News (NWS) - 2025 Q3 - Quarterly Results

Executive Summary & Financial Highlights Fiscal 2025 Third Quarter Key Financial Highlights News Corp reported strong Q3 FY2025 results with significant growth in profitability and strategic progress - Strategic Transformation: The company pursued digital growth, realigned assets, focused on cost discipline, and asserted intellectual property value[4] - Foxtel Sale: The sale was completed in April, strengthening the balance sheet and is expected to be accretive to EPS[6][8] - Dow Jones: Achieved improved revenue and profit growth, including double-digit growth in digital circulation, Risk and Compliance, and Dow Jones Energy[7][8] - REA Group: Revenues increased 6%, driven by strong Australian residential performance[8] - Book Publishing: Benefited from a strong backlist and higher downloadable audiobook sales[8] Q3 FY2025 Key Financial Highlights | Metric | Q3 FY2025 (Millions) | % Change YoY | | :--- | :--- | :--- | | Net income from continuing operations | $107 | 67% | | Total Segment EBITDA | $290 | 12% | | Total Revenues | $2,010 | 1% | | Reported EPS from continuing operations | $0.14 | 100% | | Adjusted EPS | $0.17 | 31% | Third Quarter Results Overview Consolidated Financial Performance Consolidated revenues rose 1% to $2.01 billion, while net income from continuing operations surged 67% Consolidated Financial Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Total Revenues | $2,009 | $1,994 | 1% | | Adjusted Revenues | - | - | 2% | | Net income from continuing operations | $107 | $64 | 67% | | Total Segment EBITDA | $290 | $259 | 12% | | Adjusted Total Segment EBITDA | - | - | 15% | | Reported EPS from continuing operations | $0.14 | $0.07 | 100% | | Adjusted EPS | $0.17 | $0.13 | 31% | - Foreign currency fluctuations had a negative impact of $32 million, or 1%, on total revenues[9] Segment Review Dow Jones Dow Jones revenues grew 6% to $575 million, driven by strong digital subscription and professional information growth Dow Jones Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Revenues | $575 | $544 | 6% | | Segment EBITDA | $132 | $118 | 12% | | Risk & Compliance Revenues | $84 | - | 11% | | Dow Jones Energy Revenues | $69 | - | 10% | - Digital revenues at Dow Jones represented 82% of total revenues, up from 81% in the prior year[15] - Digital circulation revenues accounted for 75% of circulation revenues, compared to 70% in the prior year[16] Dow Jones Consumer Subscriptions (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Thousands) | Q3 FY2024 (Thousands) | % Change YoY | | :--- | :--- | :--- | :--- | | Total Consumer Digital-only subscriptions | 5,543 | 5,068 | 9% | | Total Consumer Total subscriptions | 6,103 | 5,723 | 7% | | WSJ Digital-only subscriptions | 3,913 | 3,715 | 5% | | WSJ Total subscriptions | 4,339 | 4,217 | 3% | | Barron's Group Digital-only subscriptions | 1,368 | 1,221 | 12% | | Barron's Group Total subscriptions | 1,485 | 1,355 | 10% | Digital Real Estate Services Digital Real Estate Services revenues increased 5% to $406 million, with Segment EBITDA growing 19% Digital Real Estate Services Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Revenues | $406 | $388 | 5% | | Segment EBITDA | $124 | $104 | 19% | | REA Group Revenues | $271 | $256 | 6% | | Move's Revenues | $135 | $132 | 2% | - Revenues were negatively impacted by $14 million (3%) from foreign currency fluctuations[20] - Australian national residential buy listing volumes were flat compared to the prior year[21] - Average monthly unique users of Realtor.com's web and mobile sites decreased 8% to 66 million[22] - Lead volume was down 17% year over year due to high mortgage rates and affordability issues, partially offset by higher revenue per lead[22] Book Publishing Book Publishing revenues rose 2% to $514 million, supported by an acquisition and strong backlist sales Book Publishing Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Revenues | $514 | $506 | 2% | | Segment EBITDA | $64 | $62 | 3% | - Revenues were driven by a recently closed German book publisher acquisition and higher Bible sales, partially offset by a $5 million (1%) negative impact from foreign currency fluctuations[23] - Digital sales increased 3% compared to the prior year, driven by 3% growth from audiobook sales, including the contribution from Spotify[24] - Digital sales represented 25% of Consumer revenues for both the quarter and the prior year period[24] - Backlist sales represented approximately 65% of Consumer revenues in the quarter compared to 63% in the prior year[24] News Media News Media revenues declined 8% to $514 million, but Segment EBITDA grew 22% due to cost savings News Media Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Revenues | $514 | $556 | (8)% | | Circulation and subscription revenues | $276 | $286 | (3)% | | Advertising revenues | $186 | $205 | (9)% | | Segment EBITDA | $33 | $27 | 22% | - Revenues were negatively impacted by an $11 million (2%) foreign currency fluctuation[26] - Segment EBITDA increase was driven by cost savings initiatives, including lower Talk costs, and the combination of News UK's printing operations with those of DMG Media[29] - Digital revenues represented 39% of News Media segment revenues, compared to 37% in the prior year[30] News Media Digital Subscribers and Users (March 31, 2025 vs Prior Year) | Property | March 31, 2025 (Thousands/Millions) | Prior Year (Thousands/Millions) | | :--- | :--- | :--- | | News Corp Australia Digital Subscribers | 1,148 (news mastheads: 981) | 1,113 (news mastheads: 966) | | The Times and Sunday Times Digital Subscribers | 629 | 582 | | The Sun Global Monthly Unique Users | 74 million | 126 million | | New York Post Digital Network Unique Users | 85 million | 125 million | Cash Flow Free Cash Flow Free cash flow from continuing operations for the nine-month period improved to $539 million from $475 million Free Cash Flow Reconciliation (Nine Months Ended March 31) | Metric | 2025 (Millions) | 2024 (Millions) | | :--- | :--- | :--- | | Net cash provided by operating activities from continuing operations | $789 | $721 | | Less: Capital expenditures | $(250) | $(246) | | Free cash flow | $539 | $475 | - Free cash flow is a non-GAAP financial measure, defined as net cash provided by (used in) operating activities from continuing operations less capital expenditures, excluding cash flows from discontinued operations[32] Other Strategic Items Foxtel Sale The company completed the sale of Foxtel to DAZN, receiving loan repayments and a minority equity stake - The sale of the Foxtel Group to DAZN Group Limited closed on April 2, 2025[36] - Amounts outstanding under Foxtel's shareholder loans with News Corp (A$592 million) were repaid in full in cash at closing[36] - News Corp received a minority equity interest in DAZN of approximately 6% and holds one seat on its Board of Directors[36] - Foxtel's assets, liabilities, results of operations, and cash flows have been classified as discontinued operations for all periods presented[37] - The Subscription Video Services segment ceased to be a reportable segment, and its residual results were aggregated into the News Media segment[37] Non-GAAP Financial Measures Comparison of Non-GAAP to U.S. GAAP Information The company uses non-GAAP measures to assess performance by excluding items like currency and acquisitions - Non-GAAP financial measures include Adjusted Revenues, Total Segment EBITDA, Adjusted Total Segment EBITDA, Adjusted Segment EBITDA, adjusted net income attributable to News Corporation stockholders, Adjusted EPS, constant currency revenues, and free cash flow[38] - These measures are used to assess underlying business performance and provide more meaningful comparisons by excluding certain items like foreign currency impact, acquisitions, divestitures, and specific legal charges[38] - Non-GAAP measures may not be comparable to similarly titled