Strong cable, box office performance helps 21st Century Fox

Thanks in part to a strong summer film performance, 21st Century Fox (FOX) was able to beat expectations for its first quarter earnings of 2015 on Tuesday.

The media conglomerate reported quarterly revenues of $7.89 billion, an increase of 12% from the year prior.

In a letter to investors, CEO Rupert Murdoch said that momentum from cable programming and the company's slate of films helped to build strong earnings and revenue growth for the quarter.

Even though the summer movie season was a rough one overall, Fox's lineup of films posted record operating income of $458 million, a 40% increase from the same period last year.

This was thanks to films like the teen romance "The Fault in Our Stars," which stood out at the box office with $178 million globally, and "Dawn of the Planet of the Apes," which brought in a surprising $499 million worldwide.

While the quarter was full of bright spots, one negative for 21st Century Fox was low ratings at the Fox broadcasting network.

Last week the network canceled its $50 million reality experiment "Utopia" after a mere two months.

"We know we have work to do," 21st Century Fox COO Chase Carey said during the company's quarterly conference call with investors.

Carey said it was a "difficult start" to the season, but also mentioned some of the network's successes, like the solid start of the Batman prequel,"Gotham."

While the ratings are bleaker than expected at the company's broadcast network, cable programming was strong in the third quarter, showing an operating income increase of 5% to $1.04 billion.

Carey credited the long-term strength of Fox News, the new sports channel Fox Sports 1 being "on track," and the landmark deal for FXX to carry all past episodes of "The Simpsons." Carey said the "Simpsons" deal had "already paid dividends" for the company.

He also went on to say that pervasive concerns about the changing landscape of TV were "overblown," especially in the short term.

"The traditional bundle still has legs," Carey said.

However, he was quick to mention that new digital offerings are an exciting way to reach consumers, and that the traditional bundle is "fraying at the edge" with millennials.


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