ITEM 1. BUSINESS
Background
The Company is a news, sports and entertainment company, which manages and reports its businesses in four operating segments: Cable Network Programming, Television, Credible and the FOX Studio Lot with the following two reportable segments:
•Cable Network Programming, which produces and licenses news and sports content distributed through traditional cable television systems, direct broadcast satellite operators and telecommunication companies (“traditional MVPDs”), virtual multi-channel video programming distributors (“virtual MVPDs”) and other digital platforms, primarily in the U.S.
•Television, which produces, acquires, markets and distributes programming through the FOX broadcast network, advertising-supported video-on-demand (“AVOD”) service Tubi, 29 full power broadcast television stations, including 11 duopolies, and other digital platforms, primarily in the U.S. Eighteen of the broadcast television stations are affiliated with the FOX Network and 11 are affiliated with MyNetworkTV. The segment also includes various production companies that produce content for the Company and third parties.
Credible is a U.S. consumer finance marketplace. The FOX Studio Lot, located in Los Angeles, California, provides television and film production services along with office space, studio operation services and includes all operations of the facility.
Unless otherwise indicated, references in this Annual Report on Form 10-K (this “Annual Report”) for the fiscal year ended June 30, 2026 (“fiscal 2026”) to “FOX,” the “Company,” “we,” “us” or “our” mean Fox Corporation and its consolidated subsidiaries. We use the term “MVPDs” to refer collectively to traditional MVPDs and virtual MVPDs.
FOX became a standalone publicly traded company on March 19, 2019, when Twenty-First Century Fox, Inc. (“21CF”) spun off the Company to 21CF stockholders and FOX’s Class A Common Stock, par value $0.01 per share (the “Class A Common Stock”), and Class B Common Stock, par value $0.01 per share (the “Class B Common Stock” and, together with the Class A Common Stock, the “Common Stock”) began trading on The Nasdaq Global Select Market (the “Disney Transaction”). The Walt Disney Company (“Disney”) acquired the remaining 21CF assets and 21CF became a wholly-owned subsidiary of Disney. The Company is party to a separation and distribution agreement and a tax matters agreement that govern certain aspects of the Company’s relationship with 21CF and Disney following the Disney Transaction.
Roku Transaction
On June 14, 2026, the Company and Roku, Inc. (“Roku”) entered into a definitive agreement (the “Merger Agreement”) under which the Company has agreed to acquire Roku for a combination of cash and FOX Class A Common Stock (the “Roku Transaction” or “Merger”). Upon the terms and subject to the conditions of the Merger Agreement, FOX will pay $96.00 in cash and 0.9693 shares of FOX Class A Common Stock for each share of Roku Class A Common Stock and Roku Class B Common Stock outstanding immediately prior to the effective time of the merger. The exchange ratio is fixed and will not be adjusted. Following the completion of the Merger, Roku will be a wholly-owned subsidiary of FOX.
Each of the Boards of Directors of FOX and Roku have unanimously approved the transaction, which is also subject to requisite approval by FOX and Roku stockholders, clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, the receipt of consents or approvals under certain other antitrust laws and certain investment screening laws and other customary conditions. The Merger Agreement contains customary termination rights and provides that each party will be required to pay the other party a termination fee of approximately $866 million if the Merger Agreement is terminated in certain circumstances, including due to a change in the recommendation of its board of directors. In addition, FOX will be required to pay Roku a termination fee of approximately $1.2 billion if the Merger Agreement is terminated under certain circumstances related to the failure to obtain certain regulatory approvals or upon the entry of a permanent
restraint under certain antitrust laws or investment screening laws. FOX has also agreed to reimburse Roku for up to $70 million for reasonable third-party costs and expenses incurred by Roku in connection with the transaction if FOX is unable to obtain the required approval of its Class B Common stockholders of the issuance of FOX Class A Common Stock in connection with the transaction.
In connection with execution of the Merger Agreement, Roku founder, Chairman and Chief Executive Officer Anthony Wood and certain associated trusts and related entities that together hold at least a majority of the voting power of the Roku common stock entered into a voting and support agreement with FOX agreeing to vote in favor of the Transaction. LGC Holdco, LLC (“LGC Holdco”) and its sole manager Cruden 2, LLC also entered into a voting and support agreement with Roku, pursuant to which they agreed to vote all shares of FOX Class B Common Stock owned by them (representing, as of June 30, 2026, approximately 38.8% of the voting power of the FOX Class B Common Stock entitled to vote) in favor of the issuance of shares FOX Class A Common Stock in the transaction.
The Company’s fiscal year ends on June 30 of each year. The Company was incorporated in 2018 under the laws of the State of Delaware. The Company’s principal executive offices are located at 1211 Avenue of the Americas, New York, New York 10036 and its telephone number is (212) 852-7000. The Company’s website is www.foxcorporation.com. The Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available, free of charge, through the Company’s website as soon as reasonably practicable after the material is electronically filed with or furnished to the U.S. Securities and Exchange Commission (the “SEC”). The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. We are providing our website address solely for the information of investors. We do not intend the address to be an active link or to otherwise incorporate the contents of the website, including any reports that are noted in this Annual Report as being posted on the website, into this Annual Report.
Caution Concerning Forward-Looking Statements
This Annual Report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act, including statements regarding the Roku Transaction. All statements other than statements of historical or current fact are “forward-looking statements” for purposes of federal and state securities laws. Forward-looking statements may include, among others, the words “may,” “will,” “could,” “should,” “would,” “likely,” “anticipates,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “outlook” or any other similar words. Although the Company’s management believes that the expectations reflected in any of the Company’s forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any forward-looking statements. The Company’s future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties. Important factors that could cause the Company’s actual results, performance and achievements to differ materially from those estimates or projections contained in the Company’s forward-looking statements include, but are not limited to, the impact of the Roku Transaction and related risks, government regulation, economic, strategic, political and social conditions. For more detailed information about these factors, see Item 1A, “Risk Factors,” and Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Caution Concerning Forward-Looking Statements.”
Forward-looking statements in this Annual Report speak only as of the date hereof. The Company does not undertake any obligation to update or release any revisions to any forward-looking statement made herein or to report any events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or to conform such statements to actual results or changes in our expectations, except as required by law.
Business Overview
FOX produces and delivers compelling news, sports and entertainment content through its iconic brands, including FOX News Media, FOX Sports, Tubi Media Group, FOX Entertainment and FOX Television Stations. The Company differentiates itself in a crowded media and entertainment marketplace through the leadership positions of its brands and premium programming that focus on live and “appointment-based” content, a significant presence in major markets and broad distribution of its content across traditional and digital
platforms, including FOX One, the Company’s wholly-owned, direct-to-consumer subscription streaming service.
Our Competitive Strengths
Premium brands that resonate deeply with viewers.
Under the FOX banner, we produce and distribute content through some of the world’s leading and most valued brands. Our long track record of challenging the status quo emboldens us to continue making innovative decisions, disrupting norms and forming deeper relationships with audiences. FOX News Media is among the most influential and recognized news brands in the world. FOX Sports has earned a reputation for bold sports programming and, with its availability in virtually every U.S. market, is a leading destination for live sports events and sports commentary. Tubi, our leading AVOD service, attracts a young, multicultural and highly engaged audience to its content library of over 350,000 movies and television episodes. FOX Entertainment is renowned for its compelling primetime entertainment, including scripted dramas, leading unscripted programming and its longstanding Sunday animation block. These brands and others in our portfolio, such as our 29 owned and operated local television stations, including 18 broadcasting under the FOX brand, hold cultural significance with consumers and commercial importance for distributors and advertisers. The quality of our programming and the strength of our brands maximize the value of our content through a combination of affiliate fees and advertising sales.
Leadership positions across strategically significant programming platforms.
FOX enjoys leadership positions across its core news, sports and entertainment businesses. As linear television viewership declines across the industry, “appointment-based” programming that is the FOX hallmark remains resilient.
For over 24 consecutive years, FOX News has been the top-rated national cable news channel in Monday to Friday primetime viewing, according to The Nielsen Company (“Nielsen”). FOX News also finished the fiscal year as the #1 cable network in Monday to Friday primetime and total day viewing among total viewers for the eleventh consecutive year and delivered ratings that were comparable to ratings delivered by the four broadcast networks in weekday primetime viewing. A leader in marquee live sports broadcasts, FOX Sports programs the National Football League (“NFL”) featuring America's Game of the Week, college football (including the Big Ten Conference), Major League Baseball's (“MLB”) Regular Season, All-Star Game and post-season, including exclusive rights to the World Series, INDYCAR, National Association of Stock Car Auto Racing (“NASCAR”) and other marquee cyclical events, including the Super Bowl and the Fédération Internationale de Football Association (“FIFA”) Men's World Cup. FOX Sports has secured a significant portion of its marquee rights under long-term contracts. Tubi has become one of the most relevant and fastest growing AVOD services in the country, with 20% growth in total view time (the total number of hours watched) in fiscal 2026 compared to the prior fiscal year. According to Nielsen’s The Gauge, Tubi finished the fiscal year among the most-watched free ad-supported streaming services in the U.S., averaging approximately 2.2% of all television viewing over the course of the year. FOX Entertainment has delivered the youngest and most diverse audience of the broadcast networks across all programming in primetime for over two decades. During the 2025-2026 broadcast season, FOX Entertainment delivered the season’s top two debuts among adults 18-49 with Fear Factor: House of Fear and Memory of a Killer, along with three of the top four most watched cooking shows on television with Next Level Chef, Hell’s Kitchen and MasterChef. FOX Television Stations covers 18 Nielsen-designated market areas (“DMAs”), including 15 of the 16 largest, and was the #1 or #2 rated news provider in the hours of 5 a.m. - 9 a.m. in the majority of the markets in which it operates among adults 25-54.
We believe the strength and leadership of our brands will continue to support our ability to secure industry leading affiliate rate and advertising price increases, while enabling us to nimbly respond to the opportunities and challenges traditional media companies are facing as technologies and changes in consumer behavior continue to rapidly evolve.
Significant presence and relevance in major domestic markets.
The FOX portfolio combines the range of national cable and broadcast networks and digital distribution platforms with the power of tailored local television. FOX News is available in approximately 55 million U.S. households via MVPDs and in additional households through FOX One. FOX Sports and FOX Entertainment
programming on the FOX Network is available in virtually every U.S. market. Tubi’s ubiquitous availability provides broad distribution of films, episodic television programming, live local and national news content and sports programming. Tubi carries over 100 local station feeds (including feeds of our owned and operated stations), covering 77 DMAs and 23 of the top 25 markets. Additionally, our 29 owned and operated television stations cover 18 DMAs, including 15 of the 16 largest, and maintain duopolies in 11 DMAs, including New York, Los Angeles and Chicago, the three largest. These stations provide balanced content of national interest with programming of note to local communities, producing over 1,500 hours of local news coverage each week. The breadth and depth of our footprint allows us to produce and distribute our content in a cost-effective manner and share best business practices and models across regions. It also enables us to engage audiences, develop deeper consumer relationships and create more compelling product offerings.
Attractive financial profile, including multiple revenue streams, strong balance sheet and other assets.
We have consistently achieved strong operational and financial results in a complex industry environment. Additionally, our solid balance sheet provides us with the financial flexibility to continue to invest across our businesses, allocate resources toward investments in growth initiatives, take advantage of strategic opportunities, including potential acquisitions across the range of media categories in which we operate and related adjacencies, and return capital to our stockholders. We have maintained significant liquidity, ending fiscal 2026 with approximately $4.2 billion of cash and cash equivalents on our balance sheet while returning approximately $2.3 billion of capital to our stockholders through our cash dividend and stock repurchase program, including a $1.5 billion accelerated share repurchase program in fiscal 2026. We also benefit from a tax asset that resulted from the step-up in the tax basis of our assets following the Disney Transaction, which is expected to provide an annual cash tax benefit for many years. Our asset portfolio also includes the FOX Studio Lot in Los Angeles, California, which spans over 50 acres and close to 2 million square feet of space for administration and television and film production services available to FOX and industry clients, including 15 sound stages, and other production facilities. Additionally, we own an equity stake in Flutter Entertainment plc (“Flutter”), an online sports betting and gaming company with operations in the U.S. and internationally, and we maintain an option to acquire 18.6% of FanDuel Group ("FanDuel"), a majority-owned subsidiary of Flutter.
Goals and Strategies
Maintain leading positions in live news, live sports and quality entertainment.
We have long been a leader in news, sports and entertainment programming, and we believe that building on our leading market positions is essential to our success. The strength of our core businesses has allowed us to invest in attractive growth opportunities and brand extensions. Examples of this include digital brand extensions at FOX News Media, including the FOX Nation subscription video-on-demand (or SVOD) service and the FOX Weather free ad-supported streaming television (“FAST”) service. At Tubi, our investment in content, technology and marketing has yielded new viewers and increased engagement from our audience, which has translated into robust revenue growth. In fiscal 2026, Tubi expanded its content library through the premiere of 50 new original titles and the launch of over 20,000 creator-led episodes as of the end of the fiscal year. We consistently review opportunities to optimize our sports portfolio with the dual goal of maintaining and growing our audience while achieving accretive financial returns. In fiscal 2026, we added rights to two additional NFL regular season game windows for the 2026 NFL season, and we renewed rights for the CONCACAF Gold Cup in 2027 and 2029. Recognizing the industry-wide changes in viewership habits, FOX Entertainment has continued to expand its footprint across unscripted content, leveraging the breadth of offerings from FOX Entertainment Studios to populate its primetime lineup and reduce its reliance on third-party content providers. FOX Entertainment Studios also produces or co-produces original content for third parties including many of the leading SVOD services (Netflix, Amazon Prime Video and Apple TV), highlighting the attractiveness of FOX’s content to a wide variety of streaming services. FOX Television Stations produces live streaming news content on connected televisions and FAST services through both LiveNOW from FOX (its national 24/7 live streaming service) and FOX Local Streams (its group of FAST services that offer live and recorded content from 17 FOX-owned and operated local television stations). Total view time on FOX Local Streams grew over 17% compared to the prior fiscal year. We believe continuing to provide compelling news, sports and entertainment programming across platforms will increase audience engagement and drive growth across our distribution, affiliate and advertising relationships.
