News Corp - Class A (NASDAQ:NWSA) Tops Q1 FY2026 Profit Estimates Amid Divergent Segment Performance

News Corp - Class A (NASDAQ:NWSA) has reported financial results for the first quarter of fiscal year 2026, delivering a performance that narrowly surpassed analyst revenue expectations while posting a significant beat on profitability. The market's initial reaction appears muted, reflecting a complex interplay of the earnings beat against broader segment-specific challenges and a tempered full-year outlook.

Earnings and Revenue Performance Versus Estimates

The company's top-line growth for the quarter ended September 30, 2025, showed modest expansion, while its bottom-line performance demonstrated stronger operational efficiency.

• Revenue: Reported revenue of $2.14 billion, a 2% increase year-over-year, slightly exceeding the analyst consensus estimate of $2.15 billion.
• Earnings Per Share (EPS): Adjusted EPS came in at $0.22, a notable increase from $0.20 in the prior year period and solidly beating the analyst estimate of $0.189.

This earnings beat was achieved despite a challenging quarter for the Book Publishing segment, indicating that strength in other divisions was sufficient to drive overall profitability higher.

Market Reaction and Forward Outlook

Following the earnings release, the stock has shown little movement in after-hours trading. This neutral immediate reaction may be attributed to investors weighing the positive EPS surprise against the company's future guidance. While News Corp expressed confidence in generating strong free cash flow and has increased its share buyback program, the provided analyst estimates for the full fiscal year 2026 suggest a more conservative outlook.

The company did not provide specific quantitative guidance in the press release to compare directly with these analyst projections. The lack of a robust upward revision in the company's own forecasts, juxtaposed with the strong quarterly beat, likely contributes to the market's wait-and-see stance.

Segment Performance Breakdown

The first quarter results revealed a tale of divergent performances across News Corp's diversified portfolio, underscoring the company's reliance on its digital and information services businesses.

• Dow Jones: This segment was a primary growth driver, with revenues increasing 6% to $586 million and Segment EBITDA rising 10% to $144 million. Strength was fueled by growth in professional information business revenues and digital-only subscriptions. The Wall Street Journal saw its digital-only subscriptions grow 11% to over 4.2 million.
• Digital Real Estate Services: Also posted strong results, with revenues up 5% to $479 million and Segment EBITDA increasing 13% to $158 million. Both REA Group and Move contributed to the growth, with the latter benefiting from a focus on premium real estate offerings.
• Book Publishing: This segment was a notable weak spot, with revenues declining 2% to $534 million and Segment EBITDA falling 28% to $58 million. The results were impacted by a $13 million write-off of a customer receivable and softer consumer spending.
• News Media: Showed impressive profitability growth, with Segment EBITDA surging 67% to $30 million on a modest 1% revenue increase to $545 million, driven by cost-saving initiatives and higher circulation revenues.

CEO Robert Thomson emphasized the company's robust cash position and the ongoing value of its intellectual property in the age of AI, signaling expectations for future content licensing partnerships to positively impact results.

For a detailed look at historical earnings and future analyst estimates for NEWS CORP - CLASS A (NASDAQ:NWSA), you can review the data here.

Disclaimer: This article is for informational purposes only and is not intended as investment advice. The author has no position in the stock mentioned. All investments carry risks, and you should conduct your own research before making any investment decisions.