Fox 10-Q 2024-03-31

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

or

For the transition period from _________ to _________

Commission File Number 001-38776

FOX CORPORATION

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code (212) 852-7000

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

As of May 6, 2024, 231,150,132 shares of Class A Common Stock, par value $0.01 per share, and 235,581,025 shares of Class B Common Stock, par value $0.01 per share, were outstanding.

FOX CORPORATION

FORM 10-Q

TABLE OF CONTENTS

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Readers should carefully review this document and the other documents filed by Fox Corporation (“FOX” or the “Company”) with the Securities and Exchange Commission (the “SEC”). This section should be read together with the unaudited interim consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and the Annual Report on Form 10-K for the fiscal year ended June 30, (“fiscal”) 2023 as filed with the SEC on August 11, 2023 (the “2023 Form 10-K”). The unaudited consolidated financial statements are referred to as the “Financial Statements” herein.

INTRODUCTION

Management’s discussion and analysis of financial condition and results of operations is intended to help provide an understanding of the Company’s financial condition, changes in financial condition and results of operations. This discussion is organized as follows:

• Overview of the Company’s Business**—This section provides a general description of the Company’s businesses, as well as developments that occurred during the three and nine months ended March 31, 2024 and 2023 that the Company believes are important in understanding its results of operations and financial condition or to disclose known trends.

• Results of Operations**—This section provides an analysis of the Company’s results of operations for the three and nine months ended March 31, 2024 and 2023. This analysis is presented on both a consolidated and a segment basis. In addition, a brief description is provided of significant transactions and events that impact the comparability of the results being analyzed.

• Liquidity and Capital Resource****s**—This section provides an analysis of the Company’s cash flows for the nine months ended March 31, 2024 and 2023, as well as a discussion of the Company’s outstanding debt and commitments, both firm and contingent, that existed as of March 31, 2024. Included in the discussion of outstanding debt is a discussion of the amount of financial capacity available to fund the Company’s future commitments and obligations, as well as a discussion of other financing arrangements.

• Caution Concerning Forward-Looking Statements**—This section provides a description of the use of forward-looking information appearing in this Quarterly Report on Form 10-Q, including in Management’s Discussion and Analysis of Financial Condition and Results of Operations. Such information is based on management’s current expectations about future events which are subject to change and to inherent risks and uncertainties. For a discussion of the risk factors applicable to the Company, refer to (i) Part I., Item 1A. “Risk Factors” in the 2023 Form 10-K and (ii) Part II., Item 1A. “Risk Factors” in the Company’s Quarterly Reports on Form 10-Q for the fiscal quarter ended September 30, 2023, as filed with the SEC on November 2, 2023 (the “Q1 2024 Form 10-Q”), and the fiscal quarter ended December 31, 2023, as filed with the SEC on February 7, 2024 (the “Q2 2024 Form 10-Q”).

OVERVIEW OF THE COMPANY’S BUSINESS

The Company is a news, sports and entertainment company, which manages and reports its businesses in the following segments:

• Cable Network Programming**, which produces and licenses news and sports content distributed through traditional cable television systems, direct broadcast satellite operators and telecommunication companies (“traditional MVPDs”), virtual multi-channel video programming distributors (“virtual MVPDs”) and other digital platforms, primarily in the U.S.

• Television**, which produces, acquires, markets and distributes programming through the FOX broadcast network, advertising-supported video-on-demand (“AVOD”) service Tubi, 29 full power broadcast television stations, including 11 duopolies, and other digital platforms, primarily in the U.S. Eighteen of the broadcast television stations are affiliated with the FOX Network, 10 are affiliated with MyNetworkTV and one is an independent station. The segment also includes various production companies that produce content for the Company and third parties.

• Other, Corporate and Eliminations**, which principally consists of the FOX Studio Lot, Credible Labs Inc. (“Credible”), corporate overhead costs and intracompany eliminations. The FOX Studio Lot, located in Los Angeles, California, provides television and film production services along with office space, studio operation services and includes all operations of the facility. Credible is a U.S. consumer finance marketplace.

We use the term "MVPDs" to refer collectively to traditional MVPDs and virtual MVPDs.

RESULTS OF OPERATIONS

Results of Operations—For the three and nine months ended March 31, 2024 versus the three and nine months ended March 31, 2023.