Increase revenue growth through the continued delivery of high quality, premium and valuable content.
With a focused portfolio of assets, we create and produce high quality programming that delivers value for our viewers, our affiliates and our advertisers. We expect our internal production capabilities and co-production arrangements will facilitate growth by enabling us to directly manage the economics and programming needs of our broadcast network and television stations. We also believe our unique ability to deliver “appointment-based” viewing and audiences at scale, along with innovative advertising platforms, delivers substantial value to our advertising customers, and the unique nature of our “appointment-based” content positions us to maintain and even grow audiences during a time of increasing consumer fragmentation.
Expand our digital distribution offerings and direct engagement with consumers, increasing complementary sources of revenues.
The availability of our key networks on all major virtual MVPD services reflects the strength of our brands and the highly coveted nature of our content. We are also cultivating and growing direct interactions between FOX brands and consumers outside traditional linear television. For example, FOX One, our wholly-owned, direct-to-consumer subscription streaming service designed to attract “cord-cutters” and “cord-nevers”, expands the reach of our programming beyond FOX’s existing distribution footprint. Tubi also provides us with a wholly-owned digital platform to access a wider digital audience and further the reach of our content. Tubi continues to experience significant growth in total view time across a library of over 350,000 movies and television episodes, including key FOX entertainment, news and sports programming, and it streamed over 13 billion hours of content over the course of the fiscal year (a record for the platform). Tubi’s young, multicultural and highly engaged viewers, the majority of which are classified as “cord-cutters” or “cord-nevers,” is an audience advertisers are eager to reach. FOX News Media operates a number of digital businesses, including FOX News Digital, which remains the most engaged brand in digital news (leading in total views, minutes spent, YouTube views and social interactions), along with the FOX Nation SVOD service, which offers U.S. consumers a variety of content (including original programming), and FOX Weather, which offers local, regional and national weather reporting in addition to live programming. Additionally, FOX Television Stations operates a portfolio of digital businesses, including the FLX (or FOX Local Extension) digital advertising platform and the LiveNOW from FOX, FOX Local Streams and FOX Soul FAST services, in addition to distributing its local news programming on Tubi, FOX One and across a range of third-party platforms. In June 2026, the Company announced its proposed acquisition of Roku, a transaction that will combine FOX’s leading sports, news and entertainment content and Tubi service with Roku’s leading connected TV platform, its portfolio of advertising-supported and subscription-based streaming services led by The Roku Channel, first-party data and direct relationship with more than 100 million global streaming households.
Reportable Segments
Cable Network Programming
The Cable Network Programming segment produces and licenses news, business news and sports content for distribution through traditional and virtual MVPDs and other digital platforms, primarily in the U.S. The businesses in this segment include FOX News Media (which includes FOX News and FOX Business) and our primary cable sports programming networks FS1, FS2, the Big Ten Network and FOX Deportes.
The following table lists the Company’s significant cable networks and the number of subscribers as estimated by Nielsen:
| | | | | | | | | | | |
| As of June 30, |
| 2026 | | 2025 |
| (in millions) |
| FOX News Media Networks | | | |
| FOX News | 55 | | | 61 | |
| FOX Business | 52 | | | 60 | |
| FOX Sports Networks | | | |
| FS1 | 55 | | | 61 | |
| FS2 | 39 | | | 44 | |
| The Big Ten Network | 38 | | | 42 | |
| FOX Deportes | 7 | | | 10 | |
FOX News Media. FOX News Media includes the FOX News and FOX Business networks and their related properties. For over 24 consecutive years, FOX News has been the top-rated national cable news channel in Monday to Friday primetime viewing. FOX News also finished the fiscal year as the #1 cable network in Monday to Friday primetime and total day viewing among total viewers for the eleventh consecutive year. FOX Business is a business news national cable channel and was the #1 business network in business day among total viewers during fiscal 2026. FOX News also produces a weekend political commentary show, FOX News Sunday, and a 90-second daily news brief, FOX News Report, for broadcast on the FOX Television Stations and stations affiliated with the FOX Network throughout the U.S. Additionally, FOX News Audio produces news updates, podcasts and long-form programs and licenses content to local radio stations and mobile, Internet and satellite radio providers.
FS1. FS1 is a multi-sport national network that features live events, including regular season and post-season MLB games, NASCAR, college football, college basketball, the FIFA Men’s World Cup, Major League Soccer (“MLS”), the UFL, the Union of European Football Associations (“UEFA”) European Championship, UEFA Nations League, Concacaf and CONMEBOL soccer, INDYCAR and horse racing. In addition to live events, FS1 offers daily studio shows featuring key talent, including Colin Cowherd and Nick Wright, and programming from Barstool Sports.
FS2. FS2 is a multi-sport national network that features live events, including NASCAR, collegiate sports, horse racing, rugby, soccer, motor sports and golf.
FOX Sports Racing. FOX Sports Racing is a 24-hour video programming service consisting of motor sports programming, including National Hot Rod Association, motorcycle racing and horse racing. FOX Sports Racing is distributed to subscribers in Canada and the Caribbean.
FOX Soccer Plus. FOX Soccer Plus is a premium video programming network that showcases exclusive live soccer and rugby competitions, including events from FIFA, UEFA, Concacaf, Canadian Premier League, Saudi Pro League, Super Rugby League, Australian Football League and the National Rugby League.
FOX Deportes. FOX Deportes is a Spanish-language sports programming service distributed in the U.S. FOX Deportes features coverage of a variety of major sports events, including premier soccer (such as matches from Liga MX, MLS and the Saudi Pro League), the NFL, including the Thanksgiving, Christmas, NFC playoffs and Championship games, and in rotation with other NFL media partners, the Super Bowl, MLB (including regular season games, alternating between the American and National League Championship Series each year, and the All-Star and World Series games), NASCAR Cup Series, college football, INDYCAR and UFL. In addition to live events, FOX Deportes also features multi-sport news and highlight shows and daily studio programming. FOX Deportes is available to approximately 7.3 million cable and satellite households in the U.S., of which approximately 1.3 million are Hispanic.
The Big Ten Network. The Big Ten Network is a 24-hour national video programming service dedicated to the collegiate Big Ten Conference and Big Ten athletics, academics and related programming. The Big Ten
Network televises live collegiate events, including football games, regular-season and post-season men’s and women’s basketball games, and men’s and women’s Olympic events , as well as a variety of studio shows and original programming. The Big Ten Network also owns and operates B1G+, a subscription video streaming service that features live streams of non-televised sporting events, replays of televised and streamed events and a large collection of classic games and original programming. The Company owns approximately 61% of the Big Ten Network.
Digital Distribution. The Company’s cable network programming is also distributed through the FOX One direct-to-consumer subscription streaming service, FOX-branded websites, apps, podcasts and social media accounts and is licensed for distribution through MVPDs’ websites and apps. The Company’s websites and apps include FOX.com, FOXNews.com, FOXBusiness.com, FOXWeather.com, FOXSports.com, FOXDeportes.com and the FOX One, FOX News, FOX Business, FOX Weather, FOX Sports and FOX Deportes mobile apps. FOX News Media also operates direct-to-consumer services FOX Nation, an SVOD service that offers U.S. consumers a variety of content including original programming, and FOX Weather, a FAST service that offers local, regional and national weather reporting in addition to live programming. The Big Ten Network distributes live-streaming and video-on-demand programming through the B1G+ subscription video streaming service. The Company also distributes non-authenticated live-streaming and video-on-demand content, podcasts, as well as static visual content across FOX, the Big Ten Network and Big Ten branded social media and third-party video and audio platforms.
Outkick Media. The Company owns Outkick Media, a digital media company focused on the intersection of sports, news and entertainment.
FOX Latin America. FOX Latin America, which began operations in June 2025, offers sports programming to audiences in Mexico and Central America through linear television networks, the Tubi AVOD service and a direct-to-consumer subscription streaming service.
Cable Network Programming Competition
General. Cable network programming is a highly competitive business. Cable networks compete for content, distribution, viewers and advertisers with a variety of media, including broadcast television networks; cable television systems and networks; direct-to-consumer streaming and on-demand platforms and services; mobile, gaming and social media platforms; audio programming; and print and other media. Important competitive factors include the prices charged for programming, the quantity, quality and variety of programming offered, the accessibility of such programming, the ability to adapt to new technologies and distribution platforms, the quality of user experience and the effectiveness of marketing efforts. Competition for sales of advertising time is based primarily on the anticipated and actually delivered size and demographic characteristics of audiences as determined by various measurement services, price, the time of day when the advertising is to be broadcast, competition from other cable networks, broadcast networks, cable television systems, direct broadcast satellite television, social and digital media and general economic conditions. Competition for audiences is based primarily on the selection of programming, the popularity and success of which depend on the reaction of the viewing public, which is often difficult to predict.
FOX News Media. FOX News' primary competition comes from the broadcast networks' national news divisions and cable news networks such as CNN and MS NOW. FOX Business' primary competition comes from the cable networks CNBC and Bloomberg Television. FOX News and FOX Business also compete for viewers and advertisers within a broad spectrum of television networks, including other non-news cable networks, free-to-air broadcast television networks and direct-to-consumer streaming and on-demand platforms and services. FOX News and FOX Business also face competition online from CNN.com, NBCNews.com, NYTimes.com, CNBC.com, Bloomberg.com, Yahoo.com, The Wall Street Journal Online, YouTube, social media platforms and audio and podcast networks, among others.
FOX Sports. A number of basic and pay television programming services, direct-to-consumer streaming services, and free-to-air stations and broadcast networks compete with FS1, FS2 and the Big Ten Network for sports programming rights, distribution, audiences and advertisers. On a national level, the primary competitors to FS1, FS2, and the Big Ten Network are national cable networks ESPN, ESPN2, TNT, TBS, USA Network, CBS Sports Network and The CW Network; league-owned networks such as NFL Network, NHL Network, NBA TV and MLB Network; collegiate conference-specific networks such as the SEC Network and ACC Network; and direct-to-consumer streaming services such as ESPN, YouTube, Peacock, Amazon Prime Video, Netflix,
Apple TV, Paramount+ and HBO Max, among others. In regional markets, the Big Ten Network competes with regional sports networks, local broadcast television stations and other sports programming providers and distributors.
Television
The Television segment produces, acquires, markets and distributes programming through the FOX broadcast network, the Tubi AVOD service, broadcast television stations and other digital platforms, primarily in the U.S. The segment also includes various production companies that produce content for the Company and third parties.
The FOX Network
The FOX Network is a premier national television broadcast network, renowned for disrupting legacy broadcasters with powerful sports programming and appealing primetime entertainment. The FOX Network regularly delivers 15 hours of weekly primetime programming to 209 local market affiliates, including 18 stations owned and operated by the Company, covering virtually every U.S. market, according to Nielsen. The FOX Network primetime lineup is intended to appeal primarily to the 18 to 49 year old audience, the demographic group that advertisers seek to reach most often, with particular focus on the 18 to 34 year old audience. The FOX Network has ranked among the top two networks in the 18 to 34 year old audience for the past 31 broadcast seasons. During the 2025-2026 broadcast season, the FOX Network ranked #2 in the 18 to 49 and 18 to 34 year old audiences and #2 in the male 18 to 49 and 18 to 34 year old audiences (based on Nielsen’s live+7 ratings). The median age of the FOX Network viewer is 59 years, as compared to 64 years for ABC, 63 years for CBS and 60 years for NBC.
•FOX Sports. A significant component of FOX Network programming consists of sports programming, with the FOX Network providing to its affiliates during the 2025-2026 broadcast season live coverage of the NFL, featuring America's Game of the Week, and the FIFA Men’s World Cup. The FOX Network also provides live coverage of MLB (including the post-season and the World Series), college football and basketball, MLS, the NASCAR Cup Series (including the Daytona 500), INDYCAR and the UFL. In certain years, FOX Sports broadcasts the Super Bowl and the UEFA European Championship. Effective with the 2023 NFL season, FOX Sports entered into an expanded 11-year media rights agreement with the NFL (subject to an NFL one-time termination right after the 2029 season) that extended FOX Sports' coverage of NFL games.
•FOX Entertainment. FOX Entertainment delivers high-quality scripted, unscripted, animated and live event content. FOX Entertainment primetime programming during the 2025-2026 broadcast season featured such scripted series as Doc, Best Medicine and Memory of a Killer, along with the FOX Entertainment-owned comedies Animal Control and Going Dutch; animated series, including The Simpsons, Bob's Burgers, Family Guy and American Dad; and unscripted series, such as the game show The Floor, Next Level Chef, Gordon Ramsay’s Secret Service and Kitchen Nightmares from Studio Ramsay Global (FOX’s co-owned production company with Gordon Ramsay), The Masked Singer, LEGO Masters, Special Forces: World’s Toughest Test, Farmer Wants a Wife, Fear Factor: House of Fear, Extracted and investigative report specials from FOX-owned TMZ. During the 2025-2026 broadcast season, FOX Entertainment featured the season’s top two debuts among adults 18-49 with Fear Factor: House of Fear and Memory of a Killer, along with three of the top four most watched cooking shows on television with Next Level Chef, Hell’s Kitchen and MasterChef.
The FOX Network obtains national sports programming through license agreements with professional or collegiate sports leagues or organizations, including long-term agreements with the NFL, MLB, college football and basketball conferences, NASCAR, UEFA, Concacaf and INDYCAR. Entertainment programming is obtained from major television studios, including 20th Television, Sony Pictures Television and Warner Bros. Television, and independent television production companies pursuant to license and co-production agreements. The terms of these agreements generally provide the FOX Network with the right to acquire broadcast rights to a television series for a minimum of four seasons. Entertainment programming is also provided by the Company's in-house production companies described below.
The FOX Network provides programming to affiliated stations and the right to broadcast network television programming on the affiliated stations in accordance with agreements of varying durations. Such agreements typically run three or more years and have staggered expiration dates. These affiliation agreements
require affiliated stations to carry the FOX Network programming in all time periods in which the FOX Network programming is offered to those affiliated stations, subject to certain exceptions stated in the affiliation agreements.
