TV revenue performance
Media mogul Twenty-First Century Fox’s (FOXA) (or Fox’s) Television segment, which deals with the broadcasting of network programming in the United States, reported revenue of $1.1 billion in fiscal 1Q18. That’s a 2.6% rise YoY (year-over-year). The improvement was mainly fueled by growth in its affiliate revenue.
In fiscal 1Q18, Fox’s affiliate revenue increased 9% YoY, buoyed by an increase in contractual prices. However, that growth was offset by a 2% YoY decline in advertising revenue due to softness in political advertising.
From the graph above, we can see Fox’s Television segment’s revenues for the last five quarters. During that period, the segment’s revenues grew at a CAGR (compound annual growth rate) of 0.6%.
Factors influencing growth
Fox has 28 power stations that operate in nine of the top ten largest markets. Popular TV programs such as This is Us, Feud, and Legion, as well as the Fox News Channel with the most Emmy awards ever for a basic cable channel, could boost the company’s advertising and affiliate business going forward.
In addition, the availability of huge sporting rights for both local and international events could drive revenue going forward.
At the end of September 2017, most media companies reported a softness in advertising revenue, mainly due to less political advertising than in 2016 during the presidential elections. CBS (CBS) and Comcast posted YoY declines of 4.8% and 13.3%, respectively, in advertising revenues, while News Corp. (NWSA) reported flat revenue growth.