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Broadcaster Fox’s ad revenue falls 20% on weak political ad spending

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Broadcaster Fox's ad revenue falls 20% on weak political ad spending
© 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.

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Iridium secures $200M loan to boost share buybacks

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Iridium Communications Inc. (NASDAQ:) announced today that it has initiated a $200 million incremental term loan under the same terms as its existing $1.62 billion credit agreement. The company, a key player in the communications equipment sector, plans to use the additional funds to expedite its share repurchase program and for other general corporate purposes.

The new loan will be marketed with the backing of Deutsche Bank AG (NYSE:) New York Branch, which also serves as the Administrative and Collateral Agent. Joining the arrangement are Deutsche Bank Securities Inc., Barclays Bank PLC, Royal Bank of Canada, and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Bookrunners.

Iridium’s move to secure additional capital comes as part of its strategy to enhance shareholder value through an accelerated share buyback plan. The company’s decision to allocate funds for this purpose reflects its commitment to managing its capital structure proactively.

This financial maneuver is disclosed in compliance with Regulation FD, which ensures that all investors receive key financial information simultaneously. The disclosure was made through an 8-K filing with the Securities and Exchange Commission, providing transparency and allowing investors to assess the company’s financial decisions.

The McLean, Virginia-based Iridium, which operates under the jurisdiction of Delaware with a fiscal year ending on December 31, has not disclosed further details regarding the timeline or specific terms of the share repurchases.

The information in this article is based on a press release statement from Iridium Communications Inc. and serves to inform investors of the company’s latest financial activity. The strategic financial steps taken by Iridium are part of its broader efforts to optimize its operations and enhance shareholder returns.

In other recent news, Iridium Communications Inc. has reported positive second-quarter results, including a 5% growth in service revenue and an increase of 80,000 in its subscriber base. The company’s full-year guidance remains on track, forecasting continued growth in service revenue and EBITDA.

Significant contributors to this positive outlook include a $90 million 5-year contract with the U.S. government, a strong position in alternative Positioning, Navigation, and Timing (PNT) services, and advancements in IoT technology.

Iridium is also expanding its device and service offerings through its unique satellite network, with projections of record revenue in 2024 from its collaborations with the U.S. Space Development Agency. The company has also secured a reduction in annual interest expenses by $4 million due to term loan repricing and has increased its quarterly dividend through aggressive share repurchasing.

In terms of future expectations, Iridium is focused on expanding its IoT technology and lowering the cost of end-user devices. The company is also bullish on its satellite-based time and location service, expecting it to generate over $100 million in annual service revenue by 2030. These are all recent developments that investors should take into consideration.

InvestingPro Insights

Iridium Communications Inc. (NASDAQ:IRDM) has shown a proactive approach to shareholder value, as evidenced by their recent move to secure an additional $200 million loan to fund an accelerated share repurchase program. This strategy aligns with InvestingPro Tips that highlight management’s aggressive buyback policy and the anticipation of net income growth this year. With a solid gross profit margin of 71.91% in the last twelve months as of Q1 2024 and a notable EBITDA growth of 4.67%, Iridium is demonstrating its operational efficiency.

The company’s current market capitalization stands at $3.29 billion, and despite a high P/E ratio of 39.44, which suggests a premium valuation, the company’s liquid assets exceeding short-term obligations indicate a strong liquidity position.

Moreover, analysts have revised their earnings upwards for the upcoming period, which may signal confidence in the company’s future performance. For investors seeking more in-depth analysis and additional InvestingPro Tips, there are 10 more tips available, which can be explored further with a special offer. Use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription at InvestingPro.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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Protests and politics as Netanyahu addresses US Congress

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By Patricia Zengerle

WASHINGTON (Reuters) -Dozens of Democratic lawmakers planned to skip Israeli Prime Minister Benjamin Netanyahu’s speech to Congress on Wednesday, expressing dismay over the thousands of civilian deaths and the humanitarian crisis from Israel’s campaign in Gaza.

The longtime Israeli leader will make a record fourth speech to a joint meeting of the Senate and House of Representatives at 2 p.m. EDT (1800 GMT), passing British wartime leader Winston Churchill, who made three such speeches.

Netanyahu’s speech was expected to focus on coordinating the Israeli and U.S. response to the volatile situation in the Middle East, where there is a growing danger of the Gaza war spilling over into a wider regional conflict.

He was also expected to call for stronger action against Iran, which supports Palestinian Hamas and Lebanese Hezbollah, both militant groups fighting Israel, and has drawn increased U.S. condemnation over its recent nuclear advances.

Republican leaders in Congress orchestrated the visit, but it was likely to be less confrontational than in 2015 when Republicans sidestepped then-President Barack Obama, a Democrat, and Netanyahu used his speech to criticize Obama’s Iran policy.

This time, Netanyahu will seek to bolster his traditional links to Republicans but also look to ease tensions with President Joe Biden, a Democrat whose support he will rely on for the remaining six months of the president’s term.

Washington is preoccupied with the fallout from Biden’s announcement on Sunday that he was ending his reelection bid and endorsing Vice President Kamala Harris for the Democratic presidential nomination to challenge Republican Donald Trump.

