News Corp (NWSA) Q2 2020 Earnings Call Transcript

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News Corp (NWSA -0.14%)
Q2 2020 Earnings Call
Feb 5, 2021, 8:30 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day and welcome to the News Corp 2Q [Phonetic] Fiscal 2021 Conference Call. [Operator Instructions]

And at this time, I would like to turn the conference over to, Mike Florin, Senior Vice President and Head of Investor Relations. Please go ahead.

Michael Florin -- Senior Vice President and Head of Investor Relations

Thank you very much, Ally. Hello, everyone, and welcome to News Corp's fiscal second quarter 2021 earnings call. We issued our earnings press release about 30 minutes ago and now posted on our website at, newscorp.com.

On the call today are Robert Thomson, Chief Executive, and Susan Panuccio, Chief Financial Officer. We'll open with some prepared remarks and then we'll be happy to take questions from the investment community.

This call may include certain forward-looking information with respect to News Corp's business and strategy. Actual results could differ materially from what is said. News Corp's Form 10-K and Form 10-Q filings identify risks and uncertainties that could cause actual results to differ and contain cautionary statements, regarding forward-looking information.

Additionally, this call will include certain non-GAAP financial measurements such as, total segment EBITDA, adjusted segment EBITDA and adjusted EPS. The definitions and GAAP to non-GAAP reconciliations of such measures can be found in our earnings release.

With that, I'll pass it over to Robert Thomson, for some opening comments.

Robert Thompson -- Chief Executive

Thank you, Mike. Across this country and around the world in so many places for so many people, these past few months have been characterized by considerable upheaval. With social, political, financial and health related tribulations and turmoil deeply profoundly affecting many families economies and communities. I trust that all on this call and your families have been weathering the storm safely and safely.

In the midst of this two month, which has been a severe stress test for individuals and businesses and countries, I am gratified to report that News Corp has navigated the turbulence and to be candid significantly -- very significantly increased profitability. We know just three months ago that the first quarter was particularly robust. And so, I am pleased to report that our second quarter results were even more robust, and this burgeoning is attribute to the efforts and the commitment and the professionalism of all our employees and to the enduring value of the company's culture created by Rupert Murdo.

In fact, the second quarter of fiscal year 2021 was the most profitable quarter since the News Corp was launched more than seven years ago and there were other significant records established. We have the largest profits for Dow Jones, since the acquisition of the company in December 2007, while we reported a 77% rise in EBITDA at subscription video services, where at Foxtel streaming customers hit an historic high and we also benefited from lower costs.

Our Digital Real Estate Services move accounted for approximately 80% of that segments EBITDA growth and history was made, when the New York post reported a profit for the quarter and for the year-to-date, that is the first profit in modern times at the very least for what was a chronic loss making mastered founded in 1801 by Alexander Hamilton. In short Digital Real Estate Services book publishing and Dow Jones all performed powerful in Q2, collectively generating segment EBITDA growth of close to 40%. They're continuing expansion highlights profound potential of the company to increase profits and generate value for our shareholders far into the future.

These resilient results are founded on our long-term strategic shift in the company's assets, determine digitization and a relentless discipline on costs. We were adamant that we would not be victims of Digital Dystopia, but that we would contribute to fashioning a more fruitful future for content creators and we are seeing the results that resolve. It is fair to say that regulators globally have joined the digital dots.

In the second quarter, every segment in News Corp showed marked operating improvements and contributed meaningfully to our profitability. We continue to see increased cooperation across the company with valuable digital lessons and insights at each business rigorously applied for the benefit of all and to the benefit of shareholders. While overall revenues at over $2.4 billion declined 3.3% year-on-year, that was fundamentally due to the sale of News America marketing in 2020. On an adjusted basis our more genuine like-for-like comparison revenues rose 2%, despite the finishes consequences of COVID-19.

Segment EBITDA for the quarter was $497 million, the highest of any quarter since our reincarnation in 2013. Year-over-year that represents profitability growth of 40%, while our free cash flow available to News Corp for the half, rose by $373 million. Our pandemic is indeed a stress test and News Corp is surely passing that test.

At the Digital Real Estate Services segment, news revenue growth was 28% and that came despite restrictions in certain states on inspections and thus sales. Having been and all the support of the acquisition of Move, it is worth noting that we believe the net cost of this company, including the substantial settlement we ultimately receive from Zillow in our trade secret lawsuit against them is only a fraction of its current value. Net-net, we pay considerably less than $1 billion for Move in 2014. We believe it is worth vastly more today. And how much will it be worth in five years as the digitization of sales in the world's largest property market continues a pace.

At the time of our acquisition, realtor.com was struggling third place platform with modest profitability and fewer the 30 million monthly users. There were some try -- cutting [Phonetic] about the acquisition, but we were absolutely clear that our media platforms and growing digital expertise, plus our experience with REA in Australia would enable us to transform the company. In the first half of this fiscal year, REALTOR has contributed more to our profit growth, then the brilliant beacon that is REA in Australia.

