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DATE

Thursday, May 7, 2026 at 5 p.m. ET

CALL PARTICIPANTS

  • Chief Executive Officer — Robert Thomson
  • Chief Financial Officer — Lavanya Chandrashekar
  • SVP, Head of Investor Relations — Michael Florin

TAKEAWAYS

  • Total Revenue -- $2.2 billion, up 9%, reflecting broad-based growth across strategic segments and positive trends in all key business units.
  • Total Segment EBITDA -- $343 million, increasing 18% with margin expansion to 15.7% from 14.4%.
  • Net Income from Continuing Operations -- Rose 13%, with both reported EPS and adjusted EPS notably higher quarter over quarter.
  • Share Repurchases -- $193 million in Q3, an acceleration from $172 million in Q2, bringing fiscal year-to-date buybacks to $459 million.
  • Dow Jones Revenue -- $619 million, up 8%, with segment EBITDA of $147 million, an 11% increase, and margin up 70 basis points to 23.7%.
  • Dow Jones Risk & Compliance Revenue -- Grew 19% to $100 million, driven by customer expansion, new product rollouts, and pricing improvement.
  • Dow Jones Energy Revenue -- Increased 12% to $77 million, with customer retention at approximately 90% and a modest positive effect from the Eco-Movement acquisition.
  • Digital Circulation and Advertising at Dow Jones -- Digital circulation made up 76% of revenue, up from 75%, with digital-only subscriptions growing 9% and digital advertising up 13% while print declined 6%.
  • Digital Real Estate Services Revenue -- $473 million, up 17% on a reported basis and 8% adjusted; EBITDA increased 25% with margin widening to 32.8% from 30.5%.
  • Realtor.com Revenue -- Rose 10% to $148 million, reflecting a 6% rise in lead volume, improved yields, and higher annual contract values; core real estate revenues grew 15% and comprised 77% of segment total.
  • Realtor.com User Engagement -- Averaged 5.3 visits per unique user, surpassing key competitors: Zillow at 3.5, Redfin at 2.9, and Homes.com at 1.9 visits.
  • REA Group Revenue Growth -- Rose 20%, partly due to FX, with product development and mortgage service expansion driving a 14% yield increase.
  • REA Australian Residential Business -- National new buy listings increased 1%, with Sydney up 4% and Melbourne up 7%.
  • HarperCollins Revenue -- Increased 8% to $555 million, with EBITDA up 14% and margins expanding 70 basis points to 13.2%.
  • HarperCollins Digital Sales -- eBook revenue surged 17% and audiobooks rose 7%, driving digital growth of 11%.
  • Book Publishing Backlist Contribution -- 64% of consumer revenue, slightly down from 65%.
  • News Media Revenue -- Grew 5% to $538 million due to favorable currency, but segment EBITDA declined by $18 million, impacted by investment in the California Post launch and lower News UK contributions.
  • News UK Subscribers -- The Times and The Sunday Times reached 676,000 subscribers, a 7% increase; The Sun showed double-digit digital advertising growth.
  • News Corp Australia Digital Subscribers -- Rose to 1.2 million, with improved ARPU and digital ad revenue growth year over year.
  • AI and Intellectual Property Partnerships -- Announced a new deal with Meta and continued partnership with OpenAI; management expects proceeds from the $1.5 billion Anthropic settlement later in the year, with "several further deals" in advanced negotiation stages.
  • Adjusted Metrics -- On an adjusted basis, revenue increased 4% and segment EBITDA rose 13%.
  • Outlook -- April Australian residential new buy listings up 19%; Dow Jones expected to deliver continued revenue and margin improvement; Book Publishing set to benefit from a strong front-list program and new releases.
  • Cash Flow -- Free cash flow expected to rise for fiscal year, despite higher capital expenditures and Q3 working capital timing effects.

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RISKS

  • Segment EBITDA for News Media declined by $18 million, attributed to launch and marketing costs for the California Post and softer performance in Australia and the UK, with management stating Outlook includes further incremental costs from new initiatives.

