Streaming customers now two-thirds of Foxtel’s user base: ‘The intent is to reduce churn’
News Corp’s third quarter FY24 financials show that over two-thirds of Foxtel Group’s user base is now made up of streaming customers, as sports fans jump onto Kayo, and residential broadcast subscribers continue to flee.
Foxtel’s total paid subscribers sit at 4.591 million (4.537 million paid), a 1% drop from the same quarter in FY23.
BINGE subscribers dropped to 1.477 million (1.453 paid), as did residential broadcast subscribers, with broadcast subscriber churn increasing to 13.3% (from 12.3% in the prior year), which Foxtel credits to a recent price hike. Broadcast ARPU for the quarter increased 2% year-over-year to A$85 – also due to the price increase.
Kayo enjoyed an increase in both subscribers 1,466 million total subscribers, up 10% year-on-year, and saw a price bump, with this revenue mostly offsetting the drop in BINGE users. The sports streaming service had “its highest sequential quarterly net additions since inception,” News Corp CEO Robert Thomson announced at the investor meeting, “powered by both new customer growth and reactivations”, notably the return of AFL and NRL fans to the service.
Foxtel Group streaming subscription revenues represented approximately 29% of total circulation and subscription revenues in the quarter, as compared to 26% in the prior year.
Streaming subscribers now make up 67% of the Foxtel Group’s total subscribers – up from 65% in Q2 FY23, and tipping over the two-thirds mark.
Overall, Foxtel Group brought in $455 million in revenue for the quarter, a 5% drop year-on-year, which was mostly due to a 4% negative impact from foreign currency fluctuations.
EBITDA of $66 million in the quarter decreased $2 million, or 3%, compared with the prior year (which also included a $3 million impact from foreign currency fluctuations – adjusted EBITDA increased 1%, year-on-year.)
Hubbl was also launched in March, with $13 million of costs related to this. Thomson said of Hubbl, “we are working with our partners at Comcast to shepherd its adoption throughout Australia. The intent is to reduce churn, by increasing engagement and improving the customer experience.”
This comes with a cost, as Foxtel Group flag during their last quarterly update.
News Corp CFO Susan Panuccio said: “In Subscription Video Services, we continue to expect modestly higher expenses for the full year and some softness in streaming revenues due to the first half which may impact full year profitability in local currency.”
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Nathan Jolly is the Deputy Editor of Mumbrella. He joined the team in July, 2023.
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