So how much is REALTOR worth now? How much is New Corp worth. I will let you do the math. To help you do that math, a few specifics; REALTOR traffic is now outgrowing Zillow for 19 of the past 21 months according to Comscore, including the last 11 months in a row. According to our internal metrics average unique monthly users in the second quarter was 37% higher than the prior year. And we reached each month on average 18 million people.

Just to give you a sense besides scale and loyalty, we had 8.7 total billion page views in the second quarter, more than one page for every person on our planet, and that number does not include photo galleries of houses. Multiply the number of visitors by the images in those galleries and you get a sense of the scale of the intense interaction by users. Traffic has continued to grow since the quarters end with unique users, reaching a record 94 million for the month of January.

During Q2, Move expanded in the rental market through its acquisition of Avail, an online property management platform that focuses on do-it-yourself landlords and tenants. This is significant given the fact that DIY landlords own and manage about three quarters of rentals in the US. And their rental market according to US Census Bureau data is a $500 billion per year -- dollars per year business. So the addressable market is appreciable and appreciating. Also in Q2 realtor.com launched an advertising partnership with Rocket Mortgage, while continuing to build an even more seamless process for consumers wishing to qualify for mortgages to purchase our home.

In January, Realtor announced a partnership with Qualia provide simplified digital home closings, allowing for greater online collaboration between agents and their clients. Let us be very clear, buying a home is by far the largest investment that most families will make and the purchase around that acquisition, whether it'd be securing a mortgage or starting with electricity or broadband provider unnecessary and valuable adjacencies. The home purchase is at the very center of that cluster of commerce and Realtor's are at the very center of that purchase.

From a macro perspective, the overall housing market in US not only has proven to be resilient during the time of crisis, it is demonstrated tangible strength with many positive signs of activity even with listing volumes at a historic low. With mortgage rates at a minimum and family is expanding their search for better larger homes in new locations, there is reason to be optimistic about the trajectory of the sector. Resilience and optimism also characterize the housing market in Australia with the emergence from lockdowns in the quarter has led to significant signs of recovery. Australia, we're still a growing economy and it will continue to benefit from its location in the world's fastest growing region.

The deep ties with Asia, including India, give it a distinct advantage along with its reliable legal procedures and stable coherent cogent political system. We believe it is still a country that is far from maximizing its potential and the growth opportunities are pronounced.

In the second quarter REA acquired a controlling interest in Elara Technologies making it the majority owner of the large and growing Indian digital real estate portal, including Housing.com and PropTiger.com. As measured by audience a lower runs India's fastest growing Digital Real Estate business and India itself is one of the world's fastest growing economies. So the possibilities are prevailed. We are under Tracey Fellows leadership by many measures, the world's largest digital property company and we are acutely focused on the countries that we believe have the largest digital property potentials.

Meanwhile Harper Collins had one of its most lucrative quarters with double-digit growth across every category. There were many successful new releases, well the fact is bolstered both revenue and profitability as did our continued growth in digital. Brian Murray and the team are at a relatively early stage of the development of audiobooks and the proliferation of audio devices for the home will only increase the demand for our content. I'm not sure that all investors had yet comprehended the full value of that digital opportunity.

As for the resident titles and successful catalog there was: Didn't You See That Coming by Rachel Hollis; The Happy in a Hurry Cookbook, Steve Doocy; The Greatest Secret by Rhonda Byrne; Frontier Follies, Ree Drummond and the continuing strong demand of Magnolia Table Volume 2 by Joanna Gaines. And then in January there was Bridgerton. We have the series of nine Bridgerton books by Julia Quinn, which are prosper and given the popularity of the autonomous series for which a new series has recently been announced. In all revenues of Harper Collins ascended 23% in the quarter and segment EBITDA surged 65% over the prior year.

Dow Jones also se record this quarter, including having its highest absolute EBITDA, since News Corp acquired the company in late 2007 with segment EBITDA, up 43%. While the New York Times EBITDA of a 1% increase. Digital advertising spend of 29%, the highest quarter in Dow Jones history, while Digital Advertising at the New York Times fell by 2%.

Clearly print was challenged during a pandemic period in which distribution was compromised, but overall advertising was down just 4% comparing dramatically with the New York Times we are slumped 19%. In our Professional Information Business, risk and compliance continued its record of extraordinary expansion with year-over-year revenue growth accelerating to 21%. Q2 marks risk and compliance 22nd consecutive quarter of double-digit revenue growth year-over-year. Given the international tension with both the US and China and pricing controls on companies and with the new administration in US in client to tougher regulation how bright other prospects for risk and compliance. If anyone on this call works for a company that is not yet our clients, I suggest that you remedy that dereliction.

