Rupert Murdoch’s News Corp reveals plans to cut 5% of staff after quarterly earnings miss
Rupert Murdoch’s News Corp., home of media properties including The Wall Street JournalDow Jones and HarperCollins, after it posted disappointing quarterly results, announced that it was laying off 5% of its workforce.
The company reported revenue of $2.52 billion, a shade below Wall Street analysts’ consensus expectation of $2.55 billion, according to Refinitive. Earnings per share missed by a wide margin, coming in at 14 cents on an adjusted basis, compared to a Street forecast for 19 cents. (As reported, earnings per share were 12 cents.)
“Certainly, rising interest rates and strong inflation had a real impact on all of our businesses,” CEO Robert Thomson said in the earnings release. “But we believe these challenges are more temporary than eternal. As our company weathered the pandemic’s stress-test with record profits, initiatives underway now with an expected 5% headcount reduction, or approximately 1,250 positions this calendar year, will create a strong platform for future growth.”
The company and its Murdoch-controlled sibling, Fox Corp., last month abandoned a potential attempt at a merger after being separate entities for nearly a decade. Especially after 21st Century Fox sold most of its shares to Disney in 2019, many investors have scrutinized the potential of both entities as they compete with larger rivals. Fox Corp. CEO Lachlan Murdoch said during the company’s quarterly earnings call with analysts on Wednesday that “scale is important,” adding that the company will “look at M&A.”
News Corp attributed the 7% decline in revenue from the year-ago quarter to various factors. These included foreign currency fluctuations, lower book publishing revenue primarily due to lower book sales, and lower revenue at its digital real estate services unit due to challenging housing market conditions in Australia and the US.On the plus side, Dow Jones totals exceeded 5 million. customers during the quarter, helping its revenue gain, and Foxtel and The New York Post Also finished in black.
Rupert Murdoch is the executive chair of News Corporation and the chair of Fox Corporation.
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