News Corp’s subscription-based revenue is almost on par with advertising as it transitions its business model towards a user pays operation for its news business.
In the third quarter of its 2018 fiscal year, News Corp earned US$687 million from advertising and US$659 million from circulation and subscriptions.
This represents a 2.5% decline in advertising revenue from the same period in FY17 and a 6.6% increase in subscriptions and circ.
Strong performances in real estate (up 24% to US$208 million) and a solid lift consumer (up 6% to US$381) helped News grow its quarterly revenue by 6% to US$2.1 billion, up 2% when the effects of currency changes are considered.
In the fiscal year to date, News has grown revenues by 4% to US6.3 billion.
News Corp’s EBITDA was down 33% year on year to US$182 million. The company booked a US1.1billion loos, largely due to a massive writedown in the value of its investment in Foxtel following the merger of Foxtel and Fox Sports.
“We welcomed Foxtel to our corporate family. We Believe the company is uniquely positioned, given its potential in a rapidly expanding OTT market, with unrivalled sports offerings and premium entertainment and news content,” News Corp chief executive Robert Thomson said.
“At our mastheads, digital audience expanded at a time when premium news has become more important to readers and advertisers. The Wall Street journal, The Times and Sunday Times, and The Australian reported average growth in digital subscriptions of more than 20% for the quarter, testament to the success of their digital transformation.”
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