Fox Corp at Morgan Stanley Technology, Media & Telecom Conference Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : <_ALACRA_META_ABSTRACT>So maybe a good way to start, you guys have had a really tremendous last couple of years, and we've now seen the stock kind of react. I think it's roughly doubled in the last 12 months. Just to sort of set the stage and get people up to speed, what do you think's been driving the strength in the business? What's working for you guys that's paid off so well?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : What are you guys focused on for '25? What are the real strategic priorities for you and the team? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 03, 2025 / 5:15PM, FOXA.OQ - Fox Corp at Morgan Stanley Technology, Media & Telecom Conference

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Great. I'm sure we'll talk about all those things in more detail as we move through the conversation. One of the things that often comes up when we're thinking about Fox and talking to investors is sort of the pay TV ecosystem, which is obviously volatile and evolving all the time. We are seeing a real emergence of skinny bundles or as you aptly name them, Jack Bundles, since they usually include your networks. These aren't new, but we are seeing a lot more in the kind of sports and broadcast composition. How important do you think these are to the industry and to Fox as you think about the long-term growth for your company?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Yeah, that was what I was thinking just hit the point. So the 7% declines that you've been seeing, if these are successful, maybe those could improve.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : The other thing that obviously has happened in the world of bundles in the last six months has been Venu Sports shutting down essentially before it actually launched. You guys shortly thereafter announced plans to launch your own direct-to-consumer service. I think you also hired Pete to run that business. What are you guys playing for here? Why is this strategic for Fox?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Got it. Last year on stage, you give us your prediction for subscribers for Venu sports over the next five years, which you'll never -- we'll never know if it was -- I'm sure it would have been right. Would you care to do the same for your direct-to-consumer service?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Okay. And we'll see this product later this year?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Great. All right, why don't we shift gears to Fox News, which is obviously the biggest driver of cash flows for the company, and you mentioned it earlier, but I mean, the revenue trends for your business in cable, but Fox News really are outliers in a good way relative to the rest of the industry. So how do you -- particularly on the affiliate side, how is it sustainable given all of the headwinds we know about the traditional TV that you can keep growing distribution revenues for that business over time?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : I don't think I'm breaking any news here to say, after the election, a lot of people feel like the whole country is sort of stepping to the right a bit politically. Is that something that you guys are reacting to at the network in terms of program or how you manage the business?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : What, do you disagree?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : One of the areas you guys have been investing in a while has been Fox Nation. I don't know if that's still an area of investment and growth for the company. Maybe you could just update us on that business.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : One of the other things that's been a big topic post-election has been the evolution of the news business, and I'm just wondering as you think about the long term for Fox News, which has continued to kind of pull away from CNN and MSNBC. How do you think about growing news distribution platforms like in particular podcasting? Social is not new, but more and more, especially younger demo getting their news from non-TV businesses. Is that important as you guys think about the future of Fox News? What are you guys trying to do to position yourselves to win there?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : That's helpful. Thank you. I think the Red Seat's being run, I believe, by Paul, right, your Tubi team. So let's pivot to Tubi. This has been another area of real success for you guys. I think you paid, what, $440 million for this a few years back and it's our estimate that it's about to exceed a $1 billion in revenue in '25 and growing quite nicely. So what's the long-term vision for this business? Are you still in investment mode? Or how do you see sort of the long-term profit potential for Tubi?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Is there a way for us to think about the profit potential or the economics of the business? I think the business is still EBITDA negative, at least the way you guys talk.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Any timeline you want to provide for us as to when this becomes sort of an EBITDA contributor to the company?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : And then yeah, let's talk about the Super Bowl. We'll talk about it obviously on the big network. But for Tubi, why put the Super Bowl on Tubi? Is there any risk around either your MVPD of relationships? Or even technically thinking able to provision that many simultaneous streams?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Let's stick with the sports theme. So obviously, football is driving most of the sports success at Fox. But there are rights in the market this year, and currently Formula 1, which you got better relation with the past and the UFC and WWE, all of which have been on Fox in the past. MLB, we know from the ESPN kind of relationship break that's been covered in the press. Are any of these interesting to Fox at a price? Or how would you describe your sports strategy?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Okay. Part of the sports story of course is driving, helping to drive your re-transmission fee revenues and you and I have chatted about this a bunch. I mean, it's surprising to me how well you guys are growing your television segment distribution revenues. I think they were up 8%, compounded over the last three or four years. Your competitors are not, best we can tell, getting the same kind of pricing. So how do you sort of explain in the market what's driving your pricing power at broadcast? And as you go into these renewals, you mentioned you've got some this year, can this continue? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 03, 2025 / 5:15PM, FOXA.OQ - Fox Corp at Morgan Stanley Technology, Media & Telecom Conference

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Yeah. Do you have any concern that launching this D2C product might eat into some of your pricing power, because obviously you'll be broadcasting this now on an unbundled basis as you go into these renewals.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : How about on the affiliate side? What's the relation with the Fox affiliates because that's another area where they're under pressure also. Any concern that reverse re-trends, as we call it in the past, slows down or goes the other way.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : I'm sure you know this, Lachlan. Last year the NBA had their rights renewal, $75 billion massive haul, and there's a lot of speculation that the NFL is looking at that and saying, we want to revisit our broadcast deals sooner than their contracts are up, which I think is still several years out. What's Fox's perspective on that? If the NFL were to come to you to extend the deal, is that an opportunity for Fox, in your view, or a risk to the profitability of the company? What's your (multiple speakers)

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : I know you don't speak for the NFL, but what do you think their perspective is on sort of the power of broadcast? Because they'll have a lot of streaming options that are growing as well. Do you think broadcasting is key to them?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : I wanted to ask you one question just on the ad market, and then we can wrap up on kind of capital allocation topics. So 2023 for the TV market overall was pretty tough. Last year was certainly better, but post-election we definitely heard some mixed things from companies that operate in the US ad market. What's your update?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : No, I know. That's why I want to start the conference with you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 03, 2025 / 5:15PM, FOXA.OQ - Fox Corp at Morgan Stanley Technology, Media & Telecom Conference

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : You can take us through the portfolio quickly on how the ad market is from your perspective.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Got it. That's a helpful way to think about it.

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : That's great. Okay, let's wrap up here with some kind of capital deployment, capital allocation questions. So sports betting is an area that you're quite bullish on. I know you guys have been focused on it for a long time. Is the way for us to think about the way Fox shareholders can participate in that really through your FanDuel option? Is that sort of what you guys are working on in terms of creating value here? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 03, 2025 / 5:15PM, FOXA.OQ - Fox Corp at Morgan Stanley Technology, Media & Telecom Conference

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : You guys have -- I think you're down to essentially almost a net zero levered balance sheet or close to net cash, certainly under 1 times to generate a lot of free cash flow. What should we be thinking about in terms of M&A appetite? And should we sort of pass this prologue? Is that the best way to think about what you guys might do in the future?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Any update on the Smartmatic litigation and timing?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : I did want to ask you. You recently promoted John Nallen, who I think a lot of folks in the audience probably know John to President and COO as part of a new agreement. Is his mandate expanding? Or anything investors should take from that promotion other than he's doing a good job?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : So as we wrap up, Lachlan, and thank you again for kicking off the conference for us, any last comments on Fox's businesses and the long-term strategy that sort of drive shareholder value?

Question: Ben Swinburne - Morgan Stanley & Co. LLC - Analyst : Great. Well, thank you, everybody. Thank you, Lachlan.