(Bloomberg) -- For years, Wall Street rewarded the New York Times Co. with an ever-rising stock price as it continued to introduce new subscription services and sign up online customers.

Now, an activist investor is urging the company to raise prices and wring more profits from a lineup of services that includes games, recipes, sports and product reviews, as well as its flagship newspaper.

In a letter to investors first reported by Bloomberg News, investor ValueAct Capital Management advised the Times to raise the price of its bundle of digital products, citing research that 74% of customers who subscribe to the package are willing to pay more once the promotional rate expires. It said the Times should be “increasing price in line with value delivered.”

The move is part of a broader rethinking that has also affected the streaming video business, where investors of companies like Netflix Inc. and Walt Disney Co. are no longer focused solely on subscriber growth. On Wednesday Disney said it would hike the cost of its Disney+ streaming service by 38% for those who don’t want to see ads.

Shares of the Times fell 2.3% at 10:11 a.m. on Friday, paring an 11% gain in the prior session.

Until this year, Times investors were mostly focused on customer growth. In 2019, when management set a goal of 10 million subscriptions by 2025, the company’s stock price jumped 12%, hitting a 13-year high.

Investors didn’t seem concerned that growth was being fueled by charging new subscribers as little as $1 a week for a year. In February, the Times set a new goal of 15 million subscribers by the end of 2027. 

“We’ve entered a new phase where people accept that the 15 million digital subscriber goal is within reach,” said Douglas Arthur, an analyst at Huber Research Partners. “The question now is where are the profits?”

ValueAct, which said it owns a 7% stake in the company, is calling for the Times to double or triple its profit margins from current levels. 

The Times said it’s begun a concerted effort to entice more people to buy a bundle of subscriptions instead of only news. On an earnings call this month, Chief Executive Officer Meredith Kopit Levien said bundle subscribers pay more and are less likely to cancel than those who just get news subscriptions. Levien added that the Times plans to “lean more heavily” into selling the bundle to new subscribers and get existing subscribers to upgrade in the second half of the year. 

“We expect much of the revenue benefit from this to begin in 2023, as we follow our proven playbook of moving subscribers from introductory offers to higher prices over time,” Levien said. 

The Times currently offers a subscription bundle to news, cooking, games, the product-review site Wirecutter and the sports website the Athletic for $1.50 a week for one year -- a 76% discount. 

Arthur said the Times “probably needed a little more urgency on the bottom line, and that speaks to price.” But it will need to raise prices gradually, not all at once. 

“They’ve been successful because they have not price gouged,” he said. “They can’t turn around and start charging much higher prices.”

(Updates with Friday’s trading in fifth paragraph.)

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