Tubi
Tubi is a leading AVOD service that is available on multiple digital platforms in the United States and select international regions. Tubi offers a content library of over 350,000 movies and television episodes from over 600 content partners, including every major Hollywood studio, and a growing number of new original titles. In fiscal 2026, Tubi expanded its content library through the premiere of 50 new original titles and the launch of over 20,000 creator-led episodes. Tubi also features key FOX content, such as The Masked Singer and Next Level Chef, as well as live local and national news content and sports programming. In addition to its on-demand library, Tubi offers over 340 sports, entertainment and local news linear streaming channels. These include channels featuring FOX Entertainment’s The Masked Singer, TMZ and Studio Ramsay Global’s Gordon Ramsay and feeds from over 100 local television stations (including FOX’s owned and operated stations), covering 77 DMAs and 23 of the top 25 markets. As of June 2026, Tubi is available on the vast majority of streaming platforms, including connected television devices, online at tubitv.com and on iOS and Android devices and platforms. In fiscal 2026, the service generated over 13 billion hours of total view time (the total number of hours watched) and averaged approximately 2.2% of all television viewing over the course of the year according to Nielsen’s The Gauge. Tubi enables the Company’s advertising partners to access a substantial, incremental digital audience. Tubi’s viewers are young, multicultural and highly engaged, and the majority of its audience is classified as “cord-cutters” or “cord-nevers.”
FOX Television Stations
FOX Television Stations owns and operates 29 full power broadcast television stations, which deliver broadcast network content, local news and syndicated programming to viewers in 18 local markets. These include stations located in 15 of the top 16 largest DMAs and two stations (referred to as duopolies) in each of 11 DMAs, including the three largest DMAs (New York, Los Angeles and Chicago). In two of the duopoly markets, FOX Television Stations is internally channel sharing whereby both of its stations in the market operate using a single 6 MHz channel. Of the 29 full power broadcast television stations, 18 stations are affiliated with the FOX Network. These stations leverage viewer, distributor and advertiser demand for the FOX Network’s national content. In addition, the FOX Network’s strategy to deliver fewer hours of national content than other major broadcasters benefits stations affiliated with the FOX Network, which can utilize the flexibility in scheduling to offer expanded local news and other programming that viewers covet. Our 29 stations collectively produce over 1,500 hours of local news coverage every week. For a description of the programming offered to affiliates of the FOX Network, see “—The FOX Network.” In addition, FOX Television Stations owns and operates 11 stations broadcasting programming from MyNetworkTV.
FOX Television Stations also operates a portfolio of digital businesses. These include the FLX (or FOX Local Extension) digital advertising platform and digital distribution businesses, including the FOX Local Streams, LiveNOW from FOX and FOX Soul FAST services described below under the heading “Digital Distribution.”
The following table lists certain information about each of the television stations owned and operated by FOX Television Stations. Unless otherwise noted, all stations are affiliates of the FOX Network.
FOX Television Stations
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DMA/Rank | | Station | | Digital
Channel RF
(Virtual) | | Type | | Percentage of U.S. Television Households in the DMA (a) |
| New York, NY | 1 | | WNYW | | 27(5) | | UHF | | 6.1% |
| | | WWOR-TV(b)(c) | | 25(9) | | UHF | | |
| Los Angeles, CA* | 2 | | KTTV | | 11(11) | | VHF | | 4.6% |
| | | KCOP-TV(b) | | 13(13) | | VHF | | |
| Chicago, IL* | 3 | | WFLD | | 24(32) | | UHF | | 2.9% |
| | | WPWR-TV(b)(d) | | 31(50) | | UHF | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DMA/Rank | | Station | | Digital
Channel RF
(Virtual) | | Type | | Percentage of U.S. Television Households in the DMA (a) |
| Dallas, TX* | 4 | | KDFW | | 35(4) | | UHF | | 2.6% |
| | | KDFI(b) | | 27(27) | | UHF | | |
| Philadelphia, PA* | 5 | | WTXF-TV | | 31(29) | | UHF | | 2.5% |
| Houston, TX* | 6 | | KRIV | | 26(26) | | UHF | | 2.3% |
| | | KTXH(b) | | 19(20) | | UHF | | |
| Atlanta, GA* | 7 | | WAGA-TV | | 27(5) | | UHF | | 2.2% |
| Washington, DC* | 8 | | WTTG | | 36(5) | | UHF | | 2.1% |
| | | WDCA(b)(e) | | 36(20) | | UHF | | |
| San Francisco, CA* | 9 | | KTVU | | 31(2) | | UHF | | 2.0% |
| | | KICU-TV(b) | | 36(36) | | UHF | | |
| Tampa, FL* | 11 | | WTVT | | 12(13) | | VHF | | 1.8% |
| Phoenix, AZ* | 12 | | KSAZ-TV | | 10(10) | | VHF | | 1.8% |
| | | KUTP(b) | | 26(45) | | UHF | | |
| Seattle-Tacoma, WA* | 13 | | KCPQ | | 13(13) | | VHF | | 1.7% |
| | | KZJO(b) | | 36(22) | | UHF | | |
| Detroit, MI* | 14 | | WJBK | | 7(2) | | VHF | | 1.5% |
| Orlando, FL* | 15 | | WOFL | | 22(35) | | UHF | | 1.5% |
| | | WRBW(b) | | 28(65) | | UHF | | |
Minneapolis, MN*(f) | 16 | | KMSP-TV | | 9(9) | | VHF | | 1.5% |
| | | WFTC(b) | | 29(29) | | UHF | | |
| Austin, TX* | 32 | | KTBC | | 7(7) | | VHF | | 0.8% |
| Milwaukee, WI | 39 | | WITI(g) | | 31(6) | | UHF | | 0.7% |
| Gainesville, FL | 156 | | WOGX | | 31(51) | | UHF | | 0.1% |
| TOTAL | | | | | | | | | 38.7% |
Source: Nielsen, January 2026
| | | | | |
* | Denotes a market where stations are also broadcasting in the ATSC 3.0 "NextGenTV" standard in partnership with broadcasters in the applicable DMA through channel sharing arrangements or, in the case of KCOP-TV, KTXH and WRBW, each of those stations has made the conversion to and is broadcasting in the ATSC 3.0 standard. |
(a) | VHF television stations transmit on Channels 2 through 13 and UHF television stations on Channels 14 through 36. The Federal Communications Commission (the “FCC”) applies a discount (the “UHF Discount"), which attributes only 50% of the television households in a local television market to the audience reach of a UHF television station for purposes of calculating whether that station’s owner complies with the national station ownership cap imposed by FCC regulations and by statute; in making this calculation, only the station’s RF Broadcast Channel is considered. In a duopoly market, both stations must be UHF for the discount to apply. In addition, the coverage of two commonly owned stations in the same market is counted only once. The percentages listed are rounded and do not take into account the UHF Discount. For more information regarding the FCC’s national station ownership cap, see “Government Regulation.” |
(b) | MyNetworkTV licensee station. |
| | | | | |
(c) | WWOR-TV hosts television station WRNN, New Rochelle, NY, licensed to WRNN License Company, LLC, an unrelated third party pursuant to a channel sharing agreement between FOX Television Stations and shared WRNN License Company, LLC. A portion of the spectrum formerly licensed to WWOR-TV is now shared with and licensed to WRNN. |
(d) | WPWR-TV channel shares with WFLD. |
(e) | WDCA channel shares with WTTG. |
(f) | The Company also owns and operates full power station KFTC, Channel 26, Bemidji, MN as a satellite station of WFTC, Channel 29, Minneapolis, MN. Station KFTC is in addition to the 29 full power stations described in this section. |
(g) | WITI hosts television station WVCY, Milwaukee, WI, licensed to VCY America, Inc., an unrelated third party pursuant to a channel sharing agreement between WITI Television, LLC, the predecessor in interest of FOX Television Stations and VCY America, Inc. A portion of the spectrum family licensed to WITI is now shared with and licensed to WVCY. |
Digital Distribution
The Company’s Television segment also distributes programming through the FOX One direct-to-consumer subscription streaming service, FOX-branded websites, apps, podcasts and social media accounts and licenses programming for distribution through MVPDs’ websites and apps. The Company’s websites and apps, which include FOX.com, FOXSports.com and TMZ.com and the FOX One, FOX Sports and TMZ mobile apps, provide live and/or on-demand streaming of FOX Network shows and programming from broadcast stations affiliated with the FOX Network. Other digital properties offering Television segment programming and other content include Tubi and the TMZ FAST service. FOX Television Stations distributes content across websites and mobile apps associated with the stations, Tubi, a range of third-party platforms and FOX Television Station’s FAST services. These services include LiveNOW from FOX, which offers 24/7 live streaming news coverage; FOX Local Streams, a group of FAST services that offer live and recorded content from 17 FOX-owned and operated local television stations; and FOX Soul, a service dedicated to the African American viewer that features original and syndicated programming. The Company’s FAST services are distributed across multiple devices and platforms, including traditional and virtual MVPDs, Tubi, connected TV device platforms and other digital platforms.
FOX Entertainment Studios
Through its FOX Entertainment Studios business, the Company produces entertainment programming for its own traditional and digital entertainment platforms, as well as for third parties. TMZ produces daily syndicated magazine programs, broadcast and other television specials and other content for distribution on traditional and digital platforms, including FOX Television Stations, Tubi, FOX One, FOX Nation and other digital platforms. The Company also operates a co-owned production company with Gordon Ramsay called Studio Ramsay Global that develops, produces and distributes culinary and lifestyle programming such as Next Level Chef and Next Level Baker for FOX and other programs for global markets. FOX Alternative Entertainment develops and produces unscripted and alternative programming primarily for the FOX Network, including The Masked Singer and Name That Tune. Animation production company Bento Box Entertainment produces programming for cable and broadcast networks (including programming such as Krapopolis, Grimsburg, Universal Basic Guys and Bob's Burgers that air on the FOX Network) and digital platforms.
FOX Entertainment Global
FOX Entertainment Global is FOX’s wholly-owned sales and distribution business. FOX Entertainment Global engages in domestic and international sales and licenses of scripted and unscripted series and other programs owned or controlled by various FOX entities, as well as content owned by third parties that contract with FOX Entertainment Global for distribution.
Red Seat Ventures
Red Seat Ventures, acquired by FOX in 2025, is a creator-focused digital services company that partners with content creators, brands and media companies to develop digital properties.
MyNetworkTV
The programming distribution service, Master Distribution Service, Inc. (branded as MyNetworkTV), distributes two hours per night, Monday through Friday, of off-network programming from syndicators to its over 185 licensee stations, including 11 stations owned and operated by the Company, and is available to approximately 95% of U.S. households as of June 30, 2026.
Television Competition
The network television broadcasting business is highly competitive. The FOX Network (with respect to both its sports and entertainment programming), MyNetworkTV and Tubi compete for audiences, programming and advertising revenue with a variety of competing media, including other broadcast television networks; cable television systems and networks; direct-to-consumer streaming and on-demand platforms and services; mobile, gaming and social media platforms; audio programming; and print and other media. In addition, the FOX Network and MyNetworkTV compete with other broadcast networks and programming distribution services to secure affiliations or station agreements with independently owned television stations in markets across the U.S. ABC, NBC and CBS each broadcast a significantly greater number of hours of programming than the FOX Network and, accordingly, may be able to designate or change time periods in which programming is to be broadcast with greater flexibility than the FOX Network. Technological developments are also continuing to affect competition within the broadcast television marketplace. Our entertainment programming production businesses compete with other content creators for creative talent, new content ideas, intellectual property and the distribution of their content. FOX Entertainment Global competes with other content licensors and sellers for the distribution of its content.
Each of the stations owned and operated by FOX Television Stations also competes for advertising revenues with other television stations, radio and cable systems in its respective market area, along with other advertising media, including direct-to-consumer streaming and on-demand platforms and services; mobile, gaming and social media platforms; newspapers, magazines, outdoor advertising and direct mail. All of the stations owned and operated by FOX Television Stations are located in highly competitive markets. Additional factors that affect the competitive position of each of the television stations include management experience, authorized power and assigned frequency of that station. Competition for sales of broadcast advertising time is based primarily on the anticipated and actually delivered size and demographic characteristics of audiences as determined by various rating services, price, the time of day when the advertising is to be broadcast, competition from the other broadcast networks, cable television systems, direct broadcast satellite television, services and digital media and general economic conditions. Competition for audiences is based primarily on the selection of programming, the acceptance of which is dependent on the reaction of the viewing public, which is often difficult to predict.
Other
FOX Studio Lot
FOX owns the FOX Studio Lot in Los Angeles, California. The historic lot is located on over 50 acres of land and has over 1.8 million square feet of space for both administration and production and post-production services available to service a wide array of industry clients, including 15 sound stages, theaters and screening rooms, editing rooms and other television and film production facilities. The FOX Studio Lot also has network broadcast facilities including two live production studios, production control rooms and editing and graphic spaces. The FOX Studio Lot provides two primary revenue streams — the lease of a portion of the office space to third parties and the operation of studio facilities for third-party productions.
Credible
Credible Labs Inc. (“Credible”) operates consumer finance and insurance marketplaces in the U.S. Credible’s offerings provide consumers personalized product and rate options for a range of financial products, including student loans, personal loans, mortgages and insurance policies from multiple consumer lending and insurance providers.
FOX One
FOX One, which launched in August 2025, is the Company’s wholly-owned, direct-to-consumer subscription streaming service that offers subscribers live streaming and on-demand access to the full portfolio of FOX brands, including FOX News, FOX Sports, the FOX Network, FOX Business, FOX Weather, FS1, FS2, FOX Deportes, the Big Ten Network, FOX Television Stations and, on a bundled basis, FOX Nation and B1G+. The service is designed to attract “cord-cutters” and “cord-nevers”, expanding the reach of FOX’s programming beyond its existing footprint. FOX One leverages technology to enhance the user experience, help audiences discover and enjoy content and integrate live and on-demand content. FOX One is available to consumers as a stand-alone service and as part of bundled offerings that include other distributors and services. In addition, MVPD subscribers who receive the Company’s networks can access FOX One on an authenticated basis.