The following table sets forth the Company’s operating results for the three and nine months ended March 31, 2024, as compared to the three and nine months ended March 31, 2023:

Overview

For the three months ended March 31, 2024 and 2023

The Company’s revenues decreased $637 million or 16% for the three months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, due to lower advertising and other revenues, partially offset by higher affiliate fee revenue. The increase of $81 million or 4% in affiliate fee revenue was primarily due to the approximately $230 million impact of higher average rates per subscriber and higher fees received from television stations that are affiliated with the FOX Network, partially offset by the approximately $140 million impact of a lower average number of subscribers across almost all networks. The decrease of $640 million or 34% in advertising revenue was primarily due to the absence of the February 2023 broadcast of Super Bowl LVII and fewer National Football League (“NFL”) games. The decrease of $78 million or 22% in other revenues was primarily due to the timing of college sports sublicensing revenue.

Operating expenses decreased $677 million or 25% for the three months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, primarily due to the impact of the absence of the February 2023 broadcast of Super Bowl LVII, fewer NFL games and the timing of sports programming rights amortization at the national sports networks.

Selling, general and administrative expenses decreased $18 million or 3% for the three months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, primarily due to lower legal costs at FOX News Media.

For the nine months ended March 31, 2024 and 2023

The Company’s revenues decreased $993 million or 8% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, due to lower advertising and other revenues, partially offset by higher affiliate fee revenue. The increase of $185 million or 4% in affiliate fee revenue was primarily due to the approximately $550 million impact of higher average rates per subscriber and higher fees received from television stations that are affiliated with the FOX Network, partially offset by the approximately $330 million impact of a lower average number of subscribers across almost all networks. The decrease of $1.2 billion or 21% in advertising revenue was primarily due to the approximately $950 million impact of the absence of the fiscal 2023 broadcasts of Super Bowl LVII and the Fédération International de Football Association (“FIFA”) Men’s World Cup and fewer NFL playoff games. The remaining decrease of approximately $250 million was primarily related to lower political advertising revenue at the FOX Television Stations principally due to the comparison with the November 2022 U.S. midterm elections in the prior year and lower ratings at FOX News Media and the FOX Network, partially offset by continued growth at Tubi and the broadcast of the FIFA Women’s World Cup at the national sports networks in the current year. The decrease of $17 million or 2% in other revenues was primarily due to lower content revenues principally due to the impact of the industry guild labor disputes in 2023, partially offset by higher sports sublicensing revenue principally due to renewals of college sports contracts.

Operating expenses decreased $606 million or 8% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, primarily due to the approximately $460 million impact of lower sports programming rights amortization and production costs principally due to the absence of the fiscal 2023 broadcasts of Super Bowl LVII and the FIFA Men’s World Cup partially offset by the renewed NFL contract. The remaining decrease was principally due to lower entertainment programming rights and production costs largely due to fewer hours of original scripted programming as compared to the prior year period as a result of the impact of the industry guild labor disputes in 2023.

Selling, general and administrative expenses decreased $41 million or 3% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, primarily due to lower legal costs at FOX News Media and lower employee related costs.

Restructuring, impairment and other corporate matters—See Note 11—Additional Financial Information to the accompanying Financial Statements under the heading “Restructuring, Impairment and Other Corporate Matters.”

Interest expense, net— Interest expense, net decreased $14 million or 8% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, as the increase in interest expense due to the issuance of $1.25 billion of senior notes in October 2023 (See Note 5—Borrowings to the accompanying Financial Statements) was more than offset by higher interest income as a result of higher interest rates.

Non-operating other, net—See Note 11—Additional Financial Information to the accompanying Financial Statements under the heading “Non-Operating Other, net.”

Income tax (expense) benefit—The Company’s tax provision and related effective tax rate for the three and nine months ended March 31, 2024 of 27% and 25%, respectively, was higher than the statutory rate of 21% primarily due to state taxes.

The Company's tax provision and related effective tax rate for the three and nine months ended March 31, 2023 was different than the statutory rate of 21% primarily due to state taxes and the impact of other permanent items.

Net income (loss)—The Company recorded net income of $704 million and $1.2 billion for the three and nine months ended March 31, 2024, respectively, as compared to a net loss of $50 million and net income of $884 million for the three and nine months ended March 31, 2023, respectively. The increases were primarily due to the absence of the fiscal 2023 legal settlement costs at FOX News Media (See Note 11—Additional Financial Information to the accompanying Financial Statements under the heading “Restructuring, Impairment and Other Corporate Matters”) and a gain on a contribution of assets (See Note 11—Additional Financial Information to the accompanying Financial Statements under the heading “Non-Operating Other, net”), partially offset by higher provision for income tax, the net change in fair value of the Company’s investments in equity securities and, for the nine months ended March 31, 2024, lower Segment EBITDA (as defined below).

