Welcome to News Corp's First Quarter Fiscal 2026 Earnings Conference Call. Today's conference is being recorded. [Operator Instructions] At this time, I'd like to turn the conference over to Michael Florin, Senior Vice President and Head of Investor Relations. Please go ahead.

Thank you very much, operator. Hello, everyone, and welcome to News Corp's Fiscal First Quarter 2026 Earnings Call. We issued our earnings press release about 30 minutes ago, and it's now posted on our website at newscorp.com. On the call today are Robert Thomson, Chief Executive; and Lavanya Chandrashekar, Chief Financial Officer. We'll open with some prepared remarks, and then we'll be happy to take questions from the investment community. This call may include certain forward-looking information with respect to News Corp's business and strategy. Actual results could differ materially from what is said. News Corp's Form 10-K and Form 10-Q filings identify risks and uncertainties that could cause actual results to differ and contain cautionary statements regarding forward-looking information. Additionally, this call will include certain non-GAAP financial measurements such as total segment EBITDA, and adjusted segment EBITDA and adjusted EPS. The definitions and GAAP to non-GAAP reconciliations of such measures can be found in the earnings release for the applicable periods posted on our website. With that, I'll pass it over to Robert Thomson for some opening comments.

Thank you, Mike. Following a sterling performance in fiscal 2025, one that marked a record year for profitability on a continuing operations basis, News Corp continued to increase both revenue and profitability in the first quarter of fiscal 2026 led by strength at Dow Jones and Digital Real Estate Services and bolstered by digital and AI related revenues. The positive signs came despite an uncharacteristically weak performance in Book Publishing, which has shown clear signs of improvement in recent weeks. The Book Publishing results this quarter included a write-off related to the expected closure of a book distributor. But overall, our revenue for the period rose 2% versus the prior year to $2.14 billion, and total segment EBITDA increased by 5% to $340 million. Net income from continuing operations was $150 million, up from $149 million last year. And our adjusted EPS rose from $0.20 to $0.22 in the quarter. Clearly, our current cash position is robust, and we expect to generate strong free cash flow this fiscal year and have thus materially increased the rate of our share buybacks. We believe our shares are undervalued, given the sum of our valuable parts and our profit trajectory. So we will continue to focus on ways and means to maximize shareholder value. One other notable misconception is the value of IP in the age of AI. Information and sophisticated data are the essence of AI. And without these essential ingredients, AI is but empty, vacuous, ignorant infrastructure, electricity without alacrity, buildings without billings, chips without [ chops ]. Thankfully, we are seeing a positive trend with both enlightened companies and wise courts, deciding that creativity and content must not be stolen but purchased. Courtships and courts are both crucial components of our strategy. And I must salute Sam Altman and his…

Thank you, Robert, and good afternoon to everyone. I would like to start with an update on our capital allocation strategy. We are making strong progress in returning value to our shareholders through the accelerated and expanded share buyback program, which we announced in July 2025. Since we last reported earnings, we have repurchased at a rate of approximately $2.5 million per day over 4x the previous pace. We are confident in the company's growth potential and continue to believe the stock is trading at a significant discount to net asset value. As a reminder, we expect fiscal 2026 pacing to benefit from the repayment of approximately $380 million of Foxtel shareholder loans. This quarter, our results demonstrate the continued strength and resilience of our digital businesses. particularly within Dow Jones and digital real estate services. Despite the backdrop of ongoing macroeconomic uncertainty and difficult prior year comparisons, especially in our Book Publishing business, our results underscore the benefits of our strategic diversification across recurring, high-margin content licensing and digital revenues. As a reminder, since fiscal 2018, the percentage of our business comprising digital revenues has almost doubled to 62% in fiscal 2025. Dow Jones and Digital Real Estate, which together accounted for 29% of our revenue and 55% of our EBITDA in fiscal 2018 accounted for 49% of revenue and 84% of our EBITDA for fiscal 2025. On the other hand, our reliance on advertising revenue has reduced by almost 50% to just 16% of revenues for fiscal 2025. Shareholder value accretive M&A in this decade has brought valuable assets such as OPIS and CMA to our portfolio while divesting assets such as News America Marketing, and we have successfully exchanged Foxtel for a valuable stake in DAZN, the Netflix of sports. There is always more to do on…

[Operator Instructions] Our first question will come from Kane Hannan with Goldman Sachs.

Just, Move, obviously a very strong revenue print there. Given the housing backdrop and some of the comments that were made, is there anything you can see or anything we should be thinking about that I suppose stops that business doing double-digit revenue growth through the year?

Well, Kane, look, we are delighted by the growth in revenue at Realtor, which is expanding despite a U.S. housing market still somewhat hamstrung by high interest rates. We've been very much focused on the 3 aforementioned growth areas, Zillow, new homes and rentals as well as high-yield sales. And that strategy is clearly paying dividends even though we're only at the very start of the housing market recovery. We have built a site that is a holistic housing experience and -- which is the leader in residential property news in the U.S. The value of that investment and the value of Realtor itself will be increasingly obvious as the market likely gathers momentum over the coming year.

