Fox B's NFL Rights Timeline and Digital Spending Shifts Spark Contradictions in 2026 Q4 Earnings Call

Date of Call: Aug 6, 2026

Financials Results

• Revenue: Over $17 billion for fiscal 2026, up 5% YOY; Q4 revenue $4.2 billion, up 28% sequentially.
• EPS: $3.84 per share for fiscal 2026, down from $4.91 prior year; adjusted EPS $5.42, up 13% YOY. Q4 EPS $1.61, up from $1.57 prior year; adjusted EPS $1.79, up 41% YOY.

Guidance:

• Expect strong advertising momentum to continue into fiscal 2027, supported by upfront double-digit growth and healthy environment.
• Distribution revenue growth expected in fiscal 2027, with renewals more normalized and skewed towards TV.
• Performance of Tubi and Fox One running ahead of expectations, with continued bottom line improvement anticipated.
• Roku acquisition expected to close in first half of calendar 2027.
• World Cup benefits in Q1 fiscal 2027; midterm elections expected to boost advertising revenue.

Business Commentary:

Revenue and EBITDA Growth:

• Fox Corporation reported record revenue of over $17 billion and record EBITDA of $3.9 billion for fiscal 2026, with a 5% increase in revenue and 8% growth in EBITDA year-on-year.
• The growth was driven by record advertising and distribution revenue, particularly from the broadcast of the 2026 FIFA Men's World Cup and strong performance in the digital segment.

Advertising Revenue Surge:

• The company saw a significant 78% increase in advertising revenue in the fourth quarter, with double-digit growth in volume for the upfront season.
• This surge was primarily fueled by the broadcast of the World Cup and continued growth in digital platforms like Tubi.

Tubi's Performance:

• Tubi delivered its highest revenue quarter ever, with 35% revenue growth, driven by a 17% increase in total viewing time.
• The growth was attributed to the platform's strong engagement with cordless viewers and effective utilization during major events like the World Cup.

World Cup Impact:

• Fox Corporation's broadcast of the 2026 FIFA Men's World Cup led to the company topping all networks in live event sports consumption.
• The event drove significant advertising momentum and customer acquisition for Fox One, showcasing Fox's capability to deliver large-scale live events.

Digital Investments and Returns:

• Fox Corporation's digital investments were less than $200 million in fiscal 2026, a reduction from previous years, despite strong outperformance in digital segments.
• The reduction in investment was due to the strong returns and growth in digital initiatives like Tubi and Fox One, indicating a successful strategy in digital expansion.

Sentiment Analysis:

Overall Tone: Positive

• Management described fiscal 2026 as 'a notable year' and 'record financial performance,' with 'excellent results' and 'outstanding top and bottom line momentum.' The World Cup 'demonstrated the unique power of Fox' and drove 'continued advertising momentum.' The tone was confident, citing 'strong,' 'very strong,' and 'record' performance across segments and a 'strong market' for ads.

Q&A:

• Question from John Hodlick (UBS): Any teller you can provide on the underlying ad market? ... Also, any color on the NFL rights and pricing expectations?
  Response: Ad market is very strong across portfolio, with double-digit upfront volume growth and leading rates of change. NFL contract unchanged until 2030 season; no details on negotiations.

• Question from Michael Morris (Guggenheim): Can you help with the size of the World Cup contribution to ad revenue and profitability? How does the strength of a unique event like the World Cup help sustain momentum?
  Response: World Cup was a unique event that showcased Fox's ability to amplify live sports across its portfolio. Its success demonstrates Fox's value to sports leagues and client enthusiasm, but it was a non-recurring, summer event with aligned stars.

• Question from Michael Ng (Goldman Sachs): Could you break down the 35% year-over-year growth at Tubi between benefits like the World Cup hub vs. underlying? And comment on free cash flow outlook?
  Response: Tubi's 35% growth driven by increased total viewing time (17%), strong engagement from cordless viewers, and high-value, proactively chosen viewing. Momentum continued into Q1. Digital investment was under $300M in FY25, dropped to under $200M in FY26, with further improvement expected.

• Question from Peter Cepino (Wolf Research): Could you discuss Tubi ad sales in terms of sellout and CPM trends? And talk about Fox One subscriber retention and bundling impact?
  Response: Tubi has maintained efficient advertising rates without needing price cuts in a competitive CTV market. Fox One subscriber retention is below expectations, with minimal cannibalization of traditional MVPD customers; bundling will continue where it makes sense.

• Question from Sean Diffley (Morgan Stanley): Any thoughts on how ad revs are shaping up into the political cycle? And on capital allocation, given the Roku deal, what about stock buybacks?
  Response: Political ad spending estimated over $11B for midterms, expected to be a record cycle. Capital allocation: balance sheet positioned for Roku deal at ~2.8x net leverage, allowing buyback program to continue unabated through and after the transaction.