Segment Analysis

The Company’s operating segments have been determined in accordance with the Company’s internal management structure, which is organized based on operating activities. The Company evaluates performance based upon several factors, of which the primary financial measure is segment operating income before depreciation and amortization, or Segment EBITDA. Due to the integrated nature of these operating segments, estimates and judgments are made in allocating certain assets, revenues and expenses.

Segment EBITDA is defined as Revenues less Operating expenses and Selling, general and administrative expenses. Segment EBITDA does not include: Amortization of cable distribution investments, Depreciation and amortization, Restructuring, impairment and other corporate matters, Interest expense, net, Non-operating other, net and Income tax expense. Management believes that Segment EBITDA is an appropriate measure for evaluating the operating performance of the Company’s business segments because it is the primary measure used by the Company’s chief operating decision maker to evaluate the performance of and allocate resources to the Company’s businesses.

The following tables set forth the Company’s Revenues and Segment EBITDA for the three and nine months ended March 31, 2024, as compared to the three and nine months ended March 31, 2023:

Cable Network Programming (41% and 39% of the Company’s revenues for the first nine months of fiscal 2024 and 2023, respectively)

For the three months ended March 31, 2024 and 2023

Revenues at the Cable Network Programming segment decreased $98 million or 6% for the three months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, due to lower advertising and other revenues, partially offset by higher affiliate fee revenue. Affiliate fee revenue increased $11 million or 1% as higher average rates per subscriber were partially offset by a decrease in the average number of subscribers. The decrease of $20 million or 6% in advertising revenue was primarily due to lower digital advertising revenue and moderating direct response pricing declines at FOX News Media. Also contributing to this decrease was the absence of the March 2023 broadcast of the World Baseball Classic at the national sports networks. The decrease of $89 million or 55% in other revenues was primarily due to the timing of college sports sublicensing revenue.

Cable Network Programming Segment EBITDA increased $27 million or 3% for the three months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, as the revenue decreases noted above were more than offset by lower expenses. Operating expenses decreased $111 million or 18% primarily due to the timing of sports programming rights amortization at the national sports networks. Selling, general and administrative expenses decreased $14 million or 8% primarily due to lower legal costs at FOX News Media and the deconsolidation of the United States Football League.

For the nine months ended March 31, 2024 and 2023

Revenues at the Cable Network Programming segment decreased $116 million or 3% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, due to lower advertising and affiliate fee revenues, partially offset by higher other revenues. The decrease of $8 million in affiliate fee revenue was primarily due to a decrease in the average number of subscribers partially offset by higher average rates per subscriber. The decrease of $149 million or 14% in advertising revenue was primarily due to lower ratings and lower pricing in the direct response marketplace partially offset by higher pricing in the national advertising marketplace at FOX News Media. Also contributing to this decrease was the absence of the fiscal 2023 broadcast of the FIFA Men’s World Cup partially offset by the broadcast of the FIFA Women’s World Cup at the national sports networks in the current year. The increase of $41 million or 10% in other revenues was primarily due to higher sports sublicensing revenue principally due to renewals of college sports contracts.

Cable Network Programming Segment EBITDA increased $103 million or 5% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, as the revenue decreases noted above were more than offset by lower expenses. Operating expenses decreased $181 million or 8% primarily due to lower sports programming rights amortization and production costs, led by the absence of the fiscal 2023 broadcast of the FIFA Men’s World Cup partially offset by the broadcast of the FIFA Women’s World Cup at the national sports networks in the current year. Selling, general and administrative expenses decreased $38 million or 8% primarily due to lower legal costs at FOX News Media.

Television (58% and 60% of the Company’s revenues for the first nine months of fiscal 2024 and 2023, respectively)

For the three months ended March 31, 2024 and 2023

Revenues at the Television segment decreased $537 million or 22% for the three months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, due to lower advertising revenue, partially offset by higher affiliate fee and other revenues. The decrease of $620 million or 40% in advertising revenue was primarily due to the absence of the February 2023 broadcast of Super Bowl LVII and fewer NFL games in the current year quarter, partially offset by continued growth at Tubi. The increase of $70 million or 9% in affiliate fee revenue was primarily due to higher fees received from television stations that are affiliated with the FOX Network and higher average rates per subscriber partially offset by a lower average number of subscribers at the Company’s owned and operated television stations. The increase of $13 million or 9% in other revenues was primarily due to the timing of deliveries at FOX's entertainment production companies.

