Good morning, and welcome to The New York Times Company's third quarter 2021 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Harlan Toplitzky, Vice President of Investor Relations. Please go ahead. Thank you, and welcome to The New York Times Company's third quarter 2021 earnings conference call. On the call today, we have Meredith Kopit Levien, President and Chief Executive Officer, and Roland Caputo, Executive Vice President and Chief Financial Officer. Before we begin, I would like to remind you that management will make forward-looking statements during the course of this call. These statements are based on our current expectations and assumptions, which may change over time. Our actual results could differ materially due to a number of risks and uncertainties that are described in the company's 2020 10-K and subsequent SEC filings. Given the impact of the COVID-19 pandemic on our business in 2020, we will also present certain comparisons of our operating results in 2021 to 2019, which we believe in many cases provides useful context for our current year results. 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. Finally, please note that a copy of the re-prepared remarks from this morning's call will be posted to our investor website shortly after we conclude. With that, I will turn the call over to Meredith Kopit Levien. Thanks, Harlan, and good morning, everyone. The Times had a strong third quarter with the power of our subscription-first strategy on full display. It was our best third quarter in both news and total net subscription additions since the launch of the digital pay model more than a decade ago. Outside of 2020, it was our best quarter ever for digital subscription additions. We hit an important milestone during the quarter. The Times now has more than 1 million international digital subscriptions. We've said for some time that we see a huge opportunity to reach curious English-speaking people, not just in the U.S., but around the globe, and we continued to prove that out in Q3. We added a total of 455,000 net new digital subscriptions in the quarter, including 320,000 for news and 135,000 for Games, Cooking, and Wirecutter. This progress reflects the enduring demand for quality, independent journalism and our long-term potential to mean more to more people across a range of news and life needs. Total revenues grew 19% in the quarter, with digital subscription revenue rising 28% and advertising up 40% for both print and digital. As a result, adjusted operating profit grew 15% despite a 20% increase in adjusted operating costs. The quarter was a busy one in news. While COVID remained the dominant story as it has for the last 20 months, a wide range of topics also captured the public's attention, including the Afghanistan withdrawal and the tragic events in Haiti, the resignation of New York's governor, and our ongoing climate reporting. These are the kinds of stories that our 2,000-person journalism operation is uniquely positioned to cover with depth and thoughtfulness. The news cycle no doubt played a role in the quarter's performance, but so too did our improved command over the levers of our model. I've talked in the past about our efforts to build enduring daily habits whatever the news cycle. Those efforts are now bearing fruit. A prime example is our flagship newsletter, The Morning, which now has more than 5.5 million daily readers. Not only does The Morning provide real value to our audience, helping them quickly digest the day's most important stories, its programming mix is increasingly effective at driving people on site. That, plus improved marketing messaging, makes it a steady source of new subscriptions. We improved conversion in the quarter with a variety of planned experiments across the customer journey. We're using data and machine learning in increasingly sophisticated ways to identify the right moment to ask a reader to become a subscriber. Tests involving our algorithmic meter and paywall have been particularly promising. We also continued to experiment more broadly with friction and value exchange to find the right balance between converting readers into paying subscribers and growing the pool of prospects at the top of the funnel. Some of those experiments entailed more aggressive limiting of access to our journalism for non-subscribers, which had a meaningful positive impact on starts in the quarter. We've loosened those restrictions somewhat in the current quarter as we fine-tune and balance the model. We're also working to improve and differentiate the subscriber experience to showcase the benefits of subscribing to prospects and also to drive retention. To that end, we introduced a portfolio of subscriber-only newsletters in the quarter, leveraging some of our existing newsletters with strong followings, like Paul Krugman, Watching, and Well. We also launched several new newsletters, including Professor John McWhorter on race and language, and Tressie McMillan Cottom on culture, politics, and the economics of our everyday lives. As a result of strong demand for news and strength in conversion in the quarter, we were able to profitably increase media spending. That too contributed to our record quarter for net additions, and we did so while our mix of paid and organic starts remained heavily weighted to organic. We continue to pay close attention to churn, which will require increased focus and energy as our subscription base grows. As I've said in prior calls, we generally view our churn rate, which has vacillated within a relatively narrow