Foxtel’s total paid streaming subscribers grew 62% in the March quarter compared to the same three months last year.
Both BINGE and Kayo have about 1.2 million subscribers.
According to News Corp's quarterly results, revenue at Foxtel fell 6% to $US494 million, reflecting a $35 million, or 7%, negative impact from foreign currency fluctuations.
News Corp CEO Robert Thomson told analysts: “The third quarter saw continued progress in reshaping the Foxtel Group as a growth‐oriented subscription business, with continued success in streaming, stable revenues and solid cash generation.
“Notably, Kayo and Binge both surged in the quarter, and are now reaching record numbers of subscribers. Kayo plans to implement a price increase as it benefits from its scaled platform and high quality production, which is driving record ratings at the start of the season for both the NRL and the AFL. Overall, total paying streaming subs reached nearly 2.6 million, up 62%.
“We remain pleased with Foxtel’s turnaround, and harbor great optimism about its near and long‐term future. We are continuing to explore all options for Foxtel to maximize its value, while watching closely all relevant developments in the financial markets.”
Higher earnings from BINGE and Kayo and an increase in advertising revenues were partially offset by the impact from fewer residential broadcast subscribers.
Foxtel streaming subscription revenues represented about 20% of total circulation and subscription revenues in the quarter. Adjusted Revenues increased 1% compared to the prior year.
At March 31, Foxtel’s total closing paid subscribers were more than 4.3 million, a 23% increase compared to last year, primarily due to the growth in BINGE and Kayo subscribers, partially offset by lower residential broadcast subscribers.
Broadcast subscriber churn in the quarter improved to 14.3% from 20.1%. Broadcast ARPU (average revenue per user) for the quarter increased 2% year-over-year to A$82 (US$59).
EBITDA (earnings before interest, taxes, depreciation, and amortisation) fell 13% or $12 million, primarily driven by higher entertainment and sports programming rights costs, higher investment spending on streaming products and the $5 million, or 5%, negative impact from foreign currency fluctuations.
News Corp expects full year costs to be flat compared to the prior year. Adjusted segment EBITDA decreased 8%.
CFO Susan Panuccio: “Kayo benefited from the return of the winter sports codes and saw record early ratings, with total subscribers over 1.2 million. 138,000 paid subscribers were added in the quarter, a notable acceleration from the second quarter, taking paid subscribers to over 1.1 million.
“Similar to Kayo, Binge had a strong quarter, increasing its total subscribers to over 1.3 million. Paying subscribers increased to over 1.2 million, up 135% from the prior year. Binge added 284,000 paid subscribers in the quarter, the most quarterly additions since the launch of the service in 2020.
"Binge’s growth continued to be driven by the depth and diversity of its content library and the popularity of new shows such as, Love Me, a Binge original, Euphoria, and the Walking Dead.
“Foxtel ended the quarter with over 1.5 million residential broadcast subscribers, down approximately 11%, with the rate of decline stable versus the second quarter. Commercial subscribers ended the quarter at 240,000 an improvement both sequentially and year‐over‐year.
"Retaining high value customers remains the focus for Broadcast subscribers which has led to churn improvements, with churn reducing almost 6 percentage points year‐over‐year in the quarter to 14.3%, which reflects eight consecutive months of year‐over‐year churn reduction. Broadcast ARPU steadily rose by 2% to A$82.
“Segment EBITDA in the quarter of US$79 million was down 13% versus the prior year, driven by higher programming costs, partly due to increased availability of entertainment content, as well as modestly higher marketing investment in streaming."
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