News Corp shares surge as Q4 result tops estimates
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More news: News Corp shares soared in early trade after the media conglomerate's fourth-quarter earnings beat market estimates.
Shares were up 7.1% to $56.33 at 10:55am AEST, taking annual gains to 37.5%.
E&P Capital analyst Entcho Raykovski noted that News Corp's Q4 revenue came in 1% above consensus estimates, with earnings before interest, taxes, depreciation, and amortisation 4% higher. He said the company's digital real estate business beat E&P's expectations, but its books division weighed.
News Corp in ‘advanced’ talks with several AI firms
More news: News Corp global chief executive Robert Thomson said the company is in “advanced negotiations” with several generative artificial intelligence companies over possible licensing agreements.
Thomson made the comments during an investor call on Wednesday morning, following the release of News Corp’s fourth-quarter and full-year earnings results. He was asked whether the company is seeing negative impacts from Google’s new AI overviews in search.
The News Corp chief said the company had not seen any negative impact.
What they said: “And more broadly, we’re in the midst of advanced negotiations with several AI companies,” Thomson said.
“It is clear that many of them have come to recognize that the purchase of IP is as important as the acquisition of semiconductors or the securing of stable energy sources. In the end, IP powers AI.
“Now, these are important deals, particularly for unused media properties in Dow Jones. And there is, as I mentioned, a mix of wooing and suing. We prefer the former, but we will never shy away from protecting our property rights.”
News Corp reports revenue beat on strength of real estate, Dow Jones
The news: News Corp has reported a 1% lift in fourth-quarter revenue, beating analyst estimates following strong performances in its real estate and Dow Jones divisions.
The numbers: The Murdoch-controlled media conglomerate topped analyst estimates of USD2.08 billion ($3.2 billion) and reported USD2.11 billion in revenue for the quarter, according to Visible Alpha data.
News Corp reported full-year revenue of USD8.45 billion, a 2% increase on the $8.25 billion reported last year, also beating analyst expectations.
The company, which controls ASX-listed REA Group as well as Dow Jones and the Wall Street Journal, reported fourth quarter earnings before interest, taxes, depreciation and amortisation of USD322 million, beating estimates of USD308.8 million.
The company reported full-year EBITDA of USD1.42 billion, again beating expectations, up 14% on the USD1.24 billion posted a year earlier.
Net income from continuing operations per share was USD0.09 for the quarter, up on the USD0.08 reported the previous year. Adjusted earnings per share were USD0.19, the company said.
Reported diluted EPS from continuing operations were USD0.84 for the full year compared, the company said, while adjusted diluted EPS were USD0.89.
The company said it plans to executing repurchases as part of a USD1 billion stock buyback announced last month in addition to the USD300 million left over from the buyback announced four years ago.
What they said: “These robust results have enhanced our financial position and thus our ability to return capital to shareholders,” News Corp CEO Robert Thomson said.
“The AI age must cherish the value of intellectual property if we are collectively to realise our potential. Much is made of the competition with China, but America’s advantage is ingenuity and creativity, not bits and bytes, not watts but wit. To undermine that comparative advantage by stripping away IP rights is to vandalise our virtuosity.
“Even the President of the United States is not immune to this blatant theft. The President’s books are still reporting healthy sales, but are being consumed by AI engines which profit from his thoughts by cannibalising his concepts, thus undermining future sales of his books. Suddenly, The Art of the Deal has become The Art of the Steal.”
The source: News Corp press release
