NewsCorp (NWS) Q4 2025 earnings review
Dow Jones Accelerates, But Overall Growth Slows; Company Ramps Up Buyback
News Corp finished FY2025 with a record year for profitability, but the quarterly trajectory shows a clear deceleration. Q4 revenue grew just 1% YoY to $2.11 billion, with Total Segment EBITDA up 5%, a significant slowdown from the 20% growth seen mid-year. The standout performer was Dow Jones, which accelerated to 7% revenue growth, driven by its high-margin Professional Information Business. This strength was offset by revenue declines and profit pressure in the Book Publishing (-4%) and News Media (-4%) segments. In a strong signal of confidence and a nod to its own view of undervaluation, the company announced a new $1 billion stock repurchase program and its intent to accelerate the pace of buybacks.
🐂 Bull Case
Dow Jones' revenue growth accelerated to 7% in Q4, its best of the year. The high-margin Professional Information Business continues to fire on all cylinders, with Risk & Compliance growing 21%, insulating the company from advertising volatility.
The announcement of a new $1 billion buyback program, on top of ~$300M remaining, and the commitment to an 'accelerated rate' signals strong confidence from management and a direct effort to address the stock's valuation discount.
The recent sale of Foxtel Group focuses the portfolio on the three core pillars (Dow Jones, Digital Real Estate, Book Publishing) and strengthens the balance sheet, providing financial flexibility for investments and shareholder returns.
🐻 Bear Case
Despite a strong full-year result, the quarterly trend is concerning. Total Segment EBITDA growth has slowed sequentially from 20% in Q2 to just 5% in Q4, suggesting a tougher outlook heading into fiscal 2026.
Book Publishing revenues reversed to a 4% decline with profits down 12% on difficult comparisons and softer spending. News Media continues to struggle, with revenues and profits also declining. These segments offset the strength at Dow Jones.
Qualitative guidance points to continued challenges. Management noted soft July trends for Book Publishing, a tough housing market for Realtor.com, and continued volatility in advertising for News Media.
⚖️ Verdict: ⚪
Mixed. The acceleration at Dow Jones is a significant positive, showcasing the successful pivot to high-quality, recurring digital revenue. The enhanced buyback should also be very supportive for the stock. However, the sharp deceleration in overall growth and the persistent weakness in the Publishing and News Media segments are significant concerns that cannot be ignored. The company's performance is becoming increasingly bifurcated.
Key Themes
Dow Jones' Professional Business Hits Escape Velocity
Dow Jones has firmly established itself as the company's premier growth engine. Q4 revenue growth accelerated to 7%, with the Professional Information Business (PIB) growing 10%. This was led by exceptional performance in its high-demand Risk & Compliance (+21%) and Energy (+12%) divisions. The B2B focus provides high-margin, recurring revenue that is less susceptible to economic cycles and advertising market volatility, driving a 10% increase in segment EBITDA for the quarter.
Data Contradicts Narrative: Growth Has Sharply Decelerated
While management touted a 'sterling performance sustained across the four quarters,' the data shows a clear and sharp deceleration. Total Revenue growth fell from 5% in Q2 to 1% in Q4. More critically, Total Segment EBITDA growth collapsed from 20% in Q2 to 12% in Q3 and just 5% in Q4. This trajectory suggests momentum is slowing significantly heading into the new fiscal year, a crucial context missing from the high-level narrative.
Shareholder Returns Take Center Stage with Accelerated Buyback
The board authorized a new $1 billion stock repurchase program, adding to the ~$300 million remaining under the previous plan. Management explicitly stated they will begin repurchases at an 'accelerated rate.' This is the most tangible step yet to address what they perceive as a significant valuation discount and signals a clear priority to return capital to shareholders, bolstered by the cash proceeds from the Foxtel sale.
Book Publishing and News Media Act as a Drag
The two legacy segments are weighing on overall results. Book Publishing revenue swung from 8% growth in Q2 to a 4% decline in Q4, with segment EBITDA falling 12% due to softer consumer spending and tough comps. News Media remains challenged, with revenue and EBITDA declining 4% and 13% respectively. Combined, these segments account for nearly half of company revenue but are contracting.
AI Strategy: A Mix of 'Wooing and Suing'
News Corp is pursuing a dual-track strategy to capitalize on the AI boom. It is actively monetizing its content through partnerships, like the one with OpenAI. Simultaneously, it is taking an aggressive legal stance to protect its intellectual property, with CEO Robert Thomson noting the company will 'sue companies that violate the most basic property rights,' explicitly mentioning President Trump's books as an example of content being consumed without compensation.
US Housing Market Continues to Mute Realtor.com
Despite a third consecutive quarter of revenue growth (+3%) at Realtor.com, the business is still hampered by a 'sluggish U.S. housing market' due to 'punitively high mortgage rates.' While the team's focus on growth adjacencies like rentals and new homes (now 24% of revenue) is showing results, the core business remains constrained by macro factors beyond its control.
Other KPIs
Stable. Free cash flow increased from $540 million in the prior year, even with higher capital expenditures. This healthy cash generation underscores the company's financial strength and provides the capacity to fund the newly accelerated share repurchase program and dividends.
Accelerating. Digital revenues now represent 83% of the segment's total, up from 81% a year ago. This highlights the successful transition to a digital-first model and the increasing contribution from high-margin B2B services and digital subscriptions, which are more resilient than print and advertising.
Accelerating. Revenues from rentals, new homes, and seller services now account for 24% of Realtor.com's total, up from 19% a year ago. This strategic focus is driving growth and diversifying revenue away from the transaction-dependent core business, providing resilience in a tough housing market.
Guidance
Stable. Management stated that trends 'remain healthy' and they expect 'continued margin expansion'. This implies that the strong performance seen in FY25 is expected to continue, with the profitable B2B business likely driving further profit growth.
Decelerating. The outlook is cautious, with management noting that 'July trends were soft' and the business faces 'difficult comparisons'. This suggests the negative growth seen in Q4 could persist into the start of the new fiscal year.
Decelerating/Reversing. For the key Australian market, REA's new buy listings for July were down 8%, a reversal from strong growth in the prior year. The outlook for Realtor.com remains tied to the uncertain U.S. housing market, suggesting near-term headwinds for the segment.
Stable (Negative). Management expects 'recent trends to continue.' Given the segment has posted revenue declines for the past four quarters, this implies another year of contraction, albeit mitigated by ongoing cost-saving initiatives.