Friday, August 7, 2020
News Corp Posts $1.5B Loss
News Corp posted a wider loss in its latest quarter as advertising revenue halved amid the coronavirus pandemic, more than offsetting profit growth at Wall Street Journal parent Dow Jones & Co. and at the company’s video-subscription unit.
The Wall Street Journal reports the New York-based company, which owns the Journal, HarperCollins Publishers and newspapers in the U.K. and Australia, said its fiscal fourth-quarter loss was $397 million, or 67 cents a share, compared with a loss of $51 million, or 9 cents a share, a year earlier. The wider loss was partly due to noncash impairment charges of $292 million and higher restructuring costs related to the coronavirus crisis, News Corp said.
Results were heavily affected by the pandemic as well as by a decline in revenue related to the sale of the company’s supermarket-coupon business, News Corp said. When adjusted to remove impairment and restructuring charges, the loss amounted to 3 cents a share, the company said.
Revenue fell 22% to $1.92 billion from $2.47 billion. Of that decline, $330 million was attributable to the negative impact of the pandemic and 7%, or $179 million, to the loss of contributions from News America Marketing, which was sold earlier this year, the company said. Another 3%, or $63 million, were the result of foreign-currency fluctuations, it said.
News Corp’s advertising revenue was the most-heavily affected, dropping 52% to $332 million.
The company for the first time broke out reporting for its Dow Jones unit, which publishes the Journal, MarketWatch, Barron’s and others. The unit reported a 4% decline in revenue to $381 million, largely due to advertising declines. It saw a 13% rise in segment earnings to $60 million, the company said.
Circulation and subscription revenue at the Dow Jones grew by 5.6% to $303 million, bolstered by gains in digital subscribers. The company said the Journal averaged more than 2.2 million digital subscribers in the quarter, up from 2.041 million in the March quarter. In a call with analysts, Chief Financial Officer Susan Panuccio said the Journal had added 203,000 net new digital subscribers in the quarter. In the previous quarter, it had gained 112,000 subscribers. The Journal averaged nearly 3 million total subscriptions—print and digital—in the quarter, the company said. Total subscriptions for all Dow Jones publications were just shy of 3.8 million for the quarter, News Corp said.
News Corp said its news media unit, which includes newspapers in the U.K. and Australia, recorded a 41% decline in revenue to $490 million. The unit recorded a segment loss of $44 million. Advertising revenue for the news media unit declined 58%, partly affected by the removal of revenue from News America Marketing following its sale, while circulation and subscription revenue fell by 9%.
Posted 2:02:00 AM