NEW YORK, Feb. 7, 2024 /PRNewswire/ — Fox Corporation (NASDAQ:FOXA, FOX, “, FOX”, or the “, Company”, )) today reported financial results for the three months ended December 31, 2023.
The Company reported total quarterly revenues of $4.23 billion as compared to the $4.61 billion reported in the prior year quarter. Affiliate fee revenues increased 4%, driven by 10% growth at the Television segment. Advertising revenues decreased 20%, primarily due to the absence of the FIFA Men’s World Cup (“Men’s World Cup”) at FOX Sports, lower political advertising revenues at the FOX Television Stations due to the absence of the 2022 midterm elections, and the impact of elevated supply in the direct response marketplace, lower ratings and higher preemptions associated with breaking news coverage at FOX News Media. Other revenues increased 14%, primarily due to higher sports sublicensing revenues at the national sports networks, partially offset by lower content revenues at the entertainment production companies as a result of industry guild labor disputes.
The Company reported quarterly net income of $115 million as compared to the $321 million reported in the prior year quarter. The variance includes the change in fair value of the Company’s investments recognized in Other, net. Net income attributable to Fox Corporation stockholders was $109 million ($0.23 per share) as compared to the $313 million ($0.58 per share) reported in the prior year quarter. Adjusted net income attributable to Fox Corporation stockholders1 was $165 million ($0.34 per share) as compared to the $259 million ($0.48 per share) reported in the prior year quarter.
Quarterly Adjusted EBITDA2 was $350 million as compared to the $531 million reported in the prior year quarter, reflecting the revenue impacts described above, partially offset by lower expenses. Expenses decreased in the quarter, primarily due to lower entertainment and sports programming rights amortization and production costs, led by fewer hours of original scripted programming and the absence of the Men’s World Cup, partially offset by the renewed NFL contract.
Commenting on the results, Executive Chair and Chief Executive Officer Lachlan Murdoch said:
“At the halfway point in our fiscal year, our results demonstrate the strength and durability of our core brands and their ability to deliver solid audiences across our portfolio. FOX Sports continues to benefit from the power of live sports programming and FOX News has maintained its leadership in cable news, while Tubi has been resilient in an increasingly competitive market. Combining this steadfast portfolio of assets with a best-in-class balance sheet underpins our ability to deliver value for our shareholders.”
REVIEW OF OPERATING RESULTS
Three Months Ended
December 31,
Six Months Ended
December 31,
2023
2022
2023
2022
$ Millions
Revenues by Component:
Affiliate fee
$ 1,787
$ 1,712
$ 3,527
$ 3,423
Advertising
2,002
2,503
3,202
3,723
Other
445
390
712
651
Total revenues
$ 4,234
$ 4,605
$ 7,441
$ 7,797
Segment Revenues:
Cable Network Programming
$ 1,658
$ 1,632
$ 3,045
$ 3,063
Television
2,542
2,934
4,322
4,648
Other, Corporate and Eliminations
34
39
74
86
Total revenues
$ 4,234
$ 4,605
$ 7,441
$ 7,797
Adjusted EBITDA:
Cable Network Programming
$ 564
$ 353
$ 1,171
$ 1,095
Television
(138)
256
213
665
Other, Corporate and Eliminations
(76)
(78)
(165)
(137)
Adjusted EBITDA3
$ 350
$ 531
$ 1,219
$ 1,623
Depreciation and amortization:
Cable Network Programming
$ 19
$ 17
$ 37
$ 34
Television
28
30
57
59
Other, Corporate and Eliminations
50
56
99
109
Total depreciation and amortization
$ 97
$ 103
$ 193
$ 202
CABLE NETWORK PROGRAMMING
Three Months Ended
December 31,
Six Months Ended
December 31,
2023
2022
2023
2022
$ Millions
Revenues
Affiliate fee
$ 1,031
$ 1,026
$ 2,036
$ 2,055
Advertising
348
451
638
767
Other
279
155
371
241
Total revenues
1,658
1,632
3,045
3,063
Operating expenses
(942)
(1,097)
(1,591)
(1,661)
Selling, general and administrative
(156)
(186)
(291)
(315)
Amortization of cable distribution investments
4
4
8
8
Segment EBITDA
$ 564
$ 353
$ 1,171
$ 1,095
Cable Network Programming reported quarterly segment revenues of $1.66 billion, an increase of $26 million or 2% from the amount reported in the prior year quarter. Affiliate fee revenues increased $5 million as contractual price increases were partially offset by the impact of net subscriber declines. Advertising revenues were $348 million as compared to the $451 million reported in the prior year quarter, primarily due to the impact of elevated supply in the direct response marketplace, lower ratings and higher preemptions associated with breaking news coverage at FOX News Media, and the absence of the Men’s World Cup at the national sports networks. Other revenues increased $124 million or 80%, primarily due to higher sports sublicensing revenues at the national sports networks.
Cable Network Programming reported quarterly segment EBITDA of $564 million, an increase of $211 million or 60% from the amount reported in the prior year quarter, primarily due to lower sports programming rights amortization and production costs, including the absence of the Men’s World Cup, and lower legal, programming and production costs at FOX News Media.
TELEVISION
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