On February 7, 2024, News Corp (NWSA, Financial) released its 8-K filing, announcing its financial results for the second quarter of fiscal year 2024. The diversified media conglomerate, known for its influential brands such as The Wall Street Journal, HarperCollins, and its significant presence in digital real estate through REA Group and Move, showcased a notable increase in both revenue and profitability.
The company's revenue climbed to $2.59 billion, a 3% increase from the previous year, primarily driven by growth in the Digital Real Estate Services, Dow Jones, and Book Publishing segments. Net income nearly doubled to $183 million, up from $94 million, while Total Segment EBITDA improved by 16% to $473 million. Earnings per share (EPS) also reflected this positive trend, with reported EPS jumping to $0.27 from $0.12 in the prior year.
Segment Highlights and Financial Metrics
Digital Real Estate Services saw a 9% increase in revenue, with REA Group posting record quarterly revenues of $292 million, a 22% increase. Dow Jones achieved its highest quarterly revenues and Segment EBITDA since its acquisition in 2007, with professional information business revenues rising by 13%. Book Publishing revenues grew by 4%, with Segment EBITDA increasing by a remarkable 67%, thanks to higher digital sales and improved return rates.
News Corp (NWSA, Financial) CEO Robert Thomson highlighted the company's strategic shift to digital and subscription revenues, which has reduced reliance on the more volatile advertising revenues. He also noted the company's intention to be a core content provider for Generative AI companies, emphasizing the importance of high-quality, timely content.
“We had particularly robust results across the three core pillars of our business – Dow Jones, Book Publishing and Digital Real Estate Services – and believe there are strong prospects for further growth as difficult macro conditions ease in some of our markets,” said Thomson.
Despite the strong performance, the company faced challenges in the News Media segment, where revenues decreased by 3%, primarily due to lower advertising revenues. However, the company managed to offset some of these declines with higher circulation and subscription revenues.
Operational Efficiency and Future Outlook
News Corp (NWSA, Financial) also reported on its operational efficiency, highlighting a 5% headcount reduction initiative that contributed to gross cost savings. The company's focus on cost management and strategic investments positions it well for future growth, even as it navigates a challenging macroeconomic environment.
The company's balance sheet remains solid, with net cash provided by operating activities for the six months ended December 31, 2023, at $305 million, a significant increase from $161 million in the prior year. Free cash flow for the same period was $69 million, compared to $(56) million in the prior year, demonstrating improved liquidity and financial health.
News Corp (NWSA, Financial) declared a semi-annual cash dividend of $0.10 per share, payable on April 10, 2024, to stockholders of record as of March 13, 2024, reflecting confidence in the company's financial stability and commitment to shareholder returns.
For a detailed analysis of News Corp's financials and future prospects, investors and interested parties can listen to the earnings conference call held on February 7, 2024, at http://investors.newscorp.com.
As News Corp (NWSA, Financial) continues to adapt and thrive in the evolving media landscape, the company's latest earnings report underscores its ability to leverage its diverse portfolio and strategic initiatives to deliver value to shareholders and position itself for sustainable growth.
Explore the complete 8-K earnings release (here) from News Corp for further details.