band over the last few years, as a strength. That continued in the third quarter with a slight improvement. We expect pressure on churn in the fourth quarter as promotional pricing ends for the cohort that started last year around the presidential election and as credit card regulations tighten in some markets. We continue to believe that our focus on driving repeat engagement and on enhancing the subscriber experience will reduce reasons to cancel over time. One of the ways we intend to boost engagement and showcase the benefits of subscribing is by getting more people to experience the full value of The Times, including our current standalone products, Cooking, Games, and Wirecutter. The success of these standalone products alongside the growth of our core news product begins to demonstrate the potential of our multiproduct bundle. As we experiment more with cross-promotion, we're seeing more news readers also engage deeply with Cooking and Games. Over time, we expect that a bundle offering all of our products can play a big role in driving conversion and in giving subscribers more reasons to engage and retain. Cooking and Games continue to show promise as compelling propositions for subscribers in their own right, with each product nearing a million total subscriptions. Net subscription additions to Games were 35% higher in Q3 than the prior quarter and more than 20% higher than last year. Cooking net additions more than doubled quarter-over-quarter and were on par with last year's elevated Q3 with a first-time price promotion and access model experiments driving the results. We also launched paid subscriptions to Wirecutter in the quarter. While a relatively small contributor to overall subscription additions, it's off to a promising start, especially among existing Times subscribers, with 10,000 net subscriptions in the first month. It's been a fertile period for product development at The Times, both within and beyond our existing products. Last month, we announced that we'll test a new digital experience we're calling New York Times Audio. It's a single destination for listeners to enjoy the full range of our audio storytelling, which today reaches 20 million listeners a month. We also officially launched a beta for a digital kids' how-to product inspired by our popular monthly print kids section. Costs were higher in the third quarter, largely driven by higher paid media expenses as well as the strategic investments we're making in journalism, product development, and technology to allow our digital subscription business to scale efficiently. The guidance we provided in our earnings release suggests a similar level of cost growth in the fourth quarter, including increased marketing costs. As I've said in the past, you can expect us to continue to invest into our long-term opportunity to lay the foundation for a larger, more profitable business over time. Turning to advertising, we had another strong quarter of revenue growth. While year-on-year growth slowed in the third quarter compared with the second, as expected, digital advertising revenues grew 22% compared with 2019, the same rate of growth as we reported in the second quarter. Our third quarter results continue to reflect the benefits of the overall market recovery, as well as marketer interest in our proprietary products, including the first-party data that stems from our subscription business and our growing offering of captivating podcasts. I'll close by reiterating that our business success is tied inextricably to our mission of helping people understand the world. Key to that is hiring the best journalistic talent available. Several exceptional journalists joined us in recent months, including Lulu Garcia-Navarro from NPR, Peter Coy from Bloomberg Businessweek, and Paul Volpe, who returned to The Times from POLITICO, where he was executive editor. Before I turn it over to Roland, I also want to make note of an effort by many of my colleagues to evacuate 159 of our current and former Times colleagues and their families from Afghanistan. These Afghan colleagues and so many others fleeing the country went through a harrowing experience, and it has been nothing short of awe-inspiring to watch this institution come together to help. I'm incredibly grateful to the many colleagues who supported their journey to safety and continue to do so as they resettle. With that, over to you, Roland. Thank you, Meredith, and good morning. Fundamental strength in the underlying business, exemplified by strong digital subscription unit growth and healthy growth in both subscription and advertising revenues, resulted in strong financial performance in the third quarter. Adjusted diluted earnings per share was $0.23 in the quarter, $0.01 higher than the prior year. We reported adjusted operating profit of $65 million, higher than the same period in 2020 by $9 million and $21 million higher than 2019, which we continue to believe is an important comparison point given the impact that the pandemic had on our 2020 results. As Meredith noted, we added 320,000 net new subscriptions to our core digital news product and 135,000 net new standalone subscriptions to our other digital products, for a total of 455,000 net new digital-only subscriptions. As of the end of the quarter, we had approximately 980,000 Games subscriptions, approximately 900,000 Cooking subscriptions, and 10,000 Wirecutter subscriptions, the Wirecutter subscription offering having launched at the beginning of September. The international share of total new subscriptions remained at 