Fox Corporation (Nasdaq: FOXA, FOX)

Fox Corporation's Q3 fiscal 2025 revenue grew 27% year-over-year to $4.37 billion, driven primarily by the broadcast of Super Bowl LIX and continued growth of its digital platforms, particularly the Tubi AVOD service. Affiliate fee revenues increased 3%, with the Television segment growing 4% and the Cable Network Programming segment growing 3%. Advertising revenues saw the most significant boost, increasing 65%, primarily due to the impact of Super Bowl LIX, continued digital growth, and stronger news ratings and pricing. Other revenues increased 20%, primarily due to higher sports sublicensing revenues.

Despite the substantial revenue growth, net income decreased to $354 million from $704 million in the prior year quarter. Net income attributable to Fox Corporation stockholders was $346 million ($0.75 per share), compared to $666 million ($1.40 per share) in the prior year period. The decline was primarily due to higher expenses associated with the broadcast of Super Bowl LIX, increased investments in digital content and marketing, and changes in non-operating items.

Adjusted net income attributable to Fox Corporation stockholders was $507 million ($1.10 per share), relatively flat compared to $520 million ($1.09 per share) in the prior year quarter. This measure excludes the impacts of restructuring and impairment charges, non-operating items, and certain tax effects, providing a clearer view of the company's underlying operational performance.

Quarterly Adjusted EBITDA was $856 million, down slightly from $891 million in the prior year quarter. The modest decline in Adjusted EBITDA, despite the significant revenue increase, was primarily due to higher sports programming rights amortization and production costs driven by the broadcast of Super Bowl LIX and higher digital content and marketing costs.

The company maintained a strong cash position, with cash and cash equivalents of $4.82 billion as of March 31, 2025, up from $3.79 billion in the prior year. Fox continued its share repurchase program, buying back approximately $250 million of its Class A common stock during the quarter.

Cable Network Programming reported quarterly segment revenues of $1.64 billion, an increase of 11% from the prior year quarter. Affiliate fee revenues increased 3% as contractual price increases were partially offset by the impact of net subscriber declines. Advertising revenues increased 26%, primarily due to higher news ratings, pricing, and digital advertising revenues. Other revenues increased 79%, primarily due to higher sports sublicensing revenues.

Cable Network Programming segment EBITDA was $878 million, an increase of 7% from the prior year quarter. The segment's profitability improvement was driven by the revenue increase, partially offset by higher expenses, primarily related to sports programming rights amortization and production costs.

Television reported quarterly segment revenues of $2.70 billion, a substantial increase of 40% from the prior year quarter. This growth was primarily driven by advertising revenues, which increased 77% due to the impact of Super Bowl LIX and continued digital growth led by the Tubi AVOD service. Affiliate fee revenues increased 4%, driven by higher average rates at the company's owned and operated television stations and increases in fees from third-party FOX affiliates. Other revenues increased 3%, primarily due to higher content revenues.

Despite the strong revenue growth, Television segment EBITDA decreased to $60 million from $145 million in the prior year quarter. This decline was due to higher expenses, primarily sports programming rights amortization and production costs related to the broadcast of Super Bowl LIX, as well as higher digital content and marketing costs. The Television segment's profitability was temporarily impacted by the costs associated with producing the Super Bowl broadcast, which occurs only once every three years for Fox.

The segment performance highlights Fox's strategic focus on its core strengths in sports and news programming, as well as its ongoing investment in digital platforms. The company's ability to drive significant revenue growth through major sports events like the Super Bowl demonstrates the enduring value of its broadcast rights portfolio, even as it continues to expand its digital presence through platforms like Tubi.

Affiliate Fee revenues of $2.01 billion increased 3% year-over-year, contributing 46% of total revenue in Q3 2025. The Cable Network Programming segment generated $1.14 billion in affiliate fees (up 3%), while the Television segment contributed $870 million (up 4%). Growth in affiliate fees was driven by contractual price increases across both segments, partially offset by the impact of net subscriber declines in the Cable Network Programming segment.

Advertising revenues of $2.04 billion increased 65% year-over-year, representing 47% of total revenue in Q3 2025. The significant growth was primarily driven by the impact of Super Bowl LIX, which is broadcast by Fox approximately once every three years. Additional contributors to advertising growth included continued expansion of digital advertising, particularly through the Tubi AVOD service, and stronger news ratings and pricing. The Television segment generated $1.66 billion in advertising revenue (up 77%), while the Cable Network Programming segment contributed $372 million (up 26%).

Other revenues of $330 million increased 20% year-over-year, accounting for 7% of total revenue in Q3 2025. This growth was primarily driven by higher sports sublicensing revenues in the Cable Network Programming segment, which saw a 79% increase in other revenues to $129 million. The Television segment's other revenues increased 3% to $170 million, primarily due to higher content revenues.

The revenue composition for the quarter was significantly influenced by the Super Bowl broadcast, which temporarily increased the proportion of advertising revenue compared to a typical quarter. However, affiliate fees continue to provide a stable, recurring revenue base, while the company's investment in digital platforms is driving growth in both advertising and content-related revenue streams.

Fox Corporation maintained a strong balance sheet and cash position as of March 31, 2025:

• Cash and Cash Equivalents: $4.82 billion, up from $4.32 billion at June 30, 2024 and $3.79 billion at March 31, 2024
• Total Assets: $23.37 billion, up from $21.97 billion at June 30, 2024
• Total Debt: $7.20 billion, consisting of $600 million in current borrowings and $6.60 billion in non-current borrowings
• Total Equity: $11.64 billion, up from $10.81 billion at June 30, 2024
• Fox Corporation Stockholders' Equity: $11.53 billion, up from $10.71 billion at June 30, 2024

The company's robust cash flow performance was highlighted as a key strength in Q3 2025. Net cash provided by operating activities for the nine months ended March 31, 2025, was $1.81 billion, a significant increase from $941 million in the comparable period of fiscal 2024. This improvement was driven by higher net income before non-cash adjustments and more favorable working capital movements.

Fox continued its capital allocation strategy with a focus on shareholder returns through its share repurchase program. During Q3 2025, the company repurchased approximately $250 million of its Class A common stock. As of March 31, 2025, Fox had repurchased approximately $5.35 billion of its Class A common stock and approximately $1 billion of its Class B common stock, with a remaining authorization of $650 million.

The company's strong balance sheet and cash flow generation provide significant financial flexibility to pursue strategic initiatives, invest in content and digital platforms, and continue returning capital to shareholders. The debt-to-adjusted EBITDA ratio remains manageable, supporting the company's financial stability in a rapidly evolving media landscape.