Fox Corp., led by executive chair and CEO Lachlan Murdoch and chair Rupert Murdoch, reported improved fiscal second-quarter financials on Wednesday as advertising revenue rose 4 percent in the period ended Dec. 31.
The company reported quarterly earnings of $321 million, compared with a year-ago loss of $73 million, also helped by a change in the recognized fair value of the company’s investments. Adjusted earnings of $259 million, or 48 cents per share), jumped from $77 million, or 13 cents a share, in the year-ago
quarter.
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Fox reported total fiscal second-quarter revenue of $4.61 billion, a 4 percent increase from the $4.44 billion reported in the prior-year period.
The 4 percent gain in advertising revenue primarily reflected “the impact of the FIFA Men’s World Cup and strong NFL results at Fox Sports, higher political advertising revenues at the Fox Television Stations and continued growth at Tubi, partially offset by the absence of Thursday Night Football,” the company said.
Affiliate fee revenues rose 1 percent, led by 6 percent growth at the firm’s television segment. Other revenue jumped 13 percent, “primarily due to the impact of the consolidation of entertainment production companies at the television segment and higher Fox Nation subscription revenues.”
In the previous quarter, the company had posted a record-shattering midterm elections advertising haul. Fox benefitted from the midterms through its Fox TV stations, which saw record-breaking political ad buys in a number of states, as well as at Fox News, which is among the most watched channels on TV.
Macroeconomic concerns have been swirling since last year, making media investors dissect any latest ad data points with much interest. “While we are mindful of current macroeconomic conditions, the durability of our brands and Fox’s ability to deliver audiences at scale position us well to navigate this uncertainty while continuing to create value for our shareholders,” Lachlan Murdoch had said late in 2022.
On Wednesday, he highlighted: “A compelling fall sports schedule, combined with an active midterm political news cycle, showcased the power and relevance of the Fox platform in our fiscal second quarter. Whether measured in terms of engagement, monetization or profitability, our focused strategy of live news and sports programming, coupled with our growing digital initiatives, continues to deliver.”
Wednesday’s earnings update came after the Murdoch family late last month dropped a proposal to merge Fox, home of the likes of Fox News, the Fox broadcast networks, TV stations and Fox Sports, with News Corp, the owner of The Wall Street Journal, Britain’s The Times and The Sun, Dow Jones, as well as Australian pay TV giant Foxtel. “In withdrawing the proposal, Mr. Murdoch indicated that he and Lachlan K. Murdoch have determined that a combination is not optimal for shareholders of News Corp and Fox at this time,” News Corp said in a statement back then. It also came ahead of the Super Bowl, which this year will air on Fox.
Fox also boosted its stock buyback program by $3 billion to $7 billion. “The company also announced that it intends to enter into an accelerated share repurchase transaction to repurchase $1 billion of Class A common stock under the stock repurchase program and to repurchase an additional $450 million of common stock during the remainder of fiscal 2023,” Fox added. “To date, the company has repurchased approximately $2.2 billion of Class A common stock and approximately $935 million of Class B common stock.”
“Today’s announcement to increase our share repurchase authorization and our intention to immediately deploy a meaningful amount of capital in an accelerated share repurchase transaction reflects the confidence we have in our strategy, the quality of our assets and the strength of our financial position,” said Lachlan Murdoch.
Fox has been investing heavily in streaming through its free advertising-supported platform Tubi and its Fox Nation streaming service, with the company in its fiscal first quarter citing Fox Nation as a driver in its “other” reporting segment.
Fox’s stock was up 1.3 percent in pre-market trading as of 8:08 a.m. ET.
