Fox Corp

Previous wording

•Overview of the Company’s Business—This section provides a general description of the Company’s businesses, as well as developments that occurred during the three months ended September 30, 2024 and 2023 that the Company believes are important in understanding its results of operations and financial condition or to disclose known trends.

Current wording

•Overview of the Company’s Business—This section provides a general description of the Company’s businesses, as well as developments that occurred during the three and six months ended December 31, 2024 and 2023 that the Company believes are important in understanding its results of operations and financial condition or to disclose known trends.

Previous wording

•Results of Operations—This section provides an analysis of the Company’s results of operations for the three months ended September 30, 2024 and 2023. This analysis is presented on both a consolidated and a segment basis. In addition, a brief description is provided of significant transactions and events that impact the comparability of the results being analyzed.

Current wording

•Results of Operations—This section provides an analysis of the Company’s results of operations for the three and six months ended December 31, 2024 and 2023. This analysis is presented on both a consolidated and a segment basis. In addition, a brief description is provided of significant transactions and events that impact the comparability of the results being analyzed.

Previous wording

•Liquidity and Capital Resources—This section provides an analysis of the Company’s cash flows for the three months ended September 30, 2024 and 2023, as well as a discussion of the Company’s outstanding debt and commitments, both firm and contingent, that existed as of September 30, 2024. Included in the discussion of outstanding debt is a discussion of the amount of financial capacity available to fund the Company’s future commitments and obligations, as well as a discussion of other financing arrangements.

Current wording

•Liquidity and Capital Resources—This section provides an analysis of the Company’s cash flows for the six months ended December 31, 2024 and 2023, as well as a discussion of the Company’s outstanding debt and commitments, both firm and contingent, that existed as of December 31, 2024. Included in the discussion of outstanding debt is a discussion of the amount of financial capacity available to fund the Company’s future commitments and obligations, as well as a discussion of other financing arrangements.

Previous wording

Results of Operations—For the three months ended September 30, 2024 versus the three months ended September 30, 2023.

Current wording

Results of Operations—For the three and six months ended December 31, 2024 versus the three and six months ended December 31, 2023.

Previous wording

The following table sets forth the Company’s operating results for the three months ended September 30, 2024, as compared to the three months ended September 30, 2023:

Current wording

The following table sets forth the Company’s operating results for the three and six months ended December 31, 2024, as compared to the three and six months ended December 31, 2023:

Previous wording

The Company’s revenues increased $357 million or 11% for the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, due to higher affiliate fee, advertising and other revenues. The increase of $103 million or 6% in affiliate fee revenue was primarily due to the impact of higher average rates per subscriber and higher fees received from television stations that are affiliated with the FOX Network of approximately $210 million, partially offset by the approximately $110 million impact of a lower average number of subscribers across almost all networks. The increase of $129 million or 11% in advertising revenue was primarily due to the approximately $120 million impact of higher political advertising revenue due to the 2024 presidential and congressional elections at the FOX Television Stations and continued growth at Tubi. The increase of $125 million or 47% in other revenues was primarily due to higher sports sublicensing revenue at the national sports networks.

Current wording

The Company’s revenues increased $844 million or 20% for the three months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, due to higher affiliate fee, advertising and other revenues. The increase of $113 million or 6% in affiliate fee revenue was primarily due to the impact of higher average rates per subscriber and higher fees received from television stations that are affiliated with the FOX Network of approximately $225 million, partially offset by the approximately $110 million impact of a lower average number of subscribers across all networks. The increase of $420 million or 21% in advertising revenue was primarily due to the 2024 presidential and congressional elections predominantly at the Company’s owned and operated television stations, continued digital growth led by the Tubi AVOD service and higher news ratings and pricing. Also contributing to this increase was the approximately $120 million impact of sports programming led by higher Major League Baseball (“MLB”) postseason ratings and National Football League (“NFL”) pricing. The increase of $311 million or 70% in other revenues was primarily due to higher sports sublicensing revenue.

Previous wording

Selling, general and administrative expenses increased $22 million or 5% for the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, primarily due to higher legal costs at FOX News Media and higher employee costs at Tubi.

Current wording

Selling, general and administrative expenses increased $52 million or 5% for the six months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, primarily due to higher employee and marketing costs.

Previous wording

Income tax expense—The Company’s tax provision and related effective tax rate of 25% for the three months ended September 30, 2024 was higher than the statutory rate of 21% primarily due to state taxes.

Current wording

Income tax expense—The Company’s tax provision and related effective tax rate for the three and six months ended December 31, 2024 of 25% was higher than the statutory rate of 21% primarily due tostate taxes and other permanent items.

