Fox Corp. lowers Wall Street’s quarterly estimates, but feels the pressure without an influx of political ads

Fox Corp. Wall Street beat expectations for the fiscal first quarter, but profits fell from a year ago, in part because of a relatively low share of political ad spending.

Revenue was $3.21 billion, up slightly from $3.19 billion in the prior year. Adjusted earnings per share were $1.09, compared to $1.21 a year ago. Both the cap and floor slightly beat Wall Street analysts’ consensus forecasts, but Fox shares fell 2% in premarket trading on some positives from the quarterly report.

Affiliate fee revenue increased 2%, driven by 8% growth in the TV segment. Advertising revenue fell 2%. The Women’s World Cup broadcast and continued growth at Tubi were more than offset by relatively lower political advertising revenue in the company’s local broadcast division and the impact of expanded direct response offerings at Fox News Media.

While 2023 is an odd year of silence, industry analysts and leading ad vendors expect record political ad spending in 2024 due to the presidential campaign.

While in some ways it has been business as usual for Rupert Murdoch’s media empire since the 92-year-old tycoon stepped down as chairman of Fox and News Corp. A new phase has undeniably set in in September. The complicated succession arrangements have cast a cloud of uncertainty over the decades-old mainstay of the media industry.

There is more to come…