SUMMARY

News Corporation (NWSA +3.21%) reported accelerated top- and bottom-line growth by leveraging strategic momentum in Dow Jones, Digital Real Estate Services, and Book Publishing, each generating double-digit profit increases and margin expansion. The company executed $193 million in share repurchases for the quarter and confirmed the benefit of further buybacks from Foxtel loan repayments and free cash flow, supporting management's stated belief that "our stock remains materially undervalued relative to its net asset value." Recent and prospective intellectual property partnerships—including with Meta, OpenAI, and anticipated proceeds from Anthropic—are positioned as meaningful catalysts for future revenue and profit growth, while digital revenue streams now dominate major segments such as Dow Jones and Digital Real Estate. Management highlighted "record profitability margin at Dow Jones" and stated confidence in delivering a record fiscal year, while also identifying ongoing investment requirements for new launches and technology initiatives.

  • Management noted the Professional Information Business at Dow Jones accounted for around 40% of segment revenue but a significantly greater proportion of EBITDA due to higher margins compared to other lines.
  • Realtor.com achieved a revenue-to-existing-home-sales ratio exceeding 20% above the Q3 2022 level, underlining yield expansion despite sluggish U.S. housing conditions.
  • Dow Jones digital direct subscription ARPU improved year over year and sequentially, with pricing initiatives—including a Wall Street Journal digital price increase to $44.99—already starting to show benefits.
  • The CFO reiterated that digital revenues comprised 84% of Dow Jones segment revenue, an increase from the prior year's 82%.
  • "We have these baleful bad boy bots in our sights and intend to pursue them vigorously," CEO Thomson said, referencing legal action against illicit content scraping, with further enforcement expected.
  • The Other segment saw reduced expenses due primarily to stock compensation adjustments but is expected to track slightly lower or in line with the prior year's loss level for the remainder of the fiscal year.
  • News UK achieved double-digit digital advertising revenue gains at The Sun, but print advertising at Dow Jones continued to decline, down 6% for the quarter.
  • AI integration is expanding throughout the business: in product development for Factiva, translation and audiobook creation in Book Publishing, and conversational search functionality within Digital Real Estate Services.

INDUSTRY GLOSSARY

  • ARPU: Average Revenue Per User, a measure of the income generated per subscriber or user, critical in evaluating digital business performance.
  • Backlist: Previously published books that continue to generate sales, contributing to ongoing revenue for the Book Publishing segment.
  • Comscore: Independent analytics firm providing third-party audience and engagement measurement for digital platforms.
  • Professional Information Business: Dow Jones segment encompassing specialized data, analytics, and compliance services serving enterprise clients at higher margins.

Full Conference Call Transcript

Robert Thomson: News Corporation has again delivered resounding results this quarter, marking the twelfth straight quarter of profitability growth on a continuing operations basis. For the quarter, our total revenue rose 9% to $2.2 billion, while total segment EBITDA increased 18% to $343 million, and the overall margin expanded from 14.4% to 15.7%. Net income from continuing operations rose 13%, whilst both EPS and adjusted EPS were notably higher. Our third quarter results reflect a continuation of the positive trends that emerged in the first half, and we remain on track for another record fiscal year of profitability given the strength seen thus far in the fourth quarter.

The robust free cash flow and strong cash position have provided much optionality in maximizing long-term shareholder value. Given our firm belief that the current share price does not reflect the intrinsic value of the company or its prospects, we have continued to execute our enhanced buyback program at an accelerated rate. In assessing our overall performance, the results reflect the ongoing company and its ability to prosper in circumstances which are not particularly auspicious. Interest rates remain rather high and the conflict in the Middle East has exacerbated uncertainty, and yet that conflict has also highlighted the importance of our news and intelligence businesses, both socially and commercially.

The increased profits are driven by the three sectors on which we have focused our strategic investment: Dow Jones, Digital Real Estate Services, and Book Publishing, all of which reported double-digit increases in profit this quarter, and we believe they have much positive momentum. Our confidence comes as the world is grappling with the potential impact of AI. We are an AI inputs company, and that fact was reflected in our recent deal with Meta, which complements our partnership with OpenAI. We are negotiating several further deals with companies who recognize the preciousness of our provenance and which should have a positive impact on our revenue and profitability.

