Fox Corp Reports 4 Percent Revenue Increase

Fox Corporation today reported financial results for the three months ended December 31, 2022.

The Company reported total quarterly revenues of $4.61 billion, a 4% increase from the $4.44 billion reported in the prior year quarter. Affiliate fee revenues increased 1% led by 6% growth at the Television segment. Advertising revenues increased 4%, primarily reflecting the impact of the FIFA Men's World Cup ("World Cup") and strong NFL results at FOX Sports, higher political advertising revenues at the FOX Television Stations and continued growth at Tubi, partially offset by the absence of Thursday Night Football. Other revenues increased 13%, primarily due to the impact of the consolidation of entertainment production companies at the Television segment and higher FOX Nation subscription revenues.

The Company reported quarterly net income of $321 million as compared to a net loss of $73 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 $313 million ($0.58 per share) as compared to a net loss of $85 million ($(0.15) per share) reported in the prior year quarter. Adjusted net income attributable to Fox Corporation stockholders1 was $259 million ($0.48 per share), an increase of $182 million ($0.35 per share) from the $77 million ($0.13 per share) reported in the prior year quarter.

Quarterly Adjusted EBITDA2 was $531 million, a 71% increase from the $310 million reported in the prior year quarter, reflecting the revenue increases noted above and lower expenses due to the absence of Thursday Night Football.

Commenting on the results and stock repurchase announcements, Executive Chair and Chief Executive Officer Lachlan Murdoch said:

"A compelling fall sports schedule, combined with an active midterm political news cycle, showcased the power and relevance of the FOX platform in our fiscal second quarter. Whether measured in terms of engagement, monetization or profitability, our focused strategy of live news and sports programming, coupled with our growing digital initiatives, continues to deliver. Today's announcement to increase our share repurchase authorization and our intention to immediately deploy a meaningful amount of capital in an accelerated share repurchase transaction reflects the confidence we have in our strategy, the quality of our assets and the strength of our financial position."

Cable Network Programming reported quarterly segment revenues of $1.63 billion as compared to the $1.64 billion reported in the prior year quarter. Affiliate fee revenues decreased slightly by $13 million as contractual price increases essentially offset the impact of net subscriber declines. Advertising revenues were broadly consistent with the prior year quarter as the headwind at FOX News Media due to the impact of elevated supply in the direct response marketplace was nearly offset by the broadcast of the World Cup at FOX Sports. Other revenues increased $10 million or 7%, primarily due to higher FOX Nation subscription revenues.

Cable Network Programming reported quarterly segment EBITDA of $353 million as compared to the $668 million reported in the prior year quarter. Expenses increased in the quarter, primarily due to the impact of the World Cup and higher programming rights amortization at FOX Sports, as well as higher legal costs and increased digital investment at FOX News Media.

Television reported quarterly segment revenues of $2.93 billion, an increase of $175 million or 6% from the prior year quarter. Advertising revenues increased $98 million or 5%, primarily due to the broadcast of the World Cup, strong NFL ratings and pricing and additional broadcast windows at FOX Sports, higher political advertising revenues at the FOX Television Stations and continued growth at Tubi, partially offset by the absence of Thursday Night Football. Affiliate fee revenues increased $37 million or 6% driven by higher fees from third-party FOX affiliates. Other revenues increased $40 million or 26%, primarily due to the impact of the consolidation of entertainment production companies at FOX Entertainment.

Television reported quarterly segment EBITDA of $256 million, an increase of $529 million from the prior year quarter. Expenses were lower in the quarter due to the absence of Thursday Night Football, partially offset by the impact of the World Cup and higher programming rights amortization at FOX Sports, as well as increased digital investment at Tubi.