By Joe Flint and Dean Seal
Fox Corp. said it plans to launch a direct-to-consumer subscription streaming service that will include content from Fox News and Fox Sports by the end of 2025, its biggest foray yet into subscription streaming.
Chief Executive Lachlan Murdoch said the new offering is meant to complement pay-TV subscriptions, not replace them. The company has previously resisted developing a broad streaming offering because it didn't want to cannibalize the revenue it receives from pay-TV distributors.
"We see the traditional cable bundle as still the most value for our customers and frankly the most value for our company," Murdoch told analysts on a call Tuesday discussing the company's most recent quarterly results.
Murdoch provided few details on the service, including its price point or whether all Fox News and sports content would be included. He said expectations for subscriber numbers would be modest.
Fox has taken baby steps into streaming thus far. It owns the popular free, advertiser-supported streaming service Tubi. Tubi plans to air the Super Bowl live on Sunday.
Fox News has a streaming service called Fox Nation, which carries a mix of original content and some material from its Fox News channel. The service, which has more than 2 million subscribers, costs as much as $7.99 a month and doesn't include a live feed of the channel.
Fox's fiscal second quarter, which ended Dec. 31, was boosted by strong advertising revenue from the election season and sports.
The media company reported net income of $373 million, or 81 cents a share, up from $109 million, or 23 cents a share, in the same quarter a year ago.
Stripping out one-time items, adjusted earnings were 96 cents a share. Analysts polled by FactSet had been expecting 69 cents a share.
Revenue rose 20% to $5.08 billion, above analyst projections for $4.87 billion, according to FactSet.
Fox's cable-network business, which includes Fox Sports 1, Fox Business and Fox News, posted a 31% jump in revenue from higher affiliate fees that offset a decline in subscribers. Advertising revenue was up 32% on higher news ratings, prices and digital ad sales, along with higher ratings for Major League Baseball's postseason.
The company's television segment logged 16% higher revenue thanks to the strong MLB ratings, higher prices for National Football League advertisements, political ads and growth for ad-supported video on demand at the Tubi subsidiary.
Write to Joe Flint at Joe.Flint@wsj.com and Dean Seal at dean.seal@wsj.com
(END) Dow Jones Newswires
February 04, 2025 10:15 ET (15:15 GMT)
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