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News Corp. Quarterly Profit More Than Doubles

News Corp generic image - H 2012
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UPDATED: Costs associated with "News of the World" scandal amounts to $56 million during the second fiscal quarter.

News Corp. on Wednesday reported net income of $2.38 billion in the second fiscal quarter, up substantially from $1.06 billion a year earlier, primarily due to gains on acquisitions of Fox Sports in Australia and Fox Star Sports Asia.

News Corp. revenue rose 5 percent to $9.43 billion, and earnings were at $1.01 per share. Without the big gains from acquisitions and other factors, the company posted per-share earnings of 44 cents.

The parent company of the Wall Street Journal, Fox News Channel and 20th Century Fox was expected to earn 43 cents a share on $9.3 billion revenue.

Despite beating expectations on both the top and bottom lines, shares of News Corp. dropped 2 percent in after-hours trading Wednesday. During the regular session, shares rose 7 cents to $28.69. In the past 12 months, the stock has advanced 43 percent.

Costs associated with ongoing investigations into a phone-hacking scandal at the defunct News of the World newspaper dropped to $56 million, compared to $87 million in the same frame a year ago.

Founder Rupert Murdoch is splitting the conglomerate into two separately traded companies, and president and COO Chase Carey said during a conference call Wednesday that the split will be complete by year's end.

After the split, a company called Fox Group will house the film and TV businesses, while one retaining the News Corp. moniker will be made up of the publishing, education and certain Australian assets.

Carey predicted that the new News Corp. would "be a disruptive force for good in the education space."

Also during the conference call, Carey listed FX and the National Geographic Channel as bright spots during the quarter and added that "Fox News continues to be a juggernaut." He praised the new FX period drama The Americans and expressed confidence in the film studio's upcoming release, A Good Day to Die Hard.

Carey lamented weaker than expected results at the Fox Broadcast Network, which he attributed to several factors, including low ratings for The X Factor, a World Series that was won in four games, increased costs due to expanded coverage of college football and less-than-expected viewership for some NFL playoff games. Despite the negativity, the television segment posted slightly higher revenue of $1.53 billion.

Another weak link was direct broadcast satellite TV, where revenue dropped to $890 million from $957 million a year earlier, underperforming the much-maligned publishing segment, which saw revenue rise slightly to $2.15 billion.

The filmed entertainment segment also managed a slight increase in revenue to $2.07 billion in the recent quarter from $2.06 billion a year ago. Successes during the quarter included Taken 2 and Life of Pi in theaters and Ice Age: Continental Drift on home video.