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Fox (FOXA) Q2 Earnings Beat Estimates, Revenues Increase Y/Y
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Fox Corporation (FOXA - Free Report) reported second-quarter fiscal 2023 adjusted earnings of 48 cents per share, which beat the Zacks Consensus Estimate by 4.35%. The figure increased 269.2% year over year.
Revenues were up 3.7% year over year to $4.6 billion, which beat the consensus mark by 1.1%.
Affiliate fees (37.2% of revenues) rose 1.4% to $1.71 billion led by 6% growth at the Television segment. Meanwhile, advertising (54.4% of revenues) increased 3.9% to $2.5 billion reflecting the impact of the FIFA Men’s World Cup and strong National Football League (NFL) results at FOX Sports, higher political advertising revenues at the FOX Television Stations and continued growth at Tubi, partially offset by the absence of Thursday Night Football.
Other revenues (8.5% of revenues) increased 13% from the year-ago quarter’s levels to $390 million, primarily driven by the impact of the consolidation of entertainment production companies at the Television segment and higher FOX Nation subscription revenues.
Top-Line Details
Cable Network Programming (35.4% of revenues) revenues moved down by 0.4% year over year to $1.63 billion. Advertising revenues dropped 0.7%, primarily due to FOX News Media, where the impact of elevated supply in the direct response marketplace was nearly offset by the broadcast of the World Cup at FOX Sports.
Revenues from Affiliate fees decreased 1.3% year over year, primarily due to contractual price increases, partially offset by the impact of net subscriber declines. Other revenues increased 6.9% on a year-over-year basis, primarily driven by higher FOX Nation subscription revenues.
Television (63.7% of revenues) revenues increased 6.3% from the year-ago quarter’s figure to $2.93 billion. Advertising revenues increased 5% year over year because of the broadcast of the World Cup, strong NFL ratings and pricing and additional broadcast windows at FOX Sports, higher political advertising revenues at the FOX Television Stations and continued growth at Tubi.
Affiliate fees increased 5.7% year over year, driven by increases in fees from third-party FOX affiliates.
Other revenues increased 25.6% year over year, primarily driven by the impact of the consolidation of entertainment production companies at FOX Entertainment.
Operating Details
In second-quarter fiscal 2023, operating expenses decreased 3.8% year over year to $3.52 billion. As a percentage of revenues, operating expenses contracted 600 basis points (bps) to 76.6%.
Selling, general & administrative (SG&A) expenses increased 17.5% year over year to $550 million. As a percentage of revenues, SG&A expenses expanded 140 bps to 11.9%.
Total adjusted EBITDA increased 71.3% year over year to $531 million. EBITDA margin expanded 460 bps to 11.5%.
Cable Network Programming EBITDA decreased 47.2% year over year to $353 million. Television EBITDA reported $256 million of adjusted EBITDA compared with a negative adjusted EBITDA of $273 million reported in the year-ago period.
Balance Sheet
As of Dec 31, 2022, Fox had $4.05 billion in cash and cash equivalents compared with $4.95 billion as of Sep 30, 2022.
Long-term debt as of Dec 31, 2022, was $7.20 billion, which remained flat sequentially.
The company has authorized an incremental stock repurchases of an additional $3 billion of the company’s Class A common stock and Class B common stock, bringing the company’s total stock repurchase authorization to $7 billion. To date, the company has repurchased $2.2 billion of its Class A common stock and $935 million of its Class B common stock.
The Company has declared a dividend of $0.25 per Class A and Class B share. This dividend is payable on Mar 29, 2023 with a record date for determining dividend entitlements of Mar 1, 2023.
Six Flags Entertainment, Liberty Global and Warner Bros. Discovery are scheduled to report their quarterly results on Feb 22, Feb 23 and Mar 2, respectively.
The Zacks Consensus Estimate for SIX’s fourth-quarter 2022 earnings is pegged at 23 cents per share, unchanged over the past 30 days.
The Zacks Consensus Estimate for LBTYA’s fourth-quarter 2022 earnings is pegged at 49 cents per share, unchanged over the past 30 days.
The Zacks Consensus Estimate for WBD’s fourth-quarter 2022 earnings is pegged at 8 cents per share, down 42.9% over the past 30 days.
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Fox (FOXA) Q2 Earnings Beat Estimates, Revenues Increase Y/Y
Fox Corporation (FOXA - Free Report) reported second-quarter fiscal 2023 adjusted earnings of 48 cents per share, which beat the Zacks Consensus Estimate by 4.35%. The figure increased 269.2% year over year.
