News Corp. Reports Mixed Results for Q4
News Corp. reported mixed earnings on Thursday with a net loss of $32 million on revenue of $2.43 billion for its fourth fiscal quarter of 2023.
That translated to adjusted earnings of 14 cents per share of attributable to News Corp. shareholders. Analysts surveyed by Zacks Investment Research were expecting earnings of 9 cents per share on revenue of $2.49 billion.
The New York-based media company owns the Wall Street Journal, the New York Post, HarperCollins, and a host of Australian and British newspapers including the Times of London and the Sun.
CEO Robert Thomson announced in February that News Corp. would be cutting 1,250 jobs, approximately 5 percent of its employees. Prior to the layoff announcement, News Corp. and Fox News were exploring the potential of a merger, which was called off by the Murdoch family, which controls both companies, in January.
The net loss of $32 million for the quarter was driven by a decrease in book sales and “challenging housing market conditions” which have affected News Corp.’s real estate services.
The book publishing branch of News Corp., which includes HarperCollins, saw revenue decrease by $67 million as the industry experienced softening consumer demand.
However, the company reported continued growth in the company’s digital-only media subscriptions, primarily at the Wall Street Journal.
In the fourth quarter, total subscriptions at the Wall Street Journal grew 6 percent to over 3.9 million average subscriptions. Digital-only subscriptions grew 10 percent to 3.4 million average subscriptions. According to the report, digital subscriptions represented 86 percent of total Wall Street Journal subscribers.
During News Corp.’s earning call on Thursday, executives said it would seek to improve the Journal’s international digital media footprint. Only 12 percent of the publication’s subscriptions come from outside of the U.S., which News Corp. sees as “untapped potential.”
The company drew attention to the Russian detainment of Evan Gershkovich, a Wall Street Journal reporter, during Thursday’s earnings call. Thomson reiterated the WSJ’s “vehement denial” of the allegations against Gershkovich, and thanked those who have “rallie[d] to his cause.”
When asked by analysts about News Corp.’s failed bid to acquire book publisher Simon & Schuster, bought by private equity firm KKR earlier this week, Thomson said “we wouldn’t be prepared to go that high,” referencing the $1.62 billion price tag. The News Corp. CEO noted that the company would likely face intense regulatory scrutiny had they acquired the book publisher.
“We obviously have great respect for the company and its authors,” said Thomson, but candidly continued that the company’s hope was to get Simon & Schuster at a reduced cost. “It obviously didn’t end up in the Barnes and Noble bargain bin,” he quipped.
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