Investments
Flutter
The Company holds an equity interest in Flutter, an online sports betting and gaming company with operations in the U.S. and internationally. The Company owns approximately 4.3 million ordinary shares, which represents approximately 2.5% of Flutter as of June 30, 2026. In addition, FOX Sports holds a 10-year call option expiring in December 2030 to acquire an 18.6% equity interest in Flutter's majority-owned subsidiary, FanDuel, the exercise of which is subject to certain conditions and applicable gambling regulatory approvals. As of June 30, 2026, the option exercise price is approximately $4.7 billion. FOX has no obligation to commit capital towards this opportunity unless and until it exercises the option. In addition, Flutter cannot pursue an initial public offering for FanDuel without FOX's consent or approval from the arbitrator who presided over a FOX-Flutter arbitration in 2021 and 2022.
United Football League
Launched in January 2024, the United Football League (the “UFL”) is a professional spring football league that consists of eight teams playing a 40-game regular season schedule in addition to two playoff games and a championship game. FOX Sports and Disney/ESPN are the domestic distribution partners of the UFL games under multi-year rights agreements. As of June 30, 2026, the Company owns approximately 32.2% of the UFL.
Government Regulation
The Communications Act and FCC Regulation
The television broadcast industry in the U.S. is highly regulated by federal laws and regulations issued and administered by various agencies, including the FCC. The FCC regulates television broadcasting, and certain aspects of the operations of cable, satellite and other electronic media that compete with broadcasting, pursuant to the Communications Act of 1934, as amended (the “Communications Act”). The introduction of new laws and regulations or changes in the enforcement or interpretation of existing laws and regulations could have a negative impact on the operations, prospects and financial performance of the Company.
Broadcast Licenses. The Communications Act permits the operation of television broadcast stations only in accordance with a license issued by the FCC upon a finding that the grant of the license would serve the public interest, convenience and necessity. The Company, through its subsidiaries, holds broadcast licenses in connection with its ownership and operation of television stations. Under the Communications Act, television broadcast licenses may be granted for a maximum term of eight years. Generally, the FCC renews broadcast licenses upon finding that the television station has served the public interest, convenience and necessity; there have been no serious violations by the licensee of the Communications Act or FCC rules and regulations; and there have been no other violations by the licensee of the Communications Act or FCC rules and regulations which, taken together, indicate a pattern of abuse. The next renewal cycle for FOX Television Stations’ FCC applications for its full power broadcast licenses will commence in June of 2028. One television station license from the previous renewal cycle is subject to an administrative appeal at the FCC.
Ownership Regulations. Under the FCC’s national television ownership rule, one party may own television stations with a collective national audience reach of not more than 39% of all U.S. television households, subject to the UHF discount. Under the UHF discount, a UHF television station is attributed with reaching only 50% of the television households in its market for purposes of calculating national audience reach. In June
2025, the FCC released a Public Notice seeking to refresh the record on whether to eliminate the national ownership cap. In July 2026, the FCC announced that it will vote at its August 6, 2026 Open Meeting to eliminate the 39% national audience reach television ownership cap. If adopted, the elimination of the cap would allow a broadcaster to own stations serving 100% of the country subject to traditional public interest review.
The Company is also subject to other communications laws and regulations relating to ownership. For example, FCC dual network rules prohibit any of the four major broadcast television networks — FOX, ABC, CBS and NBC — from being under common ownership or control. In addition, under the Communications Act, no broadcast station licensees may be owned by a corporation if more than 25% of the corporation’s stock is owned or voted by non-U.S. persons, their representatives or by any other corporation organized under the laws of a foreign country. This ownership limit can be waived if the FCC finds it to be in the public interest. The FCC could review the Company’s compliance with the foreign ownership regulations in connection with its consideration of FOX Television Stations’ license renewal applications. The Company’s Amended and Restated Certificate of Incorporation authorizes the Company’s Board of Directors (the “Board”) to take action to prevent, cure or mitigate the effect of stock ownership above the applicable foreign ownership threshold, including: refusing to permit any transfer of common stock to or ownership of common stock by a non-U.S. stockholder; voiding a transfer of common stock to a non-U.S. stockholder; suspending rights of stock ownership if held by a non-U.S. stockholder; or redeeming common stock held by a non-U.S. stockholder.
Must-Carry/Retransmission Consent. FCC regulations require each television broadcaster to elect, at three-year intervals, either to require carriage of its signal by traditional MVPDs in the station’s market or to negotiate the terms through which that broadcast station would permit transmission of its signal by the traditional MVPDs within its market, which we refer to as retransmission consent. FOX Television Stations have historically elected retransmission consent for all of their owned and operated stations, and the Company has been compensated as a result.
Children’s Programming. Federal legislation limits the amount of commercial matter that may be broadcast during programming originally designed for children 12 years of age and younger to 10 ½ minutes per hour during the weekend and 12 minutes per hour during the week. In addition, FCC regulations generally require television stations to broadcast a minimum of three hours per week of programming, which, among other requirements, must serve, as a “significant purpose,” the educational and informational needs of children 16 years of age and under. Under FCC rules, one of the three hours per week may air on a television station’s multicast stream(s); the other two hours must air on the primary programming stream. A television station found not to have complied with the programming requirements or commercial limitations could face sanctions, including monetary fines and the possible non-renewal of its license.
Program Regulation. The FCC also regulates the content of broadcast, cable network and other video programming. The FCC prohibits broadcasters from airing obscene material at any time and indecent or profane material between 6:00 a.m. and 10:00 p.m. The FCC also monitors compliance relating to political advertising and the use and integrity of the Emergency Alert System. In addition, FCC regulations require the closed captioning of almost all broadcast and/or cable programming, as well as certain programming in the U.S. delivered by internet protocol. Broadcast television stations in certain markets that are affiliated with one of the four major U.S. broadcast networks must also provide a certain amount of programming every quarter that includes audio-narrated description of a program’s key visual elements that make the program accessible to blind and low-vision viewers. Commercials embedded in our networks’ television content stream also must adhere to certain standards for ensuring that those commercials are not transmitted at louder volumes than our program material.
Advertising Regulation. The Federal Trade Commission, or FTC, has increased its focus on unfair and deceptive advertising practices, particularly with respect to social media marketing. Both FCC and FTC rules and guidance require marketers to clearly and conspicuously disclose whenever there has been payment for a marketing message or when there is a material connection between an advertiser and a product endorser. Additionally, a number of states have recently introduced or passed legislation as it relates to disclosures of the use of artificial intelligence (“AI”) in political advertising. The disclosure and record retention requirements for AI in political advertising vary greatly by state.
Spectrum Allocation. In 2020, the FCC reallocated sixty percent of a band of satellite transmission spectrum known as the “C-Band” used by the television industry to transmit programming to free up spectrum for the next generation of commercial wireless broadband services, which has reduced the availability and use of satellite transmission spectrum for the television industry. In July 2025, legislation was signed into law, directing the FCC to conduct an auction of at least 100 MHz of C-Band spectrum within two years. The FCC launched a rulemaking on the implementation of the auction and requested public comment on whether the remaining spectrum in the C-Band, be, in whole or in part, included in the auction. In July 2026, the FCC adopted a final Order that requires 160 MHz of the remaining 200 MHz C-Band spectrum to be included in the auction, with the auction to occur in 2027 and the transition of the use of the spectrum to conclude by December 2030 in the top 75 Partial Economic Areas and June 2031 for the rest of the country. The decreased availability of satellite transmission spectrum could diminish the quality of and increase interference to our transmissions, which could significantly hinder the Company’s ability to deliver its programming to broadcast affiliates and traditional MVPDs.
Broadcast Affiliation. In addition, FCC regulations govern various aspects of the agreements between networks and affiliated broadcast stations, including a mandate that television broadcast station licensees retain the right to reject or refuse network programming in certain circumstances or to substitute programming that the licensee reasonably believes to be of greater local or national importance. In November 2025, the FCC issued a Public Notice seeking comment on how market and regulatory dynamics have impacted the relationship between local television stations and national broadcast networks. We cannot predict the timing or outcome of this rulemaking or its impact on our businesses.
Broadcast Transmission Standard. In November 2017, the FCC adopted rules to permit television broadcasters to voluntarily broadcast using the “Next Generation” broadcast television transmission standard developed by the Advanced Television Systems Committee, Inc., also referred to as “ATSC 3.0” or “NEXTGEN TV”. FOX Television Stations is actively building out ATSC 3.0 facilities and is participating in various ATSC 3.0 testing with other broadcasters, but it is too early to predict the impact of this technical standard on the Company's operations. In June 2020, the FCC adopted a Declaratory Ruling and Notice of Proposed Rulemaking declaring that local and national ownership restrictions do not apply to non-video services. In June 2023, the FCC issued a Report and Order that extended the simulcast requirement for ATSC 1.0 and ATSC 3.0 signals to July 2027. In early 2025, the National Association of Broadcasters filed a petition seeking an end of the simulcast requirements and a hard transition deadline to ATSC 3.0 standard. This proceeding may impact the roll out of both video and non-video ATSC 3.0 services.
Violation of FCC regulations can result in substantial monetary forfeitures, periodic reporting conditions, short-term license renewals and, in egregious cases, denial of license renewal or revocation of license. Violation of FTC-imposed obligations can result in enforcement actions, litigation, consent decrees and, ultimately, substantial monetary fines.
Privacy and Information Regulation
The laws and regulations governing the collection, use, retention, disclosure and transfer of personal information are complex and rapidly evolving, particularly as they relate to the Company's digital businesses. Federal and state laws and regulations affecting the Company’s digital products and services such as advertising-supported and subscription-based streaming services, websites, apps and other business activities include: the Children’s Online Privacy Protection Act, which prohibits websites and online services from collecting personally identifiable information online from children under age 13 without prior parental consent; the Video Privacy Protection Act, which prohibits the knowing disclosure of information that identifies a person as having requested or obtained specific video materials from a “video tape service provider;” the Telephone Consumer Protection Act, which restricts certain marketing communications, such as text messages and calls, without explicit consent; the Gramm-Leach-Bliley Act, which regulates the collection, handling, disclosure and use of certain personal information by companies that offer consumers financial products or services, imposes notice obligations and provides certain individual rights regarding the use and disclosure of certain information; and many state privacy laws, such as those in California and Virginia, which impose broad obligations on the collection, use, handling and disclosure of personal information, and provide certain individual rights, including the right to access, delete, correct and restrict the “sale” or “sharing” of personal information, including in connection with targeted advertising, and the right to appeal.
A number of privacy and data security bills and regulations that address the collection, retention, disclosure and use of personal information, breach notification requirements and cybersecurity that would impose additional obligations on businesses, including in connection with targeted advertising, are pending or have been adopted at the state and federal level. Certain existing and emerging privacy and AI-related laws and regulations also may impose additional obligations relating to the use of automated technologies and personal information, which could affect how the Company develops, deploys and uses AI-enabled tools. In addition, the FTC and state attorneys general and other regulators have made privacy and data security an enforcement focus. Other federal and state laws and regulations that could impact our businesses also have been or may be adopted, such as those relating to minors, tailored advertising and its measurement, and oversight of user-generated content, as well as U.S. national security restrictions regarding the transfer of certain U.S. data, such as the Preventing Access to U.S. Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons Rule issued by the U.S. Department of Justice. In addition, certain international and federal laws and all 50 states have data breach notification legislation that require businesses to notify individuals and government agencies in the event of unauthorized access or exfiltration of certain personal information.
Foreign jurisdictions also have implemented and continue to introduce new privacy and data security laws and regulations, which apply to certain of the Company’s operations. It is possible that our current data protection policies and practices may be deemed inconsistent with new legal requirements or interpretations thereof and could result in the violation of these new laws and regulations. The EU General Data Protection Regulation, in particular, regulates the collection, use and security of personal data and restricts the trans-border flow of such data. Other countries, including the United Kingdom, Canada, Australia, China and Mexico, also have enacted data protection legislation.
The Company monitors and considers these laws and regulations, particularly with respect to the design and operation of digital content services and legal and regulatory compliance programs. There may be changes in laws and regulations or judicial or regulators’ interpretation or enforcement thereof and regulatory agencies may change their priorities or activities with respect to such laws and regulations. Any of these could result in increased compliance costs, claims, changes to business practices, including with respect to tailored advertising, or otherwise impact the Company’s business. Violations of these laws and regulations could result in significant monetary fines and other penalties, private litigation, require us to expend significant resources to defend, remedy and/or address, harm our reputation or subject us to increased scrutiny from regulators or stakeholders, even if we are not ultimately responsible for the violation.
Regulation of Digital Products and Services
The Company’s digital products and services are subject to evolving federal, state and international laws and regulations governing areas including consumer protection, online safety accessibility and competition, in addition to the privacy, data security and intellectual property laws described elsewhere in this section. The scope of regulation applicable to the Company’s digital products and services may differ depending on how they are used and/or purchased. We cannot predict whether, or the extent to which, future regulatory developments could affect our digital products and services.
Consumer Finance Laws and Regulations
Credible operates consumer finance and insurance marketplaces that market and provide services in heavily regulated industries across the United States. As a result, Credible is subject to a variety of federal and state laws and regulations. These include the laws and regulations governing the collection, use and transfer of consumer information described above and the following:
•the Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the Fair Housing Act, the Real Estate Settlement Procedures Act, or “RESPA,” and similar state laws, and federal and state unfair and deceptive acts and practices, or “UDAAP,” laws and regulations, which place restrictions on the manner in which consumer loans and insurance products are marketed and originated and the amount and nature of fees that may be charged or paid to Credible by lenders, insurance carriers and real estate professionals;
•the Dodd-Frank Wall Street Reform and Consumer Protection Act, which, among other things, imposes requirements related to mortgage disclosures; and
•federal and state licensing laws, such as the Secure and Fair Enforcement for Mortgage Licensing Act of 2008, or “SAFE Act,” which establishes minimum standards for the licensing and regulation of mortgage loan originators and state insurance licensing laws.