18% as of the end of the quarter. Total subscription revenues increased nearly 14% in the quarter, with digital-only subscriptions revenue growing nearly 28% to approximately $200 million. Digital-only subscription revenue grew as a result of the large number of new subscriptions we added in the past year, continued strength in retention of the $1 per week promotional subscriptions were graduated to higher prices, and to a much lesser extent, the impact from our digital subscription price increase. Digital news subscription ARPU for the quarter increased approximately 5 percentage points compared to the prior year and nearly 1 percentage point compared to the prior quarter. This improvement in both the year-over-year and sequential result was primarily due to subscriptions graduating from their introductory price to either full price or an intermediate step-up price in the quarter, as well as the continued benefit from price increases on our more tenured full price subscriptions. ARPU related solely to domestic news subscriptions increased 6.5 percentage points versus the prior year and approximately 1.5 percentage points versus the prior quarter. We continue to expect the impact from subscriptions graduating from discounted promotions and the price increase on tenured digital subscriptions to provide a tailwind to digital news ARPU through the balance of this year. Print subscription revenues declined 1% as overall volume declines more than offset the benefit from the first quarter home delivery price increase. Total daily circulation declined approximately 7% in the quarter compared with prior year, while Sunday circulation declined approximately 5%. Compared with 2019, print subscription revenues declined 5% as single copy and international bulk sales copies declined, while revenue from domestic home delivery subscriptions grew 1.7%. Total advertising revenues increased 40% in the quarter as both digital and print advertising grew approximately 40%, in large part as a result of the impact of the comparison to weak advertising revenues in the third quarter of 2020. Digital advertising continued to be buoyed by our proprietary first-party targeted ad products and expanded audio product portfolio. Compared with 2019, digital advertising grew more than 22% as a result of higher direct sold advertising, including traditional display and audio. Meanwhile, print advertising increased 39% compared with 2020, primarily driven by growth in the luxury and entertainment categories. However, print advertising remained below 2019 levels by 25%. Other revenues increased 19% compared with the prior year to approximately $56 million, primarily as a result of higher licensing, commercial printing associated with the addition of the Dow Jones family of products to our operations and Wirecutter affiliate referral revenue. Adjusted operating costs were higher in the quarter by approximately 20% as compared with 2020 and approximately 16% higher than 2019. Cost growth came in at the top end of the guidance we issued in early August, largely due to the profitable deployment of additional marketing media above initial estimates. Cost of revenue increased 9% as a result of growth in the number of newsroom, Games, Cooking, and Audio employees, higher subscriber servicing costs, a higher incentive compensation accrual, and other costs in connection with the production of audio content. Sales and marketing costs increased more than 65%, driven primarily by higher media expenses, which had been reduced last year in light of the historically strong organic subscription demand. When compared to 2019, sales and marketing costs increased more than 30%, while media expenses were approximately 54% higher. We expect media expenses to remain elevated in the fourth quarter. Product development costs increased by approximately 18%, largely due to the growth in the number of engineers and a higher incentive compensation accrual than had been recorded in the third quarter of 2020. General and administrative costs increased by 26%, largely due to a higher incentive compensation accrual and increased headcount in support of employee growth in other areas, stock price appreciation on stock-based awards, and higher consulting costs. We recorded one special item in the quarter, a $27 million gain related to a non-marketable equity investment transaction, which is reflected on the interest income and other line of our income statement. Our effective tax rate for the third quarter was approximately 27%, which is in line with the rate we expect on every dollar of marginal income we record, with the possibility of significant variability around the quarterly effective rate. Moving to the balance sheet, our cash and marketable securities balance ended the quarter at $1,043 million, an increase of $96 million compared with the second quarter of 2021. The company remains debt-free with a $250 million revolving line of credit available. Let me conclude with our outlook for the fourth quarter of 2021. Total subscription revenues are expected to increase approximately 12% compared with the fourth quarter of 2020, with digital-only subscription revenue expected to increase approximately 25%. Overall advertising and digital advertising revenues are expected to increase in the mid-teens compared with the fourth quarter of 2020. The expectation that the rate of digital advertising growth will slow compared with our third quarter is partially a result of more difficult comparisons in the fourth quarter. Other revenues are expected to increase approximately 