Q4 2025 News Corp Earnings Call
School 2025 earnings conference call. Today's conference is being recorded, media will be allowed on a listen-only basis.
At this time, I would 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. Course fiscal fourth quarter 2025 earnings call. We issued our earnings press release about 30 minutes ago and it's now posted on our website. At newscorp on the call today are Robert Thompson, chief executive and lava. Chandra, shekar Chief Financial Officer.
We all been so prepared remarks and they'll be happy to take questions from the investment community.
This call may include certain forward-looking information with respect to news course business and strategy.
Actual results could differ materially from what it said, news corp's, form, 10K and form 10q 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 Aveda, adjusted segment, Aveda 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 Thompson for some opening comments.
Thank you Mike. We are honored to report a sterling performance sustained, across the 4 quarters of fiscal 2025, which was a record year for profitability on a continuing operations basis. For the full year, revenues Rose 2% till the 8.5 billion dollars and total segment ebita improved 14% to finish the year at just over 1.4 billion. Dollars a record for the company on a continuing operations basis. While our net income from continuing operations, increased 71% to 648 million,
Profit. Margins also increase by 170 basis points to 16.7%.
For the fourth quarter revenues Rose 1% to 2.1 billion dollars while profitability grew 5% to 322 million and net income from continuing operations, Rose a handsome, 28% to 86 million.
These robust record results have enhanced our financial position and thus, our ability to return Capital shareholders that potency was reflected in our free cash flow for fiscal 2025, which was 571 million compared to 540 million in the prior year. Even though we expanded capex at Dow Jones, including at its rapidly growing, professional information business.
Hence, the board last month. Authorized a new 1 billion stock repurchase program. In addition to the approximately 300 million remaining from the previous 1, billion program, authorized 4 years ago.
As we indicated in our announcement, we expect to begin executing repurchases at an accelerated rate soon. After the release of these results, in short, a significantly larger total and a significantly faster tempo.
We remain dedicated to driving value across our 3 pillars de Jones, digital Real Estate Services and book publishing which accounted for the vast majority of our total segment ebita for the year.
The recent sale of foxtail grouped to our partners at the Zone, further focused, our portfolio and bolstered our cash position while the teams have made Savvy, Acquisitions? For all 3 of the core businesses over the past year.
And it has also become clear over the past year that discerning audiences crave content that is profound and purposeful and pity amidst a morass of mediocrity and mendacity.
Our writers and journalists and creators of all kinds are conscious of both the responsibility and the opportunity. Cognizant that we are at an historic inflection point in the age of AI.
that AI age must cherish the value of intellectual property if we are collectively to realize our potential
Much is made of the competition with China, but America's advantage is ingenuity and creativity. Not bits and bytes, not whats, but wit to undermine that comparative advantage. By stripping away IP rights, it is to vandalize our virtuosity.
We need to be more enlightened to eulogize yoya.
Social and commercially.
Take the example of President Trump.
Deal, which is still reporting notable sales.
Is it right? That his books should be consumed by an AI engine, which then profits from his thoughts by cannibalizing his Concepts, thus undermining future sales of his book suddenly the art of the deal has become the art of the steel.
Is it fair that creators are having their Works peroid? Is it just that the president of the United States is being ripped off?
Companies are spending tens of billions on data centers, tens of billions on chips.
Tens of billions on energy generation these. Same companies need to spend tens of millions or more on the content, crucial for their success and they need to ensure that the content ecosystem remains healthy. That there is a vast range of varied and verifiable sources and that a deeply derivative woke. AI does not become the default Pathway to digital decay.
In the meantime.
We will fight to protect the intellectual property of our authors and journalists and continued to woo. And to sue companies that violate the most basic property rights.
turning now to the segments,
Dow Jones had another strong year with revenue and ebitda Rising 4% and 8% respectively. The business exited the year, with strong momentum reporting a healthy 7%, increase in revenue for the fourth quarter to 604 million significantly, higher than the annual rate of 4% while ebit da for the fourth quarter Rose, 10% to 151 million, our professional information business expanded revenues 10% overall, for the fourth quarter higher than the full year rate of 7% supported by risk and compliance and DOW Jones energy where revenues increased by 21% and 12% respectively, for the quarter.