Traffic and subscribers across Dow Jones properties are surging and Almar and the team are determined to make the most of the opportunity. WSJ digital only subscriptions, were up 28% and MarketWatch also had a successful digital subscription launch in Q2. We have always insisted that our strategy is to upsell at Dow Jones given our non-pareil portfolio. And so it's worth noting that more than 70% of those MarketWatch subscribers choose a bundle that included subscription to parents.

As for traffic average monthly unique users across the Dow Jones digital network were up 48% in the quarter, reaching a $127 million, driven by 64% growth at both the Wall Street Journal and Barron's. In Subscription Video Services, our strategy to the reshape the Foxtel Group, as a next generation subscription business is clearly gaining traction with total closing paid subscriptions increasing 12% and setting a new record of over 3.31 million.

OTT now accounts for 40% of Foxtel's paying subscriber base. With more than 1.3 million streaming subscribers. The actual growth rate in streaming subscribers, which are the 90%, driven by the strength of Binge, which launched last May, and the continued expansion of Kayo. In the past there has been skepticism about whether we could transition from our reliance on traditional broadcast, but those concerns have proven unfounded and Foxtel is now a company with a diverse portfolio and much momentum.

I would like to repeat that EBITDA at the Subscription Video Services segment for the quarter, rose 77% on the same quarter last year. And for the first half segment EBITDA was 34% higher. Growth has been crucial for that success, but we have a leadership team at Foxtel steered ably by Siobhan McKenna and Patrick Delany, that has been absolutely focused on reviewing every aspect of the company's performance. And diligently reducing cost where appropriate. That insight, foresight and discipline have contributed to the transformation of the company and given us a powerful platform and much optionality for the future.

We have now secured long-term rights to the three most popular sports in the country. Aussie Rules, Rugby League and Cricket, which had established success in the summer with the tour of the triumphant Indian team. Record after record we set on the cricket pitch and on the screen, whether the traditional screen for a digital device. And that multiplatform future is now secure with both Australian Rules and Rugby, thanks to our partners at Telstra. Over 3 million Live Pass customers, we have the opportunity to transition to Kayo in the coming month, so that they can watch their teams, when they want to watch, how they want to watch, where they want to watch and on whatever device they want to launch. This is a monumental movement for Foxtel.

Our news media segment also contributed meaningfully to News Corps profitability this quarter. With digital ad growth in UK and at the New York Post. We had indeed indicated that the New York Post opus was on a path toward profitability and it's certainly achieved that goal in the second quarter. Our channels now is to enjoy its long-term profitability, given the challenges in that sector. Digital ad growth at the Post with 64% up year-over-year. For the quarter digital advertising accounted for nearly 90% of the total page views of the Post were up 37%. It was also a quarter in which the Post recorded a significant victory for all media, for the freedom of their press, by standing resolute and principled against censorship imposed by Twitter.

Ultimately, Twitter realized it has made an egregious mistake and frankly reversed its decisions. Our journalists are not laptops with laptops. Our journalist are not geographies, our journalists are not worked, our journalists are all wake to their profound responsibilities. In Australia, we were fortunately ahead of the curve in transitioning many of our local and regional print properties to digital platforms, which help them weather the storm of lockdown.

Our Australian leadership by Michael Miller was disciplined in reducing costs and yet remained ambitious for our news platforms during this time of transition for journalism. And Rebekah Brook's showed real leadership in the UK across our baskets like The Sun and The Times in our emerging digital business and their wireless are right in network, which reached nearly 5 million listeners. In both Australia and the UK, we are using our skills in video and audio to enhance our traditional platforms. And that is clear at Times Radio, which is an extension of the newspaper founded in London in 1785.

On these calls, I've often referenced the ongoing debate with what is loosely called Big Digital. I personally regard that Monica as a euphemism. We're at a pivotal moment of those discussions in Australia with new regulations and new terms of trade will be introduced. But that debate now extends across the globe. There is not a single serious digital regulator anywhere in the world, who is not examining the opacity of algorithms, the integrity of personal data, the social value of professional journalism and the dysfunctional digital ad market. This has been an imperative for News Corp for far more than a decade, I gave evidence the health of lord in London on this very subject in 2007. And it has been an imperative because we truly care about the social value of journalism and we believe that the social value as a commercial value.

This enduring often solitary campaign would not have been successful without the further support of Rupert and Lachlan Murdoch and the News Corp Board. We expect that the new tech topography will benefit our company's financial fortunes that is for certain, and it will also have a material impact in not only the countries in which we operate, but in every country. And ambitious, inspired young woman starting a digital new site in Nigeria or in Birmingham, England or Birmingham, Alabama now has a far better a far, far better chance of sustainable success.

Finally, I want to thank all, who have contributed to the singular success of News Corp in this historic quarter. That would be all our employees, who have contributed each day in courageous compassionate ways. I salute those individuals for what they have done and so what they continue to do for the company and for their communities. Thank you. While the macro environment remains unpredictable. Our goal is to ensure the News Corp is best positioned for long-term success and that our value is absolutely appreciated by investors.

