FISCAL 2025 FIRST QUARTER KEY FINANCIAL
HIGHLIGHTS
- First quarter revenues were the highest for a first quarter
since separation at $2.58 billion, a 3% increase compared to
$2.50 billion in the prior year, driven by growth at the
Digital Real Estate Services, Book Publishing and Dow Jones
segments
- Net income in the quarter was $144 million, a
significant improvement compared to net income of $58 million
in the prior year
- Total Segment EBITDA was the highest for a first quarter
since separation at $415 million, compared to $364 million in the
prior year
- In the quarter, reported EPS were $0.21 as compared to $0.05
in the prior year - Adjusted EPS were $0.21 compared to $0.16 in
the prior year
- REA Group posted record revenues for the quarter of $318
million, a 22% increase compared to the prior year, primarily
driven by robust Australian residential performance
- Dow Jones’ growth continued to be underpinned by robust
performance in its professional information business, where revenue
increased 8%, driven by growth of 16% at Risk & Compliance and
11% at Dow Jones Energy
- Book Publishing revenues grew 4% in the quarter, while
Segment EBITDA increased 25%, driven by record digital book sales,
which grew 15%, and strong backlist performance
News Corporation (“News Corp” or the “Company”) (Nasdaq: NWS,
NWSA; ASX: NWS, NWSLV) today reported financial results for the
three months ended September 30, 2024.
Commenting on the results, Chief Executive Robert Thomson
said:
“We have begun Fiscal 2025 robustly, with record first quarter
revenue, strong net income and record first quarter profitability.
Revenue rose 3 percent year-over-year to $2.58 billion, while our
net income jumped 148 percent to $144 million. Total Segment EBITDA
surged 14 percent to $415 million, and our EPS were 21 cents
compared to 5 cents in same quarter last year. That we have
achieved these record first quarter results in macro-conditions
which are far from auspicious is compelling evidence of the
successful transformation of News Corp over the past decade.
Meanwhile, the just-completed election has highlighted the
importance of trusted journalism in a media maelstrom in which some
journalists mistake virtue signaling for virtue. Artificial
intelligence recycles informational infelicities and it is critical
that journalistic inputs have integrity, which is why our
partnership with OpenAI is so crucial and why we intend to sue AI
companies abusing and misusing our trusted journalism.
Dow Jones and the New York Post have started proceedings against
the perplexing Perplexity, which is selling products based on our
journalism, and we are diligently preparing for further action
against other companies that have ingested our archives and are
synthesizing our intellectual property.”
FIRST QUARTER RESULTS
The Company reported fiscal 2025 first quarter total revenues of
$2.58 billion, a 3% increase compared to $2.50 billion in the prior
year period, primarily driven by higher Australian residential
revenues at REA Group, higher digital book sales combined with
improved returns at the Book Publishing segment and continued
growth in the professional information business at the Dow Jones
segment, in addition to a $35 million, or 1%, positive impact from
foreign currency fluctuations. The increase was partly offset by
lower revenues at the News Media segment. Adjusted Revenues (which
excludes the foreign currency impact, acquisitions and divestitures
as defined in Note 2) increased 2% compared to the prior year.
Net income for the quarter was $144 million, a 148% increase
compared to $58 million in the prior year, primarily driven by
higher Other, net, higher Total Segment EBITDA and lower impairment
and restructuring charges. These impacts were partially offset by
higher income tax expense and higher depreciation and
amortization.
The Company reported first quarter Total Segment EBITDA of $415
million, a 14% increase compared to $364 million in the prior year
primarily due to strong contributions from REA Group within the
Digital Real Estate Services segment, despite $12 million of deal
costs related to the withdrawn offer to acquire Rightmove, as well
as the Book Publishing segment. The increase was partly offset by
higher costs at the Subscription Video Services segment primarily
driven by the Hubbl product. Adjusted Total Segment EBITDA (as
defined in Note 2) increased 12%.
Net income per share attributable to News Corporation
stockholders was $0.21 as compared to $0.05 in the prior year.
Adjusted EPS (as defined in Note 3) were $0.21 compared to $0.16
in the prior year.
SEGMENT REVIEW
For the three months ended
September 30,
2024
2023
% Change
(in millions)
Better/
(Worse)
Revenues:
Dow Jones
$
552
$
537
3
%
Digital Real Estate Services
457
403
13
%
Book Publishing
546
525
4
%
Subscription Video Services
501
486
3
%
News Media
521
548
(5
)%
Other
—
—
—
%
Total Revenues
$
2,577
$
2,499
3
%
Segment EBITDA:
Dow Jones
$
131
$
124
6
%
Digital Real Estate Services
140
122
15
%
Book Publishing
81
65
25
%
Subscription Video Services
92
93
(1
)%
News Media
16
14
14
%
Other
(45
)
(54
)
17
%
Total Segment EBITDA
$
415
$
364
14
%
Dow Jones
Revenues in the quarter increased $15 million, or 3%, compared
to the prior year, driven by continued growth in the professional
information business, as well as higher content licensing revenue.
