Cable news and media network Fox (NASDAQ: FOXA) reported Q2 CY2025 results beating Wall Street’s revenue expectations, with sales up 6.3% year on year to $3.29 billion. Its non-GAAP profit of $1.27 per share was 27.3% above analysts’ consensus estimates.

Is now the time to buy FOXA? Find out in our full research report (it’s free).

StockStory’s Take

Fox’s second quarter saw results ahead of Wall Street’s expectations, but the market reaction was negative. Management attributed the outperformance to strong gains in digital advertising, particularly at Tubi, and robust viewership across Fox News and live sports. CEO Lachlan Murdoch highlighted record-breaking audience engagement, especially during marquee events like the Super Bowl, and emphasized the company’s diversified revenue streams. However, management also acknowledged rising costs related to sports rights and digital investments, which may have contributed to investor caution despite the operational momentum.

Looking ahead, Fox’s forward guidance is shaped by the anticipated launch of its FOX One streaming platform, ongoing digital investment, and evolving advertising trends. Management believes the company is well positioned to capture demand among “cordless” audiences, while maintaining a focus on profitability at Tubi and expansion into Latin America. CFO Steve Tomsic cautioned that investments in FOX One and international growth will be front-loaded and may temporarily impact margins, but management expects digital profitability improvements to offset these over time. Murdoch stated, “Our aspiration for FOX One subscribers are modest, and our measured investment toward this initiative will match these long-range goals.”

Key Insights from Management’s Remarks

Management credited audience growth at Tubi and Fox News, as well as healthy sports advertising, as core drivers behind the quarter’s outperformance versus expectations.

• Tubi’s rapid expansion: Tubi, Fox’s free streaming service, experienced 17% growth in total viewing time and 32% revenue growth. Management attributed Tubi’s momentum to its extensive content library and appeal to “cordless” viewers who are difficult for advertisers to reach through traditional TV. The platform now accounts for about 25% of Fox’s upfront advertising commitments, indicating rising strategic importance.

• Fox News audience leadership: Fox News continued to dominate cable news ratings, achieving over 60% audience share during the quarter, with total day viewers up 25% and prime-time viewers up 31% in key demographics. This audience strength translated directly to premium advertising rates and strong demand in national and direct response categories.

• Sports portfolio resilience: Fox’s live sports programming, including the Indianapolis 500 and Major League Baseball, sustained strong viewership and demand from advertisers. The company highlighted the upcoming NFL and college football seasons as major opportunities for future engagement and revenue.

• Affiliate renewals and distribution: Fox completed renewals with distributors representing about one-quarter of affiliate revenues, with pricing gains outpacing subscriber declines. Management noted these renewals provided a stabilizing effect on affiliate fee revenue, despite broader industry cord-cutting trends.

• Investments in digital and international: The company began investing in Latin American sports rights and acquired Caliente TV, a streaming platform in Mexico. These early-stage initiatives are expected to be modest in cost, with management emphasizing a long-term view on returns and profitability.

Drivers of Future Performance

Fox’s outlook centers on continued digital growth, disciplined investment in new platforms, and leveraging strong live content franchises.

• FOX One launch and strategy: The rollout of FOX One, a direct-to-consumer streaming service, is expected to drive incremental digital revenue while targeting “cordless” consumers. Management stated that investment in FOX One will be focused on marketing and technology, with content sourced from existing Fox assets and no significant original programming spend. Subscriber goals are intentionally modest, and the company plans to adjust marketing expenditure based on early performance.

• Tubi profitability trajectory: Management projects further profitability improvements at Tubi, with gains weighted toward the second half of the year. As Tubi becomes more mature, Fox expects its increasing contribution to help offset upfront investments in other digital initiatives, including international expansion.

• Event-driven advertising cycles: Fox’s revenue will be influenced by the cyclical nature of major events such as the FIFA Men’s World Cup and the absence of the Super Bowl and political ad revenue in the upcoming quarters. Management highlighted expected advertising strength in news and sports, but also noted the headwind from prior-year political revenue, especially at local TV stations.

Catalysts in Upcoming Quarters

In upcoming quarters, our team will closely watch (1) the launch and early subscriber trends of FOX One, (2) profitability improvements at Tubi amid rising digital investment, and (3) the initial impact of Latin American market expansion. Additional attention will be paid to advertiser demand during prime sports events and any changes in affiliate fee revenue as distribution agreements renew.

FOX currently trades at $56.13, down from $57.06 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).

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