News Corp’s Dow Jones Has Strong Finish to Year; News Media Down YoY

By Jacob Cohen Donnelly • August 8, 2024

News Corp, the owner of Dow Jones, book publishing, digital real estate services, subscription video services, and news media (its five divisions), reported its fiscal Q4 2024 financials today. For the sake of our analysis, we will focus on Dow Jones and news media.

Dow Jones

This division includes The Wall Street Journal and Barron’s Group for consumer side, and then its professional information business. The entire business saw growth.

  • Revenue: $566 million, up 4% from last year
  • Circulation & subscription revenue: $442 million, up 4% from last year
  • Advertising revenue: $102 million, up 2% from last year

On the consumer side, subscriptions rose 11% year-over-year, with digital-only jumping by 16%.

While The Wall Street Journal is growing quicker, the Barron’s Group plays a role in bundling. I recently signed up for WSJ for the first time and there’s a heavy push for users to sign up for the entire suite of products.

Dow Jones is following The New York Times, which we covered earlier this week. The belief is that moving from a single product to multiple products will not only reduce churn, but also increase the average revenue per user. Any incremental subscription dollar is high-margin since fixed costs don’t change. Content creation is necessary regardless.

What’s interesting about this consumer business is how much still comes from print. While WSJ only has 11% of its subscriptions in print, 36%—or $34 million—of its ad revenue came from print advertising. That is shrinking quickly, but print remains a part of this business.

Dow Jones’ secret is its professional information business. According to the Q4 earnings release:

At the Dow Jones segment, for the quarter and full fiscal year, the professional information business was the largest contributor to segment profitability driven by robust revenue growth at Risk & Compliance and Dow Jones Energy.

We can see this growth in the below chart below.

Now, we need to be cautious about history repeating itself. When comparing Q3 2024 to Q4 2024, division revenue increased by only $2 million. And so, while year-over-year growth is strong, we need to determine if the business is reaching saturation or if it was just a slower quarter-over-quarter increase.

News Media

If Dow Jones is up, News Media, including Australian media brands, The Sun, The Times, Sunday Times, and the New York Post, was down 5% year-over-year to $545 million and the fiscal year was down 4% to $2.186 billion.

  • Circulation and subscription revenue decreased by $9 million or 3% from the prior year.
  • Advertising revenue decreased by $11 million, or 5% from the prior year.
  • Segment EBITDA decreased by $17 million, or 38%.

This business is transforming. Only 37% of the revenue is digital, up from 36% last year. The question is whether the pie is going to start getting bigger or will News Media become an incrementally smaller part of News Corp’s portfolio?

News Corp shared some statistics worth sharing:

  • The Times and Sunday Times increased digital subscribers from 565,000 to 594,000.
  • The Sun’s digital offering reached 112 million global unique users in June, compared to 159 million the prior year.
  • New York Post’s digital network reached 117 million unique users in June, compared to 145 million the previous year.

And so, its UK newspapers are growing digitally, albeit slowly, and its free publications have seen significant drops in traffic.

The one positive for this division is the OpenAI deal it signed, which could be $250 million over five years for the entire company. During the earnings, News Corp’s CFO said:

We will see new revenue from our open AI partnerships in fiscal 2025 reflected in the Dow Jones and News Media segments.

Later in the call, she said:

And the content is hugely valuable when we think about these content deals that we’re doing across the business. They have valuable archives that go back hundreds of years that are hugely important to us.

So, this division may not be generating much growth right now, but as part of this licensing revenue, it apparently matters quite a bit.