Fox Corp Earnings - Q4 2025 Analysis & Highlights
Fox Corporation reported strong Q2 FY2026 results driven by robust advertising demand across sports and news, record-breaking sports programming performance, and continued momentum in streaming initiatives, while maintaining disciplined capital allocation through substantial share buybacks and dividend distributions.
Key Financial Results
Total revenues reached $5.18 billion, representing a 2% increase year-over-year.
Adjusted EBITDA was $692 million compared to $781 million in the prior year quarter.
Net income attributable to stockholders was $229 million, or $0.52 per share, compared to $373 million, or $0.81 per share in the prior year period.
Adjusted net income was $360 million and adjusted EPS was $0.82.
Distribution revenues grew 4% during the quarter.
Advertising revenues grew 1% despite facing a difficult comparison to last year's record political cycle.
Content and other revenues were flat compared to the prior year quarter.
Business Segment Results
Cable segment delivered revenues of $2.28 billion and adjusted EBITDA of $687 million, both representing growth of 5% versus the prior year quarter.
Cable advertising revenues grew a robust 7%, driven by higher pricing at news and sports.
Cable distribution revenues increased 5% as pricing gains from affiliate renewals outpaced the impact from net subscriber declines.
Cable content and other revenues grew 4%, predominantly due to higher sports sublicensing revenues.
Television segment reported $2.94 billion in quarterly revenues.
Advertising revenues at television were unchanged as continued growth at Tubi and additional MLB Postseason games were offset by the absence of last year's political advertising revenues.
Television distribution revenues increased 1% in the quarter.
Television content and other revenues were down 19% year-over-year, primarily due to lower revenues tied to entertainment production studios.
EBITDA at the television segment was $143 million, compared to $205 million in the prior year quarter.
Tubi delivered its most streamed quarter of all time and grew total view time 27% year-over-year.
Tubi's record quarterly revenue grew 19% in the quarter on an absolute basis.
Tubi achieved EBITDA profitability for the second quarter in a row.
FOX News achieved highest second quarter advertising revenue ever.
FOX News finished the quarter as the most-watched cable network in total day and the most-watched cable news network.
FOX Sports ended 2025 as the leader in live sports event viewing, a title it has held for six of the last seven years.
Record-breaking ad revenue was achieved for the Major League Baseball Postseason, the National Football League, and college football regular seasons.
Capital Allocation
Fiscal year-to-date, the company repurchased an additional $1.8 billion through its share buyback program.
Total cumulative amount repurchased reached $8.4 billion, or approximately 35% of total shares outstanding since the launch of the buyback program in 2019.
An accelerated share repurchase transaction of $1.5 billion was announced last quarter, with approximately 8.5 million Class A and 10.9 million Class B shares retired, with the remainder to be settled during the second half of the fiscal year.
A $0.28 per share semiannual dividend was announced.
Total cumulative cash return to shareholders in the form of both dividends and share buybacks reached approximately $10.4 billion since the establishment of Fox Corp.
The company ended the quarter with approximately $2 billion in cash and $6.6 billion in debt.
Industry Trends and Dynamics
The advertising market remained robust with unabated healthy trends and positive metrics across the portfolio.
Scatter pricing for news increased approximately 46% to 47% year-over-year.
FOX News added approximately 200 new advertisers in the first half, on top of 350 new advertisers added last year.
Skinny bundles are emerging in the cable universe and are expected to play an increasing factor in keeping subscriber declines down.
Subscriber declines improved to 6.3%, excluding FOX One.
FOX One launched five months ago and has exceeded expectations in terms of consumer take-up.
Approximately two-thirds of FOX One's audience are sports fans and one-third are news fans.
News viewers on FOX One engage with the platform twice as many days per week as non-news viewers and watch nearly three times as many minutes per week on average.
70% of Tubi's user base are cord-cutters or cord-nevers, which is higher than any of the competitive set.
Social media views for FOX News Digital were up 170% over the prior year.
FOX News and FOX Business ranked number one in YouTube video views amongst their peers during the quarter.
Competitive Landscape
FOX News is the number one cable news network among all three political parties.
FOX News has more Democrats and more independents watching than watching competitors.
FOX Sports portfolio strength is described as unmatched.
FOX News Media continues to meet audiences across streaming, linear, social, and digital platforms.
FOX is positioned as a net beneficiary of skinny bundles as it is included in these packages and receives affiliate fees regardless of how distributors market channels to consumers.
Macroeconomic Environment
The advertising market was described as the most robust seen in some time, with this trend continuing into the current period.
Of the top 10 advertising categories tracked, 8 of the top 10 categories are significantly up, with financial services leading due to insurance company demand.
Entertainment and government/corporate political spending categories are modestly down, with government and political spending expected to increase as the political cycle approaches.
The local advertising market is mixed, with the Super Bowl and Olympics in the current quarter absorbing some local advertising revenue.
Growth Opportunities and Strategies
FOX One is positioned as a premier destination for live sports and the leading platform for timely, relevant live news streaming.
FOX One is expected to reach low- to mid-single-digit millions of subscribers over the next three to four years.
The company is actively promoting the sports slate on FOX One, including the Daytona 500, Indy 500, the start of the baseball season, and the World Cup.
FOX is expanding podcast content and talent across FOX News and the broader FOX platform to meet audiences wherever they are.
The company continues to sign first-look deals and creative deals with the best content creators, producers, and writers in the industry.
FOX Entertainment achieved its best season launch in approximately 13 years with launches of Good Medicine, Fear Factor, and Memory of a Killer, all achieving over 10 million viewers in their first week.
Entertainment network revenue was up in the first half for the first time in many years.
The company is watching prediction markets growth with interest as an opportunity for advertising and deals with emerging prediction markets.
The company maintains a 2.5% stake in Flutter worth approximately $700 million and an option representing 18.6% in FanDuel worth approximately $2.1 billion.
FOX's national advertising sales are concentrated in growth segments, with 94% coming from sports, news, and streaming, and only 6% from entertainment.
Over a four to five year period, FOX advertising revenue is up approximately 8% per year on a CAGR, compared to the peer set excluding FOX which is down about 4% CAGR.
Financial Guidance and Outlook
Management expects a robust political advertising cycle, with benefits primarily at the local station group and growing appetite for national political advertising at FOX News.
The World Cup, starting in June, is expected to be profitable with tremendous excitement from sponsors and traditional advertisers.
The company expects to benefit from the upcoming NFL Postseason and marquee motorsports events including the Daytona 500 and Indy 500.
Management expects the NFL contract renegotiation to provide certainty, and the company has the ability to offset a portion of any cost increases by rebalancing its sports portfolio.
The company is well-positioned for upcoming renewals in 2027 and 2028, with 2027 more skewed towards TV and 2028 more skewed towards cable.
Free cash flow recorded a deficit of $791 million in the quarter, consistent with seasonality of the working capital cycle where the first half reflects concentration of sports rights payments and advertising receivables buildup.
Management expects subscriber declines to continue improving, with skinny bundles expected to play an increasing factor.
