21st Century Fox’s sales increased 12% in its latest quarter on the back of a strong slate of summer movies like Dawn of the Planet of the Apes as well as improved revenue from the company’s cable networks. Here are some of the key points from Tuesday’s quarterly earnings.
What you need to know: The company’s revenues grew to $7.9 billion, up from $7.06 billion during the same quarter last year. The results handily beat Wall Street estimates of only $6.25 billion.
21st Century Fox’s (FOX) profits declined 17%, to $1.04 billion, or 47 cents a share. The decline was partially due to increased expenses in the company’s cable division, with much of the spending going toward consolidation of the unit’s sports networks, including the Yankees Entertainment and Sports Network (YES), which 21st Century Fox took majority control of earlier this year.
Shares of 21st Century Fox rose slightly in after-hours trading following the company’s release of its first-quarter numbers. The company’s stock had fallen 3.4% during the day on Tuesday as investors braced for what many thought would be disappointing earnings.
The big number: First-quarter revenue for the Rupert Murdoch-helmed company’s cable networks unit jumped 15% and represented nearly 40% of total revenue for 21st Century Fox. Murdoch said in a statement that the company’s sales growth was driven, in part, by “sustained increases in affiliate fees” from its cable division, with the company’s regional sports networks, FX Networks and Fox News Channel contributing to an 18% sales spike from U.S. affiliates.
The company, which was split off from News Corp. last year, also got a major boost from its film division despite concerns that the movie industry’s summer box-office slump would negatively impact revenues. Instead, 21st Century Fox’s films unit raked in $2.5 billion in the three-month period ending September 30 — a 17% gain year-over-year. While summer box-office numbers were down across the board this year, Fortune reported in September that the company’s studio division was leading the pack in Hollywood thanks to the success of films like Dawn of the Planet of the Apes, which was one of the few true blockbusters to hit theaters this summer. That film made more than $700 million worldwide while teen-weeper The Fault in Our Stars made a surprising $300 million worldwide after costing only $12 million to make, according to Box Office Mojo.
What you might have missed: TV revenue was flat for 21st Century Fox as advertising sales fell 5% amid a ratings decline for the FOX network. On a conference call, the company’s chief operating officer, Chase Carey, blamed the drop in ad sales on advertisers spending less money due to worries about the U.S. economy. Carey said Fox hopes its numbers in the current quarter will benefit from the fact that the World Series went to a full seven games this year.
