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News Corp said net quarterly profit nearly tripled, driven by strong growth at its book-publishing and digital real-estate businesses as well as at Wall Street Journal parent Dow Jones & Co.
The New York-based media company, which owns the Journal, HarperCollins Publishers and news organizations in the U.K. and Australia, posted net profit of $231 million, or 39 cents a share, in the quarter ended Dec. 31, compared with $85 million, or 14 cents a share, a year earlier, thanks to improved performance and lower operating expenses. Revenue slipped 2.6% to $2.41 billion, primarily due to the loss of contributions from its coupon-publishing unit, which was sold last year.
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NEWS CORP. CEO ROBERT THOMSON SAYS 'DIGITAL DENOUEMENT IS LOOMING'
Chief Executive Robert Thomson said the latest quarter was the company's most profitable in its current iteration, since it was split off in 2013 from the entertainment business, an entity now known as Fox Corp.
He also said Dow Jones had its largest quarterly profit since News Corp acquired it in 2007, and that the long-struggling New York Post had achieved a profit. "That is the first profit in modern times, at the very least, for what was a chronic loss-making masthead founded in 1801 by Alexander Hamilton," Mr. Thomson said.
The company's book-publishing unit, HarperCollins Publishers, posted a 23% revenue increase to $544 million, while segment earnings jumped 65% to $104 million, led by such titles as Steve Doocy's "The Happy in a Hurry Cookbook."
"HarperCollins had one of its most lucrative quarters, with double-digit growth across every category," Mr. Thomson said.
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News Corp calculates segment earnings as revenue less operating and administrative expenses. Segment earnings exclude expenses such as interest, taxes, depreciation, amortization, impairment and restructuring charges, and other items.
Dow Jones, the publisher of the Journal, Barron's and MarketWatch, reported a 43% rise in segment earnings to $109 million, thanks to the highest digital-advertising growth rate in 10 years and increases in digital subscriptions. Revenue rose 3.7% to $446 million, 70% of which came from digital revenue.
Dow Jones reported a 29% increase in digital-advertising revenue, which was offset by a 29% decline in print-advertising revenue. Overall, ad revenue slipped by 4%.
The Journal averaged more than 2.46 million digital subscribers in the quarter, up from over 2.35 million in the September quarter. Including the print edition, the Journal averaged 3.22 million subscribers in the period, a record.
News Corp's other news publications, which include the New York Post, the Sun and the Times in the U.K. and many papers in Australia, posted a 29% decline in revenue to $573 million, while segment earnings were flat at $66 million.
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The company's digital real-estate services division reported a 15% gain in revenue to $339 million. Segment earnings increased 20% to $142 million. The unit includes a majority stake in REA Group Ltd., a publicly traded digital real-estate company, and an 80% stake in Move Inc., an online real-estate business based in Santa Clara, Calif., that primarily operates the website Realtor.com.
News Corp's subscription-video-services unit, which includes Foxtel, an Australian pay-TV provider, posted a 77% rise in segment earnings, thanks in part to lower sports programming rights and production costs, as well as lower entertainment programming costs. Revenue rose 2% to $511 million
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