The operator welcomes listeners to News Corp's fourth quarter and full year fiscal 2024 earnings conference call. The call will feature remarks from the company's CEO and CFO, and may include forward-looking information and non-GAAP financial measurements. The CEO expresses gratitude for the release of Evan Gershkovich and acknowledges the efforts of those who helped secure his freedom.

The writer expresses gratitude to Dow Jones leaders and the U.S. government for their efforts in securing Evans' release. They also highlight the company's strong financial performance in the fourth quarter and fiscal year 2024. The company has made significant steps to prepare for the future of e-books through a partnership with OpenAI and legal action against content aggregators and the biased advertising industry.

The article discusses the House Judiciary Committee's pursuit of the Global Alliance for Responsible Media (GARM) and its boycott of certain media platforms. The company's prospects are positive and they are reviewing potential transactions for the Foxtel Group. The fourth quarter saw strong performance in digital real estate, with REA experiencing growth in listings and financial services. REA India also saw a substantial increase in revenues.

The company has seen growth in their real estate and media platforms, specifically in the United States and Australia. They are hopeful for an upturn in the property market and have seen improvement in revenue at Realtor.com. Dow Jones has also seen growth, particularly in their B2B segment, which has become a significant source of profitability for the company. Digital products have played a crucial role in this growth, with high renewal rates.

In the consumer business, subscriptions and digital advertising have increased significantly, with the Wall Street Journal signing a multiyear agreement with the London Stock Exchange Group. HarperCollins also had a strong quarter, with a notable increase in segment EBITDA and revenue, driven by Bible sales, Amazon demand, and audio books. The back catalog and new releases also performed well, with digital sales growing and audio books becoming the largest share of the segment. Notable best-selling authors and a resurgence of interest in J.D. Vance's Hillbilly Elegy also contributed to a successful quarter. This will have a positive impact on the company's first quarter results for fiscal 2025.

The subscription video services revenue for the quarter grew due to the increasing popularity of streaming over traditional broadcast. Foxtel's services, Kayo and Binge, gained 200,000 paying subscribers and digital advertising now accounts for 40% of Foxtel's total advertising. The launch of Hubbl has also been successful, with 30% of customers being new to Foxtel and 75% purchasing additional products. On the broadcast side, ARPU grew and churn was low. In News Media, the company's profile and impact have grown, and they have partnered with OpenAI to improve the flow of trustworthy information.

News Corp is implementing learnings about the evolving digital reading experience in their newsrooms around the world. They are also undergoing restructuring in Australia to improve their digital progress and are seeing success with their New York Post and other media outlets. The company's success is attributed to the leadership of Lachlan and Rupert Murdoch, the support of the Board, and the hard work of employees. They are committed to generating value for shareholders and are constantly adapting to the changing landscape of media. The CFO, Susan Panuccio, will now provide an update on the company's transformation.

In the fourth quarter, News Corp experienced significant growth in recurring and digital revenues, added high-margin licensing revenues, and focused on reinvesting in core pillars for the highest returns and shareholder value. They also delivered cost efficiencies to allow for investment in growth initiatives. Fourth quarter total revenues were $2.6 billion, up 6% year-over-year, and total segment EBITDA was $380 million, up 11%. The core pillars accounted for 87% of profits and grew by 28%. Digital Real Estate Services had a strong quarter with revenues up 21% and segment EBITDA up 25%, driven by the REA Group's outstanding performance.

In the third quarter, new buy listings increased by 16%, with Sydney and Melbourne experiencing significant growth. REA also saw strong growth in their Financial Services division. Move's revenues for the quarter were down only 2%, with declines moderating from the previous year. Real estate revenues fell 2%, driven by lower referral and lead generation revenues. However, lead volume was flat and average monthly unique users remained stable. The company has been able to maintain market share according to MACOM score data. They are also diversifying their revenue base with success in sell-side offerings, rentals, and new homes. In the Subscription Video Services segment, revenues were up 1% compared to the previous year.

In the fourth quarter, streaming revenues accounted for 32% of circulation and subscription revenues at Foxtel Group, with total paid streaming subscribers reaching a record 3.2 million. Kayo and Binge added a significant number of subscribers, indicating the success of winter sports and entertainment content. Foxtel's residential broadcast subscribers decreased by 10%, but churn rate improved and ARPU increased. Dow Jones also had a strong quarter, with digital revenue accounting for 81% of total revenues and circulation and subscription-based revenues representing 79% of total revenues. PIB saw strong growth, with revenues rising 8% and significant growth at Risk & Compliance and Dow Jones Energy.

The At Risk & Compliance segment saw strong demand for new products, particularly in corporate customers. Dow Jones Energy also had a successful quarter with the launch of new products and benchmarks. The consumer business saw a 1% increase in circulation revenue, driven by digital-only subscriptions and bundling. Advertising revenue grew for the first time since 2023, with digital advertising seeing the strongest growth. Dow Jones segment EBITDA increased by 3% and remained the largest contributor to overall EBITDA. Higher expenses were expected due to marketing and employee costs.

