Fox reported lower fiscal second-quarter earnings as ad revenues fell at its cable and television businesses.
Net income dropped to $109 million, or 23 cents a share, compared to $313 million, or 58 cents a share, a year ago. The result included a change in the value of the company’s investments.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell to $350 million from $531 million.
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Revenue fell 8% to $4.23 billion. The company had lower programming and production costs, partly because it how fewer hours of original scripted programming during the strikes by the writers and actors unions.
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Advertising revenues plunged 20% to $2 billion. The company said the drop was because of a comparison to last year, when it benefited from the World Cup and political spending. The company also saw elevated supply in the direct response market, lower ratings and higher preemptions at Fox News Media.
Affiliate fee revenues rose 4% to $1.8 billion, with a 10% increase in Fox’s television segment.
The results were better than Wall Street expectations.
Adjusted EBITDA at the company’s cable network programming segment rose 60% to $564 million. The company said costs fell because of the absence of the World Cup and lower legal costs at Fox News Media, which a year ago was contesting a lawsuit from voting machine maker Dominion Voting Systems. Fox later paid $787.5 million to settle the suit.
Cable programming revenues rose 2% to $1.66 billion. Advertising revenue fell to $348 million from $451 million a year ago. Affiliate-fee revenue rose 2% to $1 billion.
Fox’s television segment had a $138 million loss in EBITDA, compared to positive earnings of $256 million a year ago.
Television revenues dropped to $2.54 billion from $2.93 billion. Ad revenue fell to $1.65 billion from $2.1 billion, as lower ad political ad spending at Fox’s stations was offset by growth at Tubi.
Tubi had a 62% increase in total viewing time and a 10% gain in advertising revenue. The streamer had 78 million monthly active users and nearly 2.5 billion streaming hours in the quarter.
Affiliate revenues rose 10% to $756 million.
“At the halfway point in our fiscal year, our results demonstrate the strength and durability of our core brands and their ability to deliver solid audiences across our portfolio,” CEO Lachlan Murdoch said.
“Fox Sports continues to benefit from the power of live sports programming and Fox News has maintained its leadership in cable news, while Tubi has been resilient in an increasingly competitive market,” Murdoch said. “Combining this steadfast portfolio of assets with a best-in-class balance sheet underpins our ability to deliver value for our shareholders.”
