LOS ANGELES (AP) — Freed from its weaker publishing arm, analysts expect entertainment company 21st Century Fox to report a profitable fourth quarter Tuesday after the market closes.
WHAT TO WATCH FOR: Since the end of June, 21st Century Fox has been operating separately from the newspaper and book publishing business, which was spun off under the original name News Corp. The publishing entity is suffering from a move away from printed products among consumers and advertisers. News Corp.'s quarterly results will be filed with securities authorities later.
Analysts expect that pay TV revenue rose in the April-June period as channels such as Fox News and FX commanded higher fees from distributors including cable TV providers and telecommunications companies. Movie studio revenue is expected to be roughly unchanged from a year ago.
The Fox broadcast network's audience ratings have declined nearly 20 percent this year as "American Idol" lost viewers in its 12th season, which should be a drag on ad revenues. The advertising market overall continues to recover, however.
Direct broadcast satellite TV revenue is expected to get a boost, thanks to the company's move to increase its stake in Germany's Sky Deutschland above a majority in January.
WHY IT MATTERS: 21st Century Fox is one of the world's largest creators of content, from "The Simpsons" TV show to the movie "The Wolverine." How it sells its content is a reflection of consumer habits and changing technology. The company is also launching a new national sports channel in the U. S. called Fox Sports 1 starting Aug. 17, which it hopes to build into a rival to market leader ESPN.
Both 21st Century Fox and News Corp. continue to be controlled by founder Rupert Murdoch. He is CEO of 21st Century Fox and exercises roughly 40 percent of the voting rights in each company through a family trust.
WHAT'S EXPECTED: Analysts polled by FactSet expect adjusted earnings of 34 cents per share on revenue of $7.15 billion. The numbers exclude divisions that have become part of the new News Corp.
LAST YEAR'S QUARTER: The old News Corp., in which the publishing and entertainment divisions had been combined, reported a loss of $1.55 billion, or 64 cents per share, after it wrote down the value of its publishing assets. Excluding that charge and other items, it earned 32 cents per share on revenue of $8.37 billion.