Digital revenues at Dow Jones in the quarter represented 82% of
total revenues compared to 81% in the prior year. Adjusted Revenues
increased 2%.
Circulation and subscription revenues increased $23 million, or
5%, primarily driven by an 8% increase in professional information
business revenues, led by 16% growth in Risk & Compliance
revenues to $81 million and 11% growth in Dow Jones Energy revenues
to $68 million. Circulation revenues increased 1% compared to the
prior year, as the continued growth in digital-only subscriptions
was mostly offset by lower print volume. Digital circulation
revenues accounted for 72% of circulation revenues for the quarter,
compared to 70% in the prior year.
During the first quarter, total average subscriptions to Dow
Jones’ consumer products were over 5.9 million, an 11% increase
compared to the prior year. Digital-only subscriptions to Dow
Jones’ consumer products grew 15% to over 5.3 million. Total
subscriptions to The Wall Street Journal grew 7% compared to the
prior year, to nearly 4.3 million average subscriptions in the
quarter. Digital-only subscriptions to The Wall Street Journal grew
10% to over 3.8 million average subscriptions in the quarter, and
represented 90% of total Wall Street Journal subscriptions.
For the three months ended
September 30,
2024
2023
% Change
(in thousands, except %)
Better/(Worse)
The Wall Street Journal
Digital-only subscriptions
3,811
3,457
10
%
Total subscriptions
4,255
3,991
7
%
Barron’s Group
Digital-only subscriptions
1,325
1,055
26
%
Total subscriptions
1,446
1,197
21
%
Total Consumer
Digital-only subscriptions
5,325
4,611
15
%
Total subscriptions
5,908
5,308
11
%
Advertising revenues decreased $6 million, or 7%, primarily due
to a 10% decline in print advertising revenues and a 5% decline in
digital advertising revenues driven by lower advertising spend in
the technology and finance sectors. Digital advertising accounted
for 67% of total advertising revenues in the quarter, compared to
66% in the prior year.
Segment EBITDA for the quarter increased $7 million, or 6%,
primarily as a result of the higher revenues discussed above and
lower newsprint, production and distribution costs, partially
offset by higher marketing and employee costs. Adjusted Segment
EBITDA increased 5%.
Digital Real Estate Services
Revenues in the quarter increased $54 million, or 13%, compared
to the prior year, driven by strong performance at REA Group.
Segment EBITDA in the quarter increased $18 million, or 15%,
compared to the prior year, due to higher contribution from REA
Group, despite $12 million of deal costs related to the withdrawn
offer to acquire Rightmove, and included a $3 million, or 3%,
positive impact from foreign currency fluctuations. The increase
was partly offset by modestly lower contribution from Move.
Adjusted Revenues and Adjusted Segment EBITDA (as defined in Note
2) increased 11% and 13%, respectively.
In the quarter, revenues at REA Group increased $57 million, or
22%, to $318 million, primarily driven by higher Australian
residential revenues due to price increases, increased depth
penetration and an increase in national listings, a $7 million, or
3%, positive impact from foreign currency fluctuations and higher
revenue from REA India. Australian national residential buy listing
volumes in the quarter increased 7% compared to the prior year,
with listings in Sydney and Melbourne up 11% and 9%,
respectively.
Move’s revenues in the quarter decreased $2 million, or 1%, to
$140 million, primarily as a result of lower real estate revenues.
Real estate revenues, which represented 77% of total Move revenues,
decreased 4%, driven by the ongoing impact of the macroeconomic
environment on the housing market, which led to lower lead and
transaction volumes. Revenues from the referral model, which
includes the ReadyConnect Concierge℠ product, and the core lead
generation product decreased due to these factors. The decline was
partially offset by strong growth in seller, new homes and rentals,
including the partnership with Zillow, and increased advertising
revenues. Based on Move’s internal data, average monthly unique
users of Realtor.com®’s web and mobile sites for the fiscal first
quarter grew 2% compared to the prior year to 77 million. Lead
volume was down 1% year over year as it continues to be impacted by
high mortgage rates.
Book Publishing
Revenues in the quarter increased $21 million, or 4%, compared
to the prior year, primarily driven by higher digital and backlist
book sales and improved returns. Key titles in the quarter included
Hillbilly Elegy by J.D. Vance, A Death in Cornwall by Daniel Silva
and The Au Pair Affair by Tessa Bailey. Bible sales were also
strong. Adjusted Revenues increased 3%.
