21st Century Fox’s Filmed Entertainment segment
21st Century Fox (FOXA) recently commented about its second largest segment, Filmed Entertainment. According to James Rupert Murdoch, the company’s co-chief operating officer, “What we don’t want to get into is that we don’t want to be a film business that’s only making one type of picture. We want to be a film business that has a real diversity of output.” He said this at J.P.Morgan’s May 18, 2015, Global Technology, Media and Telecom (or TMT) Conference.
The company’s Filmed Entertainment segment has performed well in the last two quarters. As you can see in the above graph, the segment’s revenue grew by ~5% year-over-year to ~$2.4 billion in 3Q15. Some new releases that contributed to this revenue growth include Taken 3 and Kingsman: The Secret Service.
Taken 3 is a low-budget action and adventure film released in January 2015. According to Box Office Mojo, the film grossed a total of ~$326 million in domestic and international markets.
Kingsman: The Secret Service is a low-budget mystery and suspense movie released in February 2015. Box Office Mojo said the film has grossed a total of ~$403 million in domestic and international markets.
2014 mix of films
During the TMT conference, Murdoch also talked about the 2014 performance of its Filmed Entertainment segment. He said, “And one of the things that we were so excited about last year, which was I think our best year ever in terms of total box office and our most profitable year ever outside of an Avatar year – outside of the Avatar year, was that it came from such an incredibly diverse set of storytellers and types of pictures.”
He was referring to 21st Century Fox’s diversity of films and variety of genres for some of its blockbusters in 2014. These films include X-Men: Days of Future Past, Dawn of the Planet of the Apes, Fault in Our Stars, Gone Girl, and The Grand Budapest Hotel.
You may take a diversified exposure to 21st Century Fox by investing in the Consumer Discretionary Select Sector SPDR Fund (XLY). The ETF held ~2.7% in the company on April 30, 2015.