The addition of dragonfly intelligence and oxal this quarter further, solidified risk and compliance as a Premier Source for any business aiming to thoughtfully and legally navigate an increasingly complex Global landscape.
Compliance failures remain a serious issue for Global financial institutions and sanctions regimes are illegal. Labyrinth if know your client is a priority, then you should surely be a client of Dow Jones.
At Dow Jones Energy, the team has created a portfolio of innovative products, including the Global Carbon Market Report and Rack Pro from Opus.
This focus on our customers. Emerging needs is a core Factor behind our retention rates, which are north of 90% across our Jones energy.
Factiva showed improvement over the second half of the year. Thanks to a new generative AI data product, and a concentrated focus on coding, new customers in sectors such as Communications and public relations.
On the consumer side of the business, we reported 10% growth in digital circulation revenues in the fourth quarter and saw increases in both print and digital advertising of 3%. And 1% respectively, as companies increasingly understood the power and The Prestige of our platforms, including the Wall Street Journal, Barons, market watch, and Investors Business Daily.
Digital real estate revenues Rose 9% for the year. While the segment posted increased ibitta of 18%. At realtor.com Revenue, grew for the third consecutive quarter. In the fourth quarter, despite the especially sluggish US housing market. We are particularly pleased with the 3 growth areas. Targeted by Damian ills, in the team.
Revenue across rentals, new homes and seller accounted for 24% of revenues for the quarter, a rise of 5 percentage points year over year.
these Trends provide evidence that Realtor should Thrive when the US housing market, ultimately nears, normaly after a period of punitively, high mortgage rates and remarkably low turnover
Realtors reach has extended despite the depressed markets with the share of visits significantly expanding in June, when there were 256 million visits 4 times that of homes.com and more than twice that of Redfin. According to comscore,
We are working to enhance our relationship with the National Association of Realtors to the benefit of both partners, and crucially to the benefit of American seeking to buy or to sell a home.
Rhea posted another healthy year in fiscal 2025, with 12%, Revenue growth, or 13% on a constant currency, basis to 1.25 billion. While audience, reach saw continued Improvement for the year. Real estate.com.au saw an average of 132 million visits per month, 4 times, that of the nearest competitor.
12.1 million people visited the site each month, of which 6.4 million were exclusive to Rhea.
There is no question that RIA's business thrives on competition, and we look forward to meeting the changes and the challenges ahead in the Australian market with our customers' spirit of creativity and innovation.
Book publishing posted its second best Revenue year on record, in fiscal 2025 with a 3%. Increase to 2.1 billion while segment ebita expanded by 10% to 296 million. Margins were nearly 14% for the year and Improvement of over 90 basis points compared to the prior year.
Performance was weighted to the first half due in part to the impact of a strong front list schedule and a success of hillbilly allergy and wicked. We have seen softness in the overall book Market in more recent months and that Trend was reflected in some of our divisions though. Our religious and children's book divisions continue to perform well
Key titles scheduled for fifth School. 2026 should pretend positively for the full year. With a new book from Daniel, silver, last month, and upcoming works from The Pioneer Woman. Ree Drummond. Mitch, Albom and RF Kong.
Sylvester stallions Memoir. The steps will no doubt prove inspiring upon its release in November.
And we are looking forward to the exclusive release of previously. Unpublished stories by Harper Lee. The author of tequila Mockingbird,
Our Global reach was enhanced by the agreed acquisition of crunchy roles. Manga publishing operations in France and Germany. And that transaction is expected to close before the end of this calendar year.
We already have a strong network of manga contacts through our book business in Japan and believe that our teams Collective expertise will enable us to prosper from 1 of the fastest growing sections of the book reading Market.