Intellectual Property
The Company’s intellectual property assets include copyrights in television and other programming, other publications, websites, digital properties and technologies; trademarks, trade dress, service marks, logos, slogans, sound marks, design rights, symbols, characters, names, titles and trade names, domain names; patents or patent applications for inventions related to its products, business methods and/or services, trade secrets and know how; and licenses of intellectual property rights of various kinds. The Company derives value from these assets through the production, distribution and/or licensing of its programming to third-party distributors, the operation of websites and other digital properties, and through the sale of products, such as collectible merchandise, apparel, books and publications, among others.
The Company devotes significant resources to protecting its intellectual property, relying on a combination of copyright, trademark, unfair competition, patent, trade secret and other laws and contract provisions. There can be no assurance of the degree to which these measures will be successful in any given case. Policing unauthorized use of the Company’s products and services and related intellectual property is often difficult, and the steps taken by the Company may not in every case prevent the infringement. The Company seeks to limit that threat through a combination of approaches, including offering legitimate market alternatives, deploying digital rights management technologies, asserting infringement claims and by pursuing takedowns and/or monetization of Company content uploaded to the Internet by third parties without Company authorization. Piracy, including in the digital environment, continues to present a threat to revenues from products and services based on intellectual property.
Third parties may challenge the validity or scope of the Company’s intellectual property from time to time, and such challenges could result in the limitation or loss of the Company’s intellectual property rights. Even if not valid, such claims may result in substantial costs and diversion of resources that could have an adverse effect on the Company’s operations. The legal landscape for new technologies, including AI, remains uncertain, and development of the law in this area could negatively impact the Company’s ability to protect against unauthorized third-party infringing uses or result in intellectual property infringement claims against the Company.
Human Capital Resources
Our workforce is the creative, strategic and operational engine of FOX’s success, and we are committed to developing and supporting our employees by offering competitive compensation and benefits, fostering a healthy work-life balance, providing growth and development opportunities, fostering workplace civility and respect and encouraging our employees to have an impact in their communities.
As of June 30, 2026, we had approximately 10,550 full-time employees. In the ordinary course of our business and consistent with industry practice, we also employ freelance and temporary workers who provide important production and broadcast support services. The vast majority of our workforce is based in the United States, and a portion is unionized. Our most recent Employment Information Report (EEO-1) is available on our website at www.foxcorporation.com. FOX’s Corporate Social Responsibility Report, also posted on our website at www.foxcorporation.com, provides a detailed review of our human capital programs and achievements. Our key human capital initiatives include:
Employee Compensation and Benefits
We are proud to invest in our people through competitive pay and comprehensive benefits designed to attract, motivate and retain our talent. Full-time employees and their family members are eligible for medical insurance, and eligible employees may participate in flexible spending accounts, health savings accounts, and qualified transportation expense accounts. We also provide employees with a health advocate service. Eligible employees receive paid time-off programs, including vacation and sick and safe time, benefits such as life insurance, accidental death and dismemberment insurance, salary replacement for up to 26 weeks of short-term disability, basic long-term disability insurance, charitable gift matching, and an employee assistance program that offers onsite counseling in our New York and Los Angeles worksites. The FOX 401(k) Savings
Plan provides employees with a company contribution, and it offers a company match, Roth and post-tax contribution options and catch-up contributions. Freelance employees who work a minimum number of hours are also eligible for a medical, dental and vision plan, as well as the 401(k) savings plan and health advocate service.
Employee Wellness and Workplace Flexibility
We believe offering our employees the tools necessary for a healthy work-life balance and overall wellness empowers them to thrive in today's workforce. FOX provides robust parental leave, workplace lactation rooms, on-site subsidized childcare for Los Angeles employees and extensive backup care for family members and pets. FOX maintains a partnership with the National Alliance on Mental Illness to provide additional mental health resources to employees, including courses on strategies to build resilience, maintain mental well-being and protect against workplace burnout.
Learning and Development
FOX offers employees multiple learning and development programs, including tuition reimbursement, management and leadership development, online and on-demand e-learning, live webinars and assessment tools. We deliver specialized training on the First Amendment, defamation, privacy, infringement and other newsgathering and reporting topics to educate employees on these principles and provide advice on best practices. Additionally, FOX has established and put into action numerous early career training initiatives aimed at equipping promising individuals with vital job skills and career advancement opportunities. The award-winning FOX Internship Program offers students an exciting opportunity to gain practical experience, participating in real-world projects and seminars on the media industry, technology and professional development.
Workplace Civility and Respect
Trust begins in the workplace every single day. We are committed to fostering a working environment of trust for our colleagues, in which people do their best work. Harassment, discrimination, retaliation and threats to health and safety all undermine our working environment of trust and make it harder for people to excel. Therefore, it is our policy to provide a safe work environment free from this or any other unlawful conduct. Creating and maintaining an environment free of discrimination and harassment begins at the highest leadership level of the Company and we have focused on embedding this commitment throughout our policies and practices. The FOX Standards of Business Conduct and the Preventing Harassment, Discrimination and Retaliation Policy, which are posted on our website, create our framework for addressing complaints and taking remedial measures as needed. In addition, all new hires must complete training on the Preventing Harassment, Discrimination and Retaliation Policy, as well as compliance and business ethics and existing employees must complete the training periodically.
Community Impact
Through FOX Forward, our corporate social responsibility program, we strategically invest in causes that align with our business, our employees and our audience in an effort to create positive change. Our primary areas of focus include serving veterans and active-duty military, opening educational pathways for under-resourced students and providing essential resources to communities in crisis.
ITEM 1A. RISK FACTORS
Prospective investors should consider carefully the risk factors set forth below before making an investment in the Company’s securities.
Risks Related to the Roku Transaction
The Roku Transaction may not be completed or may be delayed if the closing conditions in the Merger Agreement are not satisfied, and the Merger Agreement may be terminated in accordance with its terms.
On June 14, 2026, FOX and Roku entered into the Merger Agreement pursuant to which Roku will become a wholly owned subsidiary of FOX. The completion of the Merger is subject to several closing conditions, including requisite FOX and Roku stockholder approvals, clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, the receipt of consents or approvals under certain other antitrust laws and certain investment screening laws and other customary conditions. The regulatory approval process (including if regulatory or governmental authorities seek to impose any terms, conditions, obligations or restrictions as a condition to approval) may lead to lengthy negotiations, jeopardize or delay completion of the Merger or negatively impact its anticipated benefits. The failure to satisfy all required conditions could prevent the Merger from being completed or delay its completion for a significant period of time. Such a delay could result in a failure to realize some or all of the anticipated benefits of the Merger on the expected timeline, or at all. There can be no assurance that the conditions in the Merger Agreement will be satisfied or waived or that the Merger will be consummated.
The Merger Agreement also contains customary termination rights and provides that each party is required to pay the other a termination fee of approximately $866 million if the Merger Agreement is terminated in certain circumstances, including due to a change in the recommendation of its board of directors or if the Merger is not consummated by the termination date specified in the agreement. In addition, the Company will be required to pay Roku a termination fee of approximately $1.2 billion if the Merger Agreement is terminated under certain circumstances related to the failure to obtain certain regulatory approvals or upon the entry of a permanent restraint under certain antitrust laws or investment screening laws. FOX has also agreed to reimburse Roku for up to $70 million for reasonable third-party costs and expenses incurred by Roku in connection with the Merger if the Company is unable to obtain the requisite FOX stockholder approval in connection with the transaction.
If the Transaction is significantly delayed or is not completed, it could have an adverse effect on FOX’s business, financial condition or results of operations.
Entry into the Merger Agreement could have a variety of negative impacts on FOX and the market prices of the Common Stock.
The Company is subject to a number of risks in connection with its entry into the Merger Agreement, including:
•negative reactions from the financial markets, including negative impacts on the market prices of the Common Stock;
•negative reactions from FOX’s customers, suppliers, distributors, employees, or other business partners;
•significant costs relating to the Merger, including financial advisory, legal, financing, accounting and other transaction costs and additional expenses related to combining the operations of the two companies;
•restrictions on the conduct of FOX’s business prior to completion of the Merger set forth in the Merger Agreement, including pursuing alternatives to the Merger, which could discourage a potential third party from making an alternative transaction proposal or prevent the Company from making other acquisitions or taking other actions that would have been beneficial to FOX; and
•the commitment of substantial time and resources by FOX management, which otherwise could have been directed toward the Company’s operations and pursuit of other beneficial opportunities.
If the Merger is not consummated, in addition to failing to realize it benefits, FOX may experience adverse impacts to its ongoing business, financial condition, results of operations or on the market prices of the Common Stock. For example, the Company could be subject to litigation related to a failure to complete the Merger or an enforcement proceeding seeking to require FOX to perform its obligations under the Merger Agreement. The cost of defending against such litigation and proceedings may be significant. Similarly, if there are delays in the completion of the Merger, they could, among other things, result in additional transaction costs, loss of revenue or other negative effects associated with uncertainty about completion of the Merger.
Business uncertainties and contractual restrictions on FOX while the Merger is pending could adversely affect FOX’s business and operations.
Uncertainty regarding the completion of the Merger may cause some customers, suppliers, distributors, vendors, strategic partners and other parties to delay or defer making business decisions concerning the Company or entering into agreements with FOX, and may cause them to seek to terminate or renegotiate their existing arrangements with the Company. If this occurs, it could have an adverse impact on the Company’s business, financial condition, results of operations and cash flows or on the market prices of the Common Stock, regardless of whether the Merger is completed. The Merger Agreement also restricts the Company from making certain other acquisitions or issuing additional equity in excess of certain limitations without Roku’s prior consent, which may prevent FOX from pursuing attractive business opportunities or strategic transactions that arise prior to the completion of the Merger.
The market price of the Common Stock may decline as a result of the Merger.
The market price of the Common Stock may decline as a result of the Merger, and holders of the Common Stock, including Roku stockholders who become holders of Class A Common Stock as a result of the Merger, could lose the value of their investment in the Common Stock if, among other things, the Company is unable to achieve the expected growth in earnings, the anticipated benefits from the Merger are not realized, the transaction costs are greater than expected or any transaction-related financing is on unfavorable terms. The market price of the Common Stock also may decline if FOX does not achieve the perceived benefits of the Merger as rapidly or to the extent anticipated by financial or industry analysts or if the effect of the Merger on the Company’s business, financial condition or results of operations is not consistent with analyst expectations. The issuance of shares of Class A Common Stock in the Merger could independently have the effect of depressing the market price for the Common Stock. In addition, Roku stockholders may choose or (in the case of some stockholders such as funds with limitations on permitted stockholdings) be required to sell the Class A Common Stock they receive as a result of the Merger. Any such sales of Class A Common Stock could depress the market price for the Common Stock.
The Company or its Board of Directors may be the target of Merger-related lawsuits that result in substantial costs or delay or prevent the completion of the Merger.
Securities class action and derivative lawsuits are often brought against public companies that have entered into merger agreements. Even if the lawsuits are without merit, defending against or otherwise resolving these claims can result in substantial costs and divert management time and resources and an adverse judgment could result in monetary damages, which could have a negative financial impact on FOX. In addition, if a plaintiff successfully obtains an injunction prohibiting the consummation of the Merger, it could prevent the Merger from being completed on the expected timetable, or at all.
The Company may be unable to successfully integrate the businesses of FOX and Roku and realize the anticipated benefits of the Merger.
The Merger involves the integration of Roku and FOX’s businesses -- a complex, costly and time-consuming process. Many of the difficulties inherent in the process are outside FOX’s control and could result in delays, increased costs, decreases in expected revenues and diversion of management time and attention. In addition, post-closing, FOX will have significantly more systems, assets, investments, businesses, customers and employees than it did prior to the Merger, and FOX will operate new lines of business. The combined company’s success will depend in part on the Company’s ability to successfully combine the businesses and realize the anticipated benefits of the Merger.
FOX’s post-Merger indebtedness may have a significant negative impact on its business, financial condition or results of operations.
FOX is incurring a significant amount of debt in connection with the Merger, which could have significant consequences, including: increasing the Company’s vulnerability to adverse changes in economic or industry conditions; reducing its ability to effectively compete and respond to business or industry changes; creating competitive disadvantages compared to companies with lower debt levels; increasing FOX’s borrowing costs and requiring it to dedicate a greater amount of cash to debt payments at the expense of operating needs, capital expenditures, strategic initiatives or general corporate purposes; limiting the Company’s ability to return capital to stockholders; and impeding its ability to borrow additional funds in the future. Additionally, rating agencies may take negative actions against FOX’s credit ratings because of the Merger, which would increase its borrowing costs. Following completion of the Merger, if the Company is required to arrange additional financing or refinancing for working capital, capital expenditures, acquisitions, or other general corporate purposes, its ability to do so will depend on many factors, including market conditions and other factors beyond its control. There can be no assurance that FOX will be able to arrange additional financing or refinancing on acceptable terms or at all.
Risks Related to Macroeconomic Conditions, Our Business and Our Industry
Changes in consumer behavior and evolving technologies and distribution platforms and offerings continue to challenge existing business models and may adversely affect the Company's business, financial condition or results of operations.
The ways in which consumers view content and technology and business models in our industry continue to rapidly evolve. New distribution platforms and offerings, increased competition from new entrants and emerging technologies have added to the complexity of maintaining predictable revenue streams. Technological advancements have driven changes in consumer behavior as consumers now have more control over when, where and how they consume content and have increased advertisers' options for reaching their target audiences. Consumer preferences have evolved toward direct-to-consumer offerings such as SVOD, AVOD and FAST services, as well as connected TV devices and operating systems and gaming and other consoles. An increasing number of FAST services and SVOD services that have introduced advertising-supported tiers has intensified competition for digital advertising and may continue to do so in the future. In addition, the increasing use of time-shifting and advertising-skipping technologies that enable viewers to fast-forward or circumvent advertisements impacts the attractiveness of the Company's programming to advertisers and may adversely affect its advertising revenues. Other new technological developments, such as the development and use of generative AI, including large language model applications, are rapidly evolving and increasingly being incorporated into business operations and content generation, and AI may be used in ways that could reduce demand for our content, products and services. The advantages and risks associated with the use of generative AI are largely uncertain.
