News Corp. reports earnings miss, stock stable

May 08 04:37 2015

News Corp. delivered quarterly earnings on Tuesday that missed expectations. The media company reported adjusted fiscal third-quarter profit of 5 cents per share, down from 11 cents per share a year earlier. Revenue dropped 1 percent to $2.06 billion from $2.08 billion. Wall Street had expected earnings of 6 cents per share on $2.11 billion in revenue, according to consensus estimates from Thomson Reuters.100988713-20130820-0940-251.530x298

News Corp shares were unchanged in extended hours trading. The company said the decline in revenue was due to “negative foreign currency fluctuations and lower advertising revenue.” News Corp. noted that legal costs at the News America Marketing division also impacted total revenue.

“While the quarter faced some revenue challenges, particularly at news and information services, including currency headwinds, our adjusted EBITDA was relatively stable, underscoring the strength of our assets and the diversification of our revenue base,” Chief Executive Robert Thomson said in a statement. “We believe the company is firmly on track and the signs are positive for year-over-year EBITDA growth in the fourth quarter.”

The company also reported that free cash flow decreased by $105 million in the nine months ended on March 31, 2015 to $391 million, due to “certain onetime items.” Neither News Corp. nor 21st Century Fox will face charges in the U.S. over the phone hacking scandal that has rocked the companies for years. The SEC announcement in early February brought an end to speculation that the companies would face more legal investigation outside of the U.K.