Thursday, 16 August, 2018

Digital revenues grow to 30% as news subscriptions build

Rupert Murdoch’s News Corp reported a bigger loss than the previous year Camera Icon Rupert Murdoch’s News Corp reported a bigger loss than the previous year
Ginger Lawrence | 12 August, 2018, 04:43

Overall, News Corp's 11% revenue increase to $US8.1bn was driven by a 22% jump in real estate services while group EBITA saw a 21% rise to $US885bn, again driven by a 41% improvement real estate profits.

However, the media group still posted a $US1.4 billion loss after writedowns, mainly due to Foxtel in Australia.

News Corp has reported an earnings jump for the year driven by real estate services while the news and information group showed weak growth despite digital subscriptions growing by almost a third.

The growth was partially offset by lower print advertising revenues at the news and information services segment.

Under pressure Foxtel has managed to hold onto subscribers with the pay TV operator now undergoing a transformation program under the new management after a $33M revenue drop.

Revenue growth reflects the inclusion of Foxtel's results, continued strong growth in the Book Publishing and Digital Real Estate Services segments and a $29 million positive impact from foreign currency fluctuations.

Foxtel loomed large in the News Corp's global figures with last quarter's $1bn write down of the subscription TV operator increasing the group's net loss to $US1.4bn, an increase from $US643 million previous year. Analysts had a consensus revenue estimate of $2.68 billion.

At the end of June, Foxtel had about 2.8 million subscribers, higher than a year ago mainly due to the launch of Foxtel Now.

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Telstra and News Corp merged Fox Sports, formerly 100 per cent News Corp owned, and joint-venture Foxtel in April.

"We are seeing strong digital paid subscriber growth across many of our key properties, where digital subscribers now exceed print", CFO Susan Panuccio said on an earnings call August 9.

News Corp CEO Robert Mr Thomson recently confirmed that Foxtel will launch an over-the-top streaming service in late-2018 and noted the recent acquisition of cricket rights ensured a "year-round offering for the first time" that would help reduce seasonable subscriber churn.

Rupert Murdoch's News Corp. fell the most in more than five years after the company said it will invest more in its Australian cable network.

The swathe of red ink came despite healthy digital subscriber growth led by The Times, Sunday Times and Wall Street Journal as well as successes at its property portal realestate.com in addition to its book publishing unit.

"HarperCollins' success underscores the importance of intelligent editors and great writers in creating premium content".

News Corp consolidated Foxtel and Fox Sports Australia (including Sky News), reflecting in the newly formed revenue segment - Subscription Video Services.