News Corp reported 3% revenue growth for the quarter that ended in March, driven by positive foreign-exchange fluctuations plus solid growth at the company’s digital real estate, book publishing and Dow Jones units.
The New York-based media company, whose holdings include The Wall Street Journal and HarperCollins Publishers, swung to a profit of $79 million, or 13 cents a share, compared with a loss of $730 million, or $1.24 per share, in the year-earlier quarter, when the company took a big noncash impairment charge.
News Corp’s total revenue rose to $2.34 billion in the quarter, up from $2.27 billion a year earlier. Growth was partially offset by weakness in print advertising and the loss of contributions from the coupon-publishing unit the company sold last year.
The company posted a 23% increase in earnings before interest, taxes, depreciation and amortization, reflecting improved profitability at several units.
"The results vindicate the strategy of simplifying the asset mix, vigorously pursuing digitization, slimming the cost base, and investing in three growth areas—digital real-estate services, Dow Jones and book publishing," News Corp Chief Executive Robert Thomson said on a call with analysts.
Dow Jones, the publisher of the Journal, Barron’s and MarketWatch, reported a 61% rise in segment earnings to $82 million, thanks to growth in circulation and subscription revenues. Revenue rose 6% to $421 million.
The Journal averaged 2.63 million digital subscribers in the quarter, up roughly 170,000 from over 2.46 million in the December quarter. Including the print edition, the Journal averaged 3.38 million subscribers for the period. Across the entire unit, Dow Jones reached an average 4.27 million subscribers in the quarter when including readers of Barron’s, MarketWatch and Financial News.
Dow Jones reported a 30% rise in digital advertising revenue, which the company said marked the fastest year-over-year growth in a decade. That was partially offset by a 25% decline in print advertising revenue.
On Wednesday, News Corp announced it had completed a transaction to acquire financial news and research publisher Investor’s Business Daily for $275 million. The company will become part of the Dow Jones unit.
News Corp in February announced a deal with Alphabet Inc.’s Google to license content to the tech giant, similar to an arrangement in place with Facebook Inc. Mr. Thomson said the deals were part of an effort to "to reset the terms of trade for premium journalism."
News Corp’s book-publishing unit, HarperCollins Publishers, posted a 19% revenue gain to $490 million, while segment earnings rose 45%. News Corp attributed the gains to higher backlist sales of titles such as the "Bridgerton" series by Julia Quinn. Netflix Inc. has a popular show based on the "Bridgerton" novels.
News Corp’s news media segment, which includes the New York Post, the Sun and the Times in the U.K. and many papers in Australia, posted a 25% decline in revenue to $550 million, hurt by the loss of the coupon business and a drop in print advertising. Segment earnings fell 67%.
Revenue at the company’s digital real-estate services increased 34% to $351 million. Segment earnings rose 58% to $117 million. The unit includes a majority stake in REA Group Ltd., a publicly-traded digital real-estate company based in Australia, and an 80% stake in Move Inc., an online real-estate business based in Santa Clara, Calif., that primarily operates the website Realtor.com.
News Corp’s subscription-video-services unit, which includes a 65% stake in Foxtel, Australia’s largest subscription television provider, posted a 34% rise in segment earnings, due to lower costs for sports programming rights and production as well as positive foreign-exchange fluctuations. Revenue in the unit rose 13% to $523 million.
News Corp. is the parent company of news outlets The Wall Street Journal, The New York Post, The Sun in the United Kingdom as well as newspaper and TV assets in Australia.
Fox Corp. is the parent company of Fox Business and Fox News.