Fox Corp. Earnings Impress Post-Disney Sale
The slimmed-down company earned 73 cents per share on $2.5 billion in revenue.
The slimmed-down Fox Corporation reported quarterly results that impressed Wall Street, causing shares of the Rupert Murdoch-controlled company to initially rise 3 percent in after-hours action on Wednesday.
Fox, which became a stand-alone publicly traded company on March 19, earned 73 cents per share on $2.5 billion in revenue, both of which exceeded the expectations of analysts as affiliate fees rose for its cable channels while overall advertising slipped a bit.
Fox CEO Lachlan Murdoch acknowledged during a call with analysts that "there probably is news fatigue" among Americans, but that while Fox News' ratings have been relatively soft lately, it has lost less of its audience than has its competitors.
Murdoch also excoriated Locast, which Fox and others have sued for streaming local TV signals without permission.
"Simply put, Locast is a rogue streaming service violating the copyright laws for commercial gain. Nothing more," he said. "Locast's claim to be a non-profit that is not operating for any direct or indirect commercial advantage is absurd."
Fox's report comes a day after it paid an undisclosed price to acquire Bento Box Entertainment, the animation studio behind Bob's Burgers and the upcoming The Great North and Duncanville, an indication that the new Fox isn't completely skimping on pure entertainment even as it positions itself as a news and sports powerhouse.
The Fox financials also come a day after Disney reported lackluster earnings in its first full quarter since it purchased the Fox film and TV studio and many other of the former assets of what used to be known as 21st Century Fox, with Disney CEO Bob Iger blaming the acquisition for the disappointing results.
Fox said Wednesday that affiliate fees rose to $1.4 billion from $1.3 billion in the same quarter last year, while advertising sunk to $918 million from $977 million previously. Cable revenue rose to $1.3 billion from $1.27 billion, while television rose to $1.18 billion from $1.12 billion.
Fox attributed a blip in advertising to lower political sales along with less revenue generated by FIFA Women's World Cup compared with the men's tournament last year.
During the call with analysts, Murdoch also talked up Fox Bet, a joint venture with The Stars Group that will roll out NFL betting before the start of the new season next month. He called Fox the NFL's "most significant" TV partner, including the broadcast of next year's Super Bowl.
Fox said affiliate fees rose 3 percent across all its networks, but there were subscriber declines amid cord-cutting. Ad revenue took a hit despite increased digital sales for Fox News.
Murdoch boasted of roughly 100 million page views daily for FoxNews.com and promised to "aggressively push" advertising there ahead of the looming presidential election. He said the Fox Nation digital subscription service will ramp up marketing soon.