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dimensionalize the opportunity around that push. I think the big focus sounds like it's centered on building engagement and brand, but I guess how should we think about how it affects advertising? Do you see this as maybe another aperture for expanding into video advertising opportunities? And then also maybe just touching on what kind of incremental investment needs this push might entail. And then secondly, on the family plan, it looks like it now represents 2% of your digital-only subscriber footprint, and Looks like it also came through predominantly on the game side versus the bundle. Can you talk about what stage of the rollout you're in and if there's any appetite to push further on that in terms of maybe restricting sharing somehow on your non-family plan?

I'm happy to take both those questions, Thomas. Good morning. Let me start on video. I think the first thing to say is we think it's a big opportunity for the company and we're in early days of it. We know lots and lots of people are seeking out and getting their news and the other kinds of content we make in the form of video. And so we think having more video gives us a big opportunity to engage our the people we already have more and to engage even more people and to do that both on and off our platform. And you asked specifically about advertising. I'd say we are early here. Our first priority is to do what I've just described, which is to drive more engagement. And ultimately, you know, having a wider engaged audience is what drives every part of our business, subscriptions, advertising, affiliate licensing. So We just think, you know, we think this is a really important part of our go-forward growth plans, and we're very excited about what we're doing there. On family plan, we are really excited about this. We're, you know, it's definitely played a role in the quarter. Family plan is good in a bunch of ways. It's good for market penetration. There you can think of it as, you know, the subscribers we already have bringing in other subscribers. And because the family plan subscription is priced at a premium, it's additive to subscription revenue. It's great for engagement. It's great for retention. And then I think you asked specifically about it's waiting to gains versus the bundle. That is not, I would not think about it that way. I would think about it as We presented a family opportunity in both the bundle and in games, and we are really excited about the performance of both.

Thank you so much. That's very helpful.

And the next question comes from Benjamin Soft with Deutsche Bank. Please go ahead.

Good morning. Thanks for the question. I was wondering if you could talk a bit more about the growth rate in OpEx for 4Q, kind of what's driving that higher growth rate and should we expect that to continue at similar levels going forward? And then on capital allocation, your cash balance has continued to grow nicely, even as you've been returning 50% of free cash flow to shareholders. I wanted to check in and see what your latest thoughts were there and how you might potentially go about deploying that cash. Thank you.

Sure, thanks. I'll take both of those. So, look, on the cost for Q4, the guidance, and this is relevant to Q3 and going forward, I think the most important thing I always want to say, stepping back, we remain focused over the long term on sustaining healthy revenue growth, AOP growth, and margin expansion. So everything we talk about in cost is in the context of that. Now, we do that, you know, our approach to that and our strategy is – to be both disciplined in costs and efficiency, but also making long-term investments that are helping to further areas that best position us for sustainable growth. And that's our world-class news journalism, lifestyle products, and the product development that underpins our content. Now that includes areas like video, which Meredith said in her remarks, which we're excited about. So specifically your questions on Q4 and Q3, a couple of things. we're seeing there is that continued investment into the journalism products, so areas like video. We also have, as you see in Q3 results, and you can expect in Q4, flexibility to lean into areas like sales and marketing when there are good returns in the market, or when we see a good opportunity for a great brand campaign. We have had that one in the market now. It's your role to understand, which we really like. And then the last thing to note, is that there can be some variable expenses correlated with revenue performance that can lead to fluctuations in any given quarter. This played a bit of a role in Q3. It could well end up playing a role in Q4 as well. So that disciplined approach overall to being really focused on cost efficiency while also making investments is what you're seeing in our cost performance throughout the year as well as in the Q4 guide.

Great. Thanks, Ben.

And then the question on capital allocation. Okay, go ahead. Yeah, on that one, I would just say, you know, no change in strategy there. We believe the capital allocation strategy is working really well for us. So, you know, the key thing is top priority for us has always been we have At the core, our organic growth strategy, essential subscription strategy, so investing into high return opportunities to continue that growth. We just mentioned video, for example. And then to this, you know, point of Meredith talked about in her remarks, a dynamic market environment. We like having a strong balance sheet that gives us optionality to capture opportunities should we see them, including opportunistic additional capital return. That's at least 50% is the capital return target. It's just worth making sure to reemphasize that, you know, our bar for capital allocation is really, really high. So, we've seen that in our track record thus far with any M&A we've done, and you can expect us to continue to have that very high bar going forward.

And the next question comes from David Karnvosky with JP Morgan. Please go ahead.

Hey, thank you. Maybe following up on the watch tab, wanted to see if you could speak a bit to the functionality of the product. Is the goal to make that highly personalized or are you also kind of highlighting top stories and other parts of the coverage and how do you think about the process of inserting ads there? And then just secondly, regarding other single product, you know, I think this is the best quarter for dead ads on record. Maybe you could just break that down across the various single products and for games specifically, how material you know, were factors like putting mini-crossword behind a paywall or PIPs, which you rolled out in August. Thank you.

