News (NWSA) - 2025 Q4 - Annual Report

PART I This section provides an overview of News Corporation's global media and information services businesses, including its segments, operations, and key resources ITEM 1. BUSINESS News Corporation is a global diversified media and information services company operating five segments, focusing on content creation and distribution across digital and traditional platforms - News Corporation is a global, diversified media and information services company focused on creating and distributing authoritative and engaging content and other products and services to consumers and businesses worldwide[14] - The Company's operations are organized into five reportable segments: Dow Jones, Digital Real Estate Services, Book Publishing, News Media, and Other[15] - The Company's diversified revenue base includes recurring subscriptions, circulation sales, advertising sales, sales of real estate listing products, licensing fees, and other consumer product sales[15] Fiscal Year Ended June 30, 2025 Segment Revenues and EBITDA | Segment | Revenues (in millions) | EBITDA (in millions) | | :----------------------- | :--------------------- | :------------------- | | Dow Jones | $2,331 | $588 | | Digital Real Estate Services | $1,802 | $601 | | Book Publishing | $2,149 | $296 | | News Media | $2,170 | $153 | | Other | — | $(223) | Overview News Corporation is a global media and information services company operating five segments, emphasizing quality content, product innovation, and AI monetization - News Corporation is a global, diversified media and information services company focused on creating and distributing authoritative and engaging content and other products and services to consumers and businesses throughout the world[14] - The Company's operations are organized into five reportable segments: Dow Jones, Digital Real Estate Services, Book Publishing, News Media, and Other[15] - The Company's focus on quality and product innovation has enabled it to capitalize on the shift to digital consumption and create opportunities for more effective monetization, including new licensing and partnership arrangements with large technology companies and AI-focused platforms[14] Dow Jones The Dow Jones segment delivers global news and business information to consumers and enterprises, diversifying revenue across subscriptions, advertising, and licensing, while facing intense AI-driven competition - The Dow Jones segment is a global provider of news and business information, distributing content and data through various owned and off-platform media channels[21] - Products target individual consumers (The Wall Street Journal, Barron's, MarketWatch, Investor's Business Daily) and enterprise customers (Dow Jones Risk & Compliance, Dow Jones Energy, Factiva, Dow Jones Newswires)[21][22][32] Average Daily Consumer Subscriptions (Three Months Ended June 30, 2025) | (in 000's) | Digital-only subscriptions | Print subscriptions | Total subscriptions | | :----------------------- | :------------------------- | :------------------ | :------------------ | | The Wall Street Journal | 4,126 | 412 | 4,538 | | Barron's Group | 1,319 | 113 | 1,432 | | Total Consumer | 5,719 | 542 | 6,261 | - The Dow Jones segment faces increasing competition for both circulation and advertising revenue from alternative news and information sources, programmatic advertising buying channels, and AI aggregators and other emerging technology platforms[35] Digital Real Estate Services This segment includes REA Group and Move (Realtor.com®), specializing in property advertising and data services, generating revenue from listings and subscriptions in competitive digital markets - The Digital Real Estate Services segment consists of a 61.4% interest in REA Group (Australia, India) and an 80% interest in Move (U.S.), which primarily operates Realtor.com®[37][41][43] - REA Group's realestate.com.au had 132.2 million average monthly visits and 12.1 million unique visitors for the year ended June 30, 2025, significantly outperforming its nearest competitor[39] - Realtor.com® and its mobile sites had approximately 72 million average monthly unique users during the quarter ended June 30, 2025[43] - Revenue is primarily generated through property advertising listing products, monthly advertising subscriptions from real estate agents and developers, lead generation products, referral-based services, and commissions from lenders[40][42][43] Book Publishing HarperCollins, the world's second-largest consumer book publisher, operates globally, publishing diverse content in print and digital formats, with digital sales representing 24% of fiscal 2025 consumer revenues - The Book Publishing segment consists of HarperCollins, the second largest consumer book publisher in the world, with operations in 15 countries[44] - HarperCollins publishes and distributes consumer books globally through print and digital formats, including e-books and downloadable and streaming audiobooks[44] - Digital sales represented