News 2025 Q3 Earnings Beats Expectations as Net Income Surges 226.2%

News Corporation (NWSA) reported its fiscal 2025 Q3 earnings on May 08th, 2025. News Corp exceeded Wall Street expectations for its third-quarter revenue and profit, driven primarily by growth in its Dow Jones business and digital real estate services segments. As a result, shares surged approximately 3% in extended trading. The company’s guidance remains in line with previous forecasts, reflecting confidence in maintaining its revenue and profit growth trajectories.

Revenue
News Corp's total revenue rose by 1.7% to $1.87 billion for 2025 Q3, up from the previous year's $1.84 billion. The revenue segments were as follows: Dow Jones generated $575 million, Digital Real Estate Services brought in $406 million, Book Publishing and News Media each contributed $514 million, culminating in total revenues of $2.01 billion.

Earnings/Net Income
News Corp's earnings per share (EPS) saw a significant increase, rising by 260.0% to $0.18 in 2025 Q3 from $0.05 in the previous year. This reflects robust growth in earnings, with net income reaching $137 million, a 226.2% increase from $42 million in 2024 Q3. The substantial EPS improvement indicates strong company performance.

Price Action
The stock price of News Corp has edged up 0.74% during the latest trading day, climbed 5.25% during the most recent full trading week, and surged 18.27% month-to-date.

Post-Earnings Price Action Review
Investors employing the strategy of buying News Corp shares following a quarter-over-quarter revenue increase and holding for 30 days have enjoyed considerable returns over the past five years. This strategy has yielded an impressive overall return of 208.65%, significantly outpacing the benchmark return of 92.56%, with a difference of 116.09%. Despite experiencing a maximum drawdown of -43.89%, the strategy's Sharpe ratio stands at 0.79, indicating moderate returns amidst some risk. The compound annual growth rate (CAGR) of 25.40% highlights the strategy's consistent ability to generate returns over the period, offering investors a reliable approach to capitalizing on News Corp's earnings momentum.

CEO Commentary
Robert Thomson, Chief Executive of News Corporation, highlighted the strategic transformation driving third-quarter performance, emphasizing digital growth and cost discipline. He underscored a 67% increase in net income from continuing operations to $107 million and a 12% rise in Total Segment EBITDA to $290 million, with revenue reaching $2 billion despite currency challenges and macroeconomic uncertainties. Thomson pointed to the successful sale of Foxtel to DAZN as enhancing the balance sheet and shareholder returns. He emphasized the importance of quality journalism amid evolving content landscape challenges.

Guidance
The company anticipates continued focus on core pillars to drive growth, especially within its Professional Information Business following recent acquisitions. The DAZN transaction is expected to boost earnings per share and strengthen return on invested capital. The outlook remains confident in sustaining revenue and profit growth, particularly within the Dow Jones segment, while navigating potential economic and currency headwinds.

Additional News
News Corp completed the sale of its Australian cable-TV business, Foxtel, to DAZN Group for A$3.4 billion. This strategic move grants News Corp a 6% equity stake in DAZN and a board seat, enhancing its balance sheet. Additionally, David Kline, News Corp’s Chief Technology Officer, announced his resignation to pursue a position outside the company, signaling a leadership change. In recent developments, News Corp has been sued by Brave Software, a Google search engine rival, aiming to forestall a potential lawsuit related to the direction of readers to copyrighted articles from the Wall Street Journal.