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The publishing segment dented the overall performance at News Corp. and costs associated with a phone-hacking scandal cost the company $87 million, but the conglomerate managed a 2 percent quarterly revenue gain led by television and film. Net income attributed to shareholders surged 71 percent to $1.1 billion from $642 million in the year-ago quarter.
The filmed entertainment segment led the way in growth, reporting $393 million in operating income, up from $189 million a year ago.
The massive gain was due to the success of Alvin and the Chipmunks: Chipwrecked theatrically as well as DVD releases of Rio, Rise of the Planet of the Apes, X-Men: First Class and Mr. Popper’s Penguins.
Revenue for filmed entertainment grew a more modest 14 percent to $2.06 billion.
Overall net income in the fiscal second quarter amounted to $1.13 million, up from $675 million a year ago, or 42 cents per share, up from 24 cents. Excluding certain items, the company earned 39 cents per share while analysts expected 34 cents.
News Corp. shares ended 12 cents higher on Wednesday to $19.62, just shy of a 52-week high $19.75. Despite beating expectations on both the top and bottom lines, the stock was off 1 percent during the after-hours session.
Meanwhile, the phone-hacking scandal still looms large at News Corp. The company’s News International unit settled another nine lawsuits, attorneys at a London court said Wednesday.
The company said in its earnings release that it is taking an “$87 million charge related to the costs of the ongoing investigations initiated upon the closure of The News of the World.”
Executives said Wednesday at the start of a conference call with analysts that the scandal has cost the company $104 million in the last six months and that costs have been “substantially higher” than anticipated.
News Corp. grew its revenue and operating income in four of its six segments, the exceptions being “other” and “publishing.”
Publishing has traditionally been the leading segment at News Corp., though it dropped to second-largest behind cable network programming, which grew its revenue by 10 percent to $2.16 billion and operating income by 20 percent to $882 million. Publishing revenue sunk 9 percent to $2.13 billion and operating income was off 43 percent to $218 million.
Television revenue was up 11 percent to $1.52 billion and operating income was up 25 percent to $189 million. Direct broadcast satellite TV revenue rose fractionally to $947 million while its operating income was $6 million, reversing a $12 million loss a year ago.
The company said TV’s strong results were driven by a 100 percent increase in retransmission consent revenue, as well as the popularity of Major League Baseball and National Football League programming and the shows X-Factor and The New Girl.
President and COO Chase Carey said Wednesday during the conference call that News Corp. isn’t interested in purchasing the Los Angeles Dodgers baseball team, though it wants media rights at a fair price.
“We’ll see if there’s something that makes sense to us,” he said.
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