approximately 24% of global consumer revenues for the fiscal year ended June 30, 2025[47] - Revenues are significantly affected by the timing of releases and are typically highest during the Company's second fiscal quarter due to increased demand during the end-of-year holiday season[49] News Media The News Media segment, including News Corp Australia and News UK, generates revenue from circulation, subscriptions, advertising, and licensing, facing intense competition from digital and AI platforms - The News Media segment consists primarily of News Corp Australia, News UK and the New York Post, along with Wireless Group (talkSPORT, Virgin Radio, Talk), Australian News Channel (Sky News Australia), and Storyful[51] - News Corp Australia's digital mastheads had approximately 993,000 aggregate digital closing subscribers as of June 30, 2025[52] News Corp Australia Key Properties (as of June 30, 2025) | Masthead | Total Paid Subscribers (Print and Digital) | Total Monthly Audience (Print and Digital) | | :----------------- | :----------------------------------------- | :--------------------------------------- | | The Australian | 335,903 | 4.8 million | | The Daily Telegraph | 151,336 | 4.6 million | | Herald Sun | 153,983 | 4.8 million | | The Courier Mail | 144,044 | 3.7 million | | The Advertiser | 106,696 | 2.2 million | News UK News Portfolio (as of June 30, 2025) | Publication | Print Average Issue Readership | Paid Subscribers (Print/Digital) | Monthly Global Unique Users | | :------------------ | :----------------------------- | :------------------------------- | :-------------------------- | | The Sun (Mon – Sat) | 1,597,000 | N/A | 87 million | | The Sun on Sunday | 1,655,000 | N/A | N/A | | The Times (Mon – Sat) | 605,000 | 97,000 (print) / 640,000 (digital) | N/A | | The Sunday Times | 1,113,000 | 85,000 (print) / 640,000 (digital) | N/A | - The Post Digital Network averaged approximately 89.2 million unique users per month during the quarter ended June 30, 2025[61] Other The 'Other' segment encompasses general corporate overhead, strategic costs, and expenses related to U.K. Newspaper Matters - The Other segment includes the Company's general corporate overhead expenses, strategy costs and costs related to the U.K. Newspaper Matters[63] Governmental Regulation News Corporation's global operations are subject to extensive and evolving governmental regulations, including data privacy, benchmark, and press laws, impacting business practices and costs - The Company's activities are subject to regulation in numerous jurisdictions, with new laws and changes in existing ones potentially impacting its interests[64] - The Company is subject to laws and regulations governing the collection, use, sharing, transfer, storage, and retention of personal data, as well as data security, including CCPA, GDPR, UK GDPR, and the AU Privacy Act[67][68][70] - U.K. operations are subject to press-related regulations (PRP, IPSO, Digital Markets, Competition and Consumers Act 2024) and radio broadcasting regulations (Ofcom)[73][74][76][77] Intellectual Property News Corporation's intellectual property, including copyrights and trademarks, is crucial for revenue, facing threats from unauthorized digital use and generative AI, requiring robust protection strategies - The Company's intellectual property assets include copyrights in its digital and print newspapers, books and other content and technologies; trademarks in names and logos; trade names; domain names; and licenses of intellectual property rights[78] - Unauthorized use, including in the digital environment and as a result of recent advances in AI, particularly generative AI, presents a threat to revenues from products and services based on intellectual property[78] - The Company seeks to prevent unauthorized exploitation of its content by generative AI tools through paywalls, bot management, AI crawler blocking tools, opt-out directives, and legal remedies[78] Raw Materials As a major publisher, News Corporation relies on various types of paper, procured globally, with current supply sources deemed adequate - As a major publisher of newspapers, magazines and books, the Company utilizes substantial quantities of various types of paper[80] - The Company believes that under present market conditions, its sources of paper supply used in its publishing activities are adequate[80] Human Capital News Corporation's human capital strategy focuses on attracting, developing, and retaining a diverse workforce, fostering a principled culture, and providing competitive benefits and training - News Corp's workforce is critical to the creation and delivery of its premium and trusted content and a key contributor to the success of the Company[81] - As of June 30, 2025, the Company had approximately 22,300 employees globally, with significant presence in the U.S., U.K., and Australia[82] - Key focus areas of the Company's human capital management strategy include Culture and Values (ethical conduct, compliance training), Health, Safety, Security and