measures reported by other companies and should be considered in addition to, not as a substitute for, GAAP measures[38] Additional Information Conference Call & Forward-Looking Statements The report contains forward-looking statements subject to risks and uncertainties detailed in SEC filings - News Corporation's earnings conference call was held live at 5:00 p.m. EDT on May 8, 2025[40] - The document contains forward-looking statements regarding business trends, strategy, initiatives (including the Foxtel Group sale), cost savings, and litigation[41] - Actual results may differ materially from expectations due to risks, uncertainties, and other factors described in the Company's SEC filings[41] - The Company does not undertake any obligation to publicly update any forward-looking statements, except as required by law or regulation[41] About News Corporation News Corp is a global media and information services company with operations in news, real estate, and publishing - News Corp is a global, diversified media and information services company[42] - The company focuses on creating and distributing authoritative and engaging content and other products and services[42] - Its businesses include information services and news, digital real estate services, and book publishing[42] - News Corp operates primarily in the United States, Australia, and the United Kingdom[42] Consolidated Financial Statements Consolidated Statements of Operations The company reported Q3 revenues of $2,009 million and net income from continuing operations of $107 million Consolidated Statements of Operations (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 2025 (Millions) | Q3 2024 (Millions) | | :--- | :--- | :--- | | Total Revenues | $2,009 | $1,994 | | Income before income tax expense from continuing operations | $151 | $96 | | Net income from continuing operations | $107 | $64 | | Net income (loss) from discontinued operations, net of tax | $30 | $(22) | | Net income | $137 | $42 | | Net income attributable to News Corporation stockholders | $103 | $30 | | Diluted EPS - Continuing operations | $0.14 | $0.07 | | Diluted EPS - Discontinued operations | $0.04 | $(0.02) | | Diluted EPS - Total | $0.18 | $0.05 | Consolidated Balance Sheets Total assets were $16,580 million as of March 31, 2025, with stockholders' equity increasing to $8,203 million Consolidated Balance Sheets (As of March 31, 2025 vs June 30, 2024) | Metric | March 31, 2025 (Millions) | June 30, 2024 (Millions) | | :--- | :--- | :--- | | Cash and cash equivalents | $2,095 | $1,872 | | Current assets held for sale | $2,364 | $340 | | Total current assets | $6,841 | $4,372 | | Total assets | $16,580 | $16,684 | | Current liabilities held for sale | $1,431 | $551 | | Total current liabilities | $4,081 | $3,055 | | Borrowings (Non-current) | $1,943 | $2,093 | | Total News Corporation stockholders' equity | $8,203 | $8,120 | | Total equity | $9,081 | $9,011 | Consolidated Statements of Cash Flows Net cash from operating activities for the nine-month period increased to $789 million from $721 million Consolidated Statements of Cash Flows (Nine Months Ended March 31) | Metric | 2025 (Millions) | 2024 (Millions) | | :--- | :--- | :--- | | Net income | $564 | $283 | | Net cash provided by operating activities from continuing operations | $789 | $721 | | Net cash used in investing activities from continuing operations | $(194) | $(296) | | Net cash used in financing activities from continuing operations | $(425) | $(322) | | Net cash provided by discontinued operations | $53 | $18 | | Net change in cash, cash equivalents and restricted cash | $223 | $121 | | Cash and cash equivalents (end of period) | $2,095 | $1,927 | Notes to Financial Statements NOTE 1 – TOTAL SEGMENT EBITDA Total Segment EBITDA, a key performance metric, increased 12% to $290 million in the third quarter - Segment EBITDA is defined as revenues less operating expenses and selling, general and