Fox Corp. reported higher earnings in its fiscal first quarter because of a payment from the Walt Disney Co. and a 36% jump in ad revenues at Fox News.
Net income was $1.11 billion, or $1.83 a share, up from $499 million, or 80 cents a share a year ago. The net income includes a $462 million cash received from the Walt Disney Co. reimbursing Fox for taxes prepaid as Disney divests some of the assets involved in the sale of 21st Century Fox.
Revenues were up 2% to $2.72 billion. Affiliate revenues were up 10%, with both the television and the cable network programming segments reporting gains.
Advertising revenues were down 7%, mainly due to the postponement of sports events and the postponement of some scripted programming because of the pandemic.
Fox had lower operating expenses as it produced fewer sports events and scripted programming.
“We delivered solid financial and operating results across the Company in the first quarter while we continued to navigate the impacts of the pandemic on our businesses,” said CEO Lachlan Murdoch.
“We have successfully adapted to changes in the sports calendar and entertainment production schedules to deliver key programming to audiences and advertisers across FOX, most notably at our local television stations where political advertising will have achieved a record for any election,” Murdoch said. “ Our digital-native businesses – Tubi, Credible and FoxBet – are also performing well above expectations as we use the collective power of all the FOX brands to drive consumers to these innovative and strategic growth platforms. Across the Company, we are demonstrating strong momentum underpinned by a healthy financial position.”
Earnings before interest, taxes, depreciation and amortization at Fox’s cable network programming segment 14% to $781 million. Revenues rose 3% to $1.33 billion. Ad revenues rose 18%. With higher prices and increased ratings at Fox News Media ad revenues rose 36%, but that was offset by declines at FS1.
EBITDA at Fox’s television business nearly doubled to $457 million, Revenue was down slightly at $1.35 billion. Affiliate revenues increased 23% to $560 million and ad revenues fell 15% to $670 million because of fewer NFL broadcasts, the postponement of Big Ten and Pac 12 college football games and some scripted programming at Fox Entertainment. Ad revenues were helped by increases political advertising and the inclusion of the Tubi streaming service.
On Fox's earnings call, Murdoch said that local station core advertising was down 20% in the first quarter, compared to a sequential 40% drop in the fourth quarter. With the record level of political spending, total ad sales at the stations are pacing ahead, compared to a 50% decline at the beginning of the pandemic.
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