Wellbeing (programs for mental/physical health, physical security infrastructure), Compensation and Benefits (competitive salaries, incentive programs, retirement/healthcare benefits), and Training, Development and Engagement (on-the-job learning, workshops, career planning)[81][83][84][85][87] Explanatory Note Regarding Certain Metrics News Corporation clarifies that certain metrics, like subscriptions and unique users, are based on internal or third-party data, with specific definitions for 'Unique Users' and 'Total Digital Revenues' - Certain metrics like subscriptions and unique users are calculated using third-party or internal company data that have not been independently verified, and methodologies may differ from competitors[88] - Unique users are counted only the first time an individual accesses a product's website or mobile app using a browser/device during a calendar month[89] - Total digital revenues are defined as the sum of consolidated Digital Real Estate Services segment revenues, digital advertising revenues, digital circulation and subscription revenues, revenues from digital book sales and other miscellaneous digital revenue streams[90] ITEM 1A. Risk Factors News Corporation faces significant risks from intense competition, macroeconomic conditions, AI, supply chain dependencies, reputational damage, and complex legal and regulatory landscapes, impacting financial performance - The Company operates in a highly competitive business environment, intensified by evolving technologies, including generative AI, which can reduce traffic and subscriber demand for digital products[92] - Macroeconomic and market conditions, such as economic weakness, inflation, elevated interest rates, and geopolitical tensions, may adversely affect the Company's business, particularly advertising expenditures and real estate markets[98][102] - The Company's businesses depend on a single or limited number of suppliers for certain products, services, data, and information, making it vulnerable to supply disruptions or price increases[106][108] - Developments in AI, including the Company's own use of AI, may expose it to risks such as producing deficient or infringing content, competitive disadvantages, and increased legal and regulatory scrutiny[111] - The Company is exposed to fluctuations in foreign currency exchange rates, primarily the Australian dollar and British pound sterling, which can impact reported earnings and financial statements[131] Risks Relating to the Company's Businesses and Operations Operational risks include intense competition from AI, adverse macroeconomic conditions impacting advertising and real estate, reliance on limited suppliers, potential reputational damage, and increased printing costs - The Company faces significant competition, including from other providers of information, news, real estate-related and entertainment products and services, intensified by changes in technologies, including developments in generative AI[92] - Macroeconomic and market conditions, such as economic weakness, uncertainty or volatility, geopolitical tensions, and inflationary pressures, have adversely affected, and may continue to affect, the U.S. and global economies and the Company's business[98] - A decline in customer advertising expenditures, driven by shifting consumer preferences, increased audience fragmentation, and the dominance of large digital platforms, could significantly reduce the Company's revenues and operating results[100][101] - The Company's businesses depend on a single or limited number of third-party suppliers for certain products, services, data, and information, creating vulnerability to supply reductions, interruptions, or significant price increases[106][108] - Any significant increase in the cost to print and distribute the Company's books and newspapers or disruption in its supply chain could adversely affect its business, results of operations, and financial condition[110] Risks Related to Intellectual Property News Corporation's success depends on protecting its intellectual property, which faces significant threats from unauthorized use by generative AI and an evolving legal landscape, potentially impacting revenue and costs - The Company's success depends on its ability to maintain, enforce and monetize the rights in its content and other intellectual property, and unauthorized use, especially by generative AI, affects their value[117] - The application of existing laws and regulations to new technologies, including generative AI, continues to be unsettled and is changing rapidly, making it difficult to adequately protect and monetize intellectual property[119] - Third parties may challenge the validity or scope of the Company's intellectual property, and infringement claims could result in substantial costs, diversion of resources, or the loss of IP rights[120] Risks Related to Information Technology, Cybersecurity and Data Protection News Corporation faces substantial risks from cyberattacks, system breaches, and data