Digital sales increased 15% compared to the prior year, driven
by 26% growth from audiobook sales, which benefited from the
continued contribution from the Spotify partnership and strong
market conditions, in addition to higher e-book sales, which
increased 7% compared to the prior year. Digital sales represented
25% of Consumer revenues for the quarter compared to 22% in the
prior year. Backlist sales represented approximately 64% of
Consumer revenues in the quarter compared to 61% in the prior
year.
Segment EBITDA for the quarter increased $16 million, or 25%,
compared to the prior year, primarily due to the higher revenues
discussed above, partially offset by higher employee costs.
Subscription Video Services
Revenues of $501 million in the quarter increased $15 million,
or 3%, compared with the prior year, primarily driven by higher
revenues from Kayo and BINGE from increases in both volume and
pricing, and an $11 million, or 2%, positive impact from foreign
currency fluctuations, partly offset by the impact from fewer
residential broadcast subscribers. Adjusted Revenues of $490
million increased 1% compared to the prior year. Foxtel Group
streaming subscription revenues represented 34% of total segment
circulation and subscription revenues in the quarter, as compared
to 30% in the prior year.
As of September 30, 2024, Foxtel’s total closing paid
subscribers were over 4.6 million, a 1% increase compared to the
prior year, driven by growth in Kayo and BINGE subscribers, partly
offset by fewer residential broadcast subscribers. Broadcast
subscriber churn in the quarter was 11.0% compared to 11.4% in the
prior year, while Broadcast ARPU for the quarter continued to
increase, up 4% year-over-year to A$89 (US$60).
As of September 30,
2024
2023
(in 000's)
Broadcast Subscribers
Residential
1,185
1,310
Commercial
237
233
Streaming Subscribers - Total (Paid)
Kayo
1,511 (1,499)
1,411 (1,403)
BINGE
1,571 (1,552)
1,506 (1,449)
Foxtel Now
134 (131)
167 (161)
Total Subscribers - Total (Paid)
4,658 (4,622)
4,646 (4,573)
Segment EBITDA of $92 million in the quarter decreased $1
million, or 1%, compared with the prior year, primarily due to $11
million of Hubbl costs, higher sports programming costs related to
contractual increases and higher production costs, partially offset
by declines in other costs, including marketing and entertainment
programming costs, and the higher revenues discussed above.
Adjusted Segment EBITDA decreased 3%.
News Media
Revenues in the quarter decreased $27 million, or 5%, as
compared to the prior year, including a positive $12 million, or
2%, impact from foreign currency fluctuations, primarily driven by
lower other revenues from the transfer of third-party printing
revenue contracts to News UK’s joint venture with DMG Media and
lower advertising revenues. Adjusted Revenues for the segment
decreased 7% compared to the prior year.
Circulation and subscription revenues decreased $4 million, or
1%, compared to the prior year, primarily due to lower print
volumes, partially offset by cover price increases and the $6
million, or 3%, positive impact from foreign currency
fluctuations.
Advertising revenues decreased $10 million, or 5%, compared to
the prior year, primarily due to lower print advertising revenues
at News Corp Australia and lower digital advertising revenues at
News UK mainly driven by a decline in traffic at some mastheads due
to algorithm changes at certain platforms, partially offset by a $5
million, or 2%, positive impact from foreign currency
fluctuations.
In the quarter, Segment EBITDA increased $2 million, or 14%,
compared to the prior year, driven by cost savings at News UK as a
result of the combination of its printing operations with those of
DMG Media and other cost savings initiatives, including lower Talk
costs, largely offset by the lower revenues discussed above.
Adjusted Segment EBITDA increased 7%.
Digital revenues represented 39% of News Media segment revenues
in the quarter, compared to 37% in the prior year, and represented
37% of the combined revenues of the newspaper mastheads. Digital
subscribers and users across key properties within the News Media
segment are summarized below:
- Closing digital subscribers at News Corp Australia as of
September 30, 2024 were 1,127,000 (979,000 for news mastheads),
compared to 1,049,000 (937,000 for news mastheads) in the prior
year (Source: Internal data)
- The Times and Sunday Times closing digital subscribers,
including the Times Literary Supplement, as of September 30, 2024
were 600,000, compared to 572,000 in the prior year (Source:
Internal data).
- The Sun’s digital offering reached 80 million global monthly
unique users in September 2024, compared to 134 million in the
prior year (Source: Meta Pixel)
- New York Post’s digital network reached 103 million unique
users in September 2024, compared to 127 million in the prior year
(Source: Google Analytics)
CASH FLOW
The following table presents a reconciliation of net cash
provided by (used in) operating activities to free cash flow:
For the three months ended
September 30,
2024
2023
(in millions)
Net cash provided by (used in) operating
activities
$
64
$
(55
)
Less: Capital expenditures
(95
)
(124
)
Free cash flow
$
(31
)
$
(179
)
Net cash provided by operating activities of $64 million for the
three months ended September 30, 2024 was $119 million higher than
net cash used in operating activities of $(55) million in the prior
year, primarily due to lower working capital and higher Total
Segment EBITDA, as noted above, partly offset by higher tax
payments.
