NEWS CORPORATION REPORTS FOURTH QUARTER AND FULL …

NEWS CORPORATION REPORTS FOURTH QUARTER AND

FULL YEAR RESULTS FOR FISCAL 2019

FISCAL 2019 FULL YEAR KEY FINANCIAL HIGHLIGHTS

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Revenues were $10.07 billion, a 12% increase compared to $9.02 billion in the prior year, reflecting

the consolidation of Foxtel for the full year and growth at the Digital Real Estate Services segment

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Net income of $228 million compared to a net loss of ($1.44) billion in the prior year

?

Total Segment EBITDA was $1.24 billion compared to $1.07 billion in the prior year

?

Reported diluted EPS were $0.26 compared to ($2.60) in the prior year ¨C Adjusted EPS were $0.46

compared to $0.44 in the prior year

?

The Wall Street Journal subscribers reached a record of 2.6 million with digital-only subscribers

accounting for approximately 69% of the total subscriber base

?

Book Publishing reported record Segment EBITDA, helped by successful front-list titles, strong

backlist and continued expansion of downloadable audiobook sales

?

Strengthened the Digital Real Estate Services segment through strategic investments including

the acquisitions of Opcity and Hometrack Australia

?

Subscribers for Foxtel¡¯s over-the-top services grew over 90% since the beginning of the calendar

year with approximately 777,000 paid OTT subscribers, including approximately 331,000 paid

subscribers at Kayo

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Announced the strategic review of News America Marketing

NEW YORK, NY ¨C August 8, 2019 ¨C News Corporation (¡°News Corp¡± or the ¡°Company¡±) (Nasdaq: NWS, NWSA;

ASX: NWS, NWSLV) today reported financial results for the three months and fiscal year ended June 30, 2019.

Commenting on the results, Chief Executive Robert Thomson said:

¡°News Corp completed Fiscal 2019 robustly, with revenues rising 12 percent and profitability 16 percent higher

compared to the prior year, reflecting the consolidation of Foxtel, strength in digital real estate and substantial

progress in the successful digital transformation of our news businesses.

We are acutely focused on simplifying the structure of the company and making clear the full value of the sum of

our parts. To that end, we recently announced a strategic review of News America Marketing, including a sale of

the business; we have received material interest and the process is progressing well.

Significantly, we posted higher Segment EBITDA at our News and Information Services segment, thanks to a

rapid rise in digital paid subscribers, particularly at Dow Jones. The Wall Street Journal recorded a notable

increase in digital-only subscribers, who now account for over 69 percent of the total subscriber base. The Risk &

Compliance business is also flourishing, with revenue expanding 24 percent, the fourth consecutive year of

growth well above 20 percent.

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For the Digital Real Estate Services segment, both REA and ? strengthened their competitive positions

through strategic acquisitions and product enhancements, despite headwinds in housing markets. We note with

interest the recent signs of improvement in the U.S. housing environment, with lead volume improving, record

traffic to ? and an uptick in pending home sales.

At Foxtel, paying subscribers for the Kayo sports streaming service more than doubled between the third and

fourth quarters to 331,000, while average churn among sports subscribers to the Foxtel broadcast service actually

fell during the same period. Clearly, Kayo is adding significantly to the total number of sports viewers in Australia

prepared to pay for premium content.¡±

FULL YEAR RESULTS

The Company reported fiscal 2019 full year total revenues of $10.07 billion, a 12% increase compared to $9.02

billion in the prior year period, reflecting the impact from the consolidation of Foxtel¡¯s results following the

combination of Foxtel and FOX SPORTS Australia (the ¡°Transaction¡±) into a new company in the fourth quarter of

fiscal 2018 and growth in the Digital Real Estate Services segment. The growth was partially offset by a $311

million negative impact from foreign currency fluctuations, lower print advertising and News America Marketing

revenues at the News and Information Services segment, and $72 million of lower revenues as a result of the

adoption of the new revenue recognition standard. Adjusted Revenues (which exclude the foreign currency

impact, acquisitions and divestitures as defined in Note 1) increased 1%.

Net income for the full year was $228 million as compared to a net loss of ($1.44) billion in the prior year. The

improvement was primarily driven by the absence of the non-cash impairment charges and write-downs of $1.2

billion recognized in fiscal 2018, higher Other, net, lower tax expense and higher Total Segment EBITDA, as

discussed below. The improvement was partially offset by higher depreciation and amortization expense and

higher interest expense.

Total Segment EBITDA for the full year was $1.24 billion, a 16% increase compared to $1.07 billion in the prior

year, driven by the consolidation of Foxtel¡¯s results and higher contribution from the News and Information

Services and Book Publishing segments. Adjusted Total Segment EBITDA (as defined in Note 1) increased 4%.

Diluted net income per share available to News Corporation stockholders was $0.26 as compared to net loss per

share of ($2.60) in the prior year.