Digital revenues grew 5% for the year supported by the partnership with Spotify who last month announced plans to expand audio book offerings for premium customers in the UK, Australia and parts of Europe in news media.
Profitability improved 15% for the year, despite a challenging advertising environment, reflecting our editorial creativity and cost Consciousness. There are also benefits to our Mast heads, from our digital Partnerships with the principled platforms and subscription growth at news, UK and news4, Australia, the times and Sunday times in particular, again, built on their healthy circulation base, closing the year with 640,000, paying digital subscribers compared to 594,000 a year ago.
The phenomenal expansion in influence and the Improvement in profitability over the past decade of the New York Post continued in the last year.
The masked head plays a unique role in the New York area, but also far beyond and to reflect that prowess we have just announced plans to expand in California, which surely needs the puckish profundity that characterizes the post.
Soon, all will not be Quiet on the Western Front.
Took a conclude the fiscal year with such impressive results, against a backdrop of complex, macro conditions, and political Dynamics is a testament to our transformation.
That work simply would not be possible with without the astute leadership of Lachlan Murdoch. The support of an enlightened board and the enduring Resonance of our chairman emeritus Rupert Murdoch. We also salute the invaluable contributions of our employees around the world.
and now I see to Lava Chandra, shekar our Chief Financial Officer, who will provide granularity, and sagacity,
Thank you, Robert and good afternoon.
As Robert highlighted fiscal, 2025 marked a big step in the transformation of new scope. As we continue to expand into high margin, content licensing, and increased recurring and digital revenues.
We streamlined our asset base with the divestiture of foxtail group and have been relentless on cost management. While continuing to invest in our core pillars of Dow Jones, digital Real Estate Services and book publishing
We finished the fiscal year and the fourth quarter yet again, delivering strong financial results, including improved year-over-year margins. In each quarter underscoring, the durability of Our Brands and the benefits of diversification.
Before discussing the financial results, I will discuss Capital allocation which is 1 of my key priorities.
Per our announcement last month and to reiterate, Robert's point.
Approximately million dollars remaining under the existing program, providing 1.3 billion dollars of total capacity.
We expect the pace of the program will meaningfully increase from the current rate and expect that fiscal 2026 pacing will benefit from the approximately 380 million of proceeds from repayment of foxtail, shareholder loans.
We believe the stock is trading at a significant discount to net asset value, and we believe equity shrinkage is 11 to attack that discount.
Importantly, we expect to maintain plenty of financial flexibility and continue reinvesting to drive further growth.
For today's discussion, I will focus on the fourth quarter performance.
As a reminder foxtail Financial results are reflected as discontinued operations for physical, 2025 and 2024,
We closed the foxtail transaction in early, April and have disclosed, recast financials in a previous 8K filing.
New Scope reported fiscal fourth quarter revenues of $2.1 billion, up 1% from the prior year, and total segment EBITDA of $322 million, up 5% year-over-year.
Margins improved by 60 basis points to 15.3%.
This quarter, 94% of profits were from Dow Jones and digital real estate, which we believe underscores the inherent value discount and the company's ability to drive long-term profitable growth.
Fourth quarter, adjusted revenues were flat while adjusted total segment debt, Rose 6% versus the prior year.
For the quarter, we reported earnings from continuing operations per share of 9 cents compared to 8 cents in the prior year.
Adjusted earnings from continuing operations per. Share were 19 cents in the quarter compared to 20 cents in the prior year.
Moving to the individual segments, starting with Dow Jones.
Dow Jones delivered, another strong quarter with reported revenues of 604 million up 7% versus the prior year period marking the highest quarterly rate of growth this year and was again the largest segment contributor to overall companies Avenues.
Digital Revenue accounted for 83% of Dow Jones segment, revenues, this quarter improving 2 percentage points from last year.
Professional information business Avenues, which reflect our B2B products and services Rose 10% year-over-year, the highest quarterly year-over-year growth of this school year.
