FOX — Fox Corporation

FOX Corporation Q2 2026 Earnings Call Summary

1. Key Financial Results and Metrics

• Total Revenues: $5.18 billion, a 2% increase year-over-year.
• Distribution Revenues: Grew by 4%, with improved subscriber declines.
• Advertising Revenues: Increased by 1%, despite tough comparisons to last year's political cycle.
• Adjusted EBITDA: $692 million, down from $781 million in the prior year.
• Net Income: $229 million ($0.52 per share), compared to $373 million ($0.81 per share) in the prior year.
• Adjusted Net Income: $360 million; adjusted EPS was $0.82.
• Free Cash Flow: Recorded a deficit of $71 million, consistent with seasonal working capital cycles.
• Share Buybacks: $1.8 billion repurchased year-to-date, totaling $8.4 billion since the program's inception.

2. Strategic Updates and Business Highlights

• Advertising Strength: Robust demand for advertising across news and sports, with Fox News achieving its highest second-quarter advertising revenue ever.
• Tubi Performance: Tubi had its most streamed quarter, with a 27% increase in viewer time and 19% revenue growth, achieving EBITDA profitability for the second consecutive quarter.
• Fox One Launch: Fox One exceeded expectations with significant engagement, particularly among sports and news viewers.
• Content Strategy: Continued investment in high-quality programming, with successful launches leading to a notable increase in viewership across multiple platforms.

3. Forward Guidance and Outlook

• Political Advertising: Anticipated robust political advertising cycle expected to benefit local station groups.
• Subscriber Growth: Fox One aims for low to mid-single-digit millions of subscribers over the next few years, with proactive marketing strategies in place.
• Continued Revenue Growth: Strong momentum expected to carry into the second half of the fiscal year, particularly with upcoming marquee events like the FIFA Men's World Cup.

4. Bad News, Challenges, or Points of Concern

• Adjusted EBITDA Decline: Lower EBITDA attributed to increased expenses, particularly in digital initiatives and sports programming costs.
• Subscriber Declines: Although improving, the overall subscriber base continues to face challenges, with a reported decline of 6.3% (excluding Fox One).
• Entertainment Revenue: Television content revenues fell by 19%, primarily due to timing issues in entertainment production deliveries.

5. Notable Q&A Insights

• Advertising Market Dynamics: Strong performance in the advertising sector, particularly in financial and pharmaceutical categories, with expectations for continued strength as political spending increases.
• NFL and Sports Programming: Anticipated cost increases associated with NFL contracts, but management expressed confidence in offsetting these costs through a balanced sports portfolio.
• Skinny Bundles: Management remains optimistic about skinny bundles benefiting Fox, as they allow for flexible marketing of their channels without impacting overall revenue.
• Tubi's Growth: Tubi's audience is primarily younger and more diverse, positioning it favorably for advertisers, with significant revenue growth expected to continue.

Overall, FOX Corporation demonstrated solid financial performance in Q2 2026, with strategic initiatives in advertising, digital platforms, and content driving growth, while also facing challenges in subscriber retention and entertainment revenue.