NEW DELHI: Fox Corp beat Wall Street expectations in its second fiscal quarter, with revenue of $4.09 billion improving eight per cent from the corresponding quarter last year.
Total quarterly revenues increased from last year's $3.78 billion driven by revenue growth at the television and cable network programming segments. Adjusted net income attributable to stockholders increased 45 per cent to $93 million from the $64 million reported in the year ago period.
Advertising revenue rose 14 per cent in the quarter, helped by a record haul of political advertising by Fox stations. The effects of Covid2019 on the college football season hurt results in the quarter, though, with “other” revenues dipping 14 per cent due to games cancelled by virus outbreaks.
The company’s cable networks saw a 31 per cent rise in ad revenue as political spending reached its peak, but affiliate and other revenue declined, leading to a slim one per cent increase in overall revenue in the segment.
"Beyond advertising and because of the substantial pricing power of our brands, our affiliate revenues grew by six per cent despite a reserve taken for potential distribution credits," said Fox Corp executive chairman & CEO Lachlan Murdoch. "While we experienced a decline in subscriber volume, the trend improved for the third consecutive quarter. This quarter, we saw industry subscribers declined just above five per cent, which is more than a 50 basis point improvement from what we experienced in Q1."
Fox News has slipped from its No. 1 ratings perch since the November 3 presidential election. The network has also been sued by voting software firm Smartmatic for $2.7 billion over on-air claims about the company by Fox hosts and guests.
Fox’s Television division, the largest in the company and the one where the stations and broadcast network are housed, posted a 13 per cent increase in revenue. On top of ad gains, affiliate sales rose 23 per cent, with Fox crediting higher fees from third-party Fox affiliates and higher subscriber rates for the company’s owned and operated TV stations.
An EBITDA loss in the television unit of $185 million stemmed from higher programming rights amortisation at Fox Sports, led by contractual rights increases for the NFL. The consolidation of ad-supported streaming service Tubi, which Fox acquired last year, also made a dent.
"We have mobilised the entire Fox portfolio to support and supercharge Tubi, which we acquired less than a year ago. Tubi is an exciting growth engine for the company and a key strategic platform for not only our digital expansion, but also our broader reimagining of Fox’s broadcast model for the future. With Tubi as part of our portfolio, Fox broadens from being the leader in broadcast network television into a leader in linear and streaming ecosystems," commented Murdoch.