Within that address can compliance revenues, grew 21% to 92 million driven by new customers, new products and improved yield
We continue to see strength in several products, including advanced, screening and monitoring, and our financial instruments product.
we also benefited from the addition of dragonfly intelligence and Oxford analytica, which contributed approximately 4 million dollars to revenues
Integration of those assets, is a head of plan with joint editorial and product initiatives across both risk and compliance and DOW Jones energy.
At Dow Jones. Energy Revenue, grew a healthy, 12% to 73 million with customer retention remaining. Very strong, at over 90%, in addition to improving yields
Newswires also saw modest growth due to new licensing deals, while Factory were continued to be negatively impacted by customer dispute. Albeit the decline rates have continued to moderate through the second half of the year.
Across our B2B products, higher volumes, including new customers and new products. Accounted for 60% of Revenue growth with higher yields accounting for the balance.
Within the Dow Jones consumer business circulation revenues, increased 5%, versus the prior year.
Notably digital circulation, revenues, grew by 10% surpassing our expectations.
This increase was driven by growth in digital, only subscriptions and the ongoing shift of customers from introductory and bundle promotions to higher pricing strategies.
Digital circulation, revenues, accounted for 75% of circulation, revenues for the quarter up from 71%, in the prior year.
Digital only subscriptions, improved, 9% year-over-year and by 176,000 sequentially, including the benefit from our recent, Enterprise partnership with the alsek.
Wsj, digital subscription, increased 213,000 sequentially and were up 9% year-over-year.
In revenues of 104 million rows, 2% with year-over-year, Trends improving each quarter.
Bought a print advertising revenues increased 3%. While digital grew by 1%, both benefiting from the strength in finance and Technology sectors.
Digital represented 65% of advertising revenues compared to 66% in the prior year.
Dow Jones, segment e beta for the quarter grew 10% to 151 million with margins increasing to 25%.
Moving on to digital real estate.
Digital real estate had another solid quarter, despite the macro environment and softer listing volumes in Australia, driven by a tough prior comparison.
Segment revenues are 466 million were up 4% versus the prior year and up 6% on an adjusted basis.
Segment. Ebita was 152 million up, 13% and up 16% on an adjusted basis.
Rhea revenues gained 4% year-on-year to 318 million and were up 7% on a constant currency basis.
Growth was driven by a combination of residential yield increases and customer contract upgrades.
Residential yield growth improved by 14%.
New by listings in the quarter declined, 8% following a 16% increase in the same quarter last year.
Listings in Melbourne and Sydney were down 11% and 10% respectively while home prices remained strong.
Please refer to as earnings release and their conference call for more details.
Realtors revenue for the quarter of 148 million. Grew 3%, compared to the prior year. Marking the third consecutive quarter of Revenue growth despite continued difficult, macro conditions.
At realtor Revenue growth was driven by the continued strength of growth adjacencies, new homes rentals and seller which represented 24% of revenues in the quarter.
Realtor continues to focus on higher quality leads through the real Pro. Select offering which once again drove an increase in Revenue per lead in the quarter.
Lead volumes declined. 13%.
And Improvement, compared to the quarter 3 deck of 17%.
Average monthly unique users for the quarter fell 3% year-over-year to 72 million.
That said, based on cam score, realtor continues to maintain audience, share and grow, share of visits, benefiting from continued, search engine optimization, and the scale of new scops Global audience.
Expenses at realtor were modestly higher as expected due to the launch of a new brand campaign.
Realtor recently announced acquisition of Zen list. A mobile First Communication platform, which provides a unified search experience for agents and customers.
The tool is being used by 35,000 plus agents and will be integrated as another enhancement to our products.
At book publishing as expected, very difficult, prior comparisons weighed on the results. This quarter.
The quarter was also impacted by software U.S. market conditions, per AAP data.
Segment revenues are 494 million declined 4% while segment ebita of $50 million declined, 7 million or 12%.
While performance in Christian publishing continue to be resilient sales of General books were lower than the prior year.
Recollect this quarter last year, had a dual benefit of a stronger front list and a stronger backlist from Bridgeton.