Previous wording

The Company's tax provision and related effective tax rate of 26% for thethree months ended September 30, 2023 washigher than the statutory rate of 21% primarily due to state taxes and other permanent items.

Current wording

The Company's tax provision and related effective tax rate for thethree and six months ended December 31, 2023 of 12% and 23% respectively, wasdifferent than the statutory rate of 21% primarily due to state tax law changes.

Previous wording

Net income—Net income increased $417 million for three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, primarily due to an unrealized gain recognized on the change in fair value of the Company’s investment in Flutter Entertainment plc and higher Segment EBITDA (as defined below), partially offset by higher provision for income tax.

Current wording

Net income—Net income increased $273 million and $690 million for the three and six months ended December 31, 2024, respectively, as compared to the corresponding periods of fiscal 2024, primarily due to higher Segment EBITDA (as defined below) and a change in fair value of the Company’s investments in equity securities, partially offset by the legal settlement and other costs associated with the discontinuation of Venu Sports (See Note 8—Commitments and Contingencies to the accompanying Financial Statements under the heading “Venu Sports”) and higher provision for income tax.

Previous wording

The Company’s operating segments have been determined in accordance with the Company’s internal management structure, which is organized based on operating activities. The Company evaluates performance based upon several factors, of which the primary financial measure is segment operating income before depreciation and amortization, or Segment EBITDA. Due to the integrated nature of these operating segments, estimates and judgments are made in allocating certain assets, revenues and expenses.

Current wording

The Company’s operating segments have been determined in accordance with the Company’s internal management structure, which is organized based on operating activities. The Company evaluates performance based upon several factors, of which the primary financial measure is Segment EBITDA (defined below). Due to the integrated nature of these operating segments, estimates and judgments are made in allocating certain assets, revenues and expenses.

Previous wording

Segment EBITDA is defined as Revenues less Operating expenses and Selling, general and administrative expenses. Segment EBITDA does not include: Amortization of cable distribution investments, Depreciation and amortization, Restructuring, impairment and other corporate matters, Interest expense, net, Non-operating other, net and Income tax expense. Management believes that Segment EBITDA is an appropriate measure for evaluating the operating performance of the Company’s business segments because it is the primary measure used by the Company’s chief operating decision maker to evaluate the performance of and allocate resources to the Company’s businesses.

Current wording

Segment EBITDA is defined as Revenues less Operating expenses and Selling, general and administrative expenses. Segment EBITDA does not include: Amortization of cable distribution investments, Depreciation and amortization, Restructuring, impairment and other corporate matters, Interest expense, net, Non-operating other, net and Income tax expense. Management believes that Segment EBITDA is an appropriate measure for evaluating the operating performance of the Company’s operating segments because it is the primary measure used by the Company’s chief operating decision maker to evaluate the performance of and allocate resources to the Company’s businesses.

Previous wording

The following tables set forth the Company’s Revenues and Segment EBITDA for the three months ended September 30, 2024, as compared to the three months ended September 30, 2023:

Current wording

The following tables set forth the Company’s Revenues and Segment EBITDA for the three and six months ended December 31, 2024, as compared to the three and six months ended December 31, 2023:

Previous wording

Cable Network Programming (45% and 43% of the Company’s revenues for the first three months of fiscal 2025 and 2024, respectively)

Current wording

Cable Network Programming (44% and 41% of the Company’s revenues for the first six months of fiscal 2025 and 2024, respectively)

Previous wording

Revenues at the Cable Network Programming segment increased $210 million or 15% for the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, due to higher affiliate fee, advertising and other revenues. Affiliate fee revenue increased $32 million or 3% as higher average rates per subscriber were partially offset by a decrease in the average number of subscribers. The increase of $31 million or 11% in advertising revenue was primarily due to higher ratings, higher pricing in the direct response marketplace and higher digital advertising revenue partially offset by higher preemptions associated with breaking news coverage at FOX News Media. The increase of $147 million in other revenues was primarily due to higher sports sublicensing revenue at the national sports networks.

Current wording

Revenues at the Cable Network Programming segment increased $717 million or 24% for the six months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, due to higher affiliate fee, advertising and other revenues. Affiliate fee revenue increased $77 million or 4% as higher average rates per subscriber were partially offset by a decrease in the average number of subscribers. The increase of $143 million or 22% in advertising revenue was primarily due to higher news ratings, pricing and digital advertising revenue and sports programming led by higher MLB postseason ratings. The increase of $497 million in other revenues was primarily due to higher sports sublicensing revenue.

