News Corp. said it grew Dow Jones digital-only subscriptions by 12% to 4.6 million in its first quarter of fiscal 2024, boosting the company’s overall revenues up slightly by 1% to $2.5 billion. The growth, which it also attributed to performance in its HarperCollins book segment, came as News Corp. experienced a 12% drop in net income to $58 million.
The results translated to adjusted earnings of 16 cents per share attributable to News Corp. shareholders. The results were about in line with estimates from analysts surveyed by Zacks Investment Research, who were expecting earnings of 13 cents per share on revenue of $2.49 billion.
In the first quarter of fiscal 2023, News Corp. reported revenue of $2.48 billion, a 1% decrease from the prior year driven by lower book publishing revenues. That same quarter saw net income of $66 million and earnings of 7 cents per share, while adjusted earnings sat at 12 cents per share.
News Corp.’s net income for the quarter of $58 million was impacted by non-cash impairment charges of $21 million at the News Media segment related to the write-down of fixed assets associated with the proposed combination of certain U.K. printing operations with those of a third party.
“Our positive performance in the quarter follows the three most profitable years since the creation of the new News Corp.,” chief executive Robert Thomson said in a statement, touting the company’s 4% profit gain in EBITDA.
The New York-based media company owns The Wall Street Journal, the New York Post, HarperCollins and a host of Australian and British newspapers including the Times of London and the Sun.
“We certainly agree with the perceptive commentators and analysts who suggest that News Corp is undervalued and its asset quality underappreciated,” Thomson said on Thursday’s earnings call. “Our board, our leaders and our teams deserve much credit for skillfully navigating the turbulent media waters of the past decade. Waters which have proven treacherous for many media companies.”
News Corp. cited strong growth in the Dow Jones segment of the company, with “professional information business” revenues rising 14%.
Dow Jones also saw subscription growth, surpassing 5 million subscribers, climbing 8% from the prior year. WSJ digital-only subscriptions grew 10% to nearly 3.5 million, while total Dow Jones digital-only subscriptions grew 12% to 4.6 million.
“Our teams are focused on reducing churn and maximizing the lifetime value of each and every subscriber,” Thomson said.
On Wednesday, rival New York Times Company reported that it had grown its subscriptions to over 10 million in the third quarter.
News Corp. also highlighted an increase in physical book sales and an improvement in returns for the book publishing arm of the business, which includes HarperCollins publishing. The Book Publishing segment reported a 67% increase in profitability, “with the logistical issues at Amazon resolved,” Thomson said.
“I would like to pay tribute to our reporters in the Middle East and in Ukraine, who are each day taking calculated risks to bring insight and intelligence to readers around the world during a period of unpredictable turbulence,” News Corp.’s chief executive said.
Thomson also highlighted Wall Street Journal reporter Evan Gershkovich, “who has been unjustly incarcerated in Russia for more than seven months, merely for doing his job as a journalist.”
In September, Rupert Murdoch announced he would step down from his role as chairman of both Fox Corp. and News Corp. His son Lachlan was appointed the sole chair of News Corp. However, Rupert Murdoch has promised to remain involved in the companies.
“I can personally assure you that there has been no change in his heightened levels of curiosity and energy since the announcement,” Thomson said. Murdoch’s “vast experience will be an important ongoing resource for the company. All of us at News Corp., stand on the shoulders of a giant,” he added.
Thomson said he is looking forward to Lachlan assuming the role.
“His thoughtful engagement with our teams already enhances the business each working day, and his passion for principle journalism is obvious to all who work with him,” the chief executive said.
“There is no doubt that Lachlan’s multidisciplinary expertise and philosophical integrity will be invaluable as we continue the next phase of our crucial journey,” Thomson concluded.