Free cash flow in the three months ended September 30, 2024 was
$(31) million compared to $(179) million in the prior year. The
improvement in free cash flow was primarily due to higher cash
provided by operating activities, as mentioned above, in addition
to lower capital expenditures.
Free cash flow is a non-GAAP financial measure. Free cash flow
is defined as net cash provided by (used in) operating activities,
less capital expenditures. Free cash flow may not be comparable to
similarly titled measures reported by other companies, since
companies and investors may differ as to what items should be
included in the calculation of free cash flow.
Free cash flow does not represent the total increase or decrease
in the cash balance for the period and should be considered in
addition to, not as a substitute for, the net change in cash and
cash equivalents as presented in the Company’s consolidated
statements of cash flows prepared in accordance with GAAP, which
incorporates all cash movements during the period. The Company
believes free cash flow provides useful information to management
and investors about the Company’s liquidity and cash flow
trends.
OTHER ITEMS
Strategic Review
In response to third party interest, the Company is continuing
to assess strategic and financial options for the Foxtel Group,
including its capital structure and assets. There is no assurance
regarding the timing of any action or transaction, nor that the
strategic review will result in a transaction or other strategic
change.
COMPARISON OF NON-GAAP TO U.S. GAAP INFORMATION
Adjusted Revenues, Total Segment EBITDA, Adjusted Total Segment
EBITDA, Adjusted Segment EBITDA, adjusted net income attributable
to News Corporation stockholders, Adjusted EPS, constant currency
revenues and free cash flow are non-GAAP financial measures
contained in this earnings release. The Company believes these
measures are important tools for investors and analysts to use in
assessing the Company’s underlying business performance and to
provide for more meaningful comparisons of the Company’s operating
performance between periods. These measures also allow investors
and analysts to view the Company’s business from the same
perspective as Company management. These non-GAAP measures may be
different than similar measures used by other companies and should
be considered in addition to, not as a substitute for, measures of
financial performance calculated in accordance with GAAP.
Reconciliations for the differences between non-GAAP measures used
in this earnings release and comparable financial measures
calculated in accordance with U.S. GAAP are included in Notes 1, 2,
3 and 4 and the reconciliation of net cash provided by (used in)
operating activities to free cash flow is included above.
Conference call
News Corporation’s earnings conference call can be heard live at
5:00 p.m. EST on November 7, 2024. To listen to the call, please
visit http://investors.newscorp.com.
Annual Meeting of Stockholders
News Corporation’s 2024 Annual Meeting of Stockholders will be
held exclusively via live webcast on Wednesday, November 20, 2024,
beginning at 1:00 p.m. EST. The webcast can be accessed at
www.virtualshareholdermeeting.com/NWS2024. A replay will be
available at the same location for a period of time following the
meeting.
Cautionary Statement Concerning Forward-Looking
Statements
This document contains certain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements include, but are not
limited to, statements regarding trends and uncertainties affecting
the Company’s business, results of operations and financial
condition, the Company’s strategy and strategic initiatives,
including potential acquisitions, investments and dispositions, the
Company’s cost savings initiatives and the outcome of contingencies
such as litigation and investigations. These statements are based
on management’s views and assumptions regarding future events and
business performance as of the time the statements are made. Actual
results may differ materially from these expectations due to the
risks, uncertainties and other factors described in the Company’s
filings with the Securities and Exchange Commission. More detailed
information about factors that could affect future results is
contained in our filings with the Securities and Exchange
Commission. The “forward-looking statements” included in this
document are made only as of the date of this document and we do
not have and do not undertake any obligation to publicly update any
“forward-looking statements” to reflect subsequent events or
circumstances, and we expressly disclaim any such obligation,
except as required by law or regulation.
About News Corporation
News Corp (Nasdaq: NWS, NWSA; ASX: NWS, NWSLV) is a global,
diversified media and information services company focused on
creating and distributing authoritative and engaging content and
other products and services. The company comprises businesses
across a range of media, including: information services and news,
digital real estate services, book publishing and subscription
video services in Australia. Headquartered in New York, News Corp
operates primarily in the United States, Australia, and the United
Kingdom, and its content and other products and services are
distributed and consumed worldwide. More information is available
at: www.newscorp.com.
