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Fox (FOXA) Q3 Earnings Miss Estimates, Revenues Increase Y/Y

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Fox Corporation FOXA reported third-quarter fiscal 2022 adjusted earnings of 81 cents, which missed the Zacks Consensus Estimate by 4.71%. The figure decreased 8% year over year.

Revenues were up 7.5% year over year to $3.4 billion. The figure surpassed the consensus mark by 1.72%.

Affiliate fees (52% of revenues) rose 4.5% to $1.79 billion. Meanwhile, advertising (37.8% of revenues) increased 9.1% to $1.3 billion. Other revenues (10.2% of revenues) increased 17.8% from the year-ago quarter’s levels to $351 million.

Fox Corporation Price, Consensus and EPS Surprise

Fox Corporation Price, Consensus and EPS Surprise
Fox Corporation Price, Consensus and EPS Surprise

Fox Corporation price-consensus-eps-surprise-chart | Fox Corporation Quote

Top-Line Details

Cable Network Programming (45.8% of revenues) revenues increased 7.6% year over year to $1.58 billion. Advertising revenues increased 19.8%, primarily due to continued strength in pricing and higher ratings, partially offset by the impact of higher preemptions associated with breaking news coverage at FOX News Media.

Revenues from Affiliate fees increased 2.7% year over year, driven by contractual price increases. Other revenues increased 22.5% on a year-over-year basis, driven by the timing of sports sublicensing revenues, which were impacted by COVID-19 in the prior-year quarter, and higher FOX Nation subscription revenues.

Television (52.7% of revenues) revenues increased 7.4% from the year-ago quarter’s figure to $1.82 billion. Advertising revenues increased 5.9% year over year, primarily due to continued growth at Tubi, continued strength in pricing at the FOX Network, partially offset by the absence of the rotating NFL Divisional playoff game in the current-year quarter and softer entertainment ratings at the FOX Network.

Affiliate fees increased 7.5% year over year, driven by increases in fees from third-party FOX affiliates and higher average rates at the company’s owned and operated television stations. Other revenues increased 17.1% year over year, primarily due to the impact of the consolidation of MarVista Entertainment, TMZ and Studio Ramsay Global.

Operating Details

In third-quarter fiscal 2022, operating expenses increased 14.8% year over year to $2.16 billion. As a percentage of revenues, operating expenses expanded 400 basis points (bps) to 62.7%.

Selling, general & administrative (SG&A) expenses increased 11% year over year to $485 million. As a percentage of revenues, SG&A expenses expanded 40 bps to 14%.

Total adjusted EBITDA decreased 9.8% year over year to $811 million. EBITDA margin contracted 450 bps to 23.5%.

Cable Network Programming EBITDA increased 1.6% year over year to $864 million. EBITDA margin contracted 320 bps to 54.6%.

Television EBITDA declined 74.1% to $35 million. EBITDA margin contracted 600 bps to 1.9%.

Balance Sheet

As of Mar 31, 2022, Fox had $4.63 billion in cash and cash equivalents compared with $4.26 billion as of Dec 31, 2021.

Long-term debt, as of Mar 31, 2022, was $7.20 billion, which remained flat sequentially.

Zacks Rank & Stocks to Consider

Fox currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the Zacks Consumer Discretionary sector are Cable One CABO, Planet Fitness PLNT, and SeaWorld Entertainment SEAS, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Cable One is up 36.8% in the year-to-date period against the Zacks Cable Television industry’s decline of 22.8% and the Consumer Discretionary sector’s fall of 29.4%.

Planet Fitness shares are down 23.8% in the year-to-date period against the Zacks Leisure and Recreation Services industry’s decline of 23.2% and the Consumer Discretionary sector’s fall of 29.4%.

SeaWorld Entertainment shares are down 14% in the year-to-date period against the Zacks Leisure and Recreation Services industry’s decline of 23.2% and the Consumer Discretionary sector’s fall of 29.4%.


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SeaWorld Entertainment, Inc. (SEAS) : Free Stock Analysis Report

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Cable One, Inc. (CABO) : Free Stock Analysis Report

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