News Corp., completing its first full year as a stand-alone company, reported quarterly earnings that missed analysts’ estimates for the first time as it struggled in its transition from print to digital.
Profit, excluding some items, was 1 cent a share in the fiscal fourth quarter. That was short of the 3 cents analysts estimated on average, according to data compiled by Bloomberg. Revenue fell 3.1% to $2.19 billion, said the company, which split from billionaire Rupert Murdoch’s entertainment business last year. Analysts had projected $2.14 billion.
Like many publishers, Chief Executive Robert Thomson is working to transform the company’s print properties into a digital business as well as expand around the globe. The company, which owns book publisher HarperCollins, finalized its purchase of romance publisher Harlequin Enterprises this month as part of its strategy to reap sales from foreign markets.
The news division, which publishes the Wall Street Journal and the New York Post in the U.S., continued to face difficulty at a time when advertising is fleeing print in favor of digital destinations. Sales in the division fell 6.3% to $1.56 billion as advertising revenue weakened.
Shares of News Corp. fell 21 cents, or 1.2%, to $17.42 after the release of earnings.
Net income was $13 million, or 2 cents a share, compared with a loss of $1.12 billion, or $1.94, a year earlier.
Murdoch broke off News Corp. at the end of June 2013 from his more profitable entertainment businesses, including Fox Broadcasting and cable network Fox News. He recently failed in his attempt to acquire Time Warner Inc. to combine it with his entertainment company, 21st Century Fox Inc.
Murdoch withdrew his bid of $85 a share this week after Time Warner rejected the proposal.
“This is our resolute decision, which is why we formally withdrew our acquisition offer,” Murdoch said on a conference call after Fox’s earnings report.