News Corp Outperforms on Strong Dow Jones and Digital Real Estate Growth

News Corporation (NWS) delivered a robust third-quarter fiscal 2025 performance, with earnings per share (EPS) doubling to $0.14, surpassing analyst expectations. The gains were fueled by strong contributions from its Dow Jones and Digital Real Estate Services (DRES) segments, which continue to drive growth amid macroeconomic headwinds.

Key Drivers of Growth

Dow Jones: Subscription Powerhouse

Dow Jones revenue rose 6% to $575 million, benefiting from subscription growth and its expanding professional information business. Digital subscriptions for The Wall Street Journal surged to 4.3 million, with 90% of these being digital-only. The segment’s Risk & Compliance division saw 11% revenue growth, reflecting rising demand for financial and geopolitical risk analysis.

Digital Real Estate Services (DRES): Led by REA Group

DRES revenue grew 5% (excluding currency impacts) to $406 million, driven by REA Group’s 6% rise in Australian residential revenue and improved performance at Move. Despite macroeconomic pressures, such as declining lead volumes at Realtor.com, the segment’s adjusted EBITDA jumped 25% to $124 million, underscoring operational efficiency.

Book Publishing: Steady but Modest Growth

Book Publishing revenue increased 2% to $514 million, supported by strong backlist sales and audiobook growth. Digital sales accounted for 25% of consumer revenue, with titles like Wicked and The Strawberry Patch Pancake House contributing to momentum.

News Media: Ad Challenges Offset by Cost Cuts

The only segment to report revenue decline (-8% to $514 million), News Media faced headwinds from falling ad revenue and algorithm-driven traffic declines at properties like The Sun. However, EBITDA rose 22% to $33 million due to cost synergies from its partnership with DMG Media.

Strategic Moves and Financial Health

• Foxtel Sale: The disposal of Foxtel to DAZN in April 2025 generated $592 million in cash repayments and a 6% equity stake, bolstering News Corp’s liquidity.
• Acquisitions: Dow Jones’s purchase of Oxford Analytica and Dragonfly Intelligence strengthens its professional information capabilities.
• Balance Sheet: Cash reserves rose to $2.095 billion, with net debt reduced by $118 million year-over-year.

Risks and Challenges

• Currency Volatility: Foreign exchange headwinds reduced DRES revenue by $14 million in Q3.
• Housing Market Slowdown: Move’s lead volume fell 17%, signaling sensitivity to mortgage rate pressures.
• News Media Declines: Ad revenue at The New York Post and The Sun dropped sharply due to algorithm changes and broader economic uncertainty.

Conclusion

News Corp’s Q3 results reaffirm its shift toward high-margin, subscription-based businesses, with Dow Jones and DRES leading the way. The company’s strategic focus on credible journalism, AI litigation, and cost discipline has positioned it to navigate macroeconomic challenges.

While risks like currency swings and real estate market softness linger, the $0.14 EPS and 12% rise in Total Segment EBITDA to $290 million suggest strong execution. With a free cash flow increase of 13% to $539 million year-to-date, News Corp appears well-equipped to capitalize on its strengths. Investors should monitor its ability to sustain subscription momentum in Dow Jones and navigate housing sector volatility. For now, the stock’s 23% year-to-date return reflects confidence in its diversified growth strategy.

This performance, coupled with balance sheet improvements, makes News Corp a compelling play on digital transformation in media and real estate—a trend that looks set to endure.