NEWS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited; in
millions, except per share amounts)
For the three months ended
September 30,
2024
2023
Revenues:
Circulation and subscription
$
1,157
$
1,129
Advertising
381
391
Consumer
521
502
Real estate
357
311
Other
161
166
Total Revenues
2,577
2,499
Operating expenses
(1,263
)
(1,273
)
Selling, general and administrative
(899
)
(862
)
Depreciation and amortization
(189
)
(171
)
Impairment and restructuring charges
(24
)
(38
)
Equity losses of affiliates
(3
)
(2
)
Interest expense, net
(18
)
(23
)
Other, net
23
(35
)
Income before income tax expense
204
95
Income tax expense
(60
)
(37
)
Net income
144
58
Net income attributable to noncontrolling
interests
(25
)
(28
)
Net income attributable to News
Corporation stockholders
$
119
$
30
Weighted average shares outstanding:
Basic
569.2
572.3
Diluted
571.2
574.1
Net income attributable to News
Corporation stockholders per share, basic and diluted
$
0.21
$
0.05
NEWS CORPORATION
CONSOLIDATED BALANCE SHEETS (Unaudited; in
millions)
As of September 30, 2024
As of June 30, 2024
ASSETS
Current assets:
Cash and cash equivalents
$
1,778
$
1,960
Receivables, net
1,698
1,503
Inventory, net
378
296
Other current assets
652
613
Total current assets
4,506
4,372
Non-current assets:
Investments
458
430
Property, plant and equipment, net
1,919
1,914
Operating lease right-of-use assets
965
958
Intangible assets, net
2,324
2,322
Goodwill
5,258
5,186
Deferred income tax assets, net
323
332
Other non-current assets
1,174
1,170
Total assets
$
16,927
$
16,684
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
$
374
$
314
Accrued expenses
1,213
1,231
Deferred revenue
559
551
Current borrowings
194
54
Other current liabilities
929
905
Total current liabilities
3,269
3,055
Non-current liabilities:
Borrowings
2,706
2,855
Retirement benefit obligations
130
125
Deferred income tax liabilities, net
112
119
Operating lease liabilities
1,036
1,027
Other non-current liabilities
508
492
Commitments and contingencies
Equity:
Class A common stock
4
4
Class B common stock
2
2
Additional paid-in capital
11,157
11,254
Accumulated deficit
(1,779
)
(1,889
)
Accumulated other comprehensive loss
(1,131
)
(1,251
)
Total News Corporation stockholders'
equity
8,253
8,120
Noncontrolling interests
913
891
Total equity
9,166
9,011
Total liabilities and equity
$
16,927
$
16,684
NEWS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited; in
millions)
For the three months ended
September 30,
2024
2023
Operating activities:
Net income
$
144
$
58
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization
189
171
Operating lease expense
25
24
Equity losses of affiliates
3
2
Impairment charges
—
21
Deferred income taxes
14
13
Other, net
(23
)
36
Change in operating assets and
liabilities, net of acquisitions:
Receivables and other assets
(107
)
(128
)
Inventories, net
(68
)
(55
)
Accounts payable and other liabilities
(113
)
(197
)
Net cash provided by (used in) operating
activities
64
(55
)
Investing activities:
Capital expenditures
(95
)
(124
)
Acquisitions, net of cash acquired
(12
)
(20
)
Purchases of investments in equity
affiliates and other
(51
)
(31
)
Proceeds from sales of investments in
equity affiliates and other
22
16
Net cash used in investing activities
(136
)
(159
)
Financing activities:
Borrowings
153
925
Repayment of borrowings
(185
)
(933
)
Repurchase of shares
(38
)
(29
)
Dividends paid
(35
)
(28
)
Other, net
(42
)
—
Net cash used in financing activities
(147
)
(65
)
Net change in cash and cash
equivalents
(219
)
(279
)
Cash and cash equivalents, beginning of
year
1,960
1,833
Effect of exchange rate changes on cash
and cash equivalents
37
(25
)
Cash and cash equivalents, end of
period
$
1,778
$
1,529
NOTE 1 – TOTAL SEGMENT EBITDA
Segment EBITDA is defined as revenues less operating expenses
and selling, general and administrative expenses. Segment EBITDA
does not include: depreciation and amortization, impairment and
restructuring charges, equity losses of affiliates, interest
(expense) income, net, other, net and income tax (expense) benefit.
Management believes that Segment EBITDA is an appropriate measure
for evaluating the operating performance of the Company’s business
segments because it is the primary measure used by the Company’s
chief operating decision maker to evaluate the performance of and
allocate resources within the Company’s businesses. Segment EBITDA
provides management, investors and equity analysts with a measure
to analyze the operating performance of each of the Company’s
business segments and its enterprise value against historical data
and competitors’ data, although historical results may not be
indicative of future results (as operating performance is highly
contingent on many factors, including customer tastes and
preferences).
