© Reuters. FILE PHOTO: A headline for a story on the health of U.S. President Joe Biden is displayed at the Fox News headquarters in New York City, U.S. March 4, 2023. REUTERS/Chris Helgren/File Photo

By Zaheer Kachwala

(Reuters) -Fox Corp reported a 20% fall in advertising revenue on Wednesday hurt by lower political ad spend, while concerns over uncertainty in ad spending and the future of sports programming sent the broadcaster’s shares down around 6%.

The company, which broadcasted the Super Bowl last year, is attempting to capitalize on the move by partnering with Walt Disney (NYSE:)’s ESPN and Warner Bros Discovery (NASDAQ:) to launch a sports streaming service later this autumn.

Fox said that the lower political ad spending hit revenues at its TV stations due to the absence of the 2022 midterm elections.

“A 20% ad decline and the looming shadow of Super Bowl comparisons, which this year will be broadcast on CBS and streamed on Paramount+, suggest advertising woes may continue,” said Michael Ashley Schulman, chief investment officer at Running Point Capital.

The company’s advertising revenue fell to $2 billion in the second quarter ended Dec. 31, but came in slightly higher than analysts’ estimates of $1.96 billion.

The lack of details over the joint venture to create a sports streaming platform has hurt Fox’s shares, analysts said.

“All three companies in the sports streaming announcement are down on lack of details. Shoot first, ask questions later,” Thomas Hayes, chairman of hedge fund Great Hill Capital said.

Fox’s broadcast network has been bearing the brunt of high rates of cord-cutting, as consumers cancel network TV packages and transition to video streaming for content.

Marketers too are increasingly moving to spend on streaming and digital advertising platforms to keep up with the transition.

However, political ad spending in the United States is expected to jump about 30% this year ahead of the November presidential election, from the last election in 2020, with TV media expected to be the biggest platform for advertising, according to a report by research firm Insider Intelligence.

Fox reported quarterly revenue of $4.23 billion, compared with estimates of $4.20 billion, according to LSEG data.

On an adjusted basis, the company earned 34 cents per share compared with estimates of 13 cents.