In the financial year '24, the Dow Jones segment was the highest contributor to company revenue and EBITDA for the second consecutive year. HarperCollins had a strong fourth quarter and a successful turnaround for the full year, with increased revenues and profitability. The backlist and digital sales were major contributors to revenue growth. News U.K. had a positive performance, but News Corp Australia faced challenges. Revenues for the quarter were down, with declines in circulation and advertising due to lower print volumes and platform algorithm changes.

The news media business is facing challenges in print, leading to a transition to digital revenues and cost efficiencies. Segment EBITDA declined due to challenges at News Australia and higher newsprint prices. Market trends are mixed, but there is hope for improvements in fiscal 2025. Digital Real Estate is seeing growth in new buy listings and plans for continued investment and revenue improvements. Subscription video services will focus on scaling streaming products and retaining high-value customers, while Dow Jones will focus on B2B growth.

The company expects improved circulation revenue growth and higher expenses due to investments. Book Publishing has seen strong momentum from the backlist and a partnership with Spotify. The advertising market remains challenging for News Media, but they will focus on enhancing first-party data offerings. The company also expects new revenue from OpenAI partnerships and higher CapEx due to digital reinvestment. The company is engaged with third-party interest for Foxtel and it may complicate the timeline for the broader strategic review.

Robert Thomson discusses the various processes in motion for the company, including an overture they are assessing, but emphasizes their full faith in Foxtel and their talented team. He mentions the success of their streaming platform Kayo and the surging streaming business. Thomson also mentions a broad review of their portfolio to increase shareholder value, but does not provide further details. He then moves on to discussing the OpenAI deal, stating that the impact will be tangible and meaningful for their news businesses. He mentions a guaranteed amount in the agreement and the potential for both companies to create even more value through their collaboration.

The OpenAI team, led by Sam Altman, has a strong understanding of how to successfully commercialize their products while maintaining ethical standards. This sets them apart from other companies in the Gen AI space, some of which are only interested in making a profit. The next question from Entcho Raykovski from Evans & Partners is about the potential Foxtel transaction and whether News Corp expects to recoup all of the Foxtel shareholder loans. The company's response is that they want the process to be fair and that external interest in Foxtel is a vote of confidence in the company's positive transformation and the potential for growth in the Australian market. The outstanding shareholder loans are just under $600 million, and any transaction would consider what to do with them.

During a question and answer session, Brian Han from Morningstar asked about the stagnant traffic numbers for Realtor.com despite ongoing investments. Robert Thomson, the operator, responded by stating that unique users in Q4 were 3% higher sequentially, and that the team has been working on improving technology and user experience. He also mentioned that the market seems to be on the cusp of a revival and that suppressed demand could lead to an explosion in activity. Damian, who leads the team, has done an excellent job of using media platforms to raise the profile of Realtor.com and drive traffic. Additionally, there has been anticipation and excitement at Realtor.com due to higher revenue from newer product lines. The U.S. is traditionally a buyer-led market, but the Australian market, where the company has had success, is a seller market. The company plans to continue investing in the business and is encouraged by the recent drop in mortgage rates, which historically leads to an increase in housing activity.

The cost increases for the full year are expected to be modest, with a heavier impact in the second half. However, they will be less than the increases seen in the third and fourth quarters of this year. During the Q&A portion, a question was asked about Foxtel's performance and if there were any updates on their targets. While the company cannot reveal any more figures, they remain ambitious for Foxtel's growth. The success of their streaming services, such as Kayo, Binge, and Hubbl, has attracted attention. The landscape has changed since the Investor Day in 2021, but the company is proud that their streaming subscribers are at an all-time high.

The speaker discusses the company's focus on revenue growth and cost control, mentioning that they have been raising prices and reducing CapEx. They feel confident about their targets for the future, and cost control will vary across different segments. The U.K. and Australia have made changes to reduce costs, while Dow Jones expects a moderate increase in costs to support growth. HarperCollins' costs have stabilized after a volatile period.

The company expects consistent margins in their business in 2025 and is negotiating with other Gen AI companies after signing a deal with OpenAI. The company is constantly reviewing its structure and is proud of all its divisions, including News Media which has faced challenges. The company is focused on stabilizing and transitioning to digital in this segment.

Robert Thomson discusses the benefits of utilizing segments across the portfolio, such as content complementarity between media properties and valuable archives. He also mentions the potential holdup in simplifying the company, which was not anticipated and may be due to regulatory issues. The decision to publicly announce the plan to simplify the company nine months ago was made after a lot of background work had been done.

The company is working on simplifying its structure, but it is a complicated process that cannot be rushed. They have made progress on the regulatory side, but cannot give a specific date for completion. The process may be affected by the interest in Foxtel, but the company is working to ensure a fair outcome. The call has concluded.

This summary was generated with AI and may contain some inaccuracies.