News Corp posts a $1.9bn loss but says its digital revenue is growing

Real Housewives Janet Roach, Lydia Schiavello and Gina Liano pose during a Foxtel Event at Hordern Pavilion in Sydney. ( Don Arnold/WireImage
  • News Corp posted a 29% lift in full year revenue to $US2.69 billion.
  • However, the media group still posted a $US1.4 billion loss after writedowns, mainly due to Foxtel in Australia.
  • News says its revenue flows are now more global, digital and subscription-based.

Global media group News Corp reported a loss of $US1.4 billion ($A1.9 billion) as it wrote down the value of its Australian cable business Foxtel.

The loss was bigger than last year’s $US643 million, but included a writedown of $US998 million for the merger of Foxtel and Fox Sports in Australia.

Overall revenue was 29% higher at $2.69 billion.

News and Telstra in April combined their 50% interests in Foxtel and News Corp’s 100% interest in Fox Sports Australia into a new company. News now has 65% in the new Foxtel, and Telstra has the rest.

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

However, subscription revenues were lower at new Foxtel due to the subscriber mix and lower advertising revenues

News CEO Robert Thomson says the year saw positive changes in revenue flows which were more global, digital and subscription-based.

“We generated strong revenue and Segment EBITDA growth in the Digital Real Estate Services and Book Publishing segments, which, together with the consolidation of Foxtel, drove over $1 billion in profitability for the year,” he says.

Digital revenues represented 30% of News and Information Services revenues compared to 26% last year.

“We also saw meaningful operational improvements at the News and Information Services segment led by higher digital paid subscribers and disciplined cost initiatives, notably in Australia,” says Thomson.

News Corp Australia revenue grew 1%.

Digital subscribers at News Corp Australia’s mastheads were 415,600, up from 363,600 last year.

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