Digital revenues at harpercollins fell 3% to 116 million lapping. The start of the Spotify partnership last year and driven by a weaker front list.
In total digital sales represented 25% of consumer revenues compared to 24% in the prior year.
This quarter, the backlist contributed 65% of consumer revenues up from 62% last year.
Turning to news media.
Overall, Revenue performance was challenged with continued, soft advertising conditions, partially offset, by increased cover prices, and subscription pricing across Mass heads.
Revenue for the quarter, were 545 million down 4% versus the prior year. While adjusted revenues fell 4%.
Segment e, bitter declined, 4 million or 13% year-over-year to 28 million.
Lower advertising revenues were partially offset by ongoing cost reductions.
Adjusted segment declined, 18%.
Outlook.
Some of the themes across each of our segments.
At Dow Jones Trends, remain healthy. And we expect continued margin expansion as the business shifts to B2B.
at digital, real estate, Australian residential new by listings for July were down 8%
Please refer to Rhea for more detailed Outlook commentary.
At Realtor, we continue to focus on growth adjacencies, including the integration of landless acquisition.
We hope to see continued Revenue Improvement and much will depend on the broader housing market.
At book publishing July Trends were soft and comparisons are difficult. Given the strong backlist performance last year due to hillbilly elegy by JD Vance.
At news media, we expect recent Trends to continue.
With that, let me hand it over to the operator for Q&A.
Thank you. We will now start the Q&A session. Please limit your questions to 1 for participants.
If you have joined via the zoom application, please use the raise hand functionality to ask a question. If you have joined via the audio line, please press star, 9 questions will be answered in the order. They received, we will now pause a moment to assemble the queue.
Our first question will come from David karnowski with JP Morgan. Please unmute and ask your question.
Thank you, uh, for Robert or Le I just, I was hoping you could expand a bit on the decision to accelerate the buyback, which drove that, uh, where we might, uh, expect you to raise, uh, your quarterly repurchase activity, you would reference the fox tail that pay down. Does that mean? We should sort of assume that that mount gets, uh, swept into a buyback and then I just given the transformation of the company to a more recurring Revenue business. Uh, how are you thinking about, uh, a Target leverage going forward. Thank you.
Uh well David 1 can only reiterate what uh levano and I indicated earlier, in our statements, the scale of the buyback has increased and the pace of the buyback will increase in coming weeks. Uh, we have worked hard as a company, to improve our free cash flow and return on investment. And we now have the ability to reward shareholders with cat returns. And and as you referenced that ability has certainly been enhanced by the sale of foxtail to our partners at the zone.
We also believe that there is a significant discount between our current share price, and our net asset value of the company, do the math and that will be rather obvious. Uh, so this is a moment to invest in our future by buying our stock, uh, given the necessary regulatory disclosures, you will be able to track the trajectory of the purchases and see for yourself how the program has indeed been intensified.
Just add to that uh Robert by saying that. As I said in my prepared remarks, David, uh, fiscal 2026 will benefit the pacing in fiscal 2026 will benefit from the proceeds of the foxtail sale. And, uh, we're not, uh, putting out a Target leverage ratio at this point in time, as you would have noticed, our balance sheet is extremely conservative. Um, and um, we believe that with the strength of our business and the strength of our cash flows will continue to make it that way.
Thanks Dave. Uh Leila. We will take our next question, please.
Your next question will come from Kane Hannon with Goldman Sachs. Please go ahead.
Morning guys, um maybe just move, obviously a pretty solid quarterly result. There you talked a little bit more about the strategy you move. I think where you think, adjacencies could get to over time relative to that 24%, I suppose, as we think about 2026. I mean, do you think about this as another year of investment? You also call out some of the ad campaigns and the like that were that were coming through in the fourth quarter this year. Cheers.
