Although Fox warned the coronavirus pandemic could have adverse affects on its bottom line going forward, the company managed to come slightly ahead of Wall Street expectations in reporting its fourth quarter earnings.
For the three months ending on June 30, representing the company’s fourth fiscal quarter for 2020, Fox reported $2.42 billion in revenue, topping analyst estimates of $2.4 billion. Fox also posted an adjusted earnings per share of 62 cents, which beat projections of 57 cents. Compared to the year-ago quarter, revenue was down 4% from 2.51 billion. This is the first fourth quarter since 2017 that Fox was not airing a World Cup. For the full fiscal 2020 year, Fox reported $12.30 billion in revenue, an 8% increase from the $11.39 billion from the prior year.
Fox also saw its net income for the quarter decrease by more than $300 million from the prior year ($454 million to $122 million), largely do to its decision to exit its rights deal with the U.S. Golf Association, which NBCUniversal took over.
Also Read: Fox Sports Hit With Layoffs Amid Restructuring
“Fox delivered strong results for the fourth quarter and full fiscal year, even in spite of the unprecedented environment in which we all continue to operate,underscoring the strength of our brands and content offering,” CEO Lachlan Murdoch said. “We continue to expand the way audiences interact and connect with our brands while simultaneously diversifying and enhancing our revenue base. We entered the COVID-19 crisis on sound operational and financial footing and we expect to emerge from this pandemic more competitive, more focused and even more strongly positioned to deliver value for our viewers, partners and shareholders in the years ahead.”
The majority of the impact from COVID-19 was felt on the television segment’s advertising revenue, which dropped by 22% due to fewer local advertisers and the loss of sports and entertainment programming, the former of which only recently has returned. The ad revenue loss would have been worse if not for higher fees from Fox News, the company said.
Though Fox has finally begun airing MLB games — multiple positive tests on multiple teams have put the season in jeopardy, however — and the NFL is on schedule to kick off in September, Fox warned that the pandemic could have major impacts going forward.
Also Read: Disney Reports Loss of $4.7 Billion for Q3 as Pandemic Rocks Business
“Following the COVID-19 outbreak, sports events to which the Company has broadcast rights have been cancelled or postponed and the production of certain entertainment content the Company distributes has been suspended. Although some of these sports events and productions have resumed or are expected to resume during the first quarter of fiscal 2021, there may be additional content disruptions in the future,” the company wrote said. “Depending on their duration and severity, these disruptions could materially adversely affect the Company’s future advertising revenues and, over a longer period oftime, its future affiliate fee revenues. To the extent the pandemic further negatively impacts the Company’s ability to air sports events, particularly MLB, NFL or college sports, it could result in a significantly greater adverse effect on the Company’s business, financial condition or results of operations than the Company has experienced thus far.”
Fox executives will hold a call with analysts at 5:30 p.m. ET.
Notable Athletes Who Have Opted Out of 2020 Seasons Over COVID-19 Concerns (Photos)
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