Financial Data and Key Metrics Changes - Fox Corporation reported a 9% revenue growth and a 2% EBITDA growth in the fiscal second quarter [7][19] - Total company advertising revenues grew by 6%, despite tough comparisons to the previous year's record political advertising revenues [19][20] - Adjusted EBITDA increased to $310 million, reflecting a 2% increase year-over-year [20] - The net loss attributable to stockholders was $85 million, compared to a net income of $224 million in the prior year quarter [20][21] Business Segment Data and Key Metrics Changes - Cable Networks revenues increased by 10% year-over-year, with cable affiliate revenues growing by 12% [22] - Television segment delivered 8% revenue growth, led by a 10% increase in television affiliate revenues [24] - Tubi's revenues increased by over 40% in the quarter, marking significant growth in the digital segment [25][16] Market Data and Key Metrics Changes - Local advertising revenues achieved double-digit growth, fully recovering from COVID impacts and surpassing pre-pandemic levels [9][19] - FOX News maintained a 55% share of total day cable news viewership, leading the market significantly [11] - FOX Sports had a strong performance, with a third of NFL and College Football viewership occurring on FOX [13] Company Strategy and Development Direction - The company continues to focus on expanding its digital initiatives while maintaining leadership in traditional broadcasting [7][17] - Investments in Tubi and FOX Bet are seen as key growth areas, with a strategic focus on advertising video on demand [15][17] - The upcoming USFL is expected to provide additional opportunities for engagement and revenue generation [48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current operating environment, citing strong advertising demand and digital growth [20][27] - The company anticipates a strong fiscal 2023, driven by events like the Super Bowl and mid-term elections [28][47] - Management highlighted the importance of affiliate revenue renewals in the upcoming fiscal years [27][47] Other Important Information - The company recorded a free cash flow deficit of $753 million, attributed to the normal working capital cycle [26] - Fox Corporation has repurchased $2.15 billion of its shares since the buyback program began in November 2019 [26] Q&A Session Summary Question: Growth strategy for FOX Bet and local advertising benefits - Management discussed ongoing arbitration regarding the structure of the option into FanDuel and expressed satisfaction with FOX Bet's engagement strategy [31] Question: Digital investment and Hulu licensing extension - Management indicated that digital investments are expected to be at the lower end of the $200 million to $300 million range for the year [36] Question: Investment in sports betting and upfront advertising market - Management emphasized the value of existing sports broadcasting investments and the potential for increased engagement through sports betting [40] Question: USFL rollout and future advertising revenue expectations - Management expressed optimism about the USFL and anticipated record political advertising revenues in the upcoming mid-term elections [47][48] Question: Superfan streaming sports business and Thursday Night Football savings - Management clarified that the focus remains on broadcast television and monetizing sports partnerships, with significant savings expected from the loss of Thursday Night Football [51][52]
Fox(FOXA) - 2022 Q2 - Earnings Call Transcript