The 10-second takeaway
For the quarter ended March 31 (Q3), News Corp. beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded. Non-GAAP earnings per share dropped. GAAP earnings per share expanded significantly.
Gross margins shrank, operating margins dropped, net margins expanded.
News Corp. reported revenue of $9.54 billion. The 18 analysts polled by S&P Capital IQ predicted revenue of $9.17 billion on the same basis. GAAP reported sales were 14% higher than the prior-year quarter's $8.40 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.36. The 20 earnings estimates compiled by S&P Capital IQ anticipated $0.35 per share. Non-GAAP EPS of $0.36 for Q3 were 2.7% lower than the prior-year quarter's $0.37 per share. GAAP EPS of $1.22 for Q3 were 221% higher than the prior-year quarter's $0.38 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 35.9%, 200 basis points worse than the prior-year quarter. Operating margin was 14.3%, 130 basis points worse than the prior-year quarter. Net margin was 29.9%, much better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $9.37 billion. On the bottom line, the average EPS estimate is $0.43.
Next year's average estimate for revenue is $35.61 billion. The average EPS estimate is $1.65.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 127 members out of 156 rating the stock outperform, and 29 members rating it underperform. Among 54 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 49 give News Corp. a green thumbs-up, and five give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on News Corp. is outperform, with an average price target of $31.62.
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