15%. Both operating costs and adjusted operating costs are expected to increase approximately 17%-20% compared with the fourth quarter of 2020, as we continue investing into the drivers of digital subscription growth and compare against another quarter of low spending last year. With that, we'd be happy to open it up for questions. We will now begin the question and answer session. To ask a question you may press star then one on your touchtone phone. If you are using a speaker phone please pick up the handset before pressing the keys. To withdraw your question please press star then two. At this time we will pause momentarily to assemble our roster. The first question comes from Thomas Yeh with Morgan Stanley. Please go ahead. Hi. Good morning. Thanks for taking my questions. Meredith, can you talk a bit more about the experimentations during the quarter around the more aggressive limitations on access for non-subscribers? You said you were leaning back a bit in 4Q. Do you see that as a continued lever to pull during hotter news cycle periods? Given some of the pressure you're anticipating on churn in 4Q, what are the things you plan to do differently to drive paid conversion in 4Q relative to 3Q? Can you give us an update on the advertising trends by categories and whether IDFA or supply chain inventory constraints that we've been hearing about on the advertiser side have any impact on the demand that you're seeing? Thank you. Yes. Good morning, Thomas Yeh. That's lots of questions. Let me see if I can remember them all and try and answer. I'll do that advertising question first. We have not seen a huge impact. I think you're asking if we saw an impact of IDFA. We are, I would say, on the ad side, less exposed to that. We tend to be in upper funnel business. A lot of our advertising is brand advertising, the advertising, you know, that people buy from us. So we have not seen a huge impact from that. We didn't see it in the third quarter. We don't expect to see a huge impact. You know, that could have impact on just overall demand in the market. That remains to be seen, but it's not been a big factor, and I'd say we are less exposed because of the nature of our ad business. I think that's your primary ad question. Yes? Yeah, supply chain inventory constraints. Yeah. I think. Listen, I'd say similarly, we did not see a big impact from all the issues around product supply chain, that many others have reported in the third quarter. I would attribute that to our ad business being largely driven by, you know, upper funnel and middle funnel advertising versus lower funnel. That doesn't mean that we won't see some pressure from that. It's hard to imagine that doesn't just ultimately affect total marketer spend over time. I think the bigger thing you're hearing from us on the guide in the fourth quarter is just the comp starts to get harder because the market started to recover last year, and that's all within the range of expectation that Roland and I have suggested previously. On your first question, let me try and get it and you'll help me out if I missed any of it. In terms of experimentation on conversion, we did a number of things in the quarter, and this was all, you know, we referred to these as things on our product roadmap earlier in the year. We are getting just better, more sophisticated, more precise about using machine learning in how we present our paywall and when we ask people to subscribe. So we've got more signal. We're using that signal more actively, we've got, you know, different ways to apply it, and the models just get more sophisticated over time. I would say, you can expect that broadly to continue. That just kind of gets better and better for the most part as you experiment, and that continues to improve. We also experimented more aggressively on the access model in various parts of the customer journey, and in some cases that meant more restriction of access to our journalism for non-subscribers. I'd say those experiments worked very, very well. What is always the case with us is when something really works, we'll then look at it and say, "How do we make sure this is, you know, very sustainable over time?" What I described in my prepared remarks is that we were more aggressive about restricting access in the third quarter. It played a big role in the results, and we're loosening that somewhat in the fourth quarter, which is not unusual. It just has us kind of fine-tuning and calibrating the model. I think that was the whole of your question. I can't remember if you asked me about churn as well. Yeah. Just touching on the anticipated churn in 4Q. Is the right way to think about that generally just that there was a larger kind of funnel of gross acquisitions and starts in 4Q relative to 3Q because of the elections, and that's why we're. Yeah. Hold on. There's a big group of people coming up for transition to full price because of the election in Q4 2020. You've got a large cohort of people who will go through transition to full price. I mentioned also some pressure on churn from some of the changes in credit card regulations we're seeing in some markets. Roland, I don't know if you have anything to add on that or advertising. No, I think you covered it. The markets that we're seeing the regulation changes imminent are outside the U.S. Okay. Very helpful. Thank you. The next question comes from Vasily Karasyov with Cannonball Research. Please go ahead. Thank you. Good morning. I have a couple. One, you talked earlier this year about your outlook for the EBITDA margin next