misuse, exacerbated by AI, potentially causing service disruptions, data loss, reputational damage, and regulatory non-compliance issues - A breach, failure, misuse, or other incident involving the Company's or its third-party providers' network and information systems could disrupt services, impact data confidentiality/integrity/availability, and result in increased costs, revenue loss, or reputational damage[121][125] - Cyberattacks are increasing in number and sophistication, particularly with the emergence of AI capabilities, heightening cybersecurity risks for the Company[124] - Failure to comply with complex and evolving laws and regulations regarding privacy, data use, and data protection (e.g., GDPR, UK GDPR, U.S. state laws) could lead to enforcement actions, fines, notification/remediation costs, loss of customers, and reputational damage[126][127] Risks Related to Financial Results and Position Financial risks include substantial indebtedness, foreign currency fluctuations, potential asset impairment, restructuring charges, and significant tax liabilities from complex and evolving tax laws - As of June 30, 2025, News Corp had $2.0 billion of total outstanding indebtedness, which could limit its ability to obtain additional financing, satisfy obligations, and respond to changing market conditions[129] - The Company is exposed to fluctuations in foreign currency exchange rates, primarily the Australian dollar and the British pound sterling, which can have a currency translation impact on earnings[131] - The Company may recognize impairment charges for goodwill, intangible assets, investments, and other long-lived assets, as well as restructuring charges, which negatively impact results of operations[132] - The Company could be subject to significant additional tax liabilities due to complex tax laws, changes in regulations, and the outcome of tax audits, adversely affecting operating results and financial condition[133][134] Risks Related to Legal and Regulatory Matters Legal and regulatory risks include evolving laws on data privacy, AI, and ESG, potentially leading to non-compliance costs, penalties, reputational damage, and adverse litigation outcomes - The Company's activities are subject to regulation in numerous jurisdictions, and new laws or changes in existing ones, particularly concerning data privacy, AI, and ESG matters, can increase compliance risk and negatively impact its interests[135][136] - Adverse results from litigation or other proceedings, including antitrust, tax, data privacy, intellectual property, and defamation matters, could lead to reputational harm, significant monetary damages, and changes in business practices[137] Risks Related to the Company's Common Stock Common stock market price fluctuations, potential conflicts of interest with Fox Corporation, and anti-takeover provisions, including concentrated ownership by the Murdoch Family Trust, pose risks - The market price of the Company's common stock may fluctuate significantly due to factors such as quarterly earnings, business strategy success, economic conditions, and investor perception[138] - Certain directors and significant stockholders, including Lachlan K. Murdoch, also hold equity or serve as officers/directors of Fox Corporation, which may create actual or potential conflicts of interest and divert corporate opportunities[139][140][141] - Anti-takeover provisions in the Company's Restated Certificate of Incorporation and Amended and Restated By-laws, along with the Murdoch Family Trust's approximately 40.6% ownership of Class B Common Stock, may discourage takeovers and affect voting results[142][144][145] ITEM 1B. Unresolved Staff Comments News Corporation reports no unresolved staff comments from the SEC - There are no unresolved staff comments[147] ITEM 1C. Cybersecurity News Corporation maintains a comprehensive NIST-informed cybersecurity program, overseen by the Audit Committee, to manage threats, though acknowledging ongoing risks despite no material incidents to date - News Corporation has developed and implemented a cybersecurity program, informed by the NIST Cybersecurity Framework, to manage threats to its global media and information services[148] - The program includes a dedicated global cybersecurity organization led by the CISO, employee training, technical measures (e.g., multi-factor authentication, encryption), incident response planning, and periodic testing[148][149] - The Board of Directors, through the Audit Committee, oversees cybersecurity risks, receiving quarterly reports from the CTO and CISO[153] - To date, the Company is not aware of any cybersecurity incidents that have materially affected or are reasonably likely to materially affect the Company[152] Risk Management and Strategy News Corporation's cybersecurity strategy employs a NIST-guided defense-in-depth approach, including policies, training, technical controls, and third-party risk management, acknowledging increasing cyber threats - The Company's cybersecurity program is informed by the NIST