Market Commentary and Intraday News
Earnings Preview: News Corp.
292 days ago
(AP:LOS ANGELES) News Corp. reports its fiscal fourth-quarter earnings after the market closes Wednesday as analysts expect earnings and revenue to be lower than a year ago. But the results may be overshadowed by the company's plan to split its publishing and entertainment assets into two publicly traded companies.
WHAT TO WATCH FOR: Details about how the split plan is proceeding.
In recent weeks, News Corp. has released new information about its for-profit education venture, called Amplify, which will join the publishing and newspaper assets in a separate company. It also announced layoffs at The Daily, News Corp.'s digital-only publication aimed at tablets and other mobile devices. Both moves are aimed at making the publisher more profitable.
Meanwhile, profits and revenue are expected to decline at News Corp. overall, as lower revenue at its movie studio, Sky Italia and the Fox broadcast network weigh down gains from cable TV channels like Fox News and FX.
Nomura analyst Michael Nathanson also expects the company's share buyback program _ with $5 billion in stock repurchases by next July _ will lose some punch because the price of shares has risen, which reduces the number of shares that can be pulled out of circulation.
WHY IT MATTERS: News Corp. is in the midst of a huge transformation on the heels of the British phone hacking and alleged bribery scandal, which has rocked the media empire founded by Rupert Murdoch since July 2011. The outcome of the company split and what that says about the cost of corporate ethics lapses will be of interest to investors and analysts alike.
WHAT'S EXPECTED: News Corp. is expected to post adjusted earnings of 32 cents per share on revenue of $8.78 billion, according to FactSet.
LAST YEAR'S QUARTER: The company reported adjusted earnings of 35 cents per share, which included a penny per share loss on the sale of social networking site Myspace. Revenue came to $8.96 billion.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.