News Corp Net Income Climbs 43% To $215 Million As Real Estate And Books Carry The Quarter
Revenue rose 6% to $2.28 billion, News Media earnings fell 40%, and free cash flow turned negative at $89 million.
News Corp, which publishes The Wall Street Journal and owns HarperCollins and REA Group, said net income rose 43% to $215 million in its fiscal first quarter, on revenue up 6% to $2.28 billion. Real estate and book publishing drove the gain, while the newspaper segment's earnings fell 40%.
Real estate and books do the lifting
Total Segment EBITDA, the company's operating profit measure before depreciation, interest and taxes, rose 19% to $403 million from $340 million, in results released Wednesday. Earnings per share were $0.29 against $0.20 a year earlier, and adjusted earnings per share were $0.28 against $0.22. Net income also got a lift from a gain on the sale of REA India's remaining business, partly offset by higher income tax expense, the company said.
Digital Real Estate Services EBITDA jumped 34% to $212 million, and Book Publishing climbed 29% to $75 million. The book unit's comparison was helped by the absence of a $13 million customer-receivable write-off in the prior-year quarter. Dow Jones EBITDA rose 11% to $160 million on 8% revenue growth.
News Media EBITDA fell 40% to $18 million from $30 million, which the company tied to lower revenues. Segment revenue slipped 1% to $540 million, or 4% lower excluding currency effects, acquisitions and divestitures, on lower print advertising and other revenues.
Journal subscriptions near 6.5 million digital
Dow Jones digital-only news subscriptions grew 10% to nearly 6.5 million. Wall Street Journal digital-only subscriptions rose 11% to nearly 4.7 million. Digital was 85% of Dow Jones revenue.
Realtor.com's average monthly unique users fell 8% to 66 million, which the company attributed to broader macroeconomic trends and a focus on higher-quality leads. Lead volumes dropped 11%. At the tabloids, The Sun reached 57 million global monthly unique users in September, from 77 million a year earlier, and the New York Post's network reached 84 million, from 94 million.
Cash flow turns negative
Operating cash flow fell to $13 million from $85 million, which the company blamed on working-capital timing and higher tax payments. After $102 million of capital spending, up from $81 million, free cash flow was negative $89 million against positive $4 million.
The company still repurchased $166 million of its shares and paid $61 million in dividends in the quarter. Cash stood at $1,777 million at September 30, down from $2,095 million at June 30.
"We will woo and we will sue"
CEO Robert Thomson called it a record first quarter and said it was the company's fourteenth consecutive quarter of year-over-year profitability growth. On artificial intelligence, he said News Corp has partners in OpenAI and Meta and hopes other platforms will choose "compensation over confiscation." His line on the rest: "we will woo and we will sue."
The company's earnings call was scheduled for 5:00 p.m. ET on Wednesday.
Management is holding to its AI stance: license where partners pay, sue where they do not.
Sources
- 8-K Filing — NEWS CORP (NWSA) — SEC EDGAR
- Exhibit release-q1fy2027.htm — NEWS CORP 8-K exhibit — SEC EDGAR
- News Corporation Reports First Quarter Results for Fiscal 2027 — businesswire.com