Cybersecurity Framework and leverages a defense-in-depth approach to managing cybersecurity risk[148] - The program includes annual cybersecurity and privacy awareness trainings, quarterly phishing exercises, and various technical measures such as identity and access management, multi-factor authentication, and encryption[148] - The Company conducts periodic testing and assessments of its cybersecurity program through internal personnel and third-party firms, including penetration testing and security audits[149] - Processes for identifying, assessing, and managing cybersecurity risk are integrated into the Company's overall risk management process, with semi-annual reports to the Audit Committee and Board of Directors[150] Governance The Board, through its Audit Committee, oversees cybersecurity risks, receiving quarterly reports from the CTO and CISO, who lead day-to-day risk management and policy implementation - News Corp's Board of Directors oversees the Company's processes for identifying, assessing and managing significant risks, with the Audit Committee having primary responsibility for cybersecurity[153] - The Audit Committee generally receives reports at least quarterly from the CTO and CISO on the Company's cybersecurity program[153] - Management, led by the CISO and supported by the Global Cybersecurity Steering Committee, is responsible for day-to-day cybersecurity risk management, policy development, and compliance[154] - The CTO assumed his position in June 2025 after serving in various leadership and technology roles at the Company's subsidiary News Corp Australia since 2012, including as CTO from 2020. The CISO has been in his position since December 2024 after serving in various leadership and information security roles at the Company since 2021[154] ITEM 2. Properties News Corporation owns and leases various real properties globally, including offices and printing facilities, all maintained in good condition and adequate for business operations - The Company owns and leases various real properties in the U.S., Europe, Australia and Asia that are utilized in the conduct of its businesses[155] - Principal U.S. properties include leased headquarters in New York, HarperCollins offices, an owned campus in South Brunswick, NJ, and Move's leased offices in Austin, TX[157] - Principal European properties include leased London headquarters for News UK, Dow Jones, and HarperCollins, U.K. newspaper production/printing facilities (owned and leased), and HarperCollins warehouse/offices in Glasgow, Scotland[157] - Principal Australia and Asia properties include owned and leased Australian newspaper production/printing facilities (Sydney, Melbourne, Adelaide), REA Group's leased corporate offices in Melbourne, and Dow Jones's leased office in Hong Kong[157] ITEM 3. LEGAL PROCEEDINGS News Corporation refers to Note 16—Commitments and Contingencies for details on legal proceedings - See Note 16—Commitments and Contingencies in the accompanying Consolidated Financial Statements for information on legal proceedings[156] ITEM 4. Mine Safety Disclosures Mine safety disclosures are not applicable to News Corporation's operations - Mine Safety Disclosures are not applicable[158] PART II This section details News Corporation's market for common equity, financial performance, market risks, and financial statements ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities News Corporation's Class A and B Common Stock trade on Nasdaq and ASX, with active dividend payments and ongoing stock repurchase programs, including a new $1 billion authorization - News Corporation's Class A and Class B Common Stock are listed and traded on The Nasdaq Global Select Market under symbols 'NWSA' and 'NWS', respectively. CHESS Depositary Interests (CDIs) are listed on the Australian Securities Exchange (ASX) under 'NWSLV' and 'NWS'[160] - As of August 1, 2025, 376,442,848 shares of Class A Common Stock and 188,528,838 shares of Class B Common Stock were outstanding[8] Cash Dividends Paid Per Share (Fiscal Years Ended June 30) | Fiscal Year | Cash Dividends Paid Per Share | | :---------- | :---------------------------- | | 2025 | $0.20 | | 2024 | $0.20 | | 2023 | $0.20 | Stock Repurchases (Fiscal Years Ended June 30) | Class | 2025 Shares (millions) | 2025 Amount (millions) | 2024 Shares (millions) | 2024 Amount (millions) | 2023 Shares (millions) | 2023 Amount (millions) | | :----------------- | :--------------------- | :--------------------- | :--------------------- | :--------------------- | :--------------------- | :--------------------- | | Class A Common Stock | 3.5 | $97 | 3.4 | $79 | 9.5 | $159 | | Class B Common Stock | 1.8 | $53 | 1.6 | $38 | 4.7 | $81 | | Total | 5.3 | $150 | 5.0 | $117 | 14.2 | $240 | - As of June 30, 2025, approximately $310 million remained authorized under the 2021 Repurchase Program. A new $1 billion stock repurchase program was authorized on July 15, 2025[162][164][496][499] ITEM 6. [Reserved] This item is reserved and not applicable to News Corporation's