Television Segment EBITDA increased $28 million or 24% for the three months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, as the revenue decreases noted above were more than offset by lower expenses. Operating expenses decreased $566 million or 27% primarily due to lower sports and entertainment programming rights amortization and production costs principally due to the absence of the February 2023 broadcast of Super Bowl LVII, fewer NFL games in the current year quarter, and fewer hours of original scripted programming as compared to the prior year period as a result of the impact of the industry guild labor disputes in 2023.

For the nine months ended March 31, 2024 and 2023

Revenues at the Television segment decreased $863 million or 12% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, due to lower advertising and other revenues, partially offset by higher affiliate fee revenue. The decrease of $1 billion or 22% in advertising revenue was primarily due to the absence of the fiscal 2023 broadcasts of Super Bowl LVII and the FIFA Men’s World Cup, lower political advertising revenue at the FOX Television Stations principally due to the comparison with the November 2022 U.S. midterm elections in the prior year, fewer NFL playoff games, and lower ratings at the FOX Network. Partially offsetting this decrease was continued growth at Tubi. The increase of $193 million or 9% in affiliate fee revenue was primarily due to higher fees received from television stations that are affiliated with the FOX Network and higher average rates per subscriber partially offset by a lower average number of subscribers at the Company’s owned and operated television stations. The decrease of $43 million or 9% in other revenues was primarily due to lower content revenues principally due to the impact of the industry guild labor disputes in 2023.

Television Segment EBITDA decreased $424 million or 54% for the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, due to the revenue decreases noted above partially offset by lower expenses. Operating expenses decreased $414 million or 7% primarily due to lower sports programming rights amortization and production costs principally due to the absence of the fiscal 2023 broadcasts of Super Bowl LVII and the FIFA Men’s World Cup and fewer NFL playoff games, partially offset by the renewed NFL contract. Also contributing to this decrease was lower entertainment programming rights amortization and production costs principally due to fewer hours of original scripted programming as compared to the prior year period as a result of the impact of the industry guild labor disputes in 2023. Selling, general and administrative expenses decreased $25 million or 3% primarily due to lower employee related costs.

Other, Corporate and Eliminations (1% of the Company’s revenues for the first nine months of fiscal 2024 and 2023)

For the three and nine months ended March 31, 2024 and 2023

Revenues at the Other, Corporate and Eliminations segment for the three and nine months ended March 31, 2024 and 2023 include revenues generated by Credible and the operation of the FOX Studio Lot for third parties. Operating expenses for the three and nine months ended March 31, 2024 and 2023 include advertising and promotional expenses at Credible. Selling, general and administrative expenses for the three and nine months ended March 31, 2024 and 2023 primarily relate to employee costs, professional fees and the costs of operating the FOX Studio Lot. Selling, general and administrative expenses for the nine months ended March 31, 2024 increased, as compared to the corresponding period of fiscal 2023, primarily due to higher employee related costs as a result of the transition and separation of a named executive officer of the Company.

Non-GAAP Financial Measures

Adjusted EBITDA is defined as Revenues less Operating expenses and Selling, general and administrative expenses. Adjusted EBITDA does not include: Amortization of cable distribution investments, Depreciation and amortization, Restructuring, impairment and other corporate matters, Interest expense, net, Non-operating other, net and Income tax expense.

Management believes that information about Adjusted EBITDA assists all users of the Company’s Financial Statements by allowing them to evaluate changes in the operating results of the Company’s portfolio of businesses separate from non-operational factors that affect Net income, thus providing insight into both

operations and the other factors that affect reported results. Adjusted EBITDA provides management, investors and equity analysts a measure to analyze the operating performance of the Company’s business and its enterprise value against historical data and competitors’ data, although historical results, including Adjusted EBITDA, may not be indicative of future results (as operating performance is highly contingent on many factors, including customer tastes and preferences).