I now -- I hand you to Susan Panuccio for some wise words.

Susan Panuccio -- Chief Financial Officer

Thank you, Robert. Fiscal 2021 second quarter, total revenues were over $2.4 billion, a decline of 3% versus the prior year, while total segment EBITDA was $497 million, up 40% year-over-year, reflecting strong performances across all of our key reportable segments, driven by a combination of improved operating trends and cost reductions. This is the highest quarterly segment EBITDA since the company was formed in 2013.

On an adjusted basis, which excludes the impact from acquisitions and divestitures, most notably the sales News America Marketing in the fourth quarter of fiscal 2020, as well as currency fluctuations and other items disclosed in our release, revenues rose 2%, while total segment EBITDA grew 39%.

Net income for the quarter was $261 million, compared to $103 million in the prior year. For the quarter, we reported diluted earnings per share of $0.39, as compared to $0.14 in the prior year. Adjusted EPS was $0.34 in the quarter, compared with $0.18 in the prior year.

Turning now to the operating segments. Digital Real Estate Services segment revenues were $339 million, an increase of 15%, compared to the prior year, which is more than double the rate in the first quarter, driven by another record quarterly performance for Move. On an adjusted basis, revenues increased 11%. Segment EBITDA rose 20% to $142 million or 19% on an adjusted basis, despite higher investment spending, which was in contrast to the first quarter. Results also included $6 million of costs associated with Move's acquisition of Avail and the large transaction at REA.

Move's operating results accounted for over 75% of segment revenue growth at approximately 80% of segment EBITDA growth this quarter. Move's revenues accelerated to $155 million, a 28% year-over-year increase with real estate revenues rising 30%. As Robert mentioned realtor.com traffic reached 80 million average monthly unique users, reflecting an increase of 37% year-over-year with growth in December accelerating to 44%. Monthly average lead volumes remained very strong, growing over 30%.

Like the first quarter, we saw strong growth in the performance-based referral model, which accounted for approximately 30% of total Move revenues in the quarter, benefiting from the growth in lead volume, higher home prices and real estate transaction closes. Not only did we see an acceleration in the revenue growth, if the referral model this quarter, compared to the prior quarter, but we also saw growth in ConnectionsSM Plus our traditional lead generation product, driven by strong customer demand enabling improved pricing and higher sell through.

As our referral revenues are recognized upon transaction closures only around 20% of the associated revenues from leads generated in this quarter are reflected in the results. This provides a strong pipeline through the balance of the year assuming continued favorable housing conditions. These results are very encouraging and we remain focused on expanding our addressable market through the integration of key ancillary services; including our Rocket Mortgage partnership.

We have contributed $19 million to the segment EBITDA growth this quarter versus the prior year, driven by the strong topline growth. As we had previously indicated, we are increasing our investment levels in real estate given the rapid performance in lead volume and further expansion into adjacencies.

Revenues at REA Group rose 6% to $184 million, reflecting a $12 million or 7% benefit from currency fluctuations. COVID-19 restrictions eased during the quarter, including the removal of property inspection restrictions in Melbourne. Residential listings, the quarter rose 10%, including 25% growth in Metro Melbourne and 13% growth in Sydney. A new developer project launch has increased 12% on the prior year. REAs results benefited from growth in residential revenues, which was offset by declines in Commercial and Asia. It also is worth remembering that is a consequence of COVID REA did not implemented price increase in July. Please refer to REA's earnings release and their conference call following this call for more details.

Turning to Subscription Video Services segment, revenues for the quarter was $511 million, up 2% versus the prior year and included a $33 million or 7% positive impact from foreign currency fluctuations. Adjusted revenues were down 5%, an improvement on the Q1 decline of 7%, benefiting from moderating broadcast subscription revenue declines and the expansion of OTT revenues.

Foxtel's closing paid subscriber base reached over 3.3 million as of December 31, up 12% year-over-year with OTT expanding to over 1.3 million paying subscribers close to double the prior year's number. With Kayo reaching 624,000 and Binge at 431,000 paying subscribers. Payer subscribers declined slightly quarter-over-quarter, due to seasonality, but the decline was much less pronounced than last year as the business successfully managed the transition from winter to spring and summer sporting codes underpinned by the exclusive cricket content.

Residential broadcast subscribers declined about 11% to approximately 1.8 million, relatively consistent with last quarter. Commercial subscribers declined 18% year-over-year to 218,000 with the trend improving sequentially having bottomed out at 86,000 in the fourth quarter of fiscal 2020 as a consequence of the pandemic.

