21st Century Fox Profit Declines on Programming Costs for New Cable Networks
Rupert Murdoch's 21st Century Fox film and TV company reported fiscal first-quarter profit that missed analysts' estimates after a tough quarter for the film division and investments in its cable networks.
Profit from continuing operations fell to $768 million, or 33 cents a share, from $2.23 billion, or 95 cents, a year earlier, Fox said today in a statement. Analysts expected 35 cents, the average of 23 estimates compiled by Bloomberg. Operating income rose 2% to $1.62 billion.
Mr. Murdoch is converting cable channels with smaller audiences into networks with a potentially bigger draw. In August, the racing channel Speed become Fox Sports 1 and Fox Soccer converted to FXX, networks that will take a year or more to increase revenue and to recoup higher programming costs. Fox is also spending to develop programs for its Fox broadcast network, where viewership tumbled in season ended in May.
"The investment we are making, including the launch of FXX and Fox Sports 1, will drive future sustained growth toward our stated 2016 target," Mr. Murdoch said in the statement.
Revenue increased 18% to $7.06 billion, beating the $6.82 billion average of 20 analysts' estimates.
~ Bloomberg News ~