News Corp flags job cuts as revenue, earnings decline

Rupert Murdoch’s News Corporation has reported a decline in earnings and revenue for the fiscal second quarter, with rising interest rates and inflation beginning to hurt the performance of the company’s assets.

Chief executive Robert Thomson described the challenges as “more ephemeral than eternal”, but said the company was introducing a range of cost-cutting measures, including a 5 per cent reduction in head count across the business.

About 1250 positions are expected to be impacted as part of the efforts, which Thomson said would help the company grow in the long term.

Second quarter total revenues fell 7 per cent to $US2.5 billion ($3.6 billion), largely caused by a 6 per cent negative impact from foreign currency fluctuations, lower revenues in book publishing and challenging housing market conditions in Australia and the US.

The second quarter highlighted the progress made in certain of our business segments, Thomson said. “Obviously, a surge in interest rates and acute inflation had a tangible impact on all of our businesses. But we believe these challenges are more ephemeral than eternal.”

News Corp owns a range of local assets, including The Australian as well as cable TV operator Foxtel and streaming services Kayo and Binge. It is one of many media companies locally and globally that is facing financial pressure from rising costs. A weak and increasingly volatile advertising market has also exacerbated these pressures, and the publishing industry is also facing major increases in the cost of paper, caused by soaring electricity prices and shipping costs.

More to come

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