Fox Corp. said its profit rose in its first quarterly earnings report since being separated from 21st Century Fox, driven by stronger performances in its cable network and broadcast TV segments.
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The company, whose businesses include Fox News; the Fox broadcast network and television stations; and Fox Sports, was spun off from 21st Century Fox and began trading as a separate public company in March. Walt Disney Co. closed its $71.3 billion acquisition of the major entertainment assets of the former 21st Century Fox earlier this year.
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Shares of Fox, which beat analysts’ estimates on profit and sales in the latest period, rose about 5% in extended trading as the company revealed plans to launch a sports-betting partnership with The Stars Group. As part of the deal, Fox will pay $236 million for a 5% stake in Stars Group.
Fox Bet will roll out two products this fall — one providing customers in states with legalized gambling an opportunity to wager on sporting events, and the other offering a nationwide platform where customers can win cash prizes for correctly predicting the outcome of games, the company said.
Fox is among several media companies that have been looking for ways to exploit sports betting after the Supreme Court last year struck down a federal ban. Several states have so far moved to legalize it, including New Jersey, Rhode Island, Pennsylvania, Delaware, West Virginia and Mississippi.
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The company said the most recent quarter’s results, including the prior year’s comparison, are based on the 21st Century Fox’s domestic news, national sports and broadcast businesses, along with certain other assets.
Fox said its third-quarter profit was $529 million, or 85 cents a share, compared with $457 million, or 74 cents a share, for the comparable quarter in 2018. On an adjusted basis, earnings were 76 cents a share, more than the 67 cents a share expected from analysts polled by Refinitiv.
Revenue rose 12% from a year earlier to $2.75 billion, above analysts’ expectations of $2.61 billion in revenue.
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In the latest period, Fox said its revenue growth was driven by an 11% jump in affiliate revenue and a 9% increase in advertising revenue.
The company’s broadcast TV unit logged a 20% increase in revenue, driven mainly by a jump in carriage fees for its local stations. Advertising revenue rose 10% due to the broadcast of one additional NFL divisional playoff game and higher pricing and ratings at Fox Entertainment, the company said. Advertising revenue from cable-network programming also increased from a year earlier, resulting from higher digital sales at Fox News and stronger ratings for daily studio programming at sports channel FS1.
Fox and The Wall Street Journal parent News Corp share common ownership.