administrative expenses, excluding depreciation and amortization, impairment and restructuring charges, equity losses of affiliates, interest (expense) income, net, other, net, income tax (expense) benefit and net income (loss) from discontinued operations, net of tax[54] - Management uses Segment EBITDA as the primary measure to evaluate the operating performance of and allocate resources within the Company's businesses[54] Total Segment EBITDA Reconciliation (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 2025 (Millions) | Q3 2024 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net income from continuing operations | $107 | $64 | $43 | 67% | | Add: Income tax expense | $44 | $32 | $12 | 38% | | Add: Other, net | $13 | $9 | $4 | 44% | | Add: Interest (income) expense, net | $(1) | $3 | $(4) | ** | | Add: Equity losses of affiliates | $0 | $2 | $(2) | (100)% | | Add: Impairment and restructuring charges | $13 | $35 | $(22) | (63)% | | Add: Depreciation and amortization | $114 | $114 | $0 | 0% | | Total Segment EBITDA | $290 | $259 | $31 | 12% | Total Segment EBITDA Reconciliation (Nine Months Ended March 31) | Metric | 2025 (Millions) | 2024 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net income from continuing operations | $562 | $312 | $250 | 80% | | Add: Income tax expense | $229 | $163 | $66 | 40% | | Add: Other, net | $(101) | $26 | $(127) | ** | | Add: Interest expense, net | $2 | $18 | $(16) | (89)% | | Add: Equity losses of affiliates | $11 | $5 | $6 | 120% | | Add: Impairment and restructuring charges | $51 | $84 | $(33) | (39)% | | Add: Depreciation and amortization | $339 | $325 | $14 | 4% | | Total Segment EBITDA | $1,093 | $933 | $160 | 17% | NOTE 2 – ADJUSTED REVENUES, ADJUSTED TOTAL SEGMENT EBITDA AND ADJUSTED SEGMENT EBITDA Adjusted measures show core business growth, with Adjusted Total Revenues up 2% and Adjusted Total Segment EBITDA up 15% - Adjusted Revenues, Adjusted Total Segment EBITDA, and Adjusted Segment EBITDA exclude the impact of acquisitions, divestitures, U.K. Newspaper Matters, litigation charges, and foreign currency fluctuations[58] - These measures are used to evaluate the performance of core business operations exclusive of certain items that impact comparability[58] Adjusted Total Revenues Reconciliation (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 2025 (Millions) | Q3 2024 (Millions) | Difference (Millions) | | :--- | :--- | :--- | :--- | | As reported | $2,009 | $1,994 | $15 | | Impact of acquisitions | $(13) | $0 | $(13) | | Impact of foreign currency fluctuations | $32 | $0 | $32 | | Net impact of U.K. Newspaper Matters | $0 | $0 | $0 | | As adjusted | $2,028 | $1,994 | $34 | Adjusted Total Segment EBITDA Reconciliation (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 2025 (Millions) | Q3 2024 (Millions) | Difference (Millions) | | :--- | :--- | :--- | :--- | | As reported | $290 | $259 | $31 | | Impact of acquisitions | $1 | $0 | $1 | | Impact of foreign currency fluctuations | $6 | $0 | $6 | | Net impact of U.K. Newspaper Matters | $4 | $2 | $2 | | As adjusted | $301 | $261 | $40 | Foreign Exchange Rates Average Foreign Exchange Rates (Q3 FY2025 vs Q3 FY2024) | Currency | Q3 FY2025 | Q3 FY2024 | | :--- | :--- | :--- | | U.S. Dollar per Australian Dollar | $0.63 | $0.66 | | U.S. Dollar per British Pound Sterling | $1.26 | $1.27 | Adjusted Revenues and Adjusted Segment EBITDA by Segment Adjusted Revenues by Segment (Q3 FY2025 vs Q3 FY2024) | Segment | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Dow Jones | $577 | $544 | 6% | | Digital Real Estate Services | $419 | $388 | 8% | | Book Publishing | $507 | $506 | 0% | | News Media | $525 | $556 | (6)% | | Adjusted Total Revenues | $2,028 | $1,994 | 2% | Adjusted Segment EBITDA by Segment (Q3 FY2025 vs Q3 FY2024) | Segment | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | % Change YoY | | :--- | :--- | :--- | :--- | | Dow Jones | $133 | $118 | 13% | | Digital Real Estate