Uh Kane. We're particularly positive about the prospects at realtor you. You can see that we've had Revenue growth in the past, 3 quarters, despite the sluggish torpedoed, uh, property Market. A market hobbled by high interest rates, and we're delighted with the progress in the 3 areas that we've chosen to develop as growth businesses, that is rentals new homes and seller. Um, don't forget that most of the revenue in the US market. Now come from the
Property news and Analysis site in the US as part of realtor and that's another reason uh why visitors keep returning to the site uh and realtor certainly had a role in the overall improvement. In our real estate margin which was 32.6% in Q4 compared with uh 30.1% in the same quarter a year ago.
So I could add to that Robert. I mean we
Um, in uh, realtor for sure. As you would have seen uh, recently again we did acquire uh sandless which is uh a a delightful little acquisition that will add to the capabilities that we have on realtor. Um and the integration of sand list is well underway. Uh and it will be a part of our um the continued strategy that we're has pursued up increasing Revenue per lead 5 pursuing higher quality leads uh as we've done through the real Pro MLS um that we select programs so far.
Great. Uh, thank you Kane. Uh, Leila, we will take our next question, please.
Your next question will come from Enter Roeske with Evans and Partners.
Hi Robert. Hi lava. Um, my question is on on Dow Jones um,
Which which had, I mean, accelerating Revenue growth performance in the second half. Um, as you've noted, um, I think Revenue growth was 6% in 28 versus 3%, um, in the first half. So my question is, do you, do you expect the second half trajectory can continue into fiscal 26 and what do you expect will drive? This is it mainly the B2B segment and further growth in risk and compliance. Um, and as part of the answer, if you could, please address how you think about the corresponding Opex growth, which is required to support the revenue growth. Thank you.
Uh, well look, we're delighted with, uh, the progress at at Dow Jones, generally. And, and we are seeing growth in both the professional information business, uh, and in the consumer business, uh, clearly the professional information business, which now accounts for 39% of revenues and around, uh, half the profits of Dow Jones. Uh, has been a growth engine over recent years. And and there is no reason to, uh, imagine that that growth will decline. It's fair to say that when the new news core was split was an area that we absolutely identified as a priority for expansion and investment. Not over investment, I must emphasize uh and we purposely developed this in compliance where revenues Rose 21% in the fourth quarter.
Compared to a year earlier. Well D Jones energy revenues were 12% higher.
On the Opex.
Single digits. Um, and with that we have continued to expand margins on the on the digital business. I mean uh in in the last quarter itself, I mean margins put up at 25% up from 24.2% um, and a lot of this does come from. Uh, the benefit we get from the faster growth of the professional Information Services business which as we've mentioned. Um, in the past does have a much higher margin uh profile uh than the Consumer part of the business.
Thank you. Uh, and Joe Leila. We will take our next question.
Your next question will come from Craig. Huber with Hubert research. Please go ahead.
Um, thank you. Um,
Robert just curious any update from you and your board on how much you're thinking about. Maybe you know, further simplifying the company and maybe in conjunction with that. Are you guys seeing anything any improvements on the US housing market? That benefited realtor.com? I realize it's probably sort of tied together. How would you answer that? Please.
Appreciate the value of the extraordinary assets. We have in our portfolio and we're focused on cap returns hence, our dividend, uh, and the much enhanced buyback, uh, facilities, uh, uh, as for further strategic moves, uh, the concentrated contemplation continues,
Thank you. Uh Craig uh Leila we will take our next question, please.
Your next question will come from Alan gold with loop capital, please unmute and ask your question.
Uh, thank you. Uh, got a question. A couple questions regarding AI. I was wondering what the Robert, what the impact of AI interviews AI overviews is having on your publishing business. Is that part of the reason that, uh, print ad Revenue, grew quicker than digital ad Revenue at the, the Dow Jones segment and also wondering what the Amazon license. The New York Times. Amazon licensing deal. And the present day, I actually plan. What impact? They're going to have on on the business. Thank you.