• Question from David Karnofsky (JP Morgan): What was the thinking around engaging with the NFL now versus later? How are you thinking about your rights portfolio ahead of potential opt-outs?
  Response: Relationship with NFL is positive; discussions have been productive about future rights through 2029 and beyond. Will engage on opt-out seasons and beyond closer to the 2030 season.

Contradiction Point 1

NFL Rights Deal Timeline

It directly impacts expectations regarding the future of a major sports rights agreement, influencing strategic planning and market confidence.

John Hodlick (UBS) - John Hodlick (UBS)

2026Q4: Regarding the NFL, no changes to the existing contract are planned until the 2030 season. No further color on the negotiations was provided. - Lachlan Murdoch(CEO)

Can you provide details on the underlying ad market, including linear pricing, upfront demand for sports/news inventory, CTV market health (pricing/fill rates), and clarify comments on the NFL rights deal, including potential pricing changes until 2030 and the factors leading to that outcome? - David Karnofsky (JP Morgan)

2026Q4: Fox's relationship with the NFL is incredibly positive. Discussions about the future of rights have been productive for the next four years and beyond. Fox will engage on the extension for the 2030 season closer to that date. - Lachlan Murdoch(CEO)

Contradiction Point 2

World Cup Financial Contribution

It involves a contradiction on the disclosure of financial figures for a major event, affecting transparency and investor expectations regarding event-driven revenue.

Michael Morris (Guggenheim) - Michael Morris (Guggenheim)

2026Q4: The World Cup was a unique, record-breaking event for Fox... It benefited from a summer schedule... The success demonstrates Fox's unmatched ability to execute complex, large-scale events... - Lachlan Murdoch(CEO)

What was the World Cup's contribution to Q4 ad revenue and profitability, and how does Fox expect to sustain momentum from this non-recurring event into Q1 and beyond? - Michael Morris (Guggenheim)

2026Q4: The World Cup was a unique, amplified event that drove tremendous results. Its contribution was significant but specific financial numbers were not disclosed. - Lachlan Murdoch(CEO)

Contradiction Point 3

Digital Investment Forecast

It involves changes in financial forecasts, specifically regarding digital investment spending, which is critical for understanding the company's growth strategies and resource allocation.

Michael Ng (Goldman Sachs) - Michael Ng (Goldman Sachs)

2026Q4: Digital investment was just under $300 million in fiscal 2025 and less than $200 million in fiscal 2026, with improvement expected to continue in fiscal 2027. - Steve Tomczyk(CFO)

What were the digital investment numbers for fiscal 2025 and the free cash flow outlook for next year? - Steven Cahall (Wells Fargo Securities, LLC)

2026Q3: Investments year-to-date are running better than last year's pace. Fox is being thoughtful, expecting full-year 2026 investments to be comfortably within the $290 million range achieved last year. - Steven Tomsic(CFO)

Contradiction Point 4

Timing of NFL Rights Deal Decision

Contradiction on when Fox will decide on the NFL rights renewal, impacting strategic clarity and potential financial planning.

David Karnofsky (JP Morgan) - David Karnofsky (JP Morgan)

2026Q4: Fox will engage on the extension for the 2030 season closer to that date. - Lachlan Murdoch(CEO)

What is the rationale for engaging with the NFL now rather than waiting until 2029, and how does this timing align with your strategy for managing the broader rights portfolio, including MLB and World Cup, ahead of potential NFL opt-outs? - Jessica Reif Cohen (BofA Securities)

2026Q2: The company will not speculate on the specific terms... but stated that the 'great benefit' is gaining 'certainty.' They have the ability to offset any cost increases by... as opportunities arise. - Lachlan Murdoch(CEO)

Contradiction Point 5

Financial Impact (Cost) of NFL Renewal

Contradiction on whether the NFL renewal cost is a current concern or a future certainty, affecting financial strategy and risk assessment.

What did John Hodlick (UBS) ask about the earnings results? - John Hodlick (UBS)

2026Q4: Regarding the NFL, no changes to the existing contract are planned until the 2030 season. - Lachlan Murdoch(CEO)

Can you provide details on the underlying ad market, including linear pricing, upfront demand for sports/news inventory, and the health of the CTV market (pricing/fill rates), as well as clarify comments on the NFL rights deal—should we expect a pricing change until 2030, and what led to that outcome? - Jessica Reif Cohen (BofA Securities)

2026Q2: The company will not speculate on the specific terms of the NFL renegotiation but stated that the 'great benefit' is gaining 'certainty.' They have the ability to offset any cost increases by... - Lachlan Murdoch(CEO)