Broadcast churn was somewhat elevated at 17.5% versus 16% in the prior year impacted by a strategy to reduce promotional offers, which resulted in the roll off of lower ARPU subscribers. The financial benefit is reflected in a 3% increase in ARPU to almost AUD80. Segment EBITDA improved 77% to $124 million, the continuing cost transformation of Foxtel divide to right size the cost base with the driver of profitability. Total cost declined approximately 10%, including $35 million of lower sports programing rights and production costs, which was primarily driven by savings from renegotiated sports rights, partially offset by the $20 million negative impact related to the deferral of these costs from the fourth quarter of fiscal 2020. Expenses also benefited from lower entertainment programing costs and lower overheads. Some of the cost benefit, the timing-related, which was a reverse later in the year, I will touch on these later.

Moving on to Dow Jones. Dow Jones delivered its highest revenue quarter since separation in 2013 and its highest segment EBITDA quarter since News Corp's acquisition in 2017. Revenues for the quarter were $446 million, up 4%, compared to the prior year, with digital revenues accounting for 70% of total revenues this quarter, up 6 percentage points from the prior year.

Circulation revenues rose 8%, due to growth in digital circulation revenues, partially offset by lower single copy and amenity print volume still impacted by COVID-19. As Robert mentioned, Dow Jones again achieved record subscriptions in the quarter with average subscriptions to its consumer products for the quarter, exceeding $4 million, up 18% from the prior year and of that digital-only subscriptions were over $3 million, up 29% year-over-year.

For the Wall Street Journal, there were 3.2 million average subscriptions for the quarter, up nearly 19% from the prior year. The digital-only subscriptions growing 28% to nearly 2.5 million. Revenues from Dow Jones Risk and Compliance grew 21%, which was a faster growth rate than the past three quarters. Overall, professional information business revenues rose 4%.

Advertising revenues, which accounted for 26% of revenues this quarter declined to 4% to $115 million, a marked improvement from the 17% decline last quarter. As Robert mentioned, we had another record quarter for digital advertising with 29% growth and digital accounting for 58% of advertising revenues for the second quarter. We saw growth in all categories, particularly in technology.

Print advertising revenues declined 29% year-over-year, which was an improvement from the 39% decline in the first quarter.

Dow Jones segment EBITDA for the quarter rose 43% to $109 million, with margins expanding to over 24% and up almost 7 percentage points versus the prior-year. Cost declined almost 5% this quarter, due to lower print volumes and other discretionary savings.

At Book Publishing, HarperCollins posted 23% revenue growth to $544 million and a 65% segment EBITDA growth to $104 million, marking the best quarterly performance in its history. Revenue growth was strong across all categories with double-digit gains. Robert mentioned the depth of the sub list this quarter, which included strong performances from numerous authors; including Rachel Hollis, Rhonda Byrne, Ree Drummond and Joanna Gaines and David Walliams among others.

Similar to what we saw in the past two quarters, we are continuing to benefit from a strong rebound in e-books with overall digital sales up 15% year-over-year. E-book sales increased 21% year-over-year with gains in all categories, while downloadable audio books increased 10% year-over-year.

We have continued to see higher online sales and in particularly benefited from strong orders from Amazon and other e-commerce platforms during the holiday season. But perhaps more importantly, we are seeing very strong consumption levels likely benefiting from stay at home measures and a continuous flow of new content. Revenues increased at low double-digits across the backlist, notwithstanding, they contributed 55% of sales this quarter, down from 58% last year due to the larger mix of the frontlist titles.

HarperCollins again demonstrated strong operating leverage, despite a 16% increase in cost, in part due to royalties and higher production expenses related to the successful top line performance. Margins improved by almost 5 percentage points.

Turning to News Media. Despite ongoing challenges, we remain focused on rightsizing the cost base and moving toward digital, helped by a moderation in advertising revenue trends. Revenues for the quarter was $573 million, up 29% versus the prior year, of which the impact from the divestment of News America Marketing accounted for the majority of the decline. On an adjusted basis, which excludes the impact from the divestment of NAM and Unruly and the other items mentioned in our release, revenues declined 9%, which is an improvement from a 16% decline in the first quarter. The decline also reflects $34 million or 4% negative impact from the closure or transition to digital obsession regional and community newspapers in Australia.

Circulation and subscription revenues rose 5%. There's a $9 million or 4% benefit from currency fluctuations, strong digital paid subscriber growth and cover price increases offset lower news stand sales related to COVID-19. Overall, the year-over-year trends in local currency were better in both the UK and Australia, compared to the first quarter. Circulation revenues accounted for 45% of total segment revenues and was slightly higher than advertising this quarter as the mix of revenues become more reoccurring and predictable.

Advertising revenue fell $231 million or 48% on a reported basis, of which $191 million or 40% was from the sale of News America Marketing and $28 million or 6% was related to the negative impact from the closure or transition to digital of certain regional community titles in Australia. The remainder of the decline was due to the overall weakness in the print advertising market.

On a positive note, the New York Post continued to outperform with advertising revenues, up 23% and as Robert mentioned digital advertising, up 64%. In fact digital revenues at the New York Post exceeded 50% of total revenues this quarter, and overall the New York Post had its highest digital revenue since 2013.