We also expect to receive our fair share of proceeds of the $1.5 billion settlement with Anthropic, starting later this calendar year, an outcome which asserts the integrity of intellectual property, and benefits authors and book publishers. Importantly, the decisions to partner with us by global AI leaders reinforce that status as an input company. Semiconductors are inputs. Energy is an input. And editorial is an absolutely essential input. AI engines require information, and they need constant updates to remain relevant; otherwise, they are merely retrospective. Few companies on the planet have the depth of archive and the immediacy of contemporary content that we can offer across borders and across segments.

We are also seeing a rapid proliferation of vertical specialist AI companies focusing on specific segments. We believe this is a whole new generation of opportunity for our companies—whether our mastheads, HarperCollins, or digital real estate—which generates a vast amount of unique, repurposable data. Separately, we are tracking a number of dodgy digital firms scraping illicitly, illegally, our precious content and shamelessly reselling this purloined property. We have these baleful bad boy bots in our sights and intend to pursue them vigorously. And it should be noted carefully we believe companies which willingly buy this stolen content from these nefarious fences are also culpable. There is a clear distinction between the idoneous and the odious.

Now let us turn to our segments. Dow Jones delivered yet another superb quarter. Revenues rose 8% to $619 million and segment EBITDA expanded by 11% to $147 million, with our margin expanding by 70 basis points compared to a year earlier to 23.7%. Significantly, this marks thirteen consecutive quarters of year-over-year EBITDA growth for Dow Jones, bolstered by continuing strength across Risk & Compliance and our burgeoning energy business. As we shared during our Investor Day in March, we see a clear path for Dow Jones to reach $1 billion in annual segment EBITDA within the next five years.

Not only do Dow Jones’ world-class journalism and extensive data and intelligence serve as the lifeblood of AI, they are indispensable resources for thoughtful readers and for knowing executives seeking to lead enlightened enterprises. In the third quarter, revenues at Risk & Compliance surged 19% as demand expanded from corporate customers in a volatile world seeking to minimize risk and maximize compliance. We continue to see solid demand in our energy business, where revenues rose 12%, and the boost in U.S. energy exports is clearly a positive emerging trend for our business, which has unique data from and insights into the U.S. industry.

On the consumer side, digital direct subscription ARPU continued to improve, while digital-only subscriptions were up 9% on the previous year. Remember, these are core news subscriptions, not recipes, which, like much evergreen content, are indeed susceptible in the AI age. Meanwhile, digital advertising revenue rose 13%, improving on the increase in Q2, led by stronger demand from the technology and finance sectors. Our Digital Real Estate Services segment continued to show strength even though the housing markets in Australia and the U.S. are being buffeted by crosswinds. Reported profit increased with EBITDA rising 5% year over year, while the margin widened from 30.5% to 32.8%.

Revenues at Realtor.com in the U.S. rose 10% even though the 30-year mortgage rate has generally remained above 6%, and existing home sales were near historic lows. The Realtor.com team has done a splendid job retooling the business and we should be primed to prosper when rates decline and liquidity in the housing market returns. Realtor.com has also just partnered with our friends at OpenAI to take advantage of their AI expertise in improving the experience for sellers, buyers, and realtors. Realtor.com already has far greater engagement than the competitor set according to independent Comscore metrics.

In Q3, Realtor.com averaged 5.3 visits per unique user, compared to only 3.5 visits at Zillow, 2.9 visits at Redfin, and 1.9 visits at Homes.com. The team’s strenuous efforts to make the site a holistic property experience are clearly paying dividends. At REA, revenue grew 20%, thanks in part to felicitous FX fluctuations, but also because the team’s determination to provide enhanced services to our customers led to a 14% increase in yield. The potential upside at REA remains exciting, given the focus on product development and the success in adjacencies such as mortgages where we are able to leverage our knowledge of customers and their needs.

