The Super Bowl may have been bad for the San Francisco 49ers, but it was good for Fox. The 54th iteration of the NFL’s title game drove Fox to top Wall Street estimates for its earnings on Wednesday.
For the three months ending on March 31, representing the company’s third fiscal quarter for 2020, Fox reported $3.44 billion in revenue, topping analyst estimates of $3.34 billion. Fox also posted an adjusted earnings per share of 93 cents, which surpassed projections of 71 cents.
However, Fox warned that the current coronavirus pandemic, which has put all TV production and live sports on hold in the U.S., could have an impact on Fox going forward. While the WWE — Fox airs “Smackdown” on Friday night — got clearance to resume taping, Major League Baseball, one of the company’s biggest summer programming staples, put the start of its season on hold indefinitely. The forthcoming NFL season this fall is also up in the air, even as the league plans to release its schedule Thursday. Additionally, it is unclear when scripted shows can resume production, which puts the broadcast network’s fall slate in a state of uncertainty, though Fox’s animation programming should be unaffected.
“We delivered exceptional operational and financial results in the quarter, highlighted by our successful broadcast of Super Bowl LIV on Fox. While we remain focused on continuing to execute against the strategy that drove this strong performance, we are acutely mindful of the global health crisis and its countless impacts,” said Fox CEO Lachlan Murdoch in a statement. “Our highest priority remains the safety and well-being of our employees and their families. Due to the selfless dedication of many of our colleagues, the strength of Fox has been on display throughout the crisis as we continue to provide news, information, entertainment and assistance to communities around the country. As we eventually emerge, we are confident that FOX’s focused collection of assets-centered on live and event programming-will be even more in-demand by advertisers and audiences alike, positioning us well for the future and enabling us to maximize long-term shareholder value.”
Advertising revenues increased 44%, led by the broadcast of Super Bowl LIV at the Television segment. Affiliate revenues increased 10%, led by increases at the Television segment due to higher fees from third-party Fox affiliates and higher average rates per subscriber, partially offset by net subscriber declines, at Fox’s local TV stations.
Murdoch added during the company’s earnings call that ad revenue for their local stations is pacing down 50% in the current quarter, compared to a year-ago, due to the downturn caused by the coronavirus. But on the national level, ad revenue was not as negatively affected, because advertisers shifted their buys from sports to news.
Even so, Fox expects to take between a $200-240 million advertising hit in the next quarter across every unit outside of sports. Most of the ad revenue in sports is concentrated in the fall, during the MLB playoffs and first months of the NFL season, Murdoch explained.