Home News News Corp Shares Rise as Digital Subscriber Growth Offsets Weak Ad Revenue – Key Level to Watch

News Corp Shares Rise as Digital Subscriber Growth Offsets Weak Ad Revenue – Key Level to Watch

by SuperiorInvest

Key takeaways

  • News Corp shares gained in premarket trading Thursday after the company beat analysts’ fiscal second-quarter sales and profit estimates due to a surge in digital subscriptions.
  • CEO Robert Thomson said the company intends to be a core content provider for generative AI companies.
  • If News Corp stock closes above its all-time high of $26.21, it could signal the start of a new cyclical uptrend.

news corporation

Source: TradingView.com.

Shares of News Corp (NWS) rose before the opening bell Thursday after The Wall Street Journal parent beat estimates for quarterly earnings and sales, boosted by growth in the company’s Dow Jones business information arm. company.

The New York-based company synonymous with Australian media mogul Rupert Murdoch, posted fiscal second-quarter adjusted earnings of 26 cents per share compared with analysts’ average estimate of 21 cents per share. Net income for the period was also better than expected, growing 3% to $2.59 billion, above the consensus mark of $2.55 billion.

The media conglomerate’s Dow Jones segment, which is home to leading financial publications such as The Wall Street Journal, Barron’s and Market Watch, posted $584 million in revenue for the December quarter, up 4% from the same period. quarter of 2022, as customers searched for the unit. subscription options included.

News Corp’s digital real estate services group also performed well, posting fiscal second-quarter revenue of $419 million, up 9% year-on-year. In a surprise, the company’s book publishing segment, which owns prominent publisher HarperCollins, also performed well during the quarter, posting revenue growth of 4% to $550 million.

However, News Corp’s advertising revenue fell 5.6% to $438 million from the corresponding year-ago quarter.

Chief Executive Robert Thomson said the company continued to benefit from its “strategic shift toward digital and subscription revenues and away from sometimes volatile advertising revenues.” On the artificial intelligence (AI) front, Thomson said the media giant aims to be “a central content provider for generative AI companies that need the highest quality, timely content to ensure the relevance of their products.” .

Since forming three separate lows around $15.50 between June 2022 and March of last year, NWS stock has been on a consistent upward trend. In the lead-up to this week’s earnings report, the price has consolidated within a tight range just below the stock’s all-time high of $26.21 set in May 2021, suggesting investors were embracing a wait-and-see approach. Today, it is worth monitoring whether the stock can close above its all-time high with significant trading volume, which could potentially signal the beginning of a new cyclical uptrend.

News Corp shares rose 3.3% to $25.06 about three hours before Thursday’s opening bell.

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