Fox Earnings Hit By Lower Advertising Revenue Last Quarter; Wall Street Eager For Details On New Streaming Sports Joint Venture

Fox saw revenue dip 8% last quarter to $4.23 billion on weaker advertising due in part to tough comps from the year before. The fiscal second-quarter numbers hit the day after Fox with Disney and Warner Bros. Discovery set a fall launch date for joint streaming sports venture with. There’s no name or price yet for the service, which will pool the sports rights of the three media companies. CEO Lachlan Murdoch will say more on a call at 8:30 ET.

The shares, which were up more than 5% after the news yesterday gave up some gains after the numbers and up are about 1%.

Ad sales were expected to fall and dropped 20%, primarily on the absence of the FIFA Men’s World Cup on FOX Sports, lower political advertising revenues at Fox stations due to the absence of the 2022 midterm elections, the impact of elevated supply in the direct response marketplace, and lower ratings and higher preemptions associated with breaking news coverage at Fox News.

Affiliate fee revenues increased 4%, driven by 10% growth at the television segment.

Other revenues increased 14%, primarily due to higher sports sublicensing revenues at the national sports networks, offset by lower content revenues at the entertainment production companies as a result of industry guild labor disputes.

Net income for the company’s fiscal second quarter ended in December plunged to $115 million from $321 million. EPS was  23 cents a share vs 58 cents.

Expenses decreased in the quarter, primarily due to lower entertainment and sports programming rights amortization and production costs, led by fewer hours of original scripted programming and the absence of the Men’s World Cup, partially offset by the renewed NFL contract.

“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,” said CEO Lachlan Murdoch. “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. Combining this steadfast portfolio of assets with a best-in-class balance sheet underpins our ability to deliver value for our shareholders.”