21st Century Fox has cut its profits forecast for the next fiscal year by about $500 million blaming currency swings and a decline in television ratings as viewers move to new digital platforms.
Chase Carey, chief operating officer blamed “adverse industry trends” in TV ratings. “We expect these themes to continue,” he said.
Fox is exploring OTT but Carey didn’t comment on whether it had any concrete plans for new services. “It will take time for us to build the [new digital] vehicles to replace the short-term pressures [of ratings declines]…But we’re in the sweet spot . . . we have the content people want to watch.”
Fox initially expected to deliver profits of $8bn for the 12 months ending June 2016 but Mr Carey said the group had lowered its forecast to “mid-$7bn”. “We’re disappointed to fall short of our targets,” he said.
Meanwhile, as it announces a forecast cut Fox chairman Rupert Murdoch has lost an important ally in his News Corp business as Saudi Prince Alwaleed bin Talal sold most of his stake.
Kingdom Holding Company sold $188m of B shares in the media company, cutting its stake from 6.6 per cent to 1 per cent. It said it had decided to reduce its stake during a portfolio review, but gave no further explanation.
Kingdom has consistently supported Murdoch, backing him during the phone-hacking scandal and in shareholder votes that have challenged News Corp’s dual class structure, which has for decades secured the Murdoch family’s control.