At HarperCollins, we had a particularly strong quarter with EBITDA rising 14%, while revenue increased a healthy 8%, well ahead of the overall industry trends. Our margin broadened from 12.5% to 13.2% as we benefited from higher digital sales with eBooks surging 17% and audiobooks increasing 7%. We continue to see feverish interest in Rachel Reid’s Heated Rivalry—in print and digital, and even in countries in which ice hockey is not a mainstream sport. Rachel is adding two more voluptuous volumes to the steamy saga, which has already become a cult classic.

Now, as we approach the summer months in the Northern Hemisphere, we look forward to fascinating fourth quarter releases that include Vice President JD Vance’s Communion, which tells of his personal spiritual journey, as well as releases from Ann Patchett, Alex Aster, and Laurie Gilmore. We are also heartened by the release of the Remarkably Bright Creatures movie on Netflix this week and by releases from the gifted Sarah A. Parker and the inimitable Dana Perino.

In News Media, we saw a 5% increase in revenue to $538 million, though reported a decline in profits in part due to investment in new projects, including the successful launch of the California Post, which has already attracted much attention from readers and advertisers with its feisty coverage of an important but underreported region. While still early days, we are encouraged by traffic trends and have seen meaningful increases in daily active users and engagement across the New York Post media group from California-based users.

News UK closed the quarter with 676 thousand subscribers for The Times and The Sunday Times, a 7% gain on the prior year, while digital advertising for The Sun rebounded and, in fact, increased by double digits. We are looking forward to the positive benefits of the World Cup for our talented team at TalkSport, which, like our other London-based media, will certainly benefit if England wins the ultimate prize. At News Corporation Australia, digital subscription revenue benefited from improved ARPU and an increase in total digital subscribers to 1.2 million, while digital advertising showed improvement year on year.

In conclusion, the third quarter was compelling evidence of the transformation of our business and demonstrated the robustness of our core growth engines, which we expect will propel us towards a strong fiscal finish. None of this would be possible without the thoughtful leadership of our chair, Lachlan Murdoch, the wisdom of our engaged board, and the sterling efforts of our employees around the world. And now, our Chief Financial Officer, Lavanya Chandrashekar, will enlighten you further.

Lavanya Chandrashekar: Thank you, Robert, and good afternoon, everyone. Our third quarter results demonstrate the continued strength and resilience of our portfolio and the benefits of disciplined strategic diversification. Despite the uneven economic backdrop, we posted accelerated top- and bottom-line growth led by our core pillars—Dow Jones, Digital Real Estate Services, and Book Publishing—which collectively generated 17% segment EBITDA growth in the quarter, accelerating from the second quarter rate. The third quarter marks our twelfth consecutive quarter of year-over-year total segment EBITDA growth on a continuing operations basis. These consistent results are the outcome of strong operational discipline and reflect the repositioning of our portfolio.

Our focus on operational efficiency has successfully driven margin expansion, and I believe there is significant opportunity for this trend to continue. News Corporation has evolved well beyond the scope of a traditional media company. We are now a digital-first company with a strong and recurring revenue base complemented by high-margin content licensing revenues. We continue to make strong progress in returning value to our shareholders and have accelerated our share buyback program. In the third quarter, we repurchased $193 million in shares, up from $172 million in the second quarter, bringing fiscal year-to-date repurchases to $459 million. We believe our stock remains materially undervalued relative to its net asset value.

And as a reminder, share repurchases in fiscal 2026 are benefiting from the approximately $380 million repayment of Foxtel shareholder loans and our robust free cash flow. Turning to the quarter, revenues were approximately $2.2 billion, up 9% year over year, and total segment EBITDA was $343 million, up 18%. Margins expanded by 130 basis points to 15.7%. On an adjusted basis, revenues increased 4% and total segment EBITDA grew 13%. Earnings from continuing operations were $0.16 per share compared to $0.14 in the prior year. Adjusted EPS was $0.21, up from $0.17. Turning to Dow Jones.

As highlighted during our investor briefing in March, Dow Jones has strategically pivoted into a news and digital intelligence platform driven by strong organic growth and supported in part by the value M&A we have successfully completed and integrated. This transformation has been fueled by exceptional growth in Risk & Compliance and Dow Jones Energy, supporting our target for $1 billion in annual segment EBITDA within five years. All the compelling materials and the video replay of that briefing are available on the Investor Relations section of the News Corporation website. As for the quarter, revenues were $619 million, growing a robust 8% year over year, consistent with our second quarter performance.