Total Segment EBITDA is a non-GAAP measure and should be
considered in addition to, not as a substitute for, net income
(loss), cash flow and other measures of financial performance
reported in accordance with GAAP. In addition, this measure does
not reflect cash available to fund requirements and excludes items,
such as depreciation and amortization and impairment and
restructuring charges, which are significant components in
assessing the Company’s financial performance. The Company believes
that the presentation of Total Segment EBITDA provides useful
information regarding the Company’s operations and other factors
that affect the Company’s reported results. Specifically, the
Company believes that by excluding certain one-time or non-cash
items such as impairment and restructuring charges and depreciation
and amortization, as well as potential distortions between periods
caused by factors such as financing and capital structures and
changes in tax positions or regimes, the Company provides users of
its consolidated financial statements with insight into both its
core operations as well as the factors that affect reported results
between periods but which the Company believes are not
representative of its core business. As a result, users of the
Company’s consolidated financial statements are better able to
evaluate changes in the core operating results of the Company
across different periods. The following table reconciles net income
to Total Segment EBITDA for the three months ended September 30,
2024 and 2023:
For the three months ended
September 30,
2024
2023
Change
% Change
(in millions)
Net income
$
144
$
58
$
86
148
%
Add:
Income tax expense
60
37
23
62
%
Other, net
(23
)
35
(58
)
**
Interest expense, net
18
23
(5
)
(22
)%
Equity losses of affiliates
3
2
1
50
%
Impairment and restructuring charges
24
38
(14
)
(37
)%
Depreciation and amortization
189
171
18
11
%
Total Segment EBITDA
$
415
$
364
$
51
14
%
**Not meaningful
NOTE 2 – ADJUSTED REVENUES, ADJUSTED TOTAL SEGMENT EBITDA AND
ADJUSTED SEGMENT EBITDA
The Company uses revenues, Total Segment EBITDA and Segment
EBITDA excluding the impact of acquisitions, divestitures, fees and
costs, net of indemnification, related to the claims and
investigations arising out of certain conduct at The News of the
World (the “U.K. Newspaper Matters”), charges for other
significant, non-ordinary course legal or regulatory matters
(“litigation charges”) and foreign currency fluctuations (“Adjusted
Revenues,” “Adjusted Total Segment EBITDA” and “Adjusted Segment
EBITDA,” respectively) to evaluate the performance of the Company’s
core business operations exclusive of certain items that impact the
comparability of results from period to period such as the
unpredictability and volatility of currency fluctuations. The
Company calculates the impact of foreign currency fluctuations for
businesses reporting in currencies other than the U.S. dollar by
multiplying the results for each quarter in the current period by
the difference between the average exchange rate for that quarter
and the average exchange rate in effect during the corresponding
quarter of the prior year and totaling the impact for all quarters
in the current period.
The calculation of Adjusted Revenues, Adjusted Total Segment
EBITDA and Adjusted Segment EBITDA may not be comparable to
similarly titled measures reported by other companies, since
companies and investors may differ as to what type of events
warrant adjustment. Adjusted Revenues, Adjusted Total Segment
EBITDA and Adjusted Segment EBITDA are not measures of performance
under generally accepted accounting principles and should not be
construed as substitutes for amounts determined under GAAP as
measures of performance. However, management uses these measures in
comparing the Company’s historical performance and believes that
they provide meaningful and comparable information to investors to
assist in their analysis of our performance relative to prior
periods and our competitors.
The following table reconciles reported revenues and reported
Total Segment EBITDA to Adjusted Revenues and Adjusted Total
Segment EBITDA for the three months ended September 30, 2024 and
2023:
Revenues
Total Segment EBITDA
For the three months ended
September 30,
For the three months ended
September 30,
2024
2023
Difference
2024
2023
Difference
(in millions)
(in millions)
As reported
$
2,577
$
2,499
$
78
$
415
$
364
$
51
Impact of acquisitions
(2
)
—
(2
)
1
—
1
Impact of foreign currency
fluctuations
(35
)
—
(35
)
(8
)
—
(8
)
Net impact of U.K. Newspaper Matters
—
—
—
2
3
(1
)
As adjusted
$
2,540
$
2,499
$
41
$
410
$
367
$
43
Foreign Exchange Rates
Average foreign exchange rates used in the calculation of the
impact of foreign currency fluctuations for the three months ended
September 30, 2024 and 2023 are as follows:
Fiscal Year 2025
Q1
U.S. Dollar per Australian Dollar
$0.67
U.S. Dollar per British Pound Sterling
$1.30
Fiscal Year 2024
Q1
U.S. Dollar per Australian Dollar
$0.65
U.S. Dollar per British Pound Sterling
$1.27
Adjusted Revenues and Adjusted Segment EBITDA by segment for the