Our next question will come from David Karnovsky with JPMorgan.

Maybe just on the repurchase, recognizing that you've already accelerated this rate by 4x. I think there's still a question naturally from investors on why not lean in kind of even further for a period, given where shares have traded and the views you've expressed on the call regarding value. And then if I can ask just 1 more on the business with The Wall Street Journal price increase. I don't know if you could speak to the decision to raise the rate there and what you've observed so far and how that kind of informs your strategy ahead.

David, you can indeed see from our disclosures that the rate of the buyback has accelerated markedly actually at 4x the previous rate. And we intend to fully take advantage of the expanded resources approved by our Board. Our robust cash position means that we certainly have the potential to increase the buyback, if that is the optimal strategy. We have genuine optionality, and we will exercise that optionality with all of our investors in mind. And as for the Wall Street Journal, clearly, we're at the early stage of testing and reviewing subscription pricing. But believe that there is definitely elasticity an elasticity that will be enhanced by planned product improvements in coming months. Our WSJ readers do indeed recognize that they should pay a premium service.

Our next question will come from Entcho Raykovski with Evans and Partners.

My question is around Dow Jones and the Factiva dispute, which has obviously now been settled. Given that settlement, obviously, not a headwind anymore. I'm just curious on whether you've seen any revenues in the PR and communications category in the quarter, which obviously was the source of the dispute. And if it was a tailwind, are you able to quantify the contribution to growth and whether that tailwind is likely to accelerate into Q2?

Entcho, it's difficult to be specific. But I think overall, Dow Jones the performance was excellent with a 16% increase in revenues at Risk & Compliance. And as you indicate, much improvement at Factiva, which had been hobbled by that legal dispute, but increased revenues 9%. And we had a growth of 7% at Dow Jones Energy. And there, I should point out that as Lavanya mentioned, the revenues were somewhat affected by a shift in date for its landmark event, the World Chemical Forum, which will be held this year in Q3. So factor that into your calculations. Nonetheless, we are strengthening the team at Dow Jones Energy and have an impressive array of new and enhanced offerings pending for our customers, current and potential.

Sorry, I'd just add to that. The -- what we got from the settlement of the dispute was very modest. The good news is we are bringing in new customers into that space. We do have a very cool GenAI search capability now in Factiva, and that is turning out to be a good source of success as well.

[Operator Instructions] Our next question will come from Craig Huber with Huber Research.

Robert, I typically like to ask you, I mean, you obviously fairly recently disposed of your Foxtel operation, pleased a lot of investors there. I'm wondering if your thoughts have changed at all here about further simplifying of the business at News Corp here. Any changes there in your mindset?

Craig, we are certainly not allergic to structural changes. And as you indicated, the recent sale of Foxtel to our partners at the DAZN is eloquent testimony to that willingness to simplify, not only to be institutionally perspective, but actually active. But we also believe in the importance of transparency, hence, for example, the research segmentation and the increased focus on the performance of Dow Jones, which is a global growth engine for the company and on our News Media business, which reported a significant increase in margin for the quarter. Overall, we are acutely conscious of the need to consider the evolving environment and to maximize returns for our shareholders, which is why we have significantly accelerated the buyback and maintained our dividend. And we certainly have an armory and arsenal when it comes to the buyback.

Our next question will come from David Joyce with Seaport Global.

I am very fascinated by the growth at Risk & Compliance, granted that little bit of that came from some acquisitions. But I'm wondering what could be some further tailwinds to growth there? Specifically, I was wondering if some of the services could be maybe mandated by certain industry verticals, regulatory bodies, for example. Just wondering what your thoughts are for the runway there.

We're very optimistic about the trajectory of Risk & Compliance. Clearly, companies, boards want to minimize risk and maximize compliance. The Know Your Client regulations, which are stringent and being enforced by governments around the world are also a source of new business. So while we saw 16% growth in the most recent quarter, we're confident that further growth is indeed possible in coming quarters.

Our next question will come from David Fabris with Macquarie.

I just wanted to ask about News Media. So revenues returned to growth modestly, and there's been a big improvement in EBITDA. How should we be thinking about the trajectory of that business from here?

David, we saw a slight increase in revenue, but also the benefits of leadership and cost discipline across the businesses in Australia and the U.K. and a significant surge in advertising at New York Post. Digital advertising at the post was up 23% year-on-year. And we are looking forward to the extra inventory that is great journalism that will be generated when the California Post launches early next year. It really is a testament to all the team's hard work around the world that the margin at News Media rose from 3.3% last year to 5.5%.

Yes. I'd just add to that on the cost front, especially, I mean, really great work done by the team in News UK. The commercial printing joint venture that we entered into last year is continuing to deliver savings to us. We've also saved money on the top TV business. And that's been an important move for the team over there. News Australia as well has continued to really press the boundaries in terms of cost efficiency, leveraging new capabilities to deliver better EBITDA growth.

At this time, we have no further questions. I'll now hand the call over to Michael Florin for closing remarks.

Well, thank you for participating. We look forward to speaking to you very soon. Have a great day. Luke, thanks as always, for your help, and we'll talk to you soon. Have a great day.