Changes in consumer behavior and technology have also had an adverse impact on MVPDs that deliver the Company's broadcast and cable networks to consumers. Consumers’ increasing viewership through direct-to-consumer offerings has contributed to industry-wide declines in subscribers to MVPD services over the last several years. These declines are expected to continue and possibly accelerate in the future. If consumers increasingly favor alternative offerings over MVPD subscriptions, the Company may continue to experience a decline in viewership and demand for the programming on its networks. The Company’s distribution and advertising revenues have been negatively impacted by these trends, and these negative effects could continue and accelerate in the future. Changing distribution models may also negatively impact the Company's ability to negotiate affiliation agreements on favorable terms, which could have an adverse effect on its business, financial condition or results of operations. Our distribution and advertising revenues also may be adversely affected by consumers' use of antennas (and their integration with set-top boxes or other consumer devices) to access broadcast signals to avoid subscriptions.
To remain competitive in this evolving environment, the Company must effectively anticipate and adapt to new market changes. The Company continues to focus on investing in and expanding its digital distribution offerings and direct engagement with consumers, including through Tubi, the FOX One direct-to-consumer subscription streaming service, FOX Nation, FOX Weather and other offerings. However, if the Company fails to effectively safeguard and monetize the value of its content while responding to and developing new technologies and business models to take advantage of, technological developments and consumer
preferences, it could have a significant adverse effect on the Company's business, financial condition or results of operations.
The Company derives substantial revenues from the sale of advertising, and declines in advertising expenditures have caused, and could continue to cause, the Company’s revenues and operating results to decline significantly in any given period or in specific markets.
FOX’s advertising revenues have been, and may continue to be, adversely affected by factors such as changes in consumer behavior, advertising market conditions and deficiencies in audience measurement, and they vary substantially due to cyclical sports events and elections.
The evolution of consumer preferences toward direct-to-consumer streaming offerings and other digital products and the increasing number of entertainment choices has intensified audience fragmentation and reduced viewership through traditional linear distribution models. This has caused ratings and viewership declines for television networks, including some of our networks. These changes have also given rise to new ways of purchasing advertising, as well as a general shift in advertising expenditures toward streaming and other digital offerings, some of which may not be as beneficial to us as traditional advertising methods. In addition, increased digital advertising available in the marketplace due to the proliferation of advertising-supported direct-to-consumer offerings has intensified, and may continue to intensify, competition for viewers and advertising. The use of AI tools in advertising technology also is becoming more prevalent and if our competitors are able to adopt the use of these tools more effectively than we are, it could negatively impact our advertising revenues. Periods of economic weakness also could accelerate industry-wide shifts in advertising expenditures from linear to digital advertising. There can be no assurance that we can successfully navigate the evolving digital advertising market or that the digital advertising revenues we generate will offset the declines in advertising revenues generated by our traditional linear networks.
The strength of the advertising market can fluctuate in response to the economic prospects of specific advertisers or industries, advertisers' spending priorities and the economy in general or the economy of an individual geographic market as described further below. Our ability to generate advertising revenue also depends on demand for our content, the viewers in our targeted demographics, advertising rates, targeting capabilities, results observed by advertisers, the perceived effectiveness of our advertising offerings and alternative advertising options. In addition, factors such as terrorist acts, wars, political uncertainties and hostilities, natural and other disasters and widespread health emergencies can also negatively impact advertising revenues.
Major sports events, such as the NFL’s Super Bowl and the FIFA World Cup and the state, congressional and presidential election cycles also may cause the Company's advertising revenues to vary substantially from year to year. Political advertising expenditures are impacted by the ability and willingness of candidates and political action campaigns to raise and spend funds on advertising and the competitive nature of the elections affecting viewers in markets featuring our programming.
Advertising sales also largely depend on audience measurement and could be negatively affected if measurement methodologies do not accurately reflect actual viewership levels. Although Nielsen’s statistical sampling method is the primary measurement methodology used for our linear television advertising sales, we measure and monetize our digital platforms based on a combination of internal and third-party data, including demographic composite estimates. The industry is transitioning to a multiplatform measurement environment in an effort to more completely measure viewership and advertising across linear and digital platforms, but has not yet established a consistent, broadly accepted measure of multiplatform audiences. Although we expect multiplatform measurement innovation and standards to benefit us as the advertising market continues to evolve and are actively working to improve our internal measurement capabilities, we are still largely dependent on third parties to provide these solutions. In addition, measurement providers may change their methodologies, data sources and panel/“big data” mixes, which could result in a discontinuation of or volatility in reported ratings and audience metrics (including declines in reported ratings) that may not correspond to actual changes in audience behavior. Declines in advertising revenues may also be caused by regulatory intervention or other third-party action that impacts where and when advertising may be placed. If negative impacts on advertising revenues continue or accelerate, they could have a material adverse effect on the Company's business, financial condition or results of operations.
Because the Company derives a significant portion of its revenues from a limited number of distributors, the failure to enter into or renew affiliation and carriage agreements on favorable terms, or at all, could have a material adverse effect on the Company’s business, financial condition or results of operations.
The Company depends on affiliation and carriage arrangements that enable it to reach a large percentage of households through MVPDs and third party-owned television stations. There can be no assurance that these agreements will be renewed in the future, or renewed on favorable terms, including terms related to pricing, programming tiers and bundles and the types of rights we grant distributors. The inability to enter into or renew MVPD arrangements on favorable terms, or at all, or the loss of carriage on MVPDs’ most widely distributed programming tiers or their targeted, genre-focused programming tiers (sometimes referred to as “skinny bundles”) could reduce the distribution of the Company’s owned and operated television stations and broadcast and cable networks, which could adversely affect the Company’s distribution revenues and its ability to sell national and local advertising time. The loss of favorable MVPD packaging, positioning, pricing or other marketing opportunities could also negatively impact the Company’s distribution revenues. Consolidation among MVPDs, their increased vertical integration into the cable or broadcast network business or their use of alternative technologies to offer their subscribers access to local broadcast network programming could increase their negotiating leverage. Competitive pressures faced by MVPDs, particularly in light of evolving consumer viewing patterns and distribution models, could adversely affect the terms of our contract renewals with MVPDs. In addition, our strategic initiatives could negatively impact our ability to renew our MVPD agreements on terms that are favorable to all our networks. If the Company and an MVPD reach an impasse in contract renewal negotiations, the Company's networks and owned and operated television stations could become unavailable to the MVPD’s subscribers (i.e., “go dark”), which, depending on the length of time and the size of the MVPD, could have a negative impact on the Company's distribution and advertising revenues.
The Company also depends on the maintenance of affiliation agreements and license agreements with third party-owned television stations to distribute the FOX Network and MyNetworkTV in markets where the Company does not own television stations. Consolidation among television station group owners could increase their negotiating leverage and reduce the number of available distribution partners. There can be no assurance that these affiliation and license agreements will be renewed in the future on terms favorable to the Company, or at all. The inability to enter into affiliation or licensing arrangements with third-party owned television stations on favorable terms could reduce distribution of the FOX Network and MyNetworkTV and the inability to enter into such affiliation or licensing arrangements for the FOX Network on favorable terms could adversely affect the Company's distribution revenues and its ability to sell national advertising time.
In addition, the Company has arrangements through which it makes its content available for viewing through third-party online video platforms. If these arrangements are not renewed on favorable or commercially reasonable terms or at all, it could adversely affect the Company's revenues and results of operations.
If the number of subscribers to MVPD services continues to decline or such declines accelerate, the Company’s distribution and advertising revenues could be negatively affected.
As described above, changes in technology and consumer behavior have contributed to industry-wide declines in the number of subscribers to MVPD services over the last several years, which have had a negative impact on the number of subscribers to the Company’s networks. These industry-wide subscriber declines are expected to continue and possibly accelerate in the future. The majority of the Company’s affiliation agreements with MVPDs are multi-year contracts that provide for payments to the Company that are based in part on the number of MVPD subscribers covered by the agreement. If declines in the number of MVPD subscribers are not fully offset by affiliate rate increases, the Company’s distribution revenues will be negatively affected. Because MVPD subscriber losses could also decrease the potential audience for the Company’s networks, which is a critical factor affecting both the pricing and volume of advertising, future MVPD subscriber declines could also adversely impact the Company’s advertising revenues.
The Company is exposed to risks associated with weak economic conditions and increased volatility and disruption in the financial markets.
Prevailing economic conditions and the state of the financial markets affect various aspects of our business. Factors that have affected and could in the future affect economic and financial conditions include actual or perceived uncertainty about economic stability (including taxes and tariffs) and social and political
uncertainties and conflicts, changes in consumer confidence, recession, high inflation, declining economic growth, diminished availability of credit, higher interest rates, unemployment rates and changes in consumer spending habits. Weak economic conditions have had and may continue to have an adverse impact on the Company's business, financial condition and results of operations. For example, reduced advertising expenditures due to a weak economy can negatively impact our advertising revenues, and increasing inflation raises our labor and other costs required to operate our business. Increased volatility and weakness in the financial markets, the further tightening of credit markets or a decrease in our debt ratings assigned by ratings agencies could adversely affect our ability to cost-effectively refinance outstanding indebtedness or obtain new financing.
The Company also faces risks associated with the impact of weak economic conditions and disruption in the financial markets on third parties with which the Company does business, including advertisers, affiliates, suppliers, wholesale distributors, retailers, lenders, insurers, vendors, retailers, banks and others. For instance, the inability of the Company’s counterparties to obtain capital on acceptable terms could impair their ability to perform under their agreements with the Company and lead to negative effects on the Company, including business disruptions, decreased revenues and increases in bad debt expenses.
There can be no assurance that weakening of economic conditions or volatility or disruption in the financial markets will not occur. If they do, it could have a material adverse impact on the Company’s business, financial condition or results of operations.
The Company operates in a rapidly evolving and highly competitive industry.
The Company competes with other companies for high-quality content, talent, audiences, advertisers’ expenditures and distribution. The Company’s ability to compete effectively depends on a number of factors, including our ability to consistently offer popular content, successfully adapt to evolving technologies and distribution platforms and offerings, and maintain widespread distribution of our content. Increased competition in the acquisition of programming may affect the scope of rights we are able to acquire and the cost of such rights, and the future value of the rights we acquire or retain cannot be predicted with certainty.
The composition of our competitors has evolved in recent years with the entrance of new participants, including companies in adjacent sectors with significant financial, marketing and other resources, greater efficiencies of scale, fewer regulatory burdens and more competitive pricing. Additionally, new technological developments, including the development and use of generative AI technologies, including large language model applications, are rapidly evolving. If our competitors gain an advantage by using such technologies to create, market, target or distribute content more efficiently or effectively, our ability to compete effectively could be adversely impacted. Our competitors also include companies with interests in multiple media and entertainment businesses that are vertically integrated. The media and entertainment industry is undergoing a period of rapid and significant change, with several transformative transactions that may further complicate the competitive environment. Industry consolidation and alliances among industry participants have also increased, and may continue to do so, intensifying competitive pressures.
There can be no assurance that the Company will be able to compete successfully in the future against existing or potential competitors or that competition in the marketplace will not have a material adverse effect on its business, financial condition or results of operations.
Acceptance of the Company's content by the public is difficult to predict, which could lead to fluctuations in or adverse impacts on revenues.
Programming distribution is a speculative business since the revenues derived from the distribution of content depend primarily on its acceptance by the public, which is difficult to predict. Low public acceptance of the Company's content will adversely affect the Company’s results of operations. The commercial success of our programming also depends on the quality and acceptance of other competing programming, the growing number of alternative forms of entertainment and leisure activities, general economic conditions and their effects on consumer spending and other tangible and intangible factors, all of which can change and cannot be predicted with certainty. Moreover, we must often invest substantial amounts in programming and the acquisition of sports rights before we learn the extent to which the content will earn consumer acceptance and, as described below, competition for popular content, particularly sports and entertainment programming, is
intense. A decline in the ratings or popularity of the Company’s news, sports or entertainment programming or the Company's failure to obtain or retain rights to popular content could adversely affect the Company’s advertising revenues in the near term and, over a longer period of time, its distribution revenues.
Our business depends on the popularity of special sports events and the continued popularity of the sports leagues and teams for which we have programming rights.
Our sports business depends on the popularity and success of the sports franchises, leagues and teams for which we have acquired broadcast and cable network programming rights. If a sports league declines in popularity or fails to generate fan enthusiasm, this may negatively impact our sports programming viewership and advertising and distribution revenues. Our operating results may be impacted in part by special events, such as the NFL’s Super Bowl, which is broadcast on the FOX Network on a rotating basis with other networks, and the FIFA World Cup, which occurs every four years, and other regular and post-season sports events that air on our networks. Our advertising and distribution revenues are subject to fluctuations based on the dates of sports events and their availability for viewing on our networks and the popularity of the competing teams. For example, any decrease in the number of post-season games played in a sports league for which we have acquired broadcast programming rights, or the participation of a smaller-market sports franchise in post-season competition could result in lower advertising revenues for the Company. There can be no assurance that any sports league will continue to generate fan enthusiasm or provide the expected number of regular and post-season games for advertisers and customers, and the failure to do so could result in a material adverse effect on our business, financial condition or results of operations. A shortfall in the expected popularity of the sports events for which the Company has acquired rights or in the volume of sports programming the Company expects to distribute could adversely affect the Company’s advertising revenues in the near term and, over a longer period of time, its distribution revenues.
The inability to renew programming rights, particularly sports programming rights, on sufficiently favorable terms, or at all, could cause the Company’s advertising and distribution revenues to decline significantly in any given period or in specific markets.
We enter into long-term contracts for both the acquisition and distribution of media programming and products, including contracts for the acquisition of programming rights for sports events and other content, and contracts for the distribution of our programming to content distributors. Programming rights agreements, retransmission consent agreements, carriage contracts and affiliation agreements have varying durations and renewal terms that are subject to negotiation with other parties, the outcome of which is unpredictable. The next significant sports programming rights package that is up for renewal is the FIFA World Cup package. The negotiation of programming rights agreements for popular licensed programming, and popular licensed sports programming in particular, is complicated by the intensity of competition for these rights.