Adjusted EBITDA is considered a non-GAAP financial measure and should be considered in addition to, not as a substitute for, net income, cash flow and other measures of financial performance reported in accordance with U.S. generally accepted accounting principles (“GAAP”). In addition, this measure does not reflect cash available to fund requirements and excludes items, such as depreciation and amortization and impairment charges, which are significant components in assessing the Company’s financial performance. Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.

The following table reconciles Net income to Adjusted EBITDA for the three and nine months ended March 31, 2024, as compared to the three and nine months ended March 31, 2023:

The following table sets forth the computation of Adjusted EBITDA for the three and nine months ended March 31, 2024, as compared to the three and nine months ended March 31, 2023.

LIQUIDITY AND CAPITAL RESOURCES

Current Financial Condition

The Company has approximately $3.8 billion of cash and cash equivalents as of March 31, 2024 and an unused five-year $1.0 billion unsecured revolving credit facility (See Note 5—Borrowings to the accompanying Financial Statements). The Company also has access to the worldwide capital markets, subject to market conditions. As of March 31, 2024, the Company was in compliance with all of the covenants under the revolving credit facility, and it does not anticipate any noncompliance with such covenants.

The principal uses of cash that affect the Company’s liquidity position include the following: the acquisition of rights and related payments for sports and entertainment programming; operational expenditures including production costs; marketing and promotional expenses; expenses related to broadcasting the Company’s programming; employee and facility costs; capital expenditures; acquisitions; income taxes, interest and dividend payments; debt repayments; legal settlements; and stock repurchases.

The Company has evaluated, and expects to continue to evaluate, possible acquisitions and dispositions of certain businesses and assets. Such transactions may be material and may involve cash, the Company’s securities or the assumption of additional indebtedness.

Sources and Uses of Cash

Net cash provided by operating activities for the nine months ended March 31, 2024 and 2023 was as follows (in millions):

The decrease in net cash provided by operating activities during the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, was primarily due to lower Segment EBITDA and lower NFL receipts due to the absence of Super Bowl LVII, partially offset by lower entertainment programming costs.

Net cash used in investing activities for the nine months ended March 31, 2024 and 2023 was as follows (in millions):

Net cash used in investing activities remained relatively consistent during the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, primarily due to higher investments in equity securities partially offset by a decrease in capital expenditures.

Net cash used in financing activities for the nine months ended March 31, 2024 and 2023 was as follows (in millions):

The decrease in net cash used in financing activities during the nine months ended March 31, 2024, as compared to the corresponding period of fiscal 2023, was primarily due to lower activity under the stock repurchase program and the net impact of the October 2023 issuance of $1.25 billion of senior notes and the $1.25 billion repayment of senior notes that matured in January 2024 (See Note 5—Borrowings to the accompanying Financial Statements).

Stock Repurchase Program

See Note 6—Stockholders’ Equity to the accompanying Financial Statements under the heading “Stock Repurchase Program.”

Dividends

The Company declared a semi-annual dividend of $0.26 per share on both the Class A Common Stock, par value $0.01 per share, and the Class B Common Stock, par value $0.01 per share, during the three months ended March 31, 2024, which was paid on March 26, 2024 to stockholders of record on March 6, 2024.

Debt Instruments

Borrowings include senior notes. In January 2024, $1.25 billion of 4.030% senior notes matured and were repaid in full (See Note 5—Borrowings to the accompanying Financial Statements).

Ratings of the Senior Notes

The following table summarizes the Company’s credit ratings as of March 31, 2024:

Revolving Credit Agreement

The Company has an unused five-year $1.0 billion unsecured revolving credit facility with a maturity date of June 2028 (See Note 5—Borrowings to the accompanying Financial Statements).

Commitments and Contingencies

See Note 8—Commitments and Contingencies to the accompanying Financial Statements.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

This document contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical or current fact are “forward-looking statements” for purposes of federal and state securities laws, including any statements regarding (i) future earnings, revenues or other measures of the Company’s financial performance; (ii) the Company’s plans, strategies and objectives for future operations; (iii) proposed new programming or other offerings; (iv) future economic conditions or performance; and (v) assumptions underlying any of the foregoing. Forward-looking statements may include, among others, the words “may,” “will,” “should,” “likely,” “anticipates,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “outlook” or any other similar words.

