Q4 Blues For News

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It was more bad news for News Corp. in its fiscal fourth quarter, with strong performance from its cable programming unit unable to offset big declines at its broadcasting, film and publishing units.

Revenue at the media giant was down 10% in the fiscal fourth quarter to $7.7 billion and declined 8% for the year to $30.4 billion, in line with most analysts' expectations.

Operating income for the quarter plunged 82% to $268 million from $1.47 billion in the previous year, reflecting a $452 million non-cash impairment charge related to changes at its Fox Interactive Media unit. Excluding the one-time charge, operating income for the fiscal year was down 30%, in line with company guidance.

Cable networks were the sole bright spot for the quarter and the fiscal year - cable operating income rose 39% in the quarter to $434 million and was up 32% for the fiscal year to $1.7 billion. Leading the charge was Fox News Channel, which reported a 50% rise in operating income compared to the prior year, mainly due to increased affiliate fees.

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But cable's gains weren't enough to offset huge declines at TV broadcasting (operating income down 66% in the quarter, 85% for the fiscal year), newspaper and information services (operating income down 64% for the quarter, 41% for the year) and book publishing (down 104% in the quarter, 89% for the year).

In a conference call with analysts, News Corp. chairman Rupert Murdoch said that he believed that the worst was over -- he expressed a similar sentiment in May during News Corp.'s fiscal third-quarter conference call.

Still he conceded that "In spite of a very good July, we expect a tough few months ahead."