An increasing number of companies bidding for sports programming in recent years has also driven increases in the cost of such programming. Moreover, the value of these agreements may be negatively affected by factors outside of our control, such as league agreements and decisions to alter the number, frequency and timing of regular and post-season games played during a season. We may be unable to renew existing, or enter into new, programming rights agreements on terms that are favorable to us and we may be outbid by third parties and therefore unable to obtain the rights at all. The loss of rights or renewal on less favorable terms could negatively impact the quality or quantity of our programming, in particular our sports programming, and could adversely affect our advertising and distribution revenues. These revenues could also be negatively impacted if we do not obtain exclusive rights to the programming we distribute. Our results of operations and cash flows over the term of a sports programming agreement depend on a number of factors, including the strength of the advertising market, our audience size, the timing and amount of our rights payments and our ability to secure distribution from and impose surcharges or obtain carriage on MVPDs for the content. If escalations in programming rights costs (together with our production and distribution costs) are not offset by increases in advertising and distribution revenues, our results of operations could be adversely affected.
Damage to our brands, particularly the FOX brand, or our reputation could have a material adverse effect on our business, financial condition or results of operations.
Our brands, particularly the FOX brand, are among our most valuable assets. We believe our brand image, awareness and reputation strengthen our relationship with consumers and contribute significantly to the success of our business. Maintaining, enhancing and extending our brands may require us to make significant investments in marketing, programming or new products, services or events, and these investments may not be successful. We may introduce new programming that is not popular with our consumers and advertisers, which may negatively affect our brands. To the extent our content is not compelling to consumers, it may adversely impact our ability to maintain a positive reputation. The Company’s brands, credibility and reputation have been impacted from time to time, and could be damaged in the future, by incidents that erode consumer, advertiser or business partner trust or a perception that the Company’s offerings, including its journalism, programming and other content, are low quality, unreliable or fail to attract and retain audiences. For example, the manipulation of content by bad actors, including the creation of “deep fakes” (videos created with AI to realistically impersonate persons such as journalists or political candidates), could erode audience trust by making it difficult to determine what is real. FOX’s brands, credibility and reputation also could be adversely impacted if AI tools misattribute incorrect information to the Company or if the Company’s use of AI in its own products and services produces content, information, analyses or recommendations that are alleged to be deficient, inaccurate, biased, harmful, discriminatory, an intellectual property infringement, a violation of privacy rights or otherwise problematic. Additionally, litigation, governmental scrutiny and fines and significant negative claims or publicity regarding the Company or its operations, content, products, management, employees, practices, advertisers, business partners and culture, including individuals associated with content we create or license, may damage the Company's reputation and brands, even if meritless or untrue. To the extent our marketing, cybersecurity, customer service and public relations efforts are not effective or result in negative consumer reaction, our ability to maintain a positive reputation may likewise be adversely impacted. If we are not successful in maintaining or enhancing the image or awareness of our brands, or if our reputation is harmed for any reason, it could have a material adverse effect on our business, financial condition or results of operations.
Acquisitions, investments and other strategic initiatives present many risks, and we may not realize the financial and strategic goals we had contemplated, which could adversely affect our business, financial condition or results of operations.
We have acquired and invested in, and expect to continue acquiring and investing in, new businesses, products, services, technologies and other strategic initiatives to complement, enhance or expand our current businesses or otherwise offer us growth opportunities. Such acquisitions and investments may involve significant risks and uncertainties, including insufficient revenues from an investment to offset any new liabilities assumed and expenses associated with it; failure to perform as expected, meet financial projections, achieve strategic goals or further develop an acquired business, product, service or technology; unidentified issues not discovered in our due diligence that could cause us to not realize anticipated benefits or to incur unanticipated liabilities; difficulties in integrating the operations, personnel, technologies and systems of acquired businesses; the potential loss of key employees or customers of acquired businesses; the diversion of management attention from current operations; and legal and regulatory limitations. Additionally, strategic initiatives may cause potential disruption to our business and operations or unanticipated challenges to or loss of our relationships with new or existing advertisers, distributors, viewers and others with whom we do business; and delays in or the cancellation of announced transactions or initiatives may occur. Because acquisitions, investments and strategic initiatives are inherently risky and their anticipated benefits or value may not materialize, they may adversely affect our business, financial condition or results of operations.
The loss of key personnel, including talent, could disrupt the management or operations of the Company’s business and adversely affect its revenues.
The Company's business depends on the continued efforts and abilities of key personnel, including news, sports and entertainment personalities. The loss of such personnel could disrupt the management or operations of the Company’s business and adversely affect its revenues. The Company employs or independently contracts with several news, sports and entertainment personalities who are featured on programming the Company offers. These personalities sometimes have a significant impact on the ranking of a cable network or station and its ability to attract and retain an audience and sell advertising. There can be no assurance that they will remain with us or retain their current appeal, that the costs associated with retaining current talent and hiring
new talent will be favorable or acceptable to us, or that new talent will be as successful as their predecessors. Any of the foregoing could adversely affect the Company's business, financial condition or results of operations.
Labor disputes may disrupt our operations and adversely affect the Company’s business, financial condition or results of operations.
In a variety of the Company’s businesses, the Company and its partners engage the services of writers, directors, actors, musicians and other creative talent, commentators, production crew members, trade and craft employees and others whose services are subject to collective bargaining agreements. Certain of these are industry-wide agreements negotiated by the Alliance of Motion Picture and Television Producers (the “AMPTP”) of which the Company is a non-voting member. The Company is bound by and enjoys the benefits of AMPTP-negotiated collective bargaining agreements, but is not directly involved in negotiating them. When negotiations to renew collective bargaining agreements are not successful or become unproductive, strikes, work stoppages or lockouts have occurred in the past, and such events could occur in the future. Such events have caused, and may in the future cause, delays in production, higher production costs and increased costs of labor, which could reduce profit margins and could, over the long term, have an adverse effect on the Company's business, financial condition or results of operations.
In addition, our networks have programming rights agreements of varying scope and duration with various sports leagues to broadcast and produce sports events, including certain college football and basketball, NFL and MLB games. Any labor disputes that occur in any such league (such as any dispute following the expiration of the MLB collective bargaining agreement in December 2026) may preclude us from airing or otherwise distributing scheduled games or events, resulting in decreased revenues, which could adversely affect our business, financial condition or results of operations.
The Company has recognized, and could continue to recognize, asset impairment charges for goodwill, intangible assets, programming and other assets and investments.
The Company performs an annual impairment assessment of its recorded goodwill and indefinite-lived intangible assets, including FCC licenses. The Company also continually evaluates whether current factors or indicators, such as the prevailing conditions in the capital markets, require the performance of an interim impairment assessment of those assets, as well as other long-lived assets. Any significant shortfall, now or in the future, in advertising revenue and/or the expected popularity of our programming could lead to a downward revision in the fair value of certain reporting units. The Company holds investments in marketable and non-marketable equity securities. These investments are recorded either at fair value and measured on a recurring basis based on quoted prices in active markets or on a non-recurring basis whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. The occurrence of certain events or circumstances has resulted in, and could continue to result in, a downward revision in the fair value of a reporting unit, indefinite-lived intangible assets, programming rights, investments or long-lived assets that could result in a non-cash impairment charge. Any such charge could be material to the Company’s reported net earnings in a given reporting period. During fiscal 2025 and 2026, in connection with the Company’s annual impairment assessments, the Company recorded non-cash impairment charges for intangible assets of approximately $70 million and approximately $64 million, respectively, at the Television segment primarily related to FCC licenses. See Note 2, “Summary of Significant Accounting Policies,” to the accompanying consolidated financial statements included in this Form 10-K for further discussion.
Risks Relating to Cybersecurity, Piracy, Privacy and Data Protection
The degradation, failure or misuse of the Company’s network and information systems and other technology could cause a disruption of services or improper disclosure of personal data or other confidential information, resulting in increased costs, liabilities or loss of revenue.
Cloud services, content delivery and other networks, information systems and other technologies that we or our vendors or other partners use, including AI-enabled technologies and technology systems used in connection with the production and distribution of our content (the “Systems”), are critical to our business activities, and shutdowns or disruptions of, and cybersecurity attacks on, the Systems pose increasing risks. Disruptions to the Systems, such as computer hacking and phishing, theft, computer viruses, ransomware, worms or other destructive software, process breakdowns, denial of service attacks or other malicious activities, as well as power outages, natural or other disasters (including extreme weather), human error, terrorist and/or
nation state-sponsored activities and insider threats (including actions by persons linked to hostile foreign governments and/or organized criminal groups), may affect the Systems and could result in disruption of our services, misappropriation, misuse, alteration, theft, loss, leakage, falsification and accidental or premature release or improper disclosure of confidential or other information, including intellectual property and personal data (of third parties, employees and users of our streaming services and other digital properties) contained on the Systems. The techniques used to access, disable or degrade service or sabotage systems change frequently and continue to become more sophisticated and targeted, and the increasing use of AI may intensify cybersecurity risks and the volume of attacks. In addition, ongoing tensions with China, North Korea, Russia and other nation states, conflicts in the Middle East and Europe, and other geopolitical events may lead to cyberattacks or other actions that could lead to a disruption of services, improper disclosure of personal data or other confidential information, or otherwise negatively impact the Systems (including supply chain disruption and attacks). The Company’s high-profile sports and entertainment programming and its extensive news coverage of elections, sociopolitical events and public controversies subject us to heightened cybersecurity risks. From time to time, the Company experiences cybersecurity threats and attacks. Although no cybersecurity incident has been material to the Company’s businesses to date, we expect to continue to be subject to cybersecurity threats and attacks and there can be no assurance that we will not experience a material incident. Any cybersecurity incidents could result in a disruption of our operations, customer or advertiser dissatisfaction, damage to our reputation or brands, regulatory investigations, claims, lawsuits or loss of customers or revenue, and the Company may also be subject to liability under relevant contractual obligations and laws and regulations protecting personal data and may be required to expend significant resources to defend, remedy and/or address any incidents. While we and our vendors and partners continue to develop, implement and maintain security measures seeking to identify and mitigate cybersecurity risks, including unauthorized access to or misuse of the Systems, such efforts are costly, require ongoing monitoring and updating and may not be successful in preventing these events from occurring. In addition, the Company’s recovery and business continuity plans may not be adequate to address any cybersecurity incidents that occur, and the Company may not have adequate insurance coverage to compensate it for any losses that may occur.
Technological developments may increase the threat of content piracy and signal theft and limit the Company’s ability to protect its intellectual property rights.
Content piracy and signal theft present a threat to the Company’s revenues from products and services, including television shows, cable and other programming. The Company seeks to limit the threat of content piracy as well as cable and direct broadcast satellite programming signal theft; however, policing unauthorized use of the Company’s products and services and related intellectual property is often difficult and the steps taken by the Company may not in every case prevent infringement. Although no content theft has been material to the Company’s businesses to date, we expect to continue to be subject to content threats and there can be no assurance that we will not experience a material incident. Developments in technology increase the threat of content piracy by making it easier to create, access, duplicate, widely distribute, display and store high-quality pirated material. These developments include recent advances in AI and large language model applications, digital copying, file compression technology, growing penetration of high-bandwidth Internet connections, increased availability and speed of mobile data networks and new devices and applications that enable unauthorized access to content. In addition, developments in software or devices that circumvent encryption technology and the falling prices of devices incorporating such technologies increase the threat of unauthorized use and distribution of direct broadcast satellite programming signals and distribution to MVPDs with set-top boxes, and the proliferation of user-generated content sites and live and stored video streaming sites that deliver unauthorized copies of copyrighted content may adversely impact the Company’s businesses. The proliferation of unauthorized reproduction, display, distribution and/or use of the Company’s content could have an adverse effect on the Company’s businesses and profitability because it reduces the revenue that the Company could potentially receive from the legitimate sale and distribution of its products and services. The legal landscape for new technologies remains uncertain, and legal developments in this area could negatively impact the Company’s ability to deploy new technologies or its ability to protect against uses of FOX’s proprietary content by unauthorized third parties, including generative AI developers. The Company’s use or adoption of such new technologies may also increase the Company’s exposure to intellectual property claims and further increase its enforcement costs.
The Company takes a variety of actions to combat piracy and signal theft, but the protection of the Company’s intellectual property rights depends on the scope and duration of the Company’s rights as defined by applicable laws in the U.S. and abroad and how those laws are construed. If those laws are interpreted in
ways that limit the extent or duration of the Company’s rights or if existing laws are changed, the Company’s ability to generate revenue from intellectual property may decrease or the cost of obtaining and enforcing its rights may increase. A change in the laws of one jurisdiction may also have an impact on the Company’s overall ability to protect its intellectual property rights across other jurisdictions. The Company’s efforts to enforce its rights and protect its products, services and intellectual property may not be successful in preventing content piracy or signal theft. Further, while piracy and the proliferation of piracy-enabling technology tools continue to escalate, if any laws intended to combat piracy and protect intellectual property are repealed, weakened or not adequately enforced, or if the applicable legal systems fail to evolve and adapt to new technologies that facilitate piracy, we may be unable to effectively protect our rights, the value of our intellectual property may be negatively impacted, and our costs of enforcing our rights could increase.
Third parties may challenge the validity or scope of the Company’s intellectual property from time to time, and such challenges could result in the limitation or loss of the Company’s intellectual property rights. Even if not valid, such claims may result in substantial costs and diversion of resources that could have an adverse effect on the Company’s operations.
The Company is subject to complex laws, regulations, rules, industry standards and contractual obligations related to privacy and personal data protection, which are evolving, inconsistent and potentially costly.