Digital revenues represented 84% of total segment revenue, up from 82% in the prior year. Professional Information Business revenue grew 11% driven by Risk & Compliance, which increased 19% to $100 million, supported by customer growth, product expansion, and improved pricing. The acquisition and seamless integration of Dragonfly and Oxford Analytica—which have been invaluable during the Iran conflict—contributed to this growth. At Dow Jones Energy, revenues grew 12% to $77 million with customer retention remaining very strong at approximately 90%. Growth was driven by improving yields, new price assessments, and a modest benefit from the recent acquisition of Eco-Movement. The upheaval in energy markets is certainly more an opportunity than a challenge.

In the consumer business, circulation revenue grew 1% while digital circulation increased 3%, a result tempered by the absence of a licensing revenue timing benefit in the prior year. As mentioned at the investor briefing, we are actively working to optimize yield, including raising the full-price rate for The Wall Street Journal digital to $44.99 for new customers, increasing the price of introductory offers, and continuing the rollout of higher prices for a portion of tenured subscribers. While it is still very early, we are already seeing benefits from these initiatives, delivering improving year-over-year and quarter-over-quarter growth in digital direct subscription ARPU, and we expect further improvements in the fourth quarter.

Digital circulation represented 76% of total revenue compared to 75% in the prior year. Digital-only subscriptions grew 9% year over year with sequential net adds of approximately 53 thousand. We anticipate that net additions will be notably higher in the fourth quarter driven by growth in enterprise partnerships. Advertising revenues increased 6% to $91 million, the highest third quarter revenue since fiscal 2022, with digital advertising growing 13% while print fell 6%. Growth was driven by the finance and tech categories. Digital represented 67% of total advertising revenue, up from 63% in the prior year.

Dow Jones segment EBITDA for the quarter grew a healthy 11% to $147 million, with margins increasing to 23.7%, up 70 basis points compared to the prior year. Turning to Digital Real Estate, segment revenues were $473 million, up 17% reported and 8% on an adjusted basis. Segment EBITDA was $155 million, up 25% reported and 16% on an adjusted basis. REA revenues grew 208% in constant currency. Growth of the Australian residential business was driven by pricing, contract upgrades, and geographic mix. National new buy listings in the quarter grew 1%, with Sydney up 4% and Melbourne up 7%. The Financial Services business grew double digits driven by a 21% increase in settlements.

Australian revenue grew low double digits, partially offset by declines at REA India due to the sale of PropTiger and the closure of the Housing Edge business as communicated previously. Please refer to the REA earnings release and the conference call for more details. Realtor.com continued to make strong progress this quarter with revenues rising 10% to $148 million and contributing to segment EBITDA growth despite the normalized marketing expenses lapping the pullback of marketing spend in the same period last year. We continue to accelerate the pace of innovation, including the launch of the Realtor.com app in ChatGPT, as Robert mentioned, and the expansion of its newly launched platform Realtor.com Plus, which is receiving favorable industry feedback.

This quarter, revenue growth was driven by strength in core real estate products benefiting from 6% higher lead volume, improved yields, and increased annual contract values. We continue to see strong demand for RealPro Select, our premium program for high-performing agents and teams, which has supported further yield expansion. Additionally, our growth adjacencies—comprising new homes, rentals, and sellers—continue to perform well and represented 22% of revenues in the quarter. It is worth noting that as of Q3, on a trailing twelve-month basis, the ratio of Realtor.com's revenue to existing home sales—a proxy for yield—is over 20% higher compared to Q3 2022, underscoring the upside potential for the business when the market recovers.

According to Comscore data, Realtor.com continued to gain visit share, averaging 31% of total real estate portal visits in Q3, improving from 29% in Q2—nearly six times Homes.com and almost triple that of Redfin, while narrowing the gap to Zillow. Turning to Book Publishing. Revenues grew 8% to $555 million despite mixed industry performance. Segment EBITDA was $73 million, up 14% year over year, with margins expanding 70 basis points to 13.2%. This represents the highest third quarter segment EBITDA since fiscal 2021. On an adjusted basis, revenue and EBITDA increased 4% and 14%, respectively. These robust results were driven by the strong demand for the Game Changers series due to the TV adaptation of Heated Rivalry.

