NEW YORK: A glittering performance by its film unit and strong growth at social networking website MySpace helped boost fiscal second-quarter revenue at News Corporation by 18%, but the Murdoch media empire's profit fell 24% year-on-year, mainly due to an exceptional gain in the year-ago period.
Overall in the quarter ended December 31, net income fell to $822 million (€632.9m; £417.5m) from $1.08 billion a year earlier, which included income from an asset sale. Revenue rose to $7.8 billion from $6.7bn. Operating income increased 24% to $1.1bn.
The star of the show, the film division, saw its operating income climb 57% to $470m - a record quarter according to NewsCorp - thanks in part to box-office gains from controversial comedy Borat and The Devil Wears Prada. Sales of movie and television DVDs also contributed to the bottom line.
Among the units performing less well were MyNetworkTV [WARC News: 06-Feb-07] and its sister company, Fox TV, both of which recorded lackluster ratings in the last quarter. Operating income fell to $112m from $183m in the same quarter a year earlier.
Chairman/ceo Rupert Murdoch emphasized during a conference call that he saw "no better use" for NewsCorp's cash than continued stock buybacks, hinting that he had no major acquisitions in his sights.
He also reiterated that the decision to swap his stake in US satellite TV provider DirecTV for Liberty Media's stake in NewsCorp [WARC News: 26-Dec-06] was a pragmatic decision that would boost earnings per share.
He added: "Do not interpret it as a change to our positive view on the satellite market." He said his team was bullish on prospects at BSkyB in the UK and Sky Italia.
Data sourced from Wall Street Journal Online; additional content by WARC staff