year. I was wondering if you could give us an update on your thinking there. The second question is, Meredith, for you, and it's about your view on the rise of such platforms as Substack. Do you see them as a competitor? Do you see it as a complementary product? Or just would appreciate your view on that part of the online journalist market. Vasily, I'll take the margin question first. I think the first thing I want to do is give a little context to how this year played out because it's important in answering the question. We've gotten quite a bit more ad revenue coming in the door this year than we had expected and so when we spoke to you earlier in the year, results this year have been buoyed by, you know, very high margin ad business. We got a little bit more margin than we expected to this year. In all, you know, in essence, it moved forward a bit. I don't see a lot of movement on margin next year. You know, Meredith's mentioned a few times we continue to invest in the growth because we both believe we have a very big opportunity. While there's natural leverage in the business and we wanna see that flow through, if that is in conflict with investment we think is gonna grow the business long term and tap into that great opportunity, we're gonna lean towards having a bigger and more profitable business out in the future versus trying to bring money to the bottom line immediately. I don't know, Meredith, did you want to add anything to that? Yeah. I think you said that just right. Vasily, on your Substack question, I'll say a couple things. One, we're quite confident that the sort of broad value proposition across the Times, both, you know, from our core news report and in our standalone products is, you know, sufficiently competitive that we're gonna keep growing even as new players emerge. I think that's probably the first and most important thing to say. I'll say two specific things about Substack. One, I would regard anything that is about helping make the market for paid digital journalism is good. You know, this is still a forming market, and I would regard all efforts to get more people to think about paying for high-quality journalism is a positive thing. I would then just say on sort of our proposition, particularly in subscriber-only newsletters, you know, you might come to The Times because someone like Kara Swisher or John McWhorter or Tressie McMillan Cottom has a newsletter that you wanna follow and buy, and you pay for that, but you get the whole of The New York Times value proposition with that. I would say we believe strongly that the competitive proposition that we've got or that the value proposition we've got is a very competitive one. Thank you very much. The next question comes from Craig Huber with Huber Research Partners. Please go ahead. Yeah. Thank you. I guess my first question on your marketing spend up 50%+ year-over-year. It seems pretty clear, right, that you're getting very good leverage on that spend. It sounds like you're going to repeat a pretty high number again in the fourth quarter. I know it's tough to break out in your mind, Meredith, but the marketing spend versus the news cycle versus what you're doing on the back end to try and improve the digital subscriber growth, how much of that is attributable, you think, on a percentage basis? If you have any broad sense for the higher marketing spend. Yeah. First question. I think I understand your question, and I'll say generally, I've said this on previous calls. We spend into demand, and even in this particular quarter, in the third quarter, we spent significantly more money, but our net additions, our starts still came primarily and first and most through organic means. We're still holding ourselves to, you know, to a standard on profitability, and we still spent within our guardrails. I'd say that for us is quite good. I think both Roland and I have said in the past, it's almost the opposite of what people believe. You sort of spend into a high conversion environment, spend into demand, and we can do so profitably. The long view is that the model will continue to be disproportionately weighted to the product itself as the primary engine of demand, not paid media, not paid marketing, but where we can spend profitably, we will do that, to grow faster. The other question, maybe talk about the addressable market in the U.S., but also globally. Can you put some numbers around that? You've done that in the past. Has that changed in your mind at all for digital subs? Did you ask total TAM or international or both? I'm sorry. U.S. and internet and global, however you want to look at it. Yeah. We still believe that there are at least 100 million people who you know speak English. English-speaking, college-educated around the world who will pay for quality journalism through a digital subscription. We think at least half that market is in the United States, half of it is outside the United States. I'd say our confidence that the market is there is at least as good as it was and potentially growing. In international, I think we've talked about this before, but I'll say, you know, we think half that audience is, at least half of it is outside the United States. We're probably looking at a second read audience. It's not just people who will pay for a digital subscription to quality journalism, but someone who will pay for two, and our assumption is that we can win a larger share of a second read market, which is probably smaller than 50 million people, but that we can win a large share in that. I'll just say one more thing. I