Services | $130 | $104 | 25% | | Book Publishing | $64 | $62 | 3% | | News Media | $33 | $27 | 22% | | Adjusted Total Segment EBITDA | $301 | $261 | 15% | NOTE 3 – ADJUSTED NET INCOME (LOSS) ATTRIBUTABLE TO NEWS CORPORATION STOCKHOLDERS AND ADJUSTED EPS Adjusted EPS for Q3 FY2025 was $0.17, up from $0.13, excluding certain non-operational items - Adjusted net income and adjusted EPS exclude expenses related to U.K. Newspaper Matters, litigation charges, impairment and restructuring charges, and "Other, net", net of tax, as well as the settlement of certain pre-Separation tax matters[67] - These measures are used to evaluate the performance of operations exclusive of certain items that impact comparability and certain non-operational items[67] Adjusted EPS Reconciliation (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 2025 (EPS) | Q3 2024 (EPS) | | :--- | :--- | :--- | | Net income attributable to News Corporation stockholders from continuing operations | $0.14 | $0.07 | | U.K. Newspaper Matters | $0.01 | $0.00 | | Impairment and restructuring charges | $0.02 | $0.06 | | Other, net | $0.02 | $0.02 | | Tax impact on items above | $(0.02) | $(0.02) | | Impact of noncontrolling interest on items above | $0.00 | $0.00 | | As adjusted | $0.17 | $0.13 | Adjusted EPS Reconciliation (Nine Months Ended March 31) | Metric | 2025 (EPS) | 2024 (EPS) | | :--- | :--- | :--- | | Net income attributable to News Corporation stockholders from continuing operations | $0.75 | $0.39 | | U.K. Newspaper Matters | $0.02 | $0.01 | | Impairment and restructuring charges | $0.09 | $0.15 | | Other, net | $(0.18) | $0.05 | | Tax impact on items above | $(0.03) | $(0.05) | | Impact of noncontrolling interest on items above | $0.06 | $0.00 | | As adjusted | $0.71 | $0.55 | NOTE 4 – CONSTANT CURRENCY REVENUES On a constant currency basis, total revenues increased 2%, highlighting a negative foreign exchange impact - Constant currency revenues exclude the impact of foreign currency fluctuations to provide useful information regarding the performance of core business operations[71] Consolidated Constant Currency Revenues (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2024 (Millions) | Q3 FY2025 (Millions) | FX impact (Millions) | Q3 FY2025 Constant Currency (Millions) | % Change - Reported | % Change - Constant Currency | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total revenues | $1,994 | $2,009 | $(32) | $2,041 | 1% | 2% | Dow Jones Constant Currency Revenues (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2024 (Millions) | Q3 FY2025 (Millions) | FX impact (Millions) | Q3 FY2025 Constant Currency (Millions) | % Change - Reported | % Change - Constant Currency | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Dow Jones segment revenues | $544 | $575 | $(2) | $577 | 6% | 6% | Digital Real Estate Services Constant Currency Revenues (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2024 (Millions) | Q3 FY2025 (Millions) | FX impact (Millions) | Q3 FY2025 Constant Currency (Millions) | % Change - Reported | % Change - Constant Currency | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Digital Real Estate Services segment revenues | $388 | $406 | $(14) | $420 | 5% | 8% | Book Publishing Constant Currency Revenues (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2024 (Millions) | Q3 FY2025 (Millions) | FX impact (Millions) | Q3 FY2025 Constant Currency (Millions) | % Change - Reported | % Change - Constant Currency | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Book Publishing segment revenues | $506 | $514 | $(5) | $519 | 2% | 3% | News Media Constant Currency Revenues (Q3 FY2025 vs Q3 FY2024) | Metric | Q3 FY2024 (Millions) | Q3 FY2025 (Millions) | FX impact (Millions) | Q3 FY2025 Constant Currency (Millions) | % Change - Reported | % Change - Constant Currency | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total News Media segment revenues | $556 | $514 | $(11) | $525 | (8)% | (6)% |