current filing - This item is reserved and not applicable[166] ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations News Corporation's fiscal 2025 revenues increased 2% to $8,452 million, with net income attributable to stockholders surging 344% to $1,180 million, largely due to the Foxtel sale Consolidated Operating Results (Fiscal Years Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (in millions) | % Change | | :-------------------------------------------------- | :------------------- | :------------------- | :------------------- | :------- | | Total Revenues | $8,452 | $8,252 | $200 | 2% | | Operating expenses | $(3,736) | $(3,814) | $78 | 2% | | Selling, general and administrative | $(3,301) | $(3,197) | $(104) | (3)% | | Depreciation and amortization | $(459) | $(440) | $(19) | (4)% | | Impairment and restructuring charges | $(132) | $(133) | $1 | 1% | | Equity losses of affiliates | $(15) | $(6) | $(9) | (150)% | | Interest income (expense), net | $3 | $(18) | $21 | ** | | Other, net | $111 | $(59) | $170 | ** | | Income before income tax expense from continuing operations | $923 | $585 | $338 | 58% | | Income tax expense from continuing operations | $(275) | $(206) | $(69) | (33)% | | Net income from continuing operations | $648 | $379 | $269 | 71% | | Net income (loss) from discontinued operations, net of tax | $692 | $(25) | $717 | ** | | Net income | $1,340 | $354 | $986 | 279% | | Net income attributable to News Corporation stockholders | $1,180 | $266 | $914 | 344% | - Revenues increased by $200 million (2%) in fiscal 2025, driven by Digital Real Estate Services, Dow Jones, and Book Publishing, partially offset by News Media declines. Foreign currency fluctuations had a positive impact of $8 million[195] - Net income attributable to News Corporation stockholders increased by $914 million (344%) to $1,180 million, primarily due to a $716 million pre-tax gain on the sale of Foxtel[194][415] Total Segment EBITDA (Fiscal Years Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | | :----------------- | :------------------- | :------------------- | | Total Segment EBITDA | $1,415 | $1,241 | INTRODUCTION This section provides management's discussion and analysis of News Corporation's financial condition and results of operations for fiscal years 2025 and 2024, including business overview, segment results, and critical accounting policies - This discussion and analysis covers News Corporation's financial condition and results of operations for the fiscal years ended June 30, 2025 and 2024, omitting fiscal 2023[167][168] - It includes an overview of businesses, results of operations (consolidated and segment-based), liquidity and capital resources, and critical accounting policies and estimates[171][172] - The discussion contains forward-looking statements and should be read in conjunction with the Consolidated Financial Statements and 'Item 1A. Risk Factors'[167] OVERVIEW OF THE COMPANY'S BUSINESSES News Corporation operates five segments: Dow Jones, Digital Real Estate Services, Book Publishing, News Media, and Other, each with distinct revenue drivers, competitive landscapes, and macroeconomic sensitivities - The Company manages and reports its businesses in five segments: Dow Jones, Digital Real Estate Services, Book Publishing, News Media, and Other[173][174] - Dow Jones revenue is diversified across B2C and B2B subscriptions, circulation, advertising, and licensing, facing increasing competition from AI-powered platforms[175][176][180] - Digital Real Estate Services revenue is from property advertising, lead generation, and financial services, highly sensitive to real estate market conditions and macroeconomic factors[181] - Book Publishing revenue is from print and digital book sales and licensing, affected by release timing, seasonal demand, and technological developments[183] - News Media revenue is from circulation, subscriptions, advertising, and licensing, facing intense competition from digital platforms and AI, with advertising revenues subject to seasonality[185][187][188] Other Business Developments News Corporation completed the sale of Foxtel in April 2025, resulting in a $716 million pre-tax gain and reclassification as discontinued operations, while monitoring macroeconomic trends - The Company completed the sale of the Foxtel Group to DAZN Group Limited in April 2025[190] - The transaction resulted in a pre-tax gain of $716 million and a minority equity interest of approximately 6% in DAZN, recorded at $648 million[415] - Foxtel's assets, liabilities, results of operations, and cash flows have been classified as discontinued operations for all periods presented, and its segment results were aggregated into News Media[191][416] - The Company is closely monitoring recent macroeconomic trends, including changes in trade policy and inflationary pressures, which could negatively impact customer and consumer sentiment and spending[192] [Results of Operations—Fiscal 2025 versus Fiscal 2024](index=48&type=section&id=Results%20of%20Operations%