Adjusted EPS (as defined in Note 3) were $0.46 compared to $0.44 in the prior year.

FOURTH QUARTER RESULTS

The Company reported fiscal 2019 fourth quarter total revenues of $2.47 billion, an 8% decline compared to $2.69

billion in the prior year period, primarily due to the $105 million negative impact from foreign currency fluctuations,

lower revenues at the Book Publishing segment, which includes the absence of the one-time contribution from the

sublicensing agreement for J.R.R. Tolkien¡¯s The Lord of the Rings trilogy, lower broadcast subscriber revenues at

the Subscription Video Services segment, lower advertising revenues at the News and Information Services

segment and $18 million of lower revenues as a result of the adoption of the new revenue recognition standard.

Adjusted Revenues decreased 5%.

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Net loss for the quarter was ($42) million as compared to a net loss of ($355) million in the prior year. The

improvement was mainly due to the absence of the write-off of the FOX SPORTS Australia channel distribution

agreement (the ¡°FSA channel distribution agreement¡±) intangible asset of $317 million in the prior year, which was

reflected in Other, net, and lower tax expense. The improvement was partially offset by lower Total Segment

EBITDA and higher impairment and restructuring charges.

Total Segment EBITDA for the quarter was $269 million, a 14% decrease compared to $314 million in the prior

year, reflecting lower revenues, as discussed above, and higher costs associated with continued investment in

Opcity in the Digital Real Estate Services segment. The decline was partially offset by cost reductions at the

News and Information Services segment. Adjusted Total Segment EBITDA decreased 8%.

Net loss per share available to News Corporation stockholders was ($0.09) as compared to ($0.64) in the prior

year.

Adjusted EPS were $0.07 compared to $0.08 in the prior year.

SEGMENT REVIEW

For the three months ended

June 30,

2019

2018

% Change

Better/

(in millions)

(Worse)

Revenues:

News and Information Services

Subscription Video Services

Book Publishing

Digital Real Estate Services

Other

Total Revenues

Segment EBITDA:

News and Information Services

Subscription Video Services(a)

Book Publishing

Digital Real Estate Services

Other(b)

Total Segment EBITDA

$

$

$

$

1,227 $

536

419

283

1

2,466 $

1,294

610

490

299

2,693

108 $

85

44

84

(52)

269 $

95

97

72

99

(49)

314

For the fiscal years ended

June 30,

2019

2018

% Change

Better/

(in millions)

(Worse)

(5)% $

(12)%

(14)%

(5)%

**

(8)% $

4,956 $

2,202

1,754

1,159

3

10,074 $

5,119

1,004

1,758

1,141

2

9,024

(3)%

**

2%

50 %

12 %

14 % $

(12)%

(39)%

(15)%

(6)%

(14)% $

417 $

380

253

384

(190)

1,244 $

397

173

239

401

(139)

1,071

5%

**

6%

(4)%

(37)%

16 %

** - Not meaningful

(a)

(b)

Subscription Video Services Segment EBITDA for the three months and fiscal year ended June 30, 2018 included transaction related

costs of $12 million and $17 million, respectively, associated with the Transaction.

Other Segment EBITDA for the fiscal year ended June 30, 2018 included a $46 million benefit from the reversal of certain previously

accrued net liabilities for the U.K. Newspaper Matters as a result of an agreement reached with the relevant tax authority related to

certain employment taxes.

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News and Information Services

Full Year Segment Results

Fiscal 2019 full year revenues declined $163 million, or 3%, compared to the prior year, including the $154

million, or 3%, negative impact from foreign currency fluctuations. Within the segment, Dow Jones revenues grew

3%, while revenues at News UK declined 4% and revenues at News Corp Australia and News America Marketing

both declined 6%. Adjusted Revenues for the segment were flat compared to the prior year.

Advertising revenues declined 7% compared to the prior year, reflecting weakness in the print advertising market,

a $74 million, or 3%, negative impact from foreign currency fluctuations and lower revenues at News America

Marketing. Circulation and subscription revenues increased 1% compared to the prior year, reflecting continued

strength at Dow Jones, partially offset by a $61 million, or 2%, negative impact from foreign currency fluctuations.

Other revenues increased 3% compared to the prior year, primarily due to the $38 million net benefit related to

News UK¡¯s exit of the gaming partnership with Tabcorp for Sun Bets.

Full year Segment EBITDA increased $20 million, or 5%, as compared to the prior year, primarily due to higher

contribution from Dow Jones and News Corp Australia. The improvement was partially offset by the lower

revenues discussed above. Adjusted Segment EBITDA (as defined in Note 1) increased 7% compared to the

prior year.

