fox-20220930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


x			Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
			For the quarterly period ended September 30, 2022


☐			Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from _________ to _________

Commission file number 001-38776

FOX CORPORATION

(Exact Name of Registrant as Specified in its Charter)


Delaware						83-1825597
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification No.)

1211 Avenue of the Americas

New York,

New York

10036

(Address of Principal Executive Offices and Zip Code)

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

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


Title of Each Class	Trading Symbols	Name of Each Exchange on Which Registered
Class A Common Stock, par value $0.01 per share	FOXA	The Nasdaq Global Select Market
Class B Common Stock, par value $0.01 per share	FOX	The Nasdaq Global Select Market

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, 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.


Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	o
Emerging growth company	o

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 Act). Yes ☐ No x

As of October 28, 2022, 302,474,619 shares of Class A Common Stock, par value $0.01 per share, and 240,218,963 shares of Class B Common Stock, par value $0.01 per share, were outstanding.

FOX CORPORATION

FORM 10-Q

TABLE OF CONTENTS


			Page
Part I. Financial Information
	Item 1.	Financial Statements
		Unaudited Consolidated Statements of Operations for the three months ended September 30 , 2022 and 2021	1
		Unaudited Consolidated Statements of Comprehensive Income for the three months ended September 30 , 2022 and 2021	2
		Consolidated Balance Sheets as of September 30 , 2022 (unaudited) and June 30, 202 2 (audited)	3
		Unaudited Consolidated Statements of Cash Flows for the three months ended September 30 , 2022 and 2021	4
		Unaudited Consolidated Statements of Equity for the three months ended September 30, 2022 and 2021	5
		Notes to the Unaudited Consolidated Financial Statements	6
	Item 2.	Management ’s Discussion and Analysis of Financial Condition and Results of Operations	19
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
	Item 4.	Controls and Procedures	28
Part II. Other Information
	Item 1.	Legal Proceedings	29
	Item 1A.	Risk Factors	29
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
	Item 3.	Defaults Upon Senior Securities	29
	Item 4.	Mine Safety Disclosures	29
	Item 5.	Other Information	30
	Item 6.	Exhibits	30
	Signature		31

FOX CORPORATION

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)


	For the three months ended September 30,
	2022		2021
Revenues	$	3,192	$	3,045
Operating expenses	(1,656)		(1,571)
Selling, general and administrative	(448)		(415)
Depreciation and amortization	(99)		(79)
Interest expense, net	(68)		(97)
Other, net	(76)		69
Income before income tax expense	845		952
Income tax expense	(232)		(244)
Net income	613		708
Less: Net income attributable to noncontrolling interests	(8)		(7)
Net income attributable to Fox Corporation stockholders	$	605	$	701

EARNINGS PER SHARE DATA

Weighted average shares:
Basic	550		575
Diluted	552		578

Net income attributable to Fox Corporation stockholders per share:
Basic	$	1.10	$	1.22
Diluted	$	1.10	$	1.21

The accompanying notes are an integral part of these Unaudited Consolidated Financial Statements.

FOX CORPORATION

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(IN MILLIONS)


	For the three months ended September 30,
	2022		2021
Net income	$	613	$	708
Other comprehensive (loss) income, net of tax:
Benefit plan adjustments and other	(2)		6
Other comprehensive (loss) income, net of tax	(2)		6
Comprehensive income	611		714
Less: Net income attributable to noncontrolling interests(a)	(8)		(7)
Comprehensive income attributable to Fox Corporation stockholders	$	603	$	707


(a)			Net income attributable to noncontrolling interests includes $(5) million and $(1) million for the three months ended September 30, 2022 and 2021, respectively, relating to redeemable noncontrolling interests.

The accompanying notes are an integral part of these Unaudited Consolidated Financial Statements.

