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Fox. Corp. reported its quarterly financials on Wednesday, which were buoyed by advertising strength at its Fox News and local TV stations.
The company, led by CEO and executive chairman Lachlan Murdoch and chairman Rupert Murdoch, reported quarterly advertising revenue rising to $982 million, against a year-earlier $712 million.
Fox Corp. pointed to “a recovering base market” at the Fox Television Stations, as compared to the impact of COVID-19 in the prior year quarter. “This was an absolutely historic Upfront season for us as the ad market recovered from the depths and the lows of the COVID-affected last year,” Lachlan Murdoch told investors during an after-market analyst call.
Overall revenue rose to $2.89 billion for the three months to June 30, compared to $2.41 billion in 2020, as the media company also saw higher affiliate fee revenue. Fox Corp. reported quarterly net income of $272 million, against a year-earlier $145 million, while net income attributable to stockholders was $253 million, or 43 cents per share, as compared to the $122 million or 20 cents per share in fiscal 2020.
“Despite the challenges presented by COVID, our businesses continued to inform and entertain households across the country. And in the midst of it all, we strengthened our core brands and expanded our digital capabilities, which together provide a robust platform for future growth, executive chairman and CEO Lachlan Murdoch said in a statement.
On the analyst call, Murdoch argued Fox News Channel had retained more of its audience after the 2020 U.S. presidential election than its rivals at CNN and MSNBC. “In fact, since the election, Fox News has solidified its leadership position in cable news, having reasserted its pre-election market share,” he said.
While not revealing any audience data, Murdoch insisted Fox Nation, Fox News Channel’s subscription streaming platform, had its best-ever quarter for signing up subscribers, with low churn and high conversions from trial to subscription signups. And he touted the upcoming launch of Fox Weather, a weather streaming service, later this year to continue growing the Fox News brand as an ad-supported offering.
Also on the streaming front, Tubi, Fox’s ad-supported SVOD, surpassed 3 billion hours streamed, Murdoch reported. And the Fox Corp. boss reiterated that Tubi would not follow streaming rivals in investing in expensive original programing as the platform looked to appeal to advertisers.
“We have no interest or plans to invest in high cost programming to drive subscriber acquisition as we are not in the subscriber business,” he told investors about Tubi.
Murdoch also insisted Fox Corp. had little appetite for doing acquisitions or other deals for scale amid the current new media M&A merry-go-round. “We don’t feel any pressing strategic need to get bigger,” he told analysts.
Murdoch added the current spate of mergers in the media sector, including the mega-deal between AT&T’s WarnerMedia and Discovery, had more of an impact on subscription video-on-demand services and a need for library content to drive subscriber acquisition.
“That’s not a space we need to be in right now,” Murdoch responded as Fox Corp. focuses on the advertising VOD space with Tubi and other entertainment offerings. Murdoch was also asked about CNN launching its CNN+ subscription streaming service in early 2022, with an initial eight to 12 hours of live, daily programming.
“We think when someone copies you, it’s the best form of flattery,” he responded as CNN apparently follows Fox Corp.’s strategy of expanding into the streaming space with Fox Nation. “We don’t see CNN marching into that space as anything other than an affirmation of our strategy and what we’re doing as we really drive engagement,” Murdoch added.
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