Fox TV Revenue Climbs 20% In 1Q

Fox Corp. on Wednesday reported its first financial results as a standalone company.

The Television Segment reported quarterly revenues of $1.37 billion, an increase of $232 million or 20% from the amount in the prior year quarter due to increases in affiliate, advertising and other revenues. Affiliate revenues increased $102 million or 29% led by an increase in reverse retransmission revenues.

Advertising revenues increased $77 million or 10%, primarily due to the broadcast of one additional NFL Divisional Playoff game and higher pricing and ratings at Fox Entertainment, led by the success of The Masked Singer.

Advertising revenues also benefited from the comparison to the prior year period when advertising dollars were diverted to the Winter Olympics, which were broadcast on another network. Other revenues doubled over the prior year quarter principally due to higher digital content licensing revenues.

Television reported quarterly segment EBITDA of $99 million, an increase of $18 million or 22% from the amount in the prior year quarter as the revenue increases noted above were partially offset by higher expenses.

The increase in expenses reflects higher sports programming rights amortization and production costs primarily due to the addition of one NFL Divisional Playoff game, higher entertainment programming rights amortization due to the mix of programming in the current quarter compared to the mix of programming aired in the prior year quarter against the Winter Olympics and the recognition of an approximately $55 million write-down of certain entertainment and syndicated programming.

The Cable Network Programming Segment reported quarterly revenues of $1.38 billion, an increase of $58 million or 4% from the amount in the prior year quarter primarily due to increases in affiliate and advertising revenues.

Affiliate revenues increased $37 million or 4% primarily due to contractual price increases at Fox News and FS1, partially offset by linear subscriber declines. The moderating sequential cable affiliate revenue growth rate, as compared to the cable affiliate revenue growth rate in the first half of fiscal year 2019, reflects the lapping of contractual rate increases and resets on existing affiliate agreements in the prior year. Advertising revenues increased $10 million or 4% primarily reflecting higher digital sales at Fox News and stronger ratings for daily studio programming at FS1.

Cable Network Programming reported quarterly segment EBITDA of $741 million, an increase of $49 million or 7% from the amount in the prior year quarter due to the revenue increases noted above. Expenses were in line with the prior year quarter as higher costs primarily associated with digital initiatives at Fox News were offset by lower linear sports programming rights amortization at Fox Sports due to the absence of Ultimate Fighting Championship and UEFA Champions League content in the current quarter.

The company as a whole reported total quarterly revenues of $2.75 billion, a 12% increase from the $2.46 billion of revenues in the prior year quarter. The increase in revenues was primarily attributable to affiliate and advertising revenue growth of 11% and 9%, respectively.

Quarterly income before income tax expense increased to $706 million from the $654 million in the prior year quarter primarily due to higher revenues at the Cable Network Programming and Television segments. Quarterly total segment operating income before depreciation and amortization (EBITDA) of $766 million was 8% higher than the prior year quarter driven by higher contributions at the Cable Network Programming and Television segments.

Commenting on the results, Executive Chairman-CEO Lachlan Murdoch said: “Our first quarterly results as Fox Corp. demonstrate the strength of our businesses as we delivered strong top line growth across our operating segments and across our key revenue categories. Fox commences as a standalone company with strong assets in unique positions to succeed in the evolving media landscape. Our team is all pulling in the same direction and achieving great things together.”

Read the company’s report here.