News Corp Reports Solid Q2, Beats Revenue Estimates as Digital Segments Shine
Global media and information services conglomerate NEWS CORP - CLASS A (NASDAQ:NWSA) announced financial results for its fiscal second quarter, ended December 31, 2025. The company delivered revenue that exceeded Wall Street's expectations, driven by strong performances in its digital and professional information businesses. However, the market's initial reaction appeared muted, with the stock showing little movement in after-hours trading following the release.
Earnings Snapshot: A Beat on the Top Line
For the quarter, News Corp reported total revenues of $2.36 billion, marking a 6% increase compared to the $2.24 billion reported in the same period last year. This result surpassed the analyst consensus estimate of $2.34 billion. The company's profitability, as measured by adjusted earnings per share (EPS), came in at $0.40, also beating the estimate of $0.35.
- Reported Revenue: $2.36 billion
- Estimated Revenue: $2.34 billion
- Reported Adjusted EPS: $0.40
- Estimated Adjusted EPS: $0.35
It is important to note that on a GAAP basis, which includes one-time items, net income per share was $0.34. This figure was in line with analyst expectations but represented a decrease from the prior year, primarily due to the absence of a significant gain from the sale of an investment that occurred in Q2 of fiscal 2025.
Segment Performance: Digital Drivers Lead the Way
The earnings report highlighted a continuing strategic shift toward digital and subscription-based revenues, with two segments standing out as primary growth engines.
- Dow Jones: The segment, home to The Wall Street Journal and professional information services, saw revenues grow 8% to $648 million. A 20% surge in Risk & Compliance revenues and record digital advertising were key contributors. Notably, digital revenues now represent 82% of the segment's total. Subscription metrics remained robust, with total subscriptions to Dow Jones consumer products exceeding 6.5 million, a 10% year-over-year increase.
- Digital Real Estate Services: Comprising REA Group in Australia and Move's Realtor.com in the U.S., this segment posted an 8% revenue increase to $511 million. Both subsidiaries contributed to growth, with Move reporting a 10% revenue increase and a significant 13% jump in lead volume.
The Book Publishing segment saw revenue growth of 6%, though profitability was impacted by a one-time inventory write-off. The News Media segment, which includes newspapers in the U.K., Australia, and the New York Post, reported flat revenues as growth in circulation was offset by continued softness in print advertising.
Market Reaction and Forward Outlook
Following the earnings release, shares of News Corp showed negligible change in after-hours trading. This subdued reaction suggests that the solid beat on revenue and adjusted EPS may have been largely anticipated by the market or was offset by the lower GAAP net income figure.
Management expressed optimism for the current trajectory, with CEO Robert Thomson stating, "we see favorable signs for the second half of our fiscal year." While the company did not provide specific quantitative guidance, this positive commentary aligns with analyst expectations for continued growth. Current consensus estimates project third-quarter fiscal 2026 revenue of approximately $2.13 billion.
A significant focus of the earnings call was the value of the company's content in the age of artificial intelligence. Thomson emphasized that "provenance is paramount," suggesting that News Corp's premium, fact-based journalism and data sets are becoming increasingly valuable assets for AI companies seeking reliable training data. The company announced an expansion of its partnership with Bloomberg for AI rights to Dow Jones content, signaling a potential new revenue stream.
Conclusion
News Corp's second-quarter results demonstrate the success of its pivot toward digital and professional information services, with Dow Jones and Digital Real Estate Services delivering double-digit profit growth. The company successfully navigated a tough comparison period to beat revenue estimates. The market's tempered immediate response may reflect a focus on the year-over-year decline in GAAP earnings or a wait-and-see approach regarding the monetization of its content in AI partnerships. Investors will likely watch for continued execution in its digital segments and further developments on the AI front.
For a detailed look at historical earnings, future estimates, and analyst projections for News Corp, visit the earnings and estimates page.
Disclaimer: This article is for informational purposes only and does not constitute financial advice, a recommendation, or an offer to buy or sell any security. Investing involves risk, including the potential loss of principal.