Ellen, we're not seeing, uh, any particular negative Trends from uh, search particularly at at Jones, uh, clearly, uh, the current or the new Google format. Affects different types of content in in different ways. So, uh, breaking news of specialist News, Real Estate news, uh, we are actually
Uh, any negative impact? Um, and more broadly. Uh, we're in the midst of advanced negotiations with several AI companies. Uh, it is clear that many of them have come to re recognize that the purchase of Ip is, as important as the acquisition of, uh, semiconductors or the securing of stable energy sources. And in the end, a IP Powers AI. Now these are are important deals, particularly for our news media properties, and DOW Jones. Uh, and there is, as I mentioned a mix of wearing and suing, we prefer the former, but we will never shy away from protecting our, uh, property rights. Um, and for example, if it is the case that uh, deep seek has been using open ai's information, set, in other words, more deep sneaks and deep seek, then they too will be hearing from us in the near future. Uh, we do careful research before, embarking on a legal journey and are able to quantify the level of potential abuse.
Thank you. Uh Allan. Uh Leila, we will take our next question, please.
Your next question will come from David Joyce with Seaport research.
Thank you. Uh you had a really strong growth in the uh Wall Street Journal subscriptions, both digital and total. Uh what would you attribute that and what do you think you can do to to keep that uh, that growth continuing?
Uh, we would attribute that to the unique Excellence of the Wall Street, uh, journal. And it's, um,
Functionality as the imperative of of readers, uh, uh, both professional, uh, a non-professional to be well, informed by a trusted news source. And, uh, absolutely the Wall Street Journal is that Source, uh, uh, and we saw as mentioned that overall, 9% increase in digital Subs at 10%, increase in digital Revenue. Uh, uh, and there is no reason why that, uh, shouldn't continue, um, given the uniqueness of of the content set.
Add to that. Uh, Robert. Um, we
From um, a a new, a partnership that we have, uh, entered into with elsag. Uh, the partnership is much broader than just circulation revenue and provides a custom and streamlined dashboard, uh, with our, uh, content from The Wall Street Journal, um, Baron's uh, market watch and IBD to be available to, uh, the subscribers. This is, um, this is just sticking off right now. It's still very early days but, um, the business does come with a with a higher margin. Uh, driven by lower acquisition costs or churn and lower retention costs.
Thank you Dave. Uh Leila. We will take our next question, please.
Your next question will come from Evan Caracas with UBS.
Hi. Okay, thanks. Um, what's my questions? Been been asked? Uh, can you just talk to the free cash flow? Uh, sorry the the capex step up in the fourth quarter. What what's underpin that? Um and and how that should look into Phi, 26 relative to fi25 for for capex, please
Yes, sure. Um,
Which was up, uh, 42%, um, um, and on the, on the quarter and the year over year and this really came from a pull forward and spend at Dow Jones for growth initiatives, including web redesign, as well as, um, the Sky News Studios relocating, uh, following the trans, uh, the uh, closing of the foxtail transaction. Uh, looking forward. While we're not giving any specific guidance on capex. I will say that we will continue to invest in Dow Jones, especially on the professional information service part of the business. Which as we have seen is contributing to very strong growth, um, realtor, we will continue to invest on that business as well, uh, specifically on the integration of Zen list. And, uh, Harper has also benefited from some of the Investments that we have made in the last year, which have driven efficiencies and scale, uh, but I will say that
Quarter 4 that rate isn't a run rate that we should just plug into the models for right now.
Thank you. Uh, Evan Leila, we will take our next question, please.
Your next question will come from Brian Hahn with Morning Star.
Robert, are there many acquisition opportunities out there in the professional information or data subscription space that you may spend some of your money on?
Uh, uh, Brian you you probably don't expect me to be specific about, uh, potential targets. It is fair to say, we survey, uh, the landscape, uh, and we do so, from a position of strength
Leo, we will take our next question, please.
If you have any further questions, please feel free to use the raise hand feature, which can be found at the bottom of your screen. Or if you've dialed in by phone, star 9 will activate the ray fan.
And as soon as we have no further questions at this time, I will now hand over to Michael Florin, for closing remarks.
Great. Well, thank you Leila. Thank you all for participating. And we look forward to speaking to, with you all very soon. Have a wonderful day, take care.