Although the Company’s management believes that the expectations reflected in any of the Company’s forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any forward-looking statements. The Company’s future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties, such as those disclosed or incorporated by reference in our filings with the SEC. Important factors that could cause the Company’s actual results, performance and achievements to differ materially from those estimates or projections contained in the Company’s forward-looking statements include, but are not limited to, government regulation, economic, strategic, political and social conditions and the following factors:

• evolving technologies and distribution platforms and changes in consumer behavior as consumers seek more control over when, where and how they consume content, and related impacts on advertisers and MVPDs;

• declines in advertising expenditures due to various factors such as the economic prospects of advertisers or the economy, major sports events and election cycles, evolving technologies and distribution platforms and related changes in consumer behavior and shifts in advertisers’ expenditures, the evolving market for AVOD advertising campaigns, and audience measurement methodologies’ ability to accurately reflect actual viewership levels;

• further declines in the number of subscribers to MVPD services;

• the failure to enter into or renew on favorable terms, or at all, affiliation or carriage agreements or arrangements through which the Company makes its content available for viewing through online video platforms;

• the highly competitive nature of the industry in which the Company’s businesses operate;

• the popularity of the Company’s content, including special sports events; and the continued popularity of the sports franchises, leagues and teams for which the Company has acquired programming rights;

• the Company’s ability to renew programming rights, particularly sports programming rights, on sufficiently favorable terms, or at all;

• damage to the Company’s brands or reputation;

• the inability to realize the anticipated benefits of the Company’s strategic investments and acquisitions, and the effects of any combination or significant acquisition, disposition or other similar transaction involving the Company;

• the loss of key personnel;

• labor disputes, including labor disputes involving professional sports leagues whose games or events the Company has the right to broadcast;

• lower than expected valuations associated with the Company’s reporting units, indefinite-lived intangible assets, investments or long-lived assets;

• a degradation, failure or misuse of the Company’s network and information systems and other technology relied on by the Company that causes a disruption of services or improper disclosure of personal data or other confidential information;

• content piracy and signal theft and the Company’s ability to protect its intellectual property rights;

• the failure to comply with laws, regulations, rules, industry standards or contractual obligations relating to privacy and personal data protection;

• changes in tax, federal communications or other laws, regulations, practices or the interpretations thereof;

• the impact of any investigations or fines from governmental authorities, including Federal Communications Commission (“FCC”) rules and policies and FCC decisions regarding revocation, renewal or grant of station licenses, waivers and other matters;

• the failure or destruction of satellites or transmitter facilities the Company depends on to distribute its programming;

• unfavorable litigation outcomes or investigation results that require the Company to pay significant amounts or lead to onerous operating procedures;

• changes in GAAP or other applicable accounting standards and policies;

• the Company’s ability to secure additional capital on acceptable terms;

• the impact of widespread health emergencies or pandemics and measures to contain their spread; and

• the other risks and uncertainties detailed in Part I, Item 1A. “Risk Factors” in the 2023 Form 10-K and Part II, Item 1A. “Risk Factors” in the Q1 2024 Form 10-Q and the Q2 2024 Form 10-Q.

Forward-looking statements in this Quarterly Report on Form 10-Q speak only as of the date hereof, and forward-looking statements in documents that are incorporated by reference hereto speak only as of the date of those documents. The Company does not undertake any obligation to update or release any revisions to any forward-looking statement made herein or to report any events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or to conform such statements to actual results or changes in our expectations, except as required by law.

There have been no material changes in the market risks reported in the 2023 Form 10-K.

**(a)**Disclosure Controls and Procedures

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Quarterly Report. Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective in recording, processing, summarizing and reporting on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act and were effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

**(b)**Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the Company’s third quarter of fiscal 2024 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

See Note 8—Commitments and Contingencies to the accompanying Unaudited Consolidated Financial Statements of FOX under the heading “Contingencies” for a discussion of the Company’s legal proceedings, which is incorporated herein by reference.

There have been no material changes to the risk factors described in the section titled “Risk Factors” in (i) the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023, as filed with the Securities and Exchange Commission (the “SEC”) on August 11, 2023, and (ii) the Company’s Quarterly Reports on Form 10-Q for the quarters ended September 30, 2023 and December 31, 2023, as filed with the SEC on November 2, 2023 and February 7, 2024, respectively.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Below is a summary of the Company’s repurchases of its Class A Common Stock, par value $0.01 per share (the “Class A Common Stock”) during the three months ended March 31, 2024:

In total, the Company repurchased approximately 32 million shares of Class A Common Stock for approximately $750 million during the nine months ended March 31, 2024.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

Not applicable.

(a) Exhibits.

SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.