Digital revenues at HarperCollins grew 11%, with both eBooks and audiobooks increasing year over year. This quarter, the backlist contributed 64% of consumer revenues compared to 65% last year. At News Media, revenue increased 5% to $538 million due to currency favorability, while adjusted revenues declined 2% reflecting continued declines in print revenue. Segment EBITDA was $15 million, down $18 million year over year, reflecting lower contribution from News UK coupled with disciplined investment associated with the launch of the California Post. Turning to our outlook. Needless to say, we are closely monitoring events in the Middle East.

While we are not immune to certain cyclical and supply chain issues, we remain confident in our strategy underpinned by recurring revenues and expect to report strong results in the fourth quarter. Some themes by segment. At Dow Jones, we expect continued strong revenue performance and improved margins. At Digital Real Estate Services, Australian residential new buy listings for April rose 19%. Please refer to REA for more detailed outlook commentary. At Realtor, we hope to see continued revenue improvement, albeit the overall housing recovery could be impacted in the shorter term by rising market rates. At Book Publishing, overall HarperCollins trends remain favorable and we expect to benefit from a stronger front-list program.

At News Media, expect to incur some incremental costs compared to the prior year related to the rollout of the California Post but should also see some benefits from new content licensing revenues. While third quarter cash flows were impacted by the timing of working capital, we expect strong free cash flow growth for the fiscal year despite moderately higher capital expenditures as we had communicated earlier this year. With that, I will turn it over to the Operator for Q&A.

Operator: Thank you. We will now start the Q&A session. Please limit your questions to one per participant. If you have joined via the Zoom application, please use the raise hand functionality to ask a question. If you have joined via the audio line, please press 9. Questions will be answered in the order they are received. We will now pause a moment to assemble the queue. Our first question will come from Elsa Lee with UBS. You may now unmute and ask your question.

Elsa Lee: Hi. Thanks for taking my question, Robert and Lavanya. I have just one on Dow Jones Energy and the investment required to build out new energy benchmarks. How are you thinking about the balance between continued investment into building these new benchmarks versus the return profile? And are you able to potentially quantify any investments required? Thanks.

Robert Thomson: Elsa, I think you can see in the way that we have developed that business in recent years that we do, as you suggest, balance very carefully both investment and returns. Overall, the Professional Information Business accounted for about 40% of revenues in Q3, but a significantly larger share of EBITDA, as it is a higher margin business, and that is one reason for the record profitability margin at Dow Jones itself. And there are certainly positive trends at Risk & Compliance, where revenues rose 19%, and a 12% increase at Dow Jones Energy.

Michael Florin: Thank you, Elsa. Operator, we will take our next question, please.

Operator: Your next question will come from David Karnovsky with J.P. Morgan.

David Karnovsky: Hey, thanks. Robert, you continue to report a nice upturn in Realtor growth this quarter, and this is happening even amid still high mortgage rates. Assuming you did see a better macro environment, how are you thinking about the potential uplift from that? And assuming you get that revenue, how do you think about flowing through that to EBITDA versus leaning into investment, either into adjacencies or AI functionality?

Robert Thomson: It is a very thoughtful question. The renaissance of Realtor has really preceded the recovery of the overall U.S. housing market, which remains subject to the vicissitudes of mortgage rates. In fact, at Realtor, our core real estate revenues rose by 15% and represented 77% of total revenues despite the sluggishness of the market.

So now we—and, obviously, aspiring property owners—are subject to a certain extent to the whims and wisdom of the FOMC and their rulings, but what this accelerating revenue increase at Realtor—and we have had successive quarters of double-digit increases in revenue—tells you is that the team has done an extraordinary job in building the base, sorting out the software, and also benefiting from targeting higher premium homes, which of themselves bring higher premiums, and building on the successful expansion into adjacencies including seller, new homes, and rentals. When you look at March existing home sales, which are a paltry 3.98 million homes, well below the historical average, that suppressed demand will at some stage be emancipated.

