Bloomberg news reports that American Idol and X Factor’s falling ratings are hurting FOX parent company, News Corp.’s bottom line:
News Corp., Rupert Murdoch’s media company, fell the most in eight months in Sydney trading after cutting its profit forecast because of declining ratings for shows such as “American Idol” and “X Factor.”
Operating income will grow by a “mid- to high-single- digit” percentage for the fiscal year ending in June, the company said on a conference call late yesterday, down from an earlier forecast of growth that could exceed 10 percent. Fewer viewers leads to lower advertising sales for some of the top programs on the News Corp.-owned Fox network in the U.S.
“We have had a very disappointing year ratings-wise,” Chief Operating Officer Chase Carey said on the conference call. “We’re working to improve them.”
News Corp. dropped 1.9 percent to $27.69 at 9:36 a.m. in New York. Shares fell 3.2 percent to A$26.60 at the close in Sydney, the biggest slide since June 4, with volume more than triple the three-month average.
The ratings slump puts a damper on Murdoch’s plans to split the publishing division from FOX Film studiso and FOX Cable and broadcast networks. Falling ad dollars and circulation within the publishing wing of the company has been dragging down the growth of News Corp.’s entertainment interests.
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