By Jaspreet Singh
Aug 6 (Reuters) – Fox Corp beat Wall Street estimates for fourth-quarter revenue and profit on Thursday, as the FIFA World Cup boosted advertising sales during a busy news cycle, sending its shares more than 5% higher.
The company held the exclusive U.S. English-language broadcast rights for the World Cup and benefited from strong viewership as well as new so-called hydration breaks that created more ad opportunities by splitting matches into four commercial windows.
Nearly 63 million viewers in the U.S. watched Spain defeat Argentina in the World Cup final in July, setting a new U.S. viewership record for the tournament.
In a crowded market, companies are seeking larger audiences by increasing their coverage of major events such as the U.S.-Israeli war with Iran and sporting tournaments. Fox benefits from its diverse portfolio, including Fox News, Fox Sports, Tubi and Fox One, alongside rights to major leagues such as the NFL.
“In advance of the (NFL) season, we’ve had recent, thorough, and productive discussions with the league. As a result, we will not be making any amendments to our existing contractual relationship,” CEO Lachlan Murdoch said on a post-earnings call.
Fox’s revenue of $4.21 billion beat analysts’ average estimate of $3.64 billion, according to LSEG-compiled data. Adjusted earnings per share of $1.79 also exceeded estimates.
Advertising revenue surged 78% to $1.92 billion. Tubi revenue grew 35% versus a 23% growth in the prior quarter.
“The tournament also proved to be a customer acquisition opportunity for Fox One, driving incremental subscriber acquisition and strong retention rates that surpassed our expectations,” Murdoch said.
Fox One recorded 2.8 million sign-ups in June, its strongest month since the service’s launch in August, according to industry tracker Antenna.
In June, Fox announced it would buy Roku to bolster its presence in streaming on internet-connected TVs.
“Fox must preserve Roku’s appeal as an open platform while managing declining pay-TV audiences, rising sports-rights costs and the challenge of turning event-led growth into a more consistent digital business,” PP Foresight analyst Paolo Pescatore said.
(Reporting by Jaspreet Singh in Bengaluru; Editing by Devika Syamnath)
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