And Damian Eales and the team have ensured that Realtor is primed to take full advantage of any upturn.

Lavanya Chandrashekar: I will just add, Robert, that I think the team—as you said, Damian and team—have done an absolutely brilliant job. Visit shares are up at 31%, which is six times that of Homes.com and three times that of Redfin. We continue to invest in the brand, and you can see the benefit of that flowing through. I mentioned in my prepared remarks that revenue per existing home sales is now at a 20% higher level than it was in 2022, which was the high-water mark from a housing perspective. With this much higher revenue per house now, as the real estate market comes back, as Robert mentioned, we are positioned to really take full advantage of it.

Michael Florin: Thanks, David. Operator, we will take our next question, please.

Operator: Your next question will come from David Joyce with Seaport Research.

David Joyce: Thank you. In thinking about your Risk & Compliance and Energy offerings, I would think that you have really got accelerating demand these days. Are there areas that your clients are asking for more products that you can develop internally, organically, or where you might have opportunities to do some more tuck-ins?

Robert Thomson: David, we are constantly reevaluating the portfolio, but I think you are right to suggest that product extensions are possible. The team at Dow Jones is very vigilant in taking advantage of opportunity, which is why the businesses are prospering at the moment. Given the volatility in macroeconomic circumstances and also the continuing regulatory vigilance of governments around the world, the imperative for companies and their boards to minimize risk and maximize compliance remains real. Secondly, the changing patterns in energy markets, in particular the surge of U.S. exports to the rest of the world, is of itself creating a new customer base which we can take advantage of without necessarily increasing investment.

Lavanya Chandrashekar: If I could add, during the Dow Jones Investor Day we pointed out that the Risk & Compliance market is indeed enormous—$3.7 billion—and it is growing at 11% to 13%. We believe there are several opportunities to continue to grow the business, both organically and inorganically. Inorganically, we recently completed—and are getting to the anniversary of—the integration of Dragonfly and Oxford Analytica, which have played an enormously big role during the Iran war, gathering a lot of attention.

Organically, as we talked about at the investor briefing, we have a big white space from an international perspective, as well as with financial institutions versus corporates, and there is plenty of room for us to continue to drive growth in those areas as well.

Michael Florin: Thank you, David. Operator, we will take our next question, please.

Operator: Your next question will come from Entcho Raykovski with Evans & Partners.

Entcho Raykovski: Hi, Robert. Hi, Lavanya. My question is around potential AI opportunities. Are you able to talk about the broad quantum of additional revenue from partnerships with AI platforms that you could receive? If you cannot give us specific numbers, perhaps how does it compare with what you have contracted to date with Meta and OpenAI? Maybe on a combined basis, that would be useful. Thank you.

Robert Thomson: Entcho, we obviously cannot discuss the precise details of confidential deals. But the Meta agreement is an important partnership, as is our agreement with OpenAI, and both agreements are more than purely transactional, as we will be exchanging insights as the use of AI evolves exponentially. You will be able to see the impact in our accounts over the next few years—no doubt about that. As for AI itself, we are in the midst of advanced negotiations with several companies, and it is clear that many have come to recognize that the purchase of IP is as important as the acquisition of semiconductors or the securing of stable energy sources. IP powers AI. IP is an input imperative.

And as always, there is a mix of wooing and suing. We would prefer the former, but we will never shy away from protecting our property rights. The integrity of creativity must be safeguarded. For example, as for the perplexing Perplexity, we are now not the only media company that has brought an action, and that is because we would argue that the IP excesses have been so egregiously egregious that even certain other media companies have noticed. We are looking very much forward to the discovery process because we have full confidence that fascinating, illuminating material will surface. We will always be open to a settlement, but the figure needs to be meaningful.

And the deals do keep rolling: Bloomberg, for example, buying Dow Jones AI rights; the $1.5 billion Anthropic settlement; the OpenAI partnership; the Meta agreement; and various other negotiations. The way to think about these negotiations is that there will be substantial deals with the larger horizontal AI companies and then multiple meaningful agreements with specialist verticals who require both archive and updates in their areas of specialist expertise. These are indeed propitious times for our IP.

