Fox Corporation (FOX/FOXA) — Form 10-Q Summary
Reporting-period note: The request identifies 2023 Q3, but the supplied filing is for the quarter ended March 31, 2024 (Fox fiscal 2024 Q3), with nine-month comparisons to March 31, 2023. Amounts are in millions unless noted.
Business context and results
Fox operates Cable Network Programming, Television, and Other, Corporate and Eliminations. For fiscal Q3, revenue fell 16%, mainly because the prior-year quarter included Super Bowl LVII and more NFL games. For the first nine months, revenue declined 8%, largely reflecting the absence of prior-year Super Bowl and FIFA Men’s World Cup broadcasts and lower political advertising.
| Metric | Fiscal Q3 2024 | Fiscal Q3 2023 | Nine months 2024 | Nine months 2023 |
|---|---|---|---|---|
| Revenue | $3,447 | $4,084 | $10,888 | $11,881 |
| Operating expenses | $2,050 | $2,727 | $7,305 | $7,911 |
| Net income (loss) attributable to Fox | $666 | $(54) | $1,182 | $864 |
| Diluted EPS | $1.40 | $(0.10) | $2.44 | $1.60 |
| Adjusted EBITDA | $891 | $833 | $2,110 | $2,456 |
| Adjusted EBITDA margin | 25.8% | 20.4% | 19.4% | 20.7% |
Quarterly segment EBITDA rose 3% to $819 at Cable Network Programming and 24% to $145 at Television. For the nine months, Cable Network Programming EBITDA rose 5% to $1,990, while Television EBITDA fell 54% to $358, reflecting weaker advertising and the prior-year event comparison.
Cash flow, liquidity, and debt
- Nine-month operating cash flow was $941, down from $1,307. Capital expenditures were $233; operating cash flow less capital expenditures was $708, versus $1,070 in the prior period.
- Cash and cash equivalents were $3,791 at March 31, 2024, compared with $4,272 at June 30, 2023. Current assets were $7,178 and current liabilities $2,217.
- Borrowings were $7,196, versus $7,210 at June 30, 2023; reported debt fair value was $7,057. The company issued $1.25 billion of 6.5% notes due 2033 and repaid $1.25 billion of notes that matured in January 2024. No revolving-facility borrowings were outstanding; the $1.0 billion facility matures in June 2028.
- Financing cash outflow was $1,098, including $750 of share repurchases and $272 of dividends and distributions. The remaining buyback authorization was approximately $1.65 billion at quarter-end.
- Firm commitments and future debt payments totaled approximately $39 billion. Management reported compliance with revolving-credit covenants and stated it did not anticipate noncompliance.
Material changes, unusual items, and outlook
- Fox’s reported profit benefited from the absence of the prior-year $850 million legal settlement cost and a $167 million gain on the UFL-related contribution of USFL assets. The filing also reports volatile investment results: equity-security gains were $81 million in the quarter, but nine-month net losses were $110 million.
- Fox’s approximately 42% UFL interest is accounted for under the equity method. A sports-streaming joint venture with ESPN and Warner Bros. Discovery was announced; the subscription service was expected to launch in fall 2024. The filing provides no quantified earnings or revenue guidance.
- Management cited advertising demand, subscriber declines, carriage renewals, sports-rights costs, competition, audience measurement, technology and privacy, litigation, and labor disputes among risks. No material changes to previously disclosed risk factors or market risks were reported.
Contingencies and investor verification points
- Fox settled Dominion-related litigation for approximately $800 million in April 2023. The Smartmatic lawsuit seeks $2.7 billion; Fox says it cannot predict the outcome and that a loss is neither probable nor reasonably estimable. A trial was not expected before 2025.
- The filing says the company could not estimate a loss range for certain disclosed contingencies. It also describes a Tubi privacy class action, with adverse district-court rulings being appealed, and other litigation and investigations.
- Verify the fiscal-period comparison when using this summary; the supplied filing is Q3 FY2024, not Q3 2023.
- Track whether advertising, political-ad revenue, and subscriber trends improve, and whether Television segment EBITDA recovers after the major-event comparison.
- Assess the sustainability of cash generation and capital returns against the $39 billion of commitments and future debt payments; note remaining buyback authorization and debt maturities.
- Monitor investment-value volatility, the UFL investment and sports-streaming joint venture, and developments in Smartmatic and Tubi litigation.