Segment EBITDA for the quarter was $66 million flat with the prior year, despite the $22 million one-time benefit in the prior year related to a settlement of certain warranty related claims in the UK and the absence of the modest contribution from News America Marketing. Adjusted segment EBITDA increased 5%, which included a $5 million positive contribution from the New York Post.

I would now like to talk about some themes in the upcoming quarter and the second half. Overall, we expect to see some slowdown in the second half results with forecasting remain particularly challenging given the ongoing global COVID-19 pandemic. At Digital Real Estate Services, as REA noted, National Residential Listings in Australia for January were flat to the prior year. Results will reflect a small loss related to the consolidation of Elara Technologies in the second half. Please refer to REA's press release and earnings call for more details.

At Move, we remain encouraged by the traffic and lead volume trends, which are expected to drive higher revenues in the second half, despite the historically low listing volumes across the industry. We expect these higher revenues to fund at least $40 million of additional reinvestments in the second half, compared to the prior year in areas such as brand marketing and product development, as we focus on gaining market share and expanding into adjacencies.

In Subscription Video Services, we have seen broadcast churn continue to increase due to the ongoing focus on ARPU and seasonal trends with the end of winter sports. However, Kayo has remained resilient and our OTT subscriber growth led by Binge remains strong. We expect EBITDA results in the second half to be more challenged due to -- in part to the lapping of the prior year cost savings.

As a reminder, fiscal 2020 fourth quarter results included a $70 million cost benefit, due to the deferral of sports rights and production costs related to COVID-19. We now expect full-year overall cost declines given the better-than-expected revenue performance to be more modest than we had initially expected with a net reduction of less than a AUD100 million. This includes approximately AUD80 million of higher sports comp in the second half of fiscal 2021, particularly in the fourth quarter, compared to the prior-year period.

At Dow Jones, overall revenue trends remain favorable, compared to the prior year, including strong digital advertising growth. A we look to the rest of the year, we continue to expect to reinvest in the business as we focus on driving revenue growth through its digital assets and expect second half expenses to increase modestly, compared to the prior year. In addition, third quarter will face a more difficult digital advertising growth comparison.

In Book Publishing, overall industry trends remain favorable, we continue to monitor closely the sustainability of recent consumer spending patterns, such as the increasing free time to consumers to read and the increase in the average number of books purchased. The second half comparables will be tougher, particularly in the fourth quarter, given the material outperformance last year and as we lapped some of the initial benefits at the outset of COVID-19.

At News Media, the ongoing national lockdown in the UK and domestic travel restrictions in Australia continue to put pressure on print circulation, especially with daily newsstand sales and are also creating increased uncertainty on advertising spend across most categories. Cost declines in the second half are expected to moderate from the first half rate as we lap some COVID-19 saving initiatives, as well as the divestment of News America Marketing and the closure or digital transition of some of our newspapers in Australia in the fourth quarter.

In our other segment, for the second half, we expect at least a $50 million increase in costs, driven by a combination of higher equity comp related to the stock price performance and the absence of the bonus reductions across the senior executive team in the prior year in response to COVID-19, as well as additional cost related to the implementation of the global shared services initiative.

With that, let me hand it over to the operator for Q&A.

Questions and Answers:

Operator

Thank you. [Operator Instructions] And we'll go ahead and take our first question from Alexia Quadrani from JPMorgan. Please go ahead.

Zilu Pan -- JPMorgan -- Analyst

Hi, this is Zilu Pan on for Alexia. Thanks for taking our questions. Digital advertising at Dow Jones continues to outperform some of your peers. And I'm wondering if there's any further color you can give on why you think you are doing relatively quite well on that front? Is there a vertical SKU or specific advertising products driving the outperformance? And then just on Foxtel with better results at the segment, due to the streaming products, what indicators or trend are you looking for to determine the next steps for that asset? Thank you.

Robert Thompson -- Chief Executive

Well, first of all, Dow Jones. We have a great team at Dow Jones led by Almar Latour and Josh Stinchcomb, our Chief Revenue Officer, he's done a sterling job in developing our digital ad expertise. And that's across wsj.com, MarketWatch, Barron's and beyond. And the increase has been across categories, but also in new categories in custom advertising. And it's clear that if you want not just a safe space, but a space that is brand enhancing and an audience that's still most influential in the world and I said Rod [Phonetic] well heeled, then Dow Jones has comparative advantages.

Just one broader point to bear in mind with the imminent death of the cookie, our vast audience in the US, for example will be particularly valuable and Dow Jones is a significant component in that. When you add together, the uniques across our US businesses, and this is not dejobbing, as you can tell from the number, but we have close to 350 million monthly uniques. So that's in the advertising audience, that's important for Dow Jones, but for all our properties.

Susan Panuccio -- Chief Financial Officer

And I think just to add to Robert's comments, we also, under Josh, who leads the sales team at Dow Jones have been very focused over the past 18 months on improving our ad tech capabilities, upskilling the sales force and improving yield management, which we now believe we are starting to see the benefit of in addition to obviously, the audience growth.