three months ended September 30, 2024 and 2023 are as follows:
For the three months ended
September 30,
2024
2023
% Change
(in millions)
Better/(Worse)
Adjusted Revenues:
Dow Jones
$
549
$
537
2
%
Digital Real Estate Services
449
403
11
%
Book Publishing
543
525
3
%
Subscription Video Services
490
486
1
%
News Media
509
548
(7
)%
Other
—
—
—
%
Adjusted Total Revenues
$
2,540
$
2,499
2
%
Adjusted Segment EBITDA:
Dow Jones
$
130
$
124
5
%
Digital Real Estate Services
138
122
13
%
Book Publishing
80
65
23
%
Subscription Video Services
90
93
(3
)%
News Media
15
14
7
%
Other
(43
)
(51
)
16
%
Adjusted Total Segment EBITDA
$
410
$
367
12
%
The following tables reconcile reported revenues and Segment
EBITDA by segment to Adjusted Revenues and Adjusted Segment EBITDA
by segment for the three months ended September 30, 2024 and
2023:
For the three months ended
September 30, 2024
As Reported
Impact of Acquisitions
Impact of Foreign Currency
Fluctuations
Net Impact of U.K. Newspaper
Matters
As Adjusted
(in millions)
Revenues:
Dow Jones
$
552
$
(1
)
$
(2
)
$
—
$
549
Digital Real Estate Services
457
(1
)
(7
)
—
449
Book Publishing
546
—
(3
)
—
543
Subscription Video Services
501
—
(11
)
—
490
News Media
521
—
(12
)
—
509
Other
—
—
—
—
—
Total Revenues
$
2,577
$
(2
)
$
(35
)
$
—
$
2,540
Segment EBITDA:
Dow Jones
$
131
$
—
$
(1
)
$
—
$
130
Digital Real Estate Services
140
1
(3
)
—
138
Book Publishing
81
—
(1
)
—
80
Subscription Video Services
92
—
(2
)
—
90
News Media
16
—
(1
)
—
15
Other
(45
)
—
—
2
(43
)
Total Segment EBITDA
$
415
$
1
$
(8
)
$
2
$
410
For the three months ended
September 30, 2023
As Reported
Impact of Acquisitions
Impact of Foreign Currency
Fluctuations
Net Impact of U.K. Newspaper
Matters
As Adjusted
(in millions)
Revenues:
Dow Jones
$
537
$
—
$
—
$
—
$
537
Digital Real Estate Services
403
—
—
—
403
Book Publishing
525
—
—
—
525
Subscription Video Services
486
—
—
—
486
News Media
548
—
—
—
548
Other
—
—
—
—
—
Total Revenues
$
2,499
$
—
$
—
$
—
$
2,499
Segment EBITDA:
Dow Jones
$
124
$
—
$
—
$
—
$
124
Digital Real Estate Services
122
—
—
—
122
Book Publishing
65
—
—
—
65
Subscription Video Services
93
—
—
—
93
News Media
14
—
—
—
14
Other
(54
)
—
—
3
(51
)
Total Segment EBITDA
$
364
$
—
$
—
$
3
$
367
NOTE 3 – ADJUSTED NET INCOME (LOSS) ATTRIBUTABLE TO NEWS
CORPORATION STOCKHOLDERS AND ADJUSTED EPS
The Company uses net income (loss) attributable to News
Corporation stockholders and diluted earnings per share (“EPS”)
excluding expenses related to U.K. Newspaper Matters, litigation
charges, impairment and restructuring charges and “Other, net”, net
of tax, recognized by the Company or its equity method investees,
as well as the settlement of certain pre-Separation tax matters
(“adjusted net income (loss) attributable to News Corporation
stockholders” and “adjusted EPS,” respectively), to evaluate the
performance of the Company’s operations exclusive of certain items
that impact the comparability of results from period to period, as
well as certain non-operational items. The calculation of adjusted
net income (loss) attributable to News Corporation stockholders and
adjusted EPS may not be comparable to similarly titled measures
reported by other companies, since companies and investors may
differ as to what type of events warrant adjustment. Adjusted net
income (loss) attributable to News Corporation stockholders and
adjusted EPS are not measures of performance under generally
accepted accounting principles and should not be construed as
substitutes for consolidated net income (loss) attributable to News
Corporation stockholders and net income (loss) per share as
determined under GAAP as a measure of performance. However,
management uses these measures in comparing the Company’s
historical performance and believes that they provide meaningful
and comparable information to investors to assist in their analysis
of our performance relative to prior periods and our
competitors.
The following table reconciles reported net income attributable
to News Corporation stockholders and reported diluted EPS to
adjusted net income attributable to News Corporation stockholders
and adjusted EPS for the three months ended September 30, 2024 and
2023:
For the three months ended
September 30, 2024
For the three months ended
September 30, 2023
(in millions, except per share data)
Net income attributable to
stockholders
EPS
Net income attributable to
stockholders
EPS
Net income
$
144
$
58
Net income attributable to noncontrolling
interests
(25
)
(28
)
Net income attributable to News
Corporation stockholders
$
119
$
0.21
$
30
$
0.05
U.K. Newspaper Matters
2
0.01
3
0.01
Impairment and restructuring
charges(a)
24
0.04
38
0.06
Other, net
(23
)
(0.04
)
35
0.06
Tax impact on items above
(3
)
(0.01
)
(19
)
(0.03
)
Impact of noncontrolling interest on items
above
(1
)
—
3
0.01
As adjusted
$
118
$
0.21
$
90
$
0.16
(a)
During the three months ended September
30, 2023, the Company recognized non-cash impairment charges of $21
million at the News Media segment related to the write-down of
fixed assets associated with the combination of News UK’s printing
operations with those of DMG Media.