Previous wording

Cable Network Programming Segment EBITDA increased $141 million or 23% for the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, primarily due to the revenue increases noted above, partially offset by higher expenses. Operating expenses increased $53 million or 8% primarily due to higher sports programming rights amortization driven by higher college football costs partially offset by the absence of the Fédération International de Football Association (“FIFA”) Women’s World Cup at the national sports networks in the current year. Also contributing to this increase was higher newsgathering costs at FOX News Media due to the 2024 presidential election and breaking news coverage. Selling, general and administrative expenses increased $16 million or 12% primarily due to higher legal costs at FOX News Media.

Current wording

Cable Network Programming Segment EBITDA increased $234 million or 20% for the six months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, primarily due to the revenue increases noted above, partially offset by higher expenses. Operating expenses increased $465 million or 29% primarily due to higher sports programming rights amortization driven by higher college football costs, including licensing costs for rights that are sublicensed, partially offset by the absence of the Fédération International de Football Association (“FIFA”) Women’s World Cupin the current year. Also contributing to this increase was higher newsgathering costs primarily due to the 2024 presidential election. Selling, general and administrative expenses increased $18 million or 6% primarily due to higher employee costs.

Previous wording

Television (55% and 56% of the Company’s revenues for the first three months of fiscal 2025 and 2024, respectively)

Current wording

Television (57% and 58% of the Company’s revenues for the first six months of fiscal 2025 and 2024, respectively)

Previous wording

Television Segment EBITDA increased $21 million or 6% for the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, due to the revenue increases noted above, partially offset by higher expenses. Operating expenses increased $135 million or 11% primarily due to higher sports programming rights amortization principally due to higher NFL costs, led by the timing of games, and the broadcast of the UEFA European Championship partially offset by the absence of the FIFA Women’s World Cup in the current year and continued growth at Tubi. Selling, general and administrative expenses increased $17 million or 7% primarily due to higher employee costs at Tubi.

Current wording

Television Segment EBITDA increased $343 million for the three months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, due to the revenue increases noted above, partially offset by higher expenses. Operating expenses increased $59 million or 2% primarily due to higher digital and entertainment production costs, partially offset by the absence of WWE programming rights amortization in the current quarter. Selling, general and administrative expenses increased $17 million or 7% primarily due to higher employee costs.

Previous wording

Revenues at the Television segment increased $173 million or 10% for the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, due to higher advertising, affiliate fee and other revenues. The increase of $98 million or 11% in advertising revenue was primarily due to higher political advertising revenue at the FOX Television Stations due to the 2024 presidential and congressional elections and continued growth at Tubi. Also contributing to this increase was timing of NFL games, higher NFL ratings and the broadcasts of the Union of European Football Associations (“UEFA”)European Championship and CONMEBOL Copa América, partially offset by the absence of the FIFA Women’s World Cup in the current year. The increase of $71 million or 10% in affiliate fee revenue was primarily due to higher average rates per subscriber partially offset by a lower average number of subscribers at the Company’s owned and operated television stations and higher fees received from television stations that are affiliated with the FOX Network. The increase of $4 million or 3% in other revenues was primarily due to higher third-party content revenue at FOX Entertainment studios.

Current wording

Revenues at the Television segment increased $592 million or 14% for the six months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, due to higher advertising, affiliate fee and other revenues. The increase of $406 million or 16% in advertising revenue was primarily due to higher political advertising revenue due to the 2024 presidential and congressional elections predominantly at the Company’s owned and operated television stations, continued digital growth led by the Tubi AVOD service and sports programming led by higher NFL pricing, higher MLB postseason ratings and the broadcasts of the Union of European Football Associations (“UEFA”)European Championship and CONMEBOL Copa América, partially offset by the absence of the FIFA Women’s World Cup in the current year. The increase of $139 million or 9% in affiliate fee revenue was primarily due to higher average rates per subscriber partially offset by a lower average number of subscribers at the Company’s owned and operated television stations and higher fees received from television stations that are affiliated with the FOX Network. The increase of $47 million or 18% in other revenues was primarily due to higher content revenue.

Previous wording

Revenues within Corporate and Other for the three months ended September 30, 2024 and 2023 include revenues generated by Credible and the operation of the FOX Studio Lot. Operating expenses for the three months ended September 30, 2024 and 2023 include advertising and promotional expenses at Credible. Selling, general and administrative expenses for the three months ended September 30, 2024 and 2023 primarily relate to employee costs, professional fees and the costs of operating the FOX Studio lot.

