News Corp reported a 2% fall in revenue to $US2.45 billion in the March quarter, ahead of market expectations, as returns from “improved” advertising were squeezed by currency fluctuations.
Revenue came in flat when discounting foreign exchange which had a $98 million, or 4%, negative impact
Net income in the quarter was $59 million compared to $104 million in the same three months in 2022.
The company now expects at least $160 million in annualised savings from a previously announced 5% cut in staff.
At News Corp Australia revenue increased 1% on a constant currency basis to $US255 million, including advertising of $105 million and circulation and subscription at $119 million, but fell 5% when converted to US dollars.
Lower digital advertising at News Corp Australia was partially offset by higher print advertising.
Closing digital subscribers at News Corp Australia at the end of March were 1,043,000 (937,000 for news mastheads), compared to 946,000 (876,000 for news mastheads).
News Corp CEO Robert Thomson said the results demonstrate the fundamental differences in the character of News Corp compared with other media companies.
“In a period in which advertising was clearly insipid in certain parts of the world, our core non-advertising revenue has been particularly robust, highlighted by a 38% increase in revenues at the Dow Jones professional information business,” he says.
“Overall, our fiscal third quarter results demonstrated meaningful progress compared to the first half, with various macro and sectoral trends decidedly more positive.
“Revenues were over $2.4 billion, down only 2% from the prior year, but higher in constant currency, while our company-wide cost cutting program began to gain traction.
“That cost reduction drive includes taking the difficult but necessary step of reducing headcount by an expected 5%, and we now anticipate that program will yield at least $160 million in annualised savings by the end of this calendar year.
“We also want to highlight that today marks the 44th day in captivity for Wall Street Journal reporter Evan Gershkovich, who has been wrongfully, wilfully detained in Russia. We trust that justice and common sense will prevail, and that Evan will soon be released.”
Foxtel reported revenue of $US477 million, down $17 million or 3%, due to a $28 million, or 5%, negative impact from foreign currency fluctuations.
Adjusted revenue of $505 million increased 2%.
Higher revenues from Kayo and BINGE, driven by increases in both volume and pricing, were partially offset by the impact from fewer residential broadcast subscribers.
Foxtel’s total paid subscribers were up 6% to more than 4.5 million, mainly due to the growth in streaming subscribers driven by BINGE and Kayo.
Broadcast subscriber churn improved to 12.3%, the lowest level since 2016, from 14.3%.
Average revenue per user for the quarter increased 2% year-over-year to $A84 ($US57).
News Corp March quarter, 2023:
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