And just in relation to the second question for Foxtel. When we think about the trends that we are looking at and the next steps for the assets, well, clearly OTT will be an ongoing focus for us in that business, as well as the stability in broadcast as the team focus on the management of the base subscribers within broadcast. And they are clearly focused on costs as well. They've done a tremendous job in the first half or really over the last 10 months, since COVID started in taking out the underlying cost of the business, the renegotiation of sports and entertainment contracts, but we'll be particularly looking forward to the growth within the OTT properties.

Robert Thompson -- Chief Executive

And to complement Susan's comments, so let's consider how the Foxtel narrative has changed to the questions we have be asked a couple of quarters ago, whether we would need to put extra capital into Foxtel, and then we're asked whether some spec wanted to buy more speculation and speculation. And the truth is that the successful development of the business has given us real options, and our immediate task and the teams task is to keep driving the business to keep striving, we've obviously made fairly successful migration to streaming up 90% year-on-year, and we obviously have hits with Kayo and Binge, and we obviously have more work ahead. But the path to the future is certainly paid with possibility.

Zilu Pan -- JPMorgan -- Analyst

Thank you.

Michael Florin -- Senior Vice President and Head of Investor Relations

Thank you, Zilu. Thanks, Zilu. Ally, we'll take our next question, please.

Operator

You bet. We'll go ahead and hear from Kane Hannan from Goldman Sachs. Please go ahead.

Kane Hannan -- Goldman Sachs -- Analyst

Good morning, guys. Congratulations on the result. Just two from me. Firstly, just the Move revenue outlook. You're talking about $40 million of incremental investments. You're seeing strong traffic growth. You won't have the agent concessions in the fourth quarter. And do you think it's possible that, that revenue growth continues to accelerate in the second half? Or just how should we think about the revenue trends?

And then secondly just on the global shared services initiative. I think, of the $100 million bucket, you're talking about at the full-year result. Just given some of these increasing investment you're talking to, in the second half. Just interested, how we should be thinking about that program in FY '22, and whether there is any change to those sorts of targets?

Susan Panuccio -- Chief Financial Officer

Thanks, Kane. I might take those questions, and Robert can add and supplement as he will. So just in relation to the sustainability of Move's growth. I mean, we remain very confident in the growth of the business and are encouraged by the traffic and the lead volumes, as we talked about in our prepared remarks. Notwithstanding the industry listing volumes remain as historically low levels.

We do expect with the revenue growth, the cost will increase. And I think the interesting thing to note, when we think about the results for this quarter versus the first quarter, actually the cost increased this quarter. And so it was really top line revenue growth that was dropping down to the bottom line. So we do think that the revenue growth will continue, and we do want to scale up those costs in the reinvestment areas that I mentioned, marketing and product development. Just in relation to shared services. Yes, we did quite a $100 million for financial year '22, we're still holding that number at this stage, notwithstanding the cost work that we've done across the business. We do still think that there are enormous opportunities, but it will require obviously a lot of work and reconfiguration of our systems in order to unlock those savings. But at this stage the guidance is still $100 million for financial year '22.

Robert Thompson -- Chief Executive

And just to supplement Susan's thoughts of, particularly on move. Clearly, we have to be somewhat cautious in the second half of the year, simply because of the complications of COVID. There's a lack of visibility of many of our businesses and you can see that reflected in our words today. We are certainly taking nothing for granted, despite the excellence of the Q2 results. But at Move, the signs are positive at least in January, and David and the team at REALTOR. With January normally a slower month, unique users rose 37% to $94 million, and the lead volume remained robust. Those are indicators, but we are taking nothing for granted.

Kane Hannan -- Goldman Sachs -- Analyst

Thanks guys.

Michael Florin -- Senior Vice President and Head of Investor Relations

Thank you, Kane. Alley, we'll take our next question, please.

Operator

Yes. Next we'll hear from Entcho Raykovski from Credit Suisse. Please go ahead.

Entcho Raykovski -- Credit Suisse -- Analyst

Hi, Robert. Hi, Susan. I've got a couple; firstly within News Media, obviously, significant cost reductions in the quarter. Just interested in whether you can make any comments about the extent to which those cost reductions are permanent. You've obviously indicated that print circulation may be challenged in future quarters. So I don't know if that just results in lower print costs, which may -- might come back down the track. And whether you, in fact, see further opportunities for cost reductions within that division?

And then second question is around SVS. Following the announcement of the Telstra Live Pass users transitioning to Kayo. Do you have a sense for how many of those circa 3 million users do you expect to transition? And do you have any projections you're willing to share around how many of those you'd expect to hold onto after that promotional period is over?

