Fox Reports Lower Net Earnings in First Quarter

Affiliate revenue up 4%, advertising down 2%
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Fox reported lower profits in its first fiscal quarter despite gains at its cable programming and television businesses.

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Net income dropped to $499 million, or 80 cents a share, from $604 million, or 97 cents a share. The company said the main reason for the decline was a comparison to a bigger gain a year ago on the value of the company’s investment in Roku.

Revenues rose 5% to $2.67 billion. Affiliate revenue growth was up 4% to $1.4 billion. Advertising revenue was down 2% to $1.4 billion.

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Earnings before interest, taxes, depreciation and amortization (EBITDA) for Fox’s cable network programming group rose 8% to $684 million from $633 million a year ago because of higher revenue and lower expenses.

Cable network revenues rose 2% to $1.29 billion from $1.27 billion. Affiliate revenues were flat as rate increases were offset by a decrease in subscribers. Ad revenues were down 4% because of fewer World Cup matches and no UFC content in the quarter. Other revenues were up 48% because of pay-per-view boxing and higher sports sub-licensing revenues.

EBITDA for Fox’s television segment rose 47% to $251 million from $171 million.

Revenues rose 6% to $1.36 billion from $1.28 billion. Affiliate revenues were up 14% because of increases in programming fees from Fox affiliate stations and higher retransmission fees. Ad revenues were down 2%. Higher revenues generated by Fox’s broadcast of the Emmy awards was offset by lower political ad spending.

“Fox Corporation’s first full fiscal year is off to a solid start. The Company delivered strong financial results in the quarter and we are making tremendous progress on the operational goals and strategic initiatives that we outlined at our Investor Day in May, “ said CEO Lachlan Murdoch. 

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