think we still have real running room domestically. Our international strategy in pursuit of that opportunity presupposes that we continue to lead and advance that lead domestically. My final question, if I may. For the fourth quarter, maybe just help us think about what are you expecting generally for your news-only digital sub additions in the fourth quarter? As high as you saw in the third quarter, which is quite a stellar number, more of an average of the two middle quarters for the fourth quarter? How are you sort of thinking about that? My other question related to that is what happened in the third quarter? Was it the last month and a half that came in significantly better than you perhaps were originally thinking? Good problem to have. Yeah. Let me take the first question and just say we're gonna continue to see variability from quarter to quarter. It's why we don't guide quarterly on net ads. On one hand, you're seeing us gain more control of the levers, and on the other hand, we also all know that there are plenty of outside forces that can affect our business in any given quarter. With that in mind, you know, I don't have more guidance to give you than what Roland has already said from a revenue perspective. You can go back to what I said in the prepared remarks, and draw some of your own conclusions. We've said we really succeeded in our experiments around tightening access, and we're loosening some of that in the current quarter. I also said that we expect to see more pressure on churn for some specific reasons in the current quarter. At the same time, the fourth quarter, if you look at the trajectory in standalone products, tends to be a brisk period in standalone. I think I'll leave it at that. Thank you. The next question comes from Kannan Venkateshwar with Barclays Capital. Please go ahead. Thank you. Meredith, firstly, on the advertising side, I think, you know, over the last few years, there's just broadly been this philosophy, I think, of leaning more towards subscription and less on advertising. It feels like the advertising business, at least on the digital side, is becoming a lot more stable and you have a bit more visibility around it. If you could just help us understand with, you know, new products like audio, for example, should we expect that trend line to become more stable as you go into the coming quarters? Related to that, what's the contribution margin for digital advertising versus print? Because you do have some more costs, I would assume on the digital side versus print. I'm just trying to figure out if the contribution margin is higher or lower. I have a follow-up. Yeah. Roland will probably give you a better detailed answer on your second question. Let me take the first one and maybe say a little bit about the second one. In general, I think I said this last quarter, we like our ad business better now. We particularly like our digital ad business better, and in the sense that it is much more about our proprietary first-party data products applied to media, where I think we still have plenty of running room. That business now sort of runs on the same high octane gas that the subscription business runs on, which is a real strength for the whole model, and that's you know, deeply engaged, registered, logged in users whose data we have access to in privacy forward ways. You know, we believe that has had and could continue to have a stabilizing effect on the ad business, and we like that very much. We're a little bit less susceptible to, you know, the swings from big deals from one quarter to the next. We also are optimistic about and really like our position in audio. There seems to be quite a bit of demand for high-quality audio, and we've got a great suite of audio products that we're, you know, that are really performing well with marketers and because by the way, they're performing well with consumers. We like all of that. To your point, thus far it has seemed to have and could have going forward, you know, a more stable character. All of that said, I'll just repeat the thing Roland and I have both said now for some time. Advertising in general tends to be a more demand-driven business than a supply-driven business. I think we are better positioned to go after that demand than we have been in some time, but it is still demand-driven, and the market can change pretty quickly. The market is also shaped and dominated by very large platform players that operate at a scale that's different from the Times, and so we don't rule out that there can be significant swings in any part of the business as a result of that. Roland, I don't know if you'd add anything or want to comment on the margin. Yeah. I'll comment on the margin question. A couple things to say, Kannan. One is we run the digital ad business at a much higher margin profile today than we did, say, two, three years ago. That's kind of one point of information. Relative to print, it really depends on mix. If we're selling straight display in digital, I'd say the margins are comparable to print. But if we're heavily using creative services to support the sale, or if it's a large partnership where we're creating content and other digital assets associated with sales, the margin's not as good in digital. In terms of total margin, a lot of it depends on that mix. More heavily weighted to display, the higher the margin. Got it. I guess broadly, in terms of sales and marketing spend, Meredith, you mentioned that, you know, organic growth is driving a bigger part of your total acquisitions. So when you frame