News Corp. Reports Huge Rise in Quarterly Profit
The company led by CEO Rupert Murdoch posts another set of strong results for its cable networks unit.
News Corp. on Tuesday reported fiscal first-quarter earnings of $2.23 billion, compared with $738 million in the year-ago period. Revenue came in at $8.14 billion, compared with $7.96 billion.
The surge in earnings was due in part to a large pretax gain for the sale of NDS, a television and set-top box technology company.
The results include a $67 milion charge associated with the ongoing investigation into a phone-hacking scandal as well as $5 million spent on a proposal to split News Corp. into two separate, publicly traded companies.
Initial reaction to the financial results were positive, with the stock up 3 percent in after-hours trading Tuesday after having risen 1 percent to $24.59 during the regular session.
The revenue growth at News Corp. was led by a 16 percent surge to $2.45 billion at the company's cable network programming segment, the company said.
Advertising revenue at the domestic cable channels grew 8 percent, driven by growth at the Regional Sports Networks and Fox News Channel.
Filmed entertainment revenue rose 2 percent to $1.75 billion, television was up 4 percent to $959 million, direct broadcast satellite TV was down 11 percent to $817 million, publishing was off 3 percent to $2.02 billion, and the category of "other" rose 1 percent to $148 million.
Film results were driven in part by the successful theatrical performance of Ice Age: Continental Drift, which has grossed $870 million at the worldwide box office. Digital-distribution revenue also was strong due to a licensing deal with Netflix.
Television benefited from a doubling of retransmission consent revenue and "increased local advertising, driven by record first-quarter political advertising revenues," according to the company's financial release.
During a conference call with analysts, News Corp. deputy chairman and COO Chase Carey praised TV shows Homeland, Modern Family, New Girl, Glee and Sons of Anarchy and movies Taken 2 and the upcoming Lincoln and Life of Pi.
Carey expressed dismay over a four-game World Series and said he was looking forward to a "refreshed" American Idol in January as well as The Following starring Kevin Bacon, which he called a "dynamic upcoming series."
"News Corp. is in a unique position to face challenging macro-economic issues head on and to continue growing our core businesses while taking advantage of new opportunities wherever possible," Carey said during the conference call.