Michael Florin: Thank you, Entcho. Operator, we will take our next question, please.

Operator: Your next question will come from Craig Huber with Huber Research.

Craig Huber: Yes, hi. Thank you. Can you speak about the benefits you are getting internally from the use of AI? Is there any way of quantifying what the annual cost savings is at this stage from using AI to save costs, make the company more efficient—anything on that front you could help us with?

Lavanya Chandrashekar: Maybe I can start. I would divide the benefits that we are getting from AI into a few areas. First is helping to make our products better, more accessible to consumers, and creating new revenue streams. Obviously, the most visible one is the licensing agreements that we have with the big platforms. But outside of that, we have seen significant benefits from building AI into making Factiva more user-friendly and more widely used. We are seeing that in our Book Publishing business, where we are able to use AI—we are testing AI for both translation as well as for the creation of audiobooks. There are numerous examples across Realtor and REA, using conversational search.

There is a long list of things in play that can help us drive revenue growth. In terms of efficiencies, the most obvious one right now is in coding—using AI to develop some of our product features faster and to be able to test them using AI versus solely people. There is a whole efficiency play there. Also, just being able to assist our people in getting work done, whether it is in the newsroom or in back-office operations—there are tremendous opportunities for us to get work done more efficiently and effectively. Every one of our businesses is pursuing these opportunities.

Michael Florin: Thank you, Craig. Before we take our next question, a quick reminder that if you would like to ask a question, please use the raise hand functionality at the bottom of your Zoom window, or if you joined the audio line, please dial 9. Our next question will go to Brian Han with Morningstar.

Brian Han: A question for Lavanya. Can you please talk about the drivers of the big reduction in losses in the Other division, and whether you think there is a sustainable step-down in those Other losses? Thanks.

Lavanya Chandrashekar: The Other segment represents the cost of running the total corporation outside of the business units. In Q3 we saw reduced expenses, not reduced losses necessarily, and that was related most particularly to our stock compensation calculations. For the full year, I would expect that the Other segment will be similar to the prior year and potentially slightly lower.

Michael Florin: Thank you, Brian. Operator, we will take our next question, please.

Operator: Your next question will come from David Fabris with Macquarie.

David Fabris: Yes, hi. Thanks for taking my question. I am curious how we should think about the earnings profile for the News Media segment. Are you able to talk about the start-up costs from the California Post or the impact from the News UK side in the quarter? And then thinking about these two pieces, do we annualize them going forward, or how do we think about them over the next three quarters?

Robert Thomson: David, you can see in the News Media segment that revenue year over year is 5% higher. So the decline in EBITDA reflected modestly tougher trading conditions in Australia and the UK and, more significantly, the launch costs of the California Post, which is certainly not an extravagant investment, but an investment nonetheless. For context, we have launched the California Post on the back of the rebounding profitability of the New York Post and look forward to expanding revenue and profits over time. We should be very clear about the broader context of the News Media segment. That segment reported a net decline in EBITDA of $18 million, including those launch and marketing costs.

The company overall—our EBITDA—rose 18%, and our profit margins rose from 14.4% to 15.7%. So I think that does give you a sense of the contemporary context of the News Media segment.

Lavanya Chandrashekar: Just to add a couple of things. This segment has had a strong track record of driving cost efficiencies year on year. We saw this in the early part of this year and last year with the work that the News UK team did in building out a partnership with BMG, which has significantly helped to drive efficiencies and operating cost reductions on the print side of things. They are expanding that partnership, which should deliver further efficiencies going forward. In Australia, I would call out the team as well for streamlining operations and helping to drive year-over-year cost reductions.

Looking ahead, Q4 will see some benefits from new content licensing revenues while we continue to invest in the California Post, which, as Robert said, we are being very disciplined about.

Michael Florin: Thank you, David. Operator, we will take our next question, please.

Operator: We have no further questions. I will now hand over to Michael Florin for closing remarks.

Michael Florin: Well, thank you, Operator, and thank you all for participating today. Have a wonderful day, and we will talk to you soon.

Unknown Speaker: Take care.