the spending around media, how do you think about it? Is it a percentage of revenues? Is it basically, some of the framework which is more bottom-line dependent? I mean, how do you frame the total amount you want to spend on sales and marketing in a given quarter? Yeah, I'll take that question, Kannan. First I wanna break out brand from direct acquisition spend. Let's talk about direct acquisition spend for a moment. We guide that based on an internal rate of return. We'll spend into particular channels. The marketers will spend into particular channels until they drop below that rate of return, and then they won't spend any more. That's really the guide is completely on a return on SAC. Brand is different. You know, we will pick particular moments in time to spend brand money. We're actually ramping into that now. A bit of the elevated spend in Q4 is actually going to be brand, and not direct acquisition spend. We've been pretty much running it that way for quite a while. Just one other point. I think when Meredith talked about organic becoming a bigger part, she's talking about over the long term. The percent of starts that have been coming from organic has been bouncing around in a pretty narrow band for quite a while now, with the vast majority of it being organically driven. Got it. Just as a follow-up to that, I mean, if a bigger part of the spending is skewing towards media and, you know, brand advertising, is it fair to say that when you look at your CAC numbers, those have essentially improved over the maybe the last couple of years? I mean, has it gone down over time? Well, last year, like again, last year, such a special year. They were. The CAC numbers were very low last year. The LTV to CAC numbers were very high. They've come back in line, more looking more like they did in 2019 at this point. You know, we're really happy with where they are. As I said before, we're very focused on that hitting that internal rate of return as our guide. I think we emphasized, and I did in my script that overspend in marketing was all productive and profitable, otherwise we would not have deployed that cash there in that manner. Thank you so much. The next question comes from Doug Arthur with Huber Research Partners. Please go ahead. Yeah, thanks. Two questions. Roland, you had said at the beginning of the year on the cost side that one mitigating factor would be your ability to hire the talent that you're seeking. I guess my question is that starting to ease? What is your headcount up year- over- year? I've got a follow-up. I think Meredith. Yeah, I'm happy to take the talent question broadly. I would say in journalism, it's going quite well in terms of our ability to hire talent. On the product and technology and engineering side, we're optimistic that over a long time horizon, this will continue to be a really compelling place for people to work. I will say, though, that we are subject to the same sort of labor market forces that every other business with a scaling digital product is subject to, which is there's enormous competition for engineering talent, data talent, digital product talent, and design talent. And so we're incredibly focused on that. I think over a long time horizon, this will be a place where it will be a very compelling place for people to work. I think we moved a little more slowly than we would've liked this year so far, on hiring. Yeah. In terms of the increase in headcount, it's, you know, it's roughly 5%-6% up. Okay. Just as a follow-up to that, Meredith, I mean, you've talked about the tech stack at The New York Times not being where you think it ought to be, you know, eventually. I guess, how do you frame that in terms of what inning you believe you are in terms of getting to where you wanna be? You've talked about, you know, your success and conversion in the third quarter. Any comments on that? I have to think about the timing question. What popped into my head was, you know, maybe third or fourth, but let me. I'm not even sure that's right. Let me say it to you differently, which is where I think we're quite sophisticated is on the consumer-facing experience front. So driving engagement, driving conversion, rapid experimentation. I mean, the quality and the pace of experimentation has gone up pretty dramatically in the last couple of years. Where we're putting a lot of effort and still have long arc work to do is in the back end, underlying platforms and systems, which I think really matter. We actually, I think we announced last quarter, I can't remember, getting a thumbs up from Harlan. We just hired a new CTO who I'm super excited about, a guy named Jason Sobel, who was previously at Airbnb for 5.5 Years. He was at Facebook for, I think, six years in its early days and arc of growth. He comes with a pretty deep back end and infrastructure background. We talk a lot about this next phase of our strategy as sort of getting to scale with journalism worth paying for. A lot of that is about having the platforms in core tech and in data to make sure we can do that. You can imagine that's gonna continue to be a real area of focus for us. I'm optimistic that we're on the right track. I'm more optimistic than I've been in some time, and there's plenty of work still ahead of us. Great. Thank you. This concludes our question-and-answer session. I would like to turn the conference back over to Harlan Toplitzky for any closing remarks. Thank you for joining us this morning. We look forward to talking to you again next quarter. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.