Fox (FOXA) Q1 Earnings Beat Estimates, Ad Revenues Decline
Fox Corporation FOXA reported first-quarter fiscal 2024 adjusted earnings per share of $1.09, which beat the Zacks Consensus Estimate by 13.54%. The figure decreased 9.9% year over year.
Revenues increased 0.5% year over year to $3.21 billion, which beat the consensus mark by 1.01%.
Affiliate fees (54.3% of revenues) rose 1.7% to $1.74 billion, with 7.8% growth in the Television segment.
Advertising (37.4% of revenues) declined 1.6% year over year to $1.2 billion as continued growth at Tubi was more than offset by comparably lower political advertising revenues at the FOX Television Stations and the impact of elevated supply in the direct response marketplace at FOX News Media.
Other revenues (8.3% of revenues) inched up 2.3% year over year to $267 million.
Fox Corporation Price, Consensus and EPS Surprise
Fox Corporation price-consensus-eps-surprise-chart | Fox Corporation Quote
Top-Line Details
Cable Network Programming (43.2% of revenues) revenues decreased 3.1% year over year to $1.38 billion. Advertising revenues dropped 8.2%, whereas revenues from Affiliate fees decreased 2.3% year over year. Other revenues increased 7% on a year-over-year basis.
Television (55.5% of revenues) revenues gained 3.9% from the year-ago quarter’s figure to $1.78 billion. Advertising revenues gained 0.6% year over year. Affiliate fees increased 7.8% year over year. Other revenues increased 6.3% year over year.
Operating Details
In first-quarter fiscal 2024, operating expenses increased 12.4% year over year to $1.86 billion. As a percentage of revenues, operating expenses increased 620 basis points (bps) to 58.1%. The rise in expenses includes increased digital investment at Tubi and higher programming rights amortization and production costs at FOX Sports.
Selling, general & administrative (SG&A) expenses increased 7.1% year over year to $480 million. As a percentage of revenues, SG&A expenses gained 90 bps to 15%.
Total adjusted EBITDA decreased 20.4% year over year to $869 million. Adjusted EBITDA margin contracted 710 bps to 27.1%, primarily due to higher expenses.
Cable Network Programming EBITDA decreased 18.2% year over year to $607 million. Television EBITDA reported $351 million of adjusted EBITDA, down 14.2% year over year.
Balance Sheet
As of Sep 30, 2023, Fox had $4.82 billion in cash and cash equivalents compared with $4.27 billion as of Jun 30.
Long-term debt, as of Sep 30, 2023, was $7.44 billion, higher than $7.21 billion as of Jun 30.
Zacks Rank & Stocks to Consider
Fox currently has a Zacks Rank #3 (Hold).
Ballard Power Systems BLDP, Cable One CABO and AMC Networks AMCX are some better-ranked stocks that investors can consider in the broader sector. JAKK, CABO and AMCX carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Ballard Power Systems have declined 30.5% year to date. BLDP is set to report its third-quarter 2023 results on Nov 7.
Shares of Cable One have fallen 22.8% year to date. CABO is slated to report its third-quarter 2023 results on Nov 2.
Shares of AMC Networks have decreased 24.7% year to date. AMCX is set to report its fourth-quarter fiscal 2023 results on Nov 3.
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