Current wording

Revenues within Corporate and Other for the three and six months ended December 31, 2024 and 2023 include revenues generated by Credible and the operation of the FOX Studio Lot. Operating expenses for the three and six months ended December 31, 2024 and 2023 include advertising and promotional expenses at Credible. Selling, general and administrative expenses for the three and six months ended December 31, 2024 and 2023 primarily relate to employee costs, professional fees and the costs of operating the FOX Studio Lot.

Previous wording

Management believes that information about Adjusted EBITDA assists all users of the Company’s Financial Statements by allowing them to evaluate changes in the operating results of the Company’s portfolio of businesses separate from non-operational factors that affect Net income, thus providing insight into both operations and the other factors that affect reported results. Adjusted EBITDA provides management, investors and equity analysts a measure to analyze the operating performance of the Company’s business and its enterprise value against historical data and competitors’ data, although historical results, including Adjusted EBITDA, may not be indicative of future results (as operating performance is highly contingent on many factors, including customer tastes and preferences).

Current wording

Management believes that information about Adjusted EBITDA assists all users of the Company’s Financial Statements by allowing them to evaluate changes in the operating results of the Company’s portfolio of businesses separate from non-operational factors that affect Net income, thus providing insight into both operations and the other factors that affect reported results. Adjusted EBITDA provides management, investors and equity analysts a measure to analyze the operating performance of the Company’s business and its enterprise value against historical data and competitors’ data, although historical results, including Adjusted

Previous wording

The following table reconciles Net income to Adjusted EBITDA for the three months ended September 30, 2024, as compared to the three months ended September 30, 2023:

Current wording

The following table reconciles Net income to Adjusted EBITDA for the three and six months ended December 31, 2024, as compared to the three and six months ended December 31, 2023:

Previous wording

The following table sets forth the computation of Adjusted EBITDA for the three months ended September 30, 2024, as compared to the three months ended September 30, 2023.

Current wording

The following table sets forth the computation of Adjusted EBITDA for the three and six months ended December 31, 2024, as compared to the three and six months ended December 31, 2023.

Previous wording

The Company has approximately $4.1 billion of cash and cash equivalents as of September 30, 2024 and an unused five-year $1.0 billion unsecured revolving credit facility (See Note 5—Borrowings to the accompanying Financial Statements). The Company also has access to the worldwide capital markets, subject to market conditions. As of September 30, 2024, the Company was in compliance with all of the covenants under the revolving credit facility, and it does not anticipate any noncompliance with such covenants.

Current wording

The Company has approximately $3.3 billion of cash and cash equivalents as of December 31, 2024 and an unused five-year $1.0 billion unsecured revolving credit facility (See Note 5—Borrowings to the accompanying Financial Statements). The Company also has access to the worldwide capital markets, subject to market conditions. As of December 31, 2024, the Company was in compliance with all of the covenants under the revolving credit facility, and it does not anticipate any noncompliance with such covenants.

Previous wording

The increase in net cash provided by operating activities during the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, was primarily due to higher Segment EBITDA, principally due to higher political advertising receipts due to the 2024 presidential and congressional elections, and lower restructuring payments, partially offset by higher entertainment programming costs.

Current wording

The decrease in net cash used in operating activities during the six months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, was primarily due to higher Segment EBITDA, principally due to higher political advertising receipts due to the 2024 presidential and congressional elections, and lower restructuring payments, partially offset by higher sports and entertainment programming costs and tax payments.

Previous wording

Net cash used in investing activities for the three months ended September 30, 2024 and 2023 was as follows (in millions):

Current wording

Net cash used in investing activities for the six months ended December 31, 2024 and 2023 was as follows (in millions):

Previous wording

The increase in net cash used in investing activities during the three months ended September 30, 2024, as compared to the corresponding period of fiscal 2024, primarily due to an increase in the Company’s investments partially offset by a decrease in capital expenditures.

Current wording

The increase in net cash used in investing activities during the six months ended December 31, 2024, as compared to the corresponding period of fiscal 2024, was primarily due to an increase in the Company’s investments partially offset by a decrease in capital expenditures.

Previous wording

The Company declared a semi-annual dividend of $0.27 per share on both the Class A Common Stock and the Class B Common Stock during the three months ended September 30, 2024, which was paid on September 25, 2024 to stockholders of record on September 4, 2024. The Company expects to continue to pay semi-annual dividends, although each dividend is subject to approval by the Company’s Board of Directors.

Current wording

Subsequent to December 31, 2024, the Company declared a semi-annual dividend of$0.27 per share on both the Class A Common Stock and the Class B Common Stock. The dividend declared is payable on March 26, 2025 with a record date for determining dividend entitlements of March 5, 2025. The Company expects to continue to pay semi-annual dividends, although each dividend is subject to approval by the Company’s Board of Directors.