NOTE 4 – CONSTANT CURRENCY REVENUES
The Company believes that the presentation of revenues excluding
the impact of foreign currency fluctuations (“constant currency
revenues”) provides useful information regarding the performance of
the Company’s core business operations exclusive of distortions
between periods caused by the unpredictability and volatility of
currency fluctuations. The Company calculates the impact of foreign
currency fluctuations for businesses reporting in currencies other
than the U.S. dollar as described in Note 2.
Constant currency revenues are not measures of performance under
generally accepted accounting principles and should not be
construed as substitutes for revenues as determined under GAAP as
measures of performance. However, management uses these measures in
comparing the Company’s historical performance and believes that
they provide meaningful and comparable information to investors to
assist in their analysis of our performance relative to prior
periods and our competitors.
The following tables reconcile reported revenues to constant
currency revenues for the three months ended September 30,
2024:
Q1 Fiscal 2024
Q1 Fiscal 2025
FX impact
Q1 Fiscal 2025 constant
currency
% Change - reported
% Change - constant currency
($ in millions)
Better/(Worse)
Consolidated results:
Circulation and subscription
$
1,129
$
1,157
$
18
$
1,139
2
%
1
%
Advertising
391
381
6
375
(3
)%
(4
)%
Consumer
502
521
3
518
4
%
3
%
Real estate
311
357
6
351
15
%
13
%
Other
166
161
2
159
(3
)%
(4
)%
Total revenues
$
2,499
$
2,577
$
35
$
2,542
3
%
2
%
Dow Jones:
Circulation and subscription
$
436
$
459
$
2
$
457
5
%
5
%
Advertising
91
85
—
85
(7
)%
(7
)%
Other
10
8
—
8
(20
)%
(20
)%
Total Dow Jones segment revenues
$
537
$
552
$
2
$
550
3
%
2
%
Digital Real Estate Services:
Circulation and subscription
$
3
$
2
$
—
$
2
(33
)%
(33
)%
Advertising
35
38
—
38
9
%
9
%
Real estate
311
357
6
351
15
%
13
%
Other
54
60
1
59
11
%
9
%
Total Digital Real Estate Services segment
revenues
$
403
$
457
$
7
$
450
13
%
12
%
REA Group revenues
$
261
$
318
$
7
$
311
22
%
19
%
Q1 Fiscal 2024
Q1 Fiscal 2025
FX impact
Q1 Fiscal 2025 constant
currency
% Change - reported
% Change - constant currency
($ in millions)
Better/(Worse)
Book Publishing:
Consumer
$
502
$
521
$
3
$
518
4
%
3
%
Other
23
25
—
25
9
%
9
%
Total Book Publishing segment revenues
$
525
$
546
$
3
$
543
4
%
3
%
Subscription Video Services:
Circulation and subscription
$
415
$
425
$
10
$
415
2
%
—
%
Advertising
62
65
1
64
5
%
3
%
Other
9
11
—
11
22
%
22
%
Total Subscription Video Services segment
revenues
$
486
$
501
$
11
$
490
3
%
1
%
News Media:
Circulation and subscription
$
275
$
271
$
6
$
265
(1
)%
(4
)%
Advertising
203
193
5
188
(5
)%
(7
)%
Other
70
57
1
56
(19
)%
(20
)%
Total News Media segment revenues
$
548
$
521
$
12
$
509
(5
)%
(7
)%
News UK
Circulation and subscription
$
144
$
146
$
4
$
142
1
%
(1
)%
Advertising
59
50
2
48
(15
)%
(19
)%
Other
25
11
—
11
(56
)%
(56
)%
Total News UK revenues
$
228
$
207
$
6
$
201
(9
)%
(12
)%
News Corp Australia
Circulation and subscription
$
107
$
103
$
2
$
101
(4
)%
(6
)%
Advertising
93
90
2
88
(3
)%
(5
)%
Other
38
41
1
40
8
%
5
%
Total News Corp Australia revenues
$
238
$
234
$
5
$
229
(2
)%
(4
)%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241107961040/en/
Investor Relations Michael Florin
212-416-3363 mflorin@newscorp.com
Anthony Rudolf 212-416-3040 arudolf@newscorp.com
Corporate Communications Arthur
Bochner 646-422-9671 abochner@newscorp.com
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