Fox Growth Led By Broadcast TV And Sports

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 and strong NFL results at Fox Sports, higher political advertising revenues at the Fox Television Stations and continued growth at Tubi.

Jack Messmer

With the fiscal second quarter for Fox Corp. ending Dec. 31, 2022, company Executive Chairman-CEO Lachlan Murdoch told Wall Street analysts Wednesday morning that Fox Corp. had delivered record ratings and revenues for the first half of its fiscal year.

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 and strong NFL results at Fox Sports, higher political advertising revenues at the Fox Television Stations and continued growth at Tubi. That was partially offset by the absence of Thursday Night Football.

“Our television segment led this growth and had a truly stellar performance,” Murdoch said. “The stations group posted another record mid-term political cycle with approximately $250 million booked during the first half of our fiscal year. This is higher than our previous mid-term record and just shy of our fiscal ’21 presidential year record. These are impressive numbers that reinforce the strength and breadth of our station group.”

The CEO was also bullish on the current quarter, saying the company’s focus on news and live sports has enabled it to run counter to the declining trends for linear TV.

“Looking ahead into this third fiscal quarter, our top line will of course be aided by a record Super Bowl. But we are seeing solid national demand for our news and sports platforms, growth in the Tubi KPIs [key performance indicators] — and we are encouraged by the local ad categories pacing strongly positive at our local stations,” Murdoch said.

Later in the Q&A session, Murdoch provided some details about that local strength.

“We’re really happy to see a lot of categories back to robust growth. Auto is pacing up almost 30%. Health up 30%. Pharmaceuticals up 45%. Travel up 60%. And, of course, this is offset with categories like crypto down 97%. We’re still trying to find out who the 3% is who is left advertising,” he chuckled.

Taking a broader look at the advertising landscape, Murdoch said Fox Corp. is not seeing the softness that some other media companies have reported.

“We’re not seeing that. We’re seeing advertising being fluid and money coming late. So, it is a different environment than we were in a year ago, or even a couple of quarters ago. But, at the end of the day, we’re still hitting our goals and our revenue targets. It’s just coming in late. I think that goes to the strength of our portfolio. Being in news and being in sports — and the leader in those two categories — I think sets us apart in the advertising marketplace from a lot of our peers,” he said.

CFO Steve Tomsic noted that revenues were up 6% for the television segment (Fox Network, O&O stations and Tubi streaming) to $2.9 billion and advertising up 5% to $2.1 billion, despite dropping Thursday Night Football.

“For the NFL specifically, we also benefitted from strong pricing, a record-breaking Thanksgiving Day broadcast, and the timing of a week sliding back into the December quarter,” the CFO noted.

For the cable segment, revenues dipped slightly to $1.63 billion from $1.64 billion, with affiliate fees and advertising both down slightly from a year earlier.