We are subject to U.S. federal and state laws and regulations, as well as those of other countries, relating to the collection, use, disclosure and security of personal information. The number and complexity of these laws and regulations continues to increase. For example, many states have passed legislation imposing broad obligations on businesses’ collection, use, handling and disclosure of personal information of their respective residents and imposing fines for noncompliance. In addition, the E.U., the U.K. and other countries have privacy and data security legislation with significant penalties for violations that apply to certain of the Company’s operations. New privacy and data protection laws and regulations, including in connection with children and teens, continue to be introduced and interpretations of existing privacy laws and regulations, some of which may be inconsistent with one another, continue to evolve. As a result, significant uncertainty exists as to their application and scope. Compliance with these laws and regulations may be costly and could require the Company to change its business practices, including in connection with the use of AI-enabled technologies and data-driven targeted advertising. Although the Company expends significant resources to comply with data privacy and protection laws, we have been and may continue to be subject to legal claims and may be subject to regulatory action despite these efforts. Any such actions could result in damage to our reputation or brands, loss of customers or revenue, and other negative impacts to our operations. The Company may also be subject to liability under relevant contractual obligations and may be required to expend significant resources to defend, remedy and/or address any claims. The Company may not have adequate insurance coverage to compensate it for any losses that may occur. For more information, see Item 1, “Business – Government Regulation – Privacy and Information Regulation.”
Risks Relating to Legal and Regulatory Matters
Changes in laws and regulations, or the interpretation or enforcement thereof, may have an adverse effect on the Company’s business, financial condition or results of operations.
The Company is subject to a variety of laws and regulations in the jurisdictions in which its businesses operate, as described in Item 1 “Business – Government Regulation.” The U.S. television broadcasting and traditional MVPD industries are highly regulated by federal laws and regulations issued and administered by various federal agencies, including the FCC. Among other things, the Company is required to apply for and operate in compliance with licenses from the FCC to operate its television stations, purchase a new television station, or sell an existing television station. The Company may be subject to investigations or fines under FCC rules and policies, or delays in its renewal and other applications with the FCC. From time to time, the FCC considers whether virtual MVPDs should be considered MVPDs (as defined and regulated by the FCC), which could negatively impact the Company’s distribution model.
The Company could be adversely affected by new laws and regulations, changes in existing laws and regulations, changes in judicial and regulators’ interpretations of laws and regulations or in regulators’ priorities or activities, as well as by the threat that additional laws or regulations may be forthcoming. In particular, the legal and regulatory landscape governing new technologies such as AI remains unsettled and is an area of
increasing regulatory focus. Developments in this area may adversely impact the Company’s business, including through increased legal liability risk and compliance costs associated with the use of AI and large language models. In addition, new laws and regulations may vary between local, state, federal and international jurisdictions and may conflict, and the enforcement of these laws and regulations may be inconsistent and unpredictable, further intensifying compliance risks. Changes in the legal or regulatory landscape could require FOX to change or limit certain of its business practices in ways that negatively impact the Company, including its competitive position and its ability to generate revenues. FOX could also incur substantial costs to comply with new and existing laws and regulations and could face substantial penalties or other liabilities, reputational damage or increased scrutiny from regulators or stakeholders if it fails to comply with such laws and regulations. Any of the foregoing could have a material adverse effect on FOX’s business, financial condition or results of operations.
The Communications Act and FCC regulations limit the ability of non-U.S. citizens and certain other persons to invest in us.
The Company owns broadcast station licensees in connection with its ownership and operation of U.S. television stations. Under the Communications Act of 1934, as amended, which we refer to as the Communications Act, and the FCC rules, without the FCC’s prior approval, no broadcast station licensee may be owned by a corporation if more than 25% of its stock is owned or voted by non-U.S. persons, their representatives, or by any other corporation organized under the laws of a foreign country. The Company’s Amended and Restated Certificate of Incorporation authorizes the Board to take action to prevent, cure or mitigate the effect of stock ownership above the applicable foreign ownership threshold, including: refusing to permit any transfer of Common Stock to or ownership of Common Stock by a non-U.S. stockholder; voiding a transfer of Common Stock to a non-U.S. stockholder; suspending rights of stock ownership if held by a non-U.S. stockholder; or redeeming Common Stock held by a non-U.S. stockholder. We are currently in compliance with applicable U.S. law and continue to monitor our foreign ownership based on our assessment of the information reasonably available to us, but we are not able to predict whether we will need to take action pursuant to our Amended and Restated Certificate of Incorporation. The FCC could review the Company’s compliance with applicable U.S. law in connection with its consideration of the Company’s renewal applications for licenses to operate the broadcast stations the Company owns.
The failure or destruction of satellites or transmitter facilities the Company depends on to distribute its programming could materially adversely affect its businesses and results of operations, as could changes in FCC regulations governing the availability and use of satellite transmission spectrum.
The Company uses satellite systems to transmit its broadcast and cable networks to affiliates. The distribution facilities include communications satellites, uplinks, downlinks and studio and transmitter facilities. Transmissions may be disrupted or degraded as a result of local disasters, extreme weather, power outages, terrorist attacks, cyberattacks or other events that impair on-ground uplinks or downlinks or studio and transmitter facilities, or as a result of an impairment of a satellite. Currently, there are a limited number of communications satellites available for the transmission of programming. If a disruption occurs, failure to secure alternate distribution facilities in a timely manner could have a material adverse effect on the Company’s business and results of operations. In the event of a business disruption of the Company’s television station and cable network studio and transmitter facilities, a failure to restore such facilities in a timely manner could have a material adverse effect on the Company’s businesses and results of operations. In recent years, the FCC has reallocated a large portion of satellite transmission spectrum known as the “C-Band” used by the television industry to transmit programming to free up spectrum for the next generation of commercial wireless broadband services. This has reduced the availability and use of satellite transmission spectrum for the television industry, and the FCC is reallocating additional spectrum in the future. For more information, see Item 1, “Business – Government Regulation – The Communications Act and FCC Regulation.” The decreased availability of satellite transmission spectrum could diminish the quality of and increase interference to our transmissions, which could significantly hinder the Company’s ability to deliver its programming to broadcast affiliates and traditional MVPDs.
The Company could be subject to significant tax liabilities.
We are subject to taxation in U.S. federal, state and local, as well as certain international jurisdictions. Changes in tax laws, regulations, practices or the interpretations thereof could adversely affect the Company’s
results of operations or its tax assets. Judgment is required in evaluating and estimating our provision and accruals for taxes. In addition, transactions occur during the ordinary course of business or otherwise for which the ultimate tax determination is uncertain.
Tax returns are routinely audited, tax-related litigation or settlements may occur, and certain jurisdictions may assess income tax liabilities against us. The final outcomes of tax audits, investigations, and any related litigation could result in materially different tax recognition from our historical tax provisions and accruals. These outcomes could conflict with private letter rulings, opinions of counsel or other interpretations provided to the Company. If these matters are adversely resolved, we may be required to recognize additional charges to our tax provisions and pay significant additional amounts with respect to current or prior periods or our taxes in the future could increase, which could have a material adverse effect on our financial condition or results of operations.
Unfavorable litigation or governmental investigation results could require us to pay significant amounts or lead to onerous operating procedures.
From time to time, we are subject to various legal proceedings (including class action and individual lawsuits, administrative complaints, regulatory investigations and arbitration proceedings), involving claims relating to, among other things, competition, intellectual property rights, employment and labor matters, personal injury and property damage, free speech, data privacy and protection, regulatory requirements and advertising, marketing and selling practices. See Note 14, “Commitments and Contingencies,” to the accompanying consolidated financial statements included in this Form 10-K for a discussion of certain of these matters. The Company has incurred significant expenses defending against the defamation and disparagement matters described in Note 14, including the payment of approximately $800 million to settle the Dominion matter and a related lawsuit in April 2023.
The Company continues to believe the Smartmatic and other lawsuits alleging defamation or disparagement as well as related derivative lawsuits are without merit and intends to defend against them vigorously, including through any appeals. However, the outcome of these pending matters is subject to significant uncertainty, and it is possible that an adverse resolution of one or more of these pending matters could result in reputational harm and/or significant monetary damages, injunctive relief or settlement costs. There can be no assurance that the ultimate resolution of these pending matters will not have a material adverse effect on the Company's business, financial condition, results of operations or cash flows.
We also spend substantial resources complying with various regulatory and government standards, including any related investigations and litigation. We may incur additional significant expenses in the future defending against any lawsuit or government charge and may be required to pay amounts or otherwise change our operations in ways that could adversely impact our businesses, results of operations, financial condition or cash flows. In addition, regardless of merit or outcome, litigation and government investigations are time-consuming and costly to defend, divert management’s attention and resources away from our business, may result in reputational harm and may impair our ability to conduct our business.
Risks Relating to Our Ownership Structure Certain of the Company’s directors and significant stockholders may have actual or potential conflicts of interest because of their equity ownership in News Corp or because they also serve as directors of News Corp.
In June 2013, 21CF completed the separation of its businesses into two independent publicly traded companies by distributing to its shareholders shares of a new company called News Corporation (“News Corp”). Certain of the Company’s directors and significant stockholders own shares of common stock of News Corp, and the individual holdings may be significant for some of these individuals compared to their total assets. In addition, FOX’s Executive Chair and Chief Executive Officer, Lachlan K. Murdoch, also serves as the Chair of News Corp. This ownership of or service to both companies may create, or may create the appearance of, conflicts of interest when these individuals are faced with decisions that could have different implications for News Corp and the Company. In addition to any other arrangements that the Company and News Corp may agree to implement, the Company and News Corp have agreed that officers and directors who serve at both companies will recuse themselves from decisions where conflicts arise due to their positions at both companies.
Our Amended and Restated By-laws acknowledge that our directors and officers, as well as certain of our stockholders, including K. Rupert Murdoch, certain members of his family and certain family trusts (so long as such persons continue to own, in the aggregate, 10% or more of the voting stock of each of News Corp and the Company), each of which we refer to as a covered stockholder, are or may become stockholders, directors, officers, employees or agents of News Corp and certain of its affiliates. Our Amended and Restated By-laws provide that any such overlapping person will not be liable to us, or to any of our stockholders, for breach of any fiduciary duty that would otherwise exist because such individual directs a corporate opportunity to News Corp instead of us. The provisions in our Amended and Restated By-laws could result in an overlapping person submitting any corporate opportunities to News Corp instead of us.
Certain provisions of the Company’s Amended and Restated Certificate of Incorporation, Amended and Restated By-laws, Delaware law and the ownership of the Company’s Common Stock by LGC Holdco, LLC may discourage takeovers and the concentration of ownership will affect the voting results of matters submitted for stockholder approval.
The Company’s Amended and Restated Certificate of Incorporation and Amended and Restated By-laws contain certain anti-takeover provisions that may make more difficult or expensive a tender offer, change in control, or takeover attempt that is opposed by the Company’s Board or certain stockholders holding a significant percentage of the voting power of the Company’s outstanding voting stock. In particular, the Amended and Restated Certificate of Incorporation and Amended and Restated By-laws provide for, among other things:
•a dual class common equity capital structure, in which holders of FOX Class A Common Stock can vote only in very specific, limited circumstances;
•a prohibition on stockholders taking any action by written consent without a meeting (unless there are three record holders or fewer);
•special stockholders’ meeting to be called only by a majority of the Board, the Chair or vice or deputy chair, or upon the written request of holders of not less than 20% of the voting power of our outstanding voting stock;
•the requirement that stockholders give the Company advance notice to nominate candidates for election to the Board or to make stockholder proposals at a stockholders’ meeting;
•the requirement of an affirmative vote of at least 65% of the voting power of the Company’s outstanding voting stock to amend or repeal our Amended and Restated By-laws;
•restrictions on the transfer of the Company’s shares; and
•the Board to issue, without stockholder approval, preferred stock and series common stock with such terms as the Board may determine.
These provisions could discourage potential acquisition proposals and could delay or prevent a change in control of the Company, even in the case where a majority of the stockholders may consider such proposals desirable.
In addition, all of the shares of FOX Class A Common Stock and the majority of the shares of FOX Class B Common Stock formerly held by the Murdoch Family Trust have been transferred to LGC Holdco, a Delaware limited liability company owned by certain Murdoch family trusts (collectively, the “LGC Family Trusts”). LGC Holdco beneficially owns less than one percent of the outstanding FOX Class A Common Stock and approximately 38.8% of the FOX Class B Common Stock. The voting and disposition of the shares of FOX Class A Common Stock and FOX Class B Common Stock held by LGC Holdco is, subject to certain limited exceptions, decided solely by a managing director of LGC Holdco’s sole manager who is appointed, and may be replaced, by Lachlan K. Murdoch. As a result, Lachlan K. Murdoch may be deemed the beneficial owner of the shares owned by LGC Holdco. Lachlan K. Murdoch, however, disclaims beneficial ownership of such shares.
This ownership concentration of FOX Class B Common Stock by LGC Holdco and associated concentration of voting power could discourage third parties from making proposals involving an acquisition of the Company. Additionally, such ownership concentration increases the likelihood that proposals submitted for stockholder approval that are supported by LGC Holdco will be adopted and proposals that are not supported
by LGC Holdco will not be adopted, whether or not such proposals to stockholders are also supported by the other holders of FOX Class B Common Stock. LGC Holdco’s interests may be different from, or conflict with, the interests of the Company’s other stockholders and, as a result, this concentration of ownership may have the effect of delaying, preventing or deterring a change in control of the Company and may negatively affect the market price of its common stock.
The Board has approved a $12 billion stock repurchase program for the FOX Class A common stock and FOX Class B common stock, which has and in the future could increase the percentage of FOX Class B Common Stock held by LGC Holdco. The Company has entered into a stockholders agreement with LGC Holdco and the LGC Family Trusts pursuant to which the parties have agreed not to take actions that would result in LGC Holdco and the LGC Family Trusts owning, collectively with Lachlan K. Murdoch and certain of his family members (collectively, the “Murdoch Individuals”), more than 44% of the outstanding voting power of the shares of FOX Class B Common Stock (the “Ownership Threshold”). LGC Holdco and the LGC Family Trusts would forfeit votes to the extent necessary to ensure that they and the Murdoch Individuals collectively do not exceed the Ownership Threshold, except where a Murdoch Individual votes his or her own shares differently from the others on any matter.