FOX CORPORATION

CONSOLIDATED BALANCE SHEETS

(IN MILLIONS, EXCEPT SHARE AND PER SHARE AMOUNTS)


	As of September 30, 2022		As of June 30, 2022
	(unaudited)		(audited)
ASSETS
Current assets
Cash and cash equivalents	$	4,950	$	5,200
Receivables, net	2,268		2,128
Inventories, net	1,020		791
Other	257		162
Total current assets	8,495		8,281
Non-current assets
Property, plant and equipment, net	1,681		1,682
Intangible assets, net	3,135		3,157
Goodwill	3,550		3,554
Deferred tax assets	3,334		3,440
Other non-current assets	2,229		2,071
Total assets	$	22,424	$	22,185
LIABILITIES AND EQUITY
Current liabilities
Accounts payable, accrued expenses and other current liabilities	$	2,362	$	2,296
Total current liabilities	2,362		2,296
Non-current liabilities
Borrowings	7,207		7,206
Other liabilities	1,077		1,120
Redeemable noncontrolling interests	193		188
Commitments and contingencies
Equity
Class A Common Stock(a)	3		3
Class B Common Stock(b)	2		3
Additional paid-in capital	8,949		9,098
Retained earnings	2,795		2,461
Accumulated other comprehensive loss	(228)		(226)
Total Fox Corporation stockholders’ equity	11,521		11,339
Noncontrolling interests	64		36
Total equity	11,585		11,375
Total liabilities and equity	$	22,424	$	22,185


(a)			Class A Common Stock, $0.01 par value per share, 2,000,000,000 shares authorized, 303,622,569 shares and 307,496,876 shares issued and outstanding at par as of September 30, 2022 and June 30, 2022, respectively.


(b)			Class B Common Stock, $0.01 par value per share, 1,000,000,000 shares authorized, 240,746,979 shares and 243,122,595 shares issued and outstanding at par as of September 30, 2022 and June 30, 2022, respectively.

The accompanying notes are an integral part of these Unaudited Consolidated Financial Statements.

FOX CORPORATION

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN MILLIONS)


	For the three months ended September 30,
	2022		2021
OPERATING ACTIVITIES
Net income	$	613	$	708
Adjustments to reconcile net income to cash provided by operating activities
Depreciation and amortization	99		79
Amortization of cable distribution investments	4		5
Equity-based compensation	7		15
Other, net	76		(69)
Deferred income taxes	104		168
Change in operating assets and liabilities, net of acquisitions and dispositions
Receivables and other assets	(260)		(174)
Inventories net of programming payable	(333)		(499)
Accounts payable and accrued expenses	(127)		(171)
Other changes, net	87		(33)
Net cash provided by operating activities	270		29
INVESTING ACTIVITIES
Property, plant and equipment	(74)		(53)
Acquisitions, net of cash acquired	—		(75)
Proceeds from dispositions, net	—		82
Purchase of investments	(31)		(29)
Other investing activities, net	(13)		—
Net cash used in investing activities	(118)		(75)
FINANCING ACTIVITIES
Repurchase of shares	(250)		(250)
Dividends paid and distributions	(147)		(150)
Sale of subsidiary noncontrolling interest	25		—
Other financing activities, net	(30)		(29)
Net cash used in financing activities	(402)		(429)
Net decrease in cash and cash equivalents	(250)		(475)
Cash and cash equivalents, beginning of year	5,200		5,886
Cash and cash equivalents, end of period	$	4,950	$	5,411

The accompanying notes are an integral part of these Unaudited Consolidated Financial Statements.

FOX CORPORATION

UNAUDITED CONSOLIDATED STATEMENTS OF EQUITY

(IN MILLIONS)


	Class A			Class B			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Fox Corporation Stockholders’ Equity		Noncontrolling Interests(a)		Total Equity
	Common Stock			Common Stock
	Shares	Amount		Shares	Amount
Balance, June 30, 2022	308	$	3	243	$	3	$	9,098	$	2,461	$	(226)	$	11,339	$	36	$	11,375
Net income	—	—		—	—		—		605		—		605		13		618
Other comprehensive loss	—	—		—	—		—		—		(2)		(2)		—		(2)
Dividends	—	—		—	—		—		(137)		—		(137)		—		(137)
Shares repurchased	(5)	—		(3)	—		(124)		(126)		—		(250)		—		(250)
Other	—	—		1	(1)		(25)		(8)		—		(34)		15		(19)
Balance, September 30, 2022	303	$	3	241	$	2	$	8,949	$	2,795	$	(228)	$	11,521	$	64	$	11,585






Balance, June 30, 2021	324	$	3	252	$	3	$	9,453	$	1,982	$	(318)	$	11,123	$	2	$	11,125
Net income	—	—		—	—		—		701		—		701

SEC Form 10-Q filed by Fox Corporation