and a wellness and fitness product based on our Well blog arriving this year. Cooking is delivering now real scale in terms of total unique users, but also some really striking numbers for engagement. We will be testing and exploring ways of beginning to use these to drive subscription.
We're going to test different models to see what's the best way of doing it, but we absolutely believe that there are other bundles of IP that The Times can produce, other brands which The Times already controls, which it can exploit, which potentially can broaden the subscription base. I think the more we learn about our core new subscription offering and the demand curves and the way the best marketing works to migrate people into subscriptions, the more useful it'll be to have a broader based set of different options we can give people to subscribe to.
All right. Thank you.
Your next question comes from the line of Douglas Arthur from Huber Research Partners. Please go ahead.
Yeah, just two quick follow-ups. Jim, on your share repurchase program, did you say cumulatively you've repurchased 6.5 million since the program began, and it's pretty much done at this point? Is that fair?
It's not pretty much done. I mean, I think we've still got about $16 million left under $101 million authorization. The number I gave, I quoted something like, what was it, $86 million or so, and that's cumulative program to date.
Okay. Thank you. Meredith, when you talk about a better back half in digital, can you frame that a little bit? Would you be disappointed if it wasn't double digit in the second half?
I'll frame it by saying a few things. One, we have easier comps, so I think our growth in the second half of last year in digital advertising was inside of 5%. The comps get meaningfully easier. I think I mentioned this before. I'll say we do have good just kind of pipeline visibility in seeing the things we're selling in branded content, in marketing services, in video and in VR. We've got some optimism around that. As I said, programmatic is becoming a bigger and also more predictable part of the business. I'll mention, we had in the second half of last year, we launched Mobile Moments and Flex Frames on mobile, so we improved the display advertising on mobile, and we'll be bringing that energy and that sort of re-imagination to the desktop.
I stand behind the guidance Jim's given generally, but say that we believe in our strategy and we feel optimistic about the back half of the year.
Great, thanks.
There are no further questions at this time. I turn the call back over to Mr. Toplitzky.
Thank you for joining us this morning. We look forward to talking to you again next quarter.
This concludes today's conference call. You may now disconnect.