Fourth Quarter Segment Results

Revenues in the quarter decreased $67 million, or 5%, compared to the prior year, reflecting a $40 million, or 3%,

negative impact from foreign currency fluctuations. Within the segment, Dow Jones revenues grew 4%, while

revenues at News America Marketing declined 6%. News Corp Australia and News UK declined 7% and 10%,

respectively, primarily driven by foreign currency headwinds. Adjusted Revenues for the segment were 2% lower

compared to the prior year.

Advertising revenues declined 8% compared to the prior year, of which $18 million, or 2%, was related to the

negative impact from foreign currency fluctuations. The remainder of the decline was driven by weakness in the

print advertising market and lower home delivered revenues, which include free-standing insert products, at News

America Marketing, partially offset by growth in digital advertising revenues. Advertising revenues at Dow Jones

were flat in the quarter as growth in digital advertising offset the decline in print advertising. Digital revenues

represented 40% of total Dow Jones advertising revenues in the quarter.

Circulation and subscription revenues were flat compared to the prior year, including a $17 million, or 3%,

negative impact from foreign currency fluctuations. Circulation and subscription revenues again benefited from a

healthy contribution from Dow Jones, which again saw a 7% increase in its circulation revenues, reflecting digital

paid subscriber growth of 14% and subscription price increases at The Wall Street Journal, as well as the

continued growth in its Risk & Compliance products. Dow Jones¡¯ consumer products reached approximately 3.3

million total subscribers, reflecting a 9% increase compared to the prior year. Cover price increases at other

mastheads also contributed to the results. These increases were partially offset by lower print volume in the U.K.

and Australia.

Segment EBITDA increased $13 million in the quarter, or 14%, as compared to the prior year, primarily due to

higher contribution from News America Marketing, as well as continued cost reductions across the businesses.

The growth was partially offset by lower revenues, as mentioned above. Adjusted Segment EBITDA increased

17% compared to the prior year.

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Digital revenues represented 33% of News and Information Services segment revenues in the quarter, compared

to 30% in the prior year. For the quarter, digital revenues for Dow Jones and the newspaper mastheads

represented 37% of their combined revenues, and at Dow Jones, digital accounted for 55% of its circulation

revenues. Digital subscribers and users across key properties within the News and Information Services segment

are summarized below:

?

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?

?

The Wall Street Journal average daily digital subscribers in the three months ended June 30, 2019 were

1,818,000, compared to 1,590,000 in the prior year (Source: Internal data)

Closing digital subscribers at News Corp Australia¡¯s mastheads as of June 30, 2019 were 517,300,

compared to 415,600 in the prior year (Source: Internal data)

The Times and Sunday Times closing digital subscribers as of June 30, 2019 were 304,000, compared to

256,000 in the prior year (Source: Internal data)

The Sun¡¯s digital offering reached approximately 113 million global monthly unique users in June 2019

(Source: Google Analytics; prior year comparable statistic unavailable due to source change)

Subscription Video Services

Full Year Segment Results

Revenues and Segment EBITDA for fiscal 2019 increased $1.20 billion and $207 million, respectively, compared

to the prior year, primarily due to the consolidation of Foxtel¡¯s results for the full year. Adjusted Revenues and

Adjusted Segment EBITDA, which exclude the impact of foreign currency fluctuations, acquisitions and

divestitures, declined 2% and 19%, respectively.

On a pro forma basis, reflecting the Transaction, segment revenues for fiscal 2019 declined $342 million, or 13%,

compared with the prior year, of which $181 million, or 7%, was due to the negative impact from foreign currency

fluctuations. The remainder of the revenue decline was driven by the impact from lower broadcast subscribers

and changes in the subscriber package mix, partially offset by higher revenues from Foxtel Now and Kayo.

Segment EBITDA for fiscal 2019 decreased $165 million, or 30%, compared with pro forma Segment EBITDA for

the prior year, primarily due to the lower revenues discussed above, $95 million of higher sports programming and

production costs, mainly related to Cricket Australia and National Rugby League rights, as well as higher

marketing costs related to the launch of Kayo. The decline was partially offset by the $150 million positive impact

on expenses from foreign currency fluctuations and lower entertainment programming and non-programming

costs.

Fourth Quarter Segment Results

Revenues in the quarter decreased $74 million, or 12%, compared to the prior year, of which $44 million, or 7%,

was due to the negative impact from foreign currency fluctuations. The remainder of the revenue decline was

primarily due to lower broadcast subscribers and changes in the subscriber package mix, partially offset by higher

revenues from Foxtel Now and Kayo. Adjusted Revenues for the segment decreased 5% compared to the prior

year.

As of June 30, 2019, Foxtel¡¯s total closing subscribers were 3.144 million, which was 12% higher than the prior

year, primarily due to the launch of Kayo, subscriber growth at Foxtel Now and the inclusion of commercial

subscribers of FOX SPORTS Australia beginning in the first quarter of fiscal 2019, partially offset by lower

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