News Corp announces 1,250 jobs cut after missing estimates of second-quarter
News Corp to cut down 1,250 jobs after estimates of second-quarter missed.
Media conglomerate News Corp on Thursday announced that it will be laying off 1,250 employees after the company failed to meet the estimate for second-quarter earnings because of it lagging behind in its digital real estate businesses and news.Higher interest rates and rising inflation have forced companies to curb theirmarketing and ad spend, which dented the major sources of revenue of conglomerates like News Corp, which has major publishing platforms like New York Post and the Wall Street Journal in the US, and the Times and the Sun in the UK under its umbrella.
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In a statement, News Corp chief executive Robert Thomson said, "A surge in interest rates and acute inflation had a tangible impact on all of our businesses."
“The initiatives now underway, including an expected 5 per cent headcount reduction, or around 1,250 positions this calendar year, will create a robust platform for future growth,” he added.
The company's shares fell by 1.4 per cent in extended trading after its first quarterly report since Rupert Murdoch had pulled out from a proposal to reunite News Corpand Fox Corp, which is headed by his son Lachlan Murdoch.
The conglomerate will carry out lay offs across all businesses, which will help in making annual savings of at least $130 million.
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The company stated that it is likely to witness one-time costs related to withdrawal Fox-News Corp proposal as well as exploration of a sale of Move Inc, which was previously announced, in the third quarter.
The Dow Jones division, under which the Wall Street Journal falls, reported an increase of 11 per centin revenues to $563 million in the quarter, reflecting growth in its professional information business.
(With inputs from agencies)
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