Susan Panuccio -- Chief Financial Officer

Entcho, maybe if I start with your first question, just in relation to News Media. Obviously, there's been a lot of cost work that's been done. And you're right. Some of that is obviously volume related and some of that will scale up and down depending on how those businesses trade in light of COVID. But there are also significant permanent cost reductions, the teams have been working on -- we've had a significant reduction in headcount that came through in the back end of last fiscal year, that is obviously flowing through here. But we do have a lot of costs that have come out in the overhead space as well.

Now some of that naturally will come back in as the businesses open up, but we would also hope that some of that may be permanent as we change the way that we work going forward. We also had in the back end of last significant reductions in marketing expenditure within News Media. We would expect to see some of that start to come back in, but not necessarily the levels that we're seeing. So I think a balance of both as we work forward and I do think actually that there are still permanent cost reduction opportunities that the businesses are working on within that segment. A lot of that is to do with the restructuring of the business and the reconfiguration, and the teams are actively working on that.

Robert Thompson -- Chief Executive

And as for the transition from Live Pass to Kayo, this is obviously an extraordinary opportunity for Foxtel and our partners at Telstra will be doing everything as they can to encourage their users to make that migration to around a total of 3.2 million Live Pass members for those who are interested in Aussie Rules or Rugby or any of the many sports on Kayo, this is an extraordinary opportunity to be able to watch a world-class streaming operation at work. And the -- those who have used Kayo and have experienced its ability to not only show one game, but many games simultaneously. That experience is definitely compelling. And so we believe that a very large number of Live Pass subscribers will make that migration, but it's so early in the process that at the moment, we don't want to put numbers out there. But with the imminent start of the winter sport seasons in Australia, I think, you'll soon see the metrics in coming months, and we'll be able to update you next quarter.

Susan Panuccio -- Chief Financial Officer

And I think, Entcho, the only other thing to add to that would be that as we think about these exciting opportunity that Foxtel now have, it will scale clearly more from year one, given the introductory office. So while we would expect subscriber numbers to pick up, we would expect the actual impact on revenue and EBITDA to be more back-ended from year one onwards.

Entcho Raykovski -- Credit Suisse -- Analyst

Got it. That's very useful. Maybe just a very quick follow-up. Do you know, if there's much overlap at the moment between the existing Kayo subspace and the Live Pass users?

Robert Thompson -- Chief Executive

It's relatively small, Entcho. Well below 20%.

Entcho Raykovski -- Credit Suisse -- Analyst

Alright. Thank you.

Michael Florin -- Senior Vice President and Head of Investor Relations

Thank you, Entcho. Alley, we'll take our next question, please.

Operator

Thank you. We'll now hear from Craig Huber from Huber Research Partners. Please go ahead.

Craig Huber -- Huber Research Partners -- Analyst

Thank you. Susan wanted to hear a little bit further about the costs within your Subscription Video Services, just the remaining part of the year and maybe as we think out the next fiscal year, anything out of the ordinary there you want to call it further you haven't already touched on?

Susan Panuccio -- Chief Financial Officer

I guess, it could be the easiest way to maybe frame the cost in the second half is I expect them to be broadly in line with the cost for the first half, which is net of any of the movements that we've obviously talked about with the deferral of sports rights. With the remainder, we are reminded that the full-year cost will absorb approximately AUD156 million of additional cost year-on-year, due to the deferral for both sports cost. So I think, you know, that the underlying cost work, as I said, the Foxtel team has done is starting to pay dividends. But clearly, we've got this double off of sports rights in the current year. But as a frame, I would say, broadly speaking, in line with the first half.

Craig Huber -- Huber Research Partners -- Analyst

And then my follow-on question, if I quickly ask, if you think out to the next fiscal year. Is there any large sports programing contracts up for renewal that might have a significant jump if taken into account in our models, the next fiscal year?

Susan Panuccio -- Chief Financial Officer

No we've got -- we've obviously just executed the renewals of the AFL and NRL. So we have those deferred up now 2024 and 2027, and we're not expecting in next financial year significant step-ups from a overall basis on sports cost.

Craig Huber -- Huber Research Partners -- Analyst

Great, thank you.

Michael Florin -- Senior Vice President and Head of Investor Relations

Thank you, Craig. Alley, we'll take our next question, please.

Operator

It appears we have no further questions. That does conclude our question-and-answer session for today. I would now like to turn over to our speakers for any additional or closing remarks.

Robert Thompson -- Chief Executive

Well, thank you very much, Ally, and thank you all for participating. We look forward to talking to you soon. Have a great day and stay safe. Take care.

Operator

[Operator Closing Remarks]

Duration: 51 minutes

Call participants:

Michael Florin -- Senior Vice President and Head of Investor Relations

Robert Thompson -- Chief Executive

Susan Panuccio -- Chief Financial Officer

Zilu Pan -- JPMorgan -- Analyst

Kane Hannan -- Goldman Sachs -- Analyst

Entcho Raykovski -- Credit Suisse -- Analyst

Craig Huber -- Huber Research Partners -- Analyst

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