Fox Reports Second Quarter Fiscal 2024 Revenues Of $4.23 Billion, Net Income Of $115 Million

Fox Corporation (Nasdaq: FOXA, FOX) 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.”

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 reported quarterly segment revenues of $2.54 billion as compared to the $2.93 billion reported in the prior year quarter. Advertising revenues were $1.65 billion as compared to the $2.05 billion reported in the prior year quarter, primarily due to the absence of the Men’s World Cup at FOX Sports and lower political advertising revenues at the FOX Television Stations, partially offset by continued growth at Tubi. Affiliate fee revenues increased $70 million or 10%, led by higher rates at both the Company’s owned and operated stations and third-party FOX affiliates. Other revenues were $132 million as compared to the $196 million reported in the prior year quarter, primarily due to lower content revenues at the entertainment production companies as a result of industry guild labor disputes.

Television reported a quarterly segment EBITDA loss of $138 million, as compared to an EBITDA contribution of $256 million in the prior year quarter, primarily from the revenue impacts described above. Expenses were consistent with the prior year quarter as higher sports programming rights amortization, led by the renewed NFL contract, was partially offset by the absence of the Men’s World Cup at FOX Sports. Additionally, there were lower costs due to fewer hours of original scripted programming at FOX Entertainment as a result of industry guild labor disputes.

DIVIDEND

The Company has declared a dividend of $0.26 per Class A and Class B share. This dividend is payable on March 26, 2024 with a record date for determining dividend entitlements of March 6, 2024.

SHARE REPURCHASE PROGRAM

As of December 31, 2023, the Company has repurchased approximately $4.1 billion of its Class A common stock and approximately $1.0 billion of its Class B common stock, with a remaining authorization of up to $1.9 billion.

DEBT MATURITY

In January 2024, $1.25 billion of 4.030% senior notes matured and were repaid in full.