SOME LAWMAKERS STAY AWAY

Some lawmakers said they were uncomfortable about appearing to endorse Netanyahu and his hard-right coalition government as he faces declining poll numbers in Israel.

“For him, this is all about shoring up his support back home, which is one of the reasons I don’t want to attend,” Senator Chris Van Hollen told reporters. “I don’t want to be part of a political prop in this act of deception. He is not the great guardian of the U.S.-Israel relationship.”

A Republican House member, Representative Thomas Massie, also said he would not attend. “The purpose of having Netanyahu address Congress is to bolster his political standing in Israel and to quell int’l opposition to his war. I don’t feel like being a prop so I won’t be attending,” he wrote on X.

Some of the most prominent Democrats planned to stay away. They included Senators Dick Durbin, the chamber’s No. 2 Democrat, Tim Kaine, Jeff Merkley and Brian Schatz, all members of the Senate Foreign Relations Committee, as well as Patty Murray, who chairs Senate Appropriations.

In the House, those staying away included progressive Representatives Rashida Tlaib and Alexandria Ocasio-Cortez, as well as Ami Bera, a senior member of the Foreign Affairs Committee, and Adam Smith, the top Democrat on Armed Services.

Smith said he never attends joint meetings but also described himself on Tuesday as “very, very opposed to what Prime Minister Netanyahu is doing in Israel.” 

Harris, who normally would preside over the speech as vice president, will not be attending. Neither will Republican Senator JD (NASDAQ:) Vance, Trump’s vice presidential running mate.

Murray would have presided, as the senior Senate Democrat, in Harris’ absence. Democratic Senator Ben Cardin, who leads the foreign relations committee, will replace her.

NETANYAHU TO MEET BIDEN, HARRIS ON THURSDAY

Netanyahu will meet both Biden and Harris on Thursday. Harris has at times been more forward-leaning than her boss in criticizing Israel for heavy Palestinian civilian casualties in Gaza.

Netanyahu was to travel to Florida to meet with Trump on Friday. The meeting will be their first since the end of Trump’s presidency, during which the two forged close ties.

Before addressing Congress, Netanyahu spoke at a memorial for Senator Joe Lieberman, who died in March, stressing the lawmaker’s view that Israel must be allowed to achieve its goal of “disabling Hamas” and that the U.S. and Israel had a shared interest in a united front against Iran.

Several hundred activists staged a demonstration on Tuesday at a congressional office building, and mass protests were promised for Wednesday. The Capitol building was surrounded by high fencing and a heavy security presence.

Some protesters were out on Wednesday hours before Netanyahu’s speech, holding signs including, “Stop War Crimes in Gaza.” Dozens of Washington streets were closed, with some neighborhoods patrolled by New York City police officers.

Some Democrats said they were attending despite their concerns. 

© Reuters. Pro-Palestinian demonstrators protest, on the day of Israeli Prime Minister Benjamin Netanyahu's address to a joint meeting of the U.S. Congress, on Capitol Hill in Washington, U.S., July 24, 2024. REUTERS/Seth Herald

“I sit in that chair that I was elected to sit in on days that I enjoy it and days that are iffy and days that I despise it or a mix of the latter two. But I’m elected to be in that seat,” Representative Dan Kildee said.

    “My constituents didn’t elect me to show up only when I enjoy what I’m hearing. If I did that I would spend very little time on the floor of the House.”

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NSTS Bancorp reaches 52-week high, hitting $10.48

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NSTS Bancorp, a prominent player in the banking sector, has recently hit a 52-week high, reaching a price level of $10.48. This milestone marks a significant achievement for the company, reflecting its robust performance and strong market position. Over the past year, NSTS Bancorp has demonstrated a remarkable growth trajectory, with a 1-year change of 12.83%. This positive trend underscores the company’s resilience and adaptability in a dynamic market environment. Investors and market watchers are keeping a close eye on NSTS Bancorp, as it continues to navigate the financial landscape with strategic acumen and operational efficiency.

InvestingPro Insights

NSTS Bancorp’s recent surge to a 52-week high is a testament to its market performance, yet a deeper look through InvestingPro metrics reveals a more nuanced picture. With a market capitalization of $51.15 million, the company is a smaller player in the banking sector. Despite achieving a 1-year price total return of 11.25%, NSTS Bancorp grapples with challenges such as weak gross profit margins and a lack of profitability over the last twelve months. Additionally, the stock’s current price is hovering close to this peak, trading at 99.33% of its 52-week high. Investors considering NSTS Bancorp should note that while the stock exhibits low price volatility, it does not offer dividend payouts, which could be a significant factor for those seeking income-generating investments.

For a comprehensive understanding of NSTS Bancorp’s financial health and stock performance, consider the InvestingPro Tips which reveal that the stock is currently in overbought territory according to the RSI, and the company’s P/E ratio stands at -10.89, indicating that it may be overvalued given its lack of recent profitability. To explore additional insights and gain access to exclusive metrics, visit https://www.investing.com/pro/NSTS. There are 5 more InvestingPro Tips available for NSTS Bancorp, which can be accessed with a subscription. Use coupon code PRONEWS24 for up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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