I'm happy to take both of those, David. Thank you. Let me start with video and the Watch tab, and I'll step back just a little bit and note a number of things we're doing in video, and the Watch tab is kind of one of them. You know, we now have, you know, on our site and in the app, substantially more news video on whatever the major stories of the day are. We have many more reporter videos with reporters essentially explaining their work and humanizing journalism. That's great for enhancing trust, and it also serves as a teaser to longer-form work that we do. We turned most of our podcasts now into full-length shows. The Watch tab and the work we've done in the Today feed to get people to watch video more and go to that tab is all just kind of part of that broader effort to get more engagement with, you know, more and more of the journalism. in video. In addition, by the way, to reading and listening, neither of those things are going away. In the Watch tab specifically, I would say it is early days on your question about advertising. The most important thing we can do is get lots and lots of people to engage with our video on platform, in the tab, and off platform. And the more we do that, the more opportunity I think it opens up across all of our revenue lines. So I'm sort of long-term optimistic about that. On your question about single product subscriptions and games, we are really pleased with the strong net ads growth in the quarter. And I would say it's kind of a strategy working as it's designed to do. We've got multiple growth levers, including games, that are all going to play different roles in sort of different quarters. And games definitely played a role Here, on the mini specifically, which I think you asked about, the idea here is that we were, you know, pretty intentional about, you know, long-term value creation. In the case of the mini, our decision to make that a paid subscription, very intentional one. we believed and it's proven to be the case that we would do it in a way that did not sacrifice in a big way engaged audience. So we feel great about that. And the idea here is that we've got sort of multiple ways to monetize, you know, across the portfolio, including in games. And what we're optimizing for here is, having the widest possible audience for all of our work, in this case, games, and also having plenty of reasons for people to feel like they should pay. And you could sort of extrapolate that to the kind of broader theory of how we make free pay decisions across the enterprise. I think the thing to know on games is we are always adding value to the portfolio. We've got a robust pipeline kind of at all times. of new games in development and a very good track record here, and we're just excited about the opportunity.

Great. Thanks, David. Operator, next question, please.

And the next question goes to Cutgun Morrell with Evercore ISI. Please go ahead.

Great. Good morning, and thanks for taking the questions. Two, if I could. First, advertising continues to be an area of strength in the quarter, and you expect the momentum to carry into the fourth quarter. I know you called out marketer demand and new advertiser supply, but can you unpack the dynamics there a bit more? How much of this is attributable to the underlying market compared to uptick from some of the new product innovations that you've been actively rolling out across the portfolio? And second, on affiliate licensing and other revenues, you had a healthy third quarter. Is there anything more you can share on Q4 and the outlook for the slight deceleration in growth to mid-single digits? I know we're not talking about 2026 just yet, but I was hoping for more color, especially in the context of the Amazon AI partnership. Thank you.

Why don't I take the advertising question? Will, you'll take the one on other revenue. Look, I think the first thing to say is we're really pleased with what we saw in the quarter and, you know, frankly, so far all year. And it's a little bit of everything working to answer that. your question directly. The big picture here is we kind of see the ad business increasingly like we see the consumer business. You know, the consumer strategy is to mean more to more people. And in advertising, we're kind of providing more value to more advertisers in more ways. So we've got these really big products in big spaces where there's lots of consumer interest, especially in news and I would say games and sports. but also shopping and cooking. We have lots of engagement for all of those products, which allows us to really effectively target people at scale. We have great ad products. By the way, we've been at that targeting and at those ad products for many years now, very deliberately building first-party data, very deliberately building a suite of proprietary ad products. And we're continuing to sort of extend those across the portfolio. And we keep innovating in our ad products. So our AI-powered brand match, which I think we launched a year ago, is really also helping on the targeting front. All of that means we've got ad products that work. And I think we're executing well. So the sort of broad answer is it's a little bit of everything that you're pointing to.

And then on affiliate licensing and other and the dynamics there, it's just always important to remember that that revenue line has a lot of different items that can both create some variability quarter to quarter, as well as make it difficult to isolate the contribution of any one particular item. And so, you know, we've said this in the past, it's obviously not just affiliate. And licensing is multiple licensing items. deals there. It's both TV film, it's commercial printing, so a lot of different dynamics. And I think the most important thing to say there, you know, looking forward, not just Q4, but, you know, into the future, as you said, is just given our strategy to make our news journalism and product portfolio more valuable to more people, we expect this revenue line to grow over the long term as part of our multi-revenue stream model.

And the next question comes from Doug Arthur with Huber Research Partners. Please go ahead.

You didn't break out the athletic as promised. Any color on it? Was it additive in line? Any color would be helpful. Thank you.

Morning, Doug. I'll just say we continue to be very pleased with the performance of the athletic. It remains on track for all the things we wanted to do. I mentioned in my remarks sort of consistently strong engagement across the portfolio and the addition of video in lots and lots of places. I think this was the quarter where we introduced NFL footage. We already had NBA footage. We introduced NFL footage and we're combining that with our signature journalism and our reporting. And I think that's a great product experience for engagement. NFL is a huge part of what The Athletic covers and we're continuing to build audience and awareness for the brand, Athletic, and I would just say it's all going well. Big contributor and advertising, all going very, very well.

And still early. Excellent. Just as a follow-up on the surge in single product subscribers, are you getting the conversion – off those over time that you expect? I mean, how is that playing out to higher value products?

I think the best way to describe it is we really, it's really the model working kind of as it's designed to work. Our single products are serving as a wonderful engine of audience and engagement. And in many instances or funnels to get people to subscribe either to the individual product or to the bundle, that's all kind of working as we expected it to. And they're also all proving to be very valuable to the sort of multi-revenue stream monetization. I've called out games and sports in particular as being big spaces that marketers You know, see real value in and want to be around. And we have on games, you know, a scaled audience, lots and lots of people who play our games. And in the athletic, we are really growing the audience. So we see a big opportunity there. But I would say it's all kind of going. It's all working together. as it's designed to as far as driving subscription, advertising, and ultimately the whole model.

Great. Thanks, Doug.

This concludes our question and answer session. I would like to turn the conference back over to Anthony DiClemente for any closing remarks.

Well, thanks, everyone, for your interest and for joining us on the earnings call. We'll see you next quarter.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.