Revenues were up 3.7% year over year to $4.6 billion, which beat the consensus mark by 1.1%.
Affiliate fees (37.2% of revenues) rose 1.4% to $1.71 billion led by 6% growth at the Television segment. Meanwhile, advertising (54.4% of revenues) increased 3.9% to $2.5 billion reflecting the impact of the FIFA Men’s World Cup and strong National Football League (NFL) results at FOX Sports, higher political advertising revenues at the FOX Television Stations and continued growth at Tubi, partially offset by the absence of Thursday Night Football.
Other revenues (8.5% of revenues) increased 13% from the year-ago quarter’s levels to $390 million, primarily driven by the impact of the consolidation of entertainment production companies at the Television segment and higher FOX Nation subscription revenues.
Top-Line Details
Cable Network Programming (35.4% of revenues) revenues moved down by 0.4% year over year to $1.63 billion. Advertising revenues dropped 0.7%, primarily due to FOX News Media, where the impact of elevated supply in the direct response marketplace was nearly offset by the broadcast of the World Cup at FOX Sports.
Revenues from Affiliate fees decreased 1.3% year over year, primarily due to contractual price increases, partially offset by the impact of net subscriber declines. Other revenues increased 6.9% on a year-over-year basis, primarily driven by higher FOX Nation subscription revenues.
Fox Corporation Price, Consensus and EPS Surprise
Fox Corporation price-consensus-eps-surprise-chart | Fox Corporation Quote
Television (63.7% of revenues) revenues increased 6.3% from the year-ago quarter’s figure to $2.93 billion. Advertising revenues increased 5% year over year because of the broadcast of the World Cup, strong NFL ratings and pricing and additional broadcast windows at FOX Sports, higher political advertising revenues at the FOX Television Stations and continued growth at Tubi.
Affiliate fees increased 5.7% year over year, driven by increases in fees from third-party FOX affiliates.
Other revenues increased 25.6% year over year, primarily driven by the impact of the consolidation of entertainment production companies at FOX Entertainment.
Operating Details
In second-quarter fiscal 2023, operating expenses decreased 3.8% year over year to $3.52 billion. As a percentage of revenues, operating expenses contracted 600 basis points (bps) to 76.6%.
Selling, general & administrative (SG&A) expenses increased 17.5% year over year to $550 million. As a percentage of revenues, SG&A expenses expanded 140 bps to 11.9%.
Total adjusted EBITDA increased 71.3% year over year to $531 million. EBITDA margin expanded 460 bps to 11.5%.
Cable Network Programming EBITDA decreased 47.2% year over year to $353 million. Television EBITDA reported $256 million of adjusted EBITDA compared with a negative adjusted EBITDA of $273 million reported in the year-ago period.
Balance Sheet
As of Dec 31, 2022, Fox had $4.05 billion in cash and cash equivalents compared with $4.95 billion as of Sep 30, 2022.
Long-term debt as of Dec 31, 2022, was $7.20 billion, which remained flat sequentially.
The company has authorized an incremental stock repurchases of an additional $3 billion of the company’s Class A common stock and Class B common stock, bringing the company’s total stock repurchase authorization to $7 billion. To date, the company has repurchased $2.2 billion of its Class A common stock and $935 million of its Class B common stock.
The Company has declared a dividend of $0.25 per Class A and Class B share. This dividend is payable on Mar 29, 2023 with a record date for determining dividend entitlements of Mar 1, 2023.
Zacks Rank & Stocks to Consider
Fox currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Consumer Discretionary sector are Six Flags Entertainment (SIX - Free Report) , Liberty Global (LBTYA - Free Report) and Warner Bros. Discovery (WBD - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Six Flags Entertainment, Liberty Global and Warner Bros. Discovery are scheduled to report their quarterly results on Feb 22, Feb 23 and Mar 2, respectively.
The Zacks Consensus Estimate for SIX’s fourth-quarter 2022 earnings is pegged at 23 cents per share, unchanged over the past 30 days.
The Zacks Consensus Estimate for LBTYA’s fourth-quarter 2022 earnings is pegged at 49 cents per share, unchanged over the past 30 days.
The Zacks Consensus Estimate for WBD’s fourth-quarter 2022 earnings is pegged at 8 cents per share, down 42.9% over the past 30 days.