Segment Information

12 Months Ended

Jun. 30, 2019

NOTE 20. SEGMENT INFORMATION

The Company manages and reports its businesses in the following five segments:

•

News and Information Services

—The News and Information Services segment includes the Company’s global print, digital and broadcast radio media platforms. These product offerings include the global print and digital versions of

The Wall Street Journal

and Barron’s Group, which includes

Barron’s

and MarketWatch, the Company’s suite of professional information products, including Factiva, Dow Jones Risk & Compliance and Dow Jones Newswires, and its live journalism events. The Company also owns, among other publications, The Australian,

The Daily Telegraph, Herald Sun, The Courier Mail

and

The Advertiser

in Australia,

The Times, The Sunday Times, The Sun

and

The Sun on Sunday

in the U.K. and the

New York Post

in the U.S. This segment also includes News America Marketing, a leading provider of

in-store

marketing products and services, home-delivered shopper media and digital marketing solutions, including Checkout 51’s mobile application, as well as Unruly, a global video advertising marketplace, Wireless Group, operator of talkSPORT, the leading sports radio network in the U.K., and Storyful, a social media content agency.

•

Subscription Video Services

—The Company’s Subscription Video Services segment provides video sports, entertainment and news services to

pay-TV

subscribers and other commercial licensees, primarily via cable, satellite and internet distribution, and consists of (i) the Company’s 65% interest in Foxtel (with the remaining 35% interest in Foxtel held by Telstra, an Australian Securities Exchange (“ASX”)-listed telecommunications company) and (ii) ANC. Foxtel is the largest

pay-TV

provider in Australia, with nearly 200 channels covering sports, general entertainment, movies, documentaries, music, children’s programming and news. Foxtel offers the leading sports programming content in Australia, with broadcast rights to live sporting events including: National Rugby League, Australian Football League, Cricket Australia, the domestic football league, the Australian Rugby Union and various motorsports programming. Foxtel also operates Foxtel Now, an

over-the-top,

or OTT, service and Kayo, a sports-only OTT service.

ANC operates the SKY NEWS network, Australia’s

24-hour

multi-channel, multi-platform news service. ANC channels are distributed throughout Australia and New Zealand and available on Foxtel and Sky Network Television NZ. ANC also owns and operates the international Australia Channel IPTV service and offers content across a variety of digital media platforms, including mobile, podcasts and social media websites.

•

Book Publishing

—The Book Publishing segment consists of HarperCollins, the second largest consumer book publisher in the world, with operations in 17 countries and particular strengths in general fiction, nonfiction, children’s and religious publishing. HarperCollins owns more than 120 branded publishing imprints, including Harper, William Morrow, HarperCollins Children’s Books, Avon, Harlequin and Christian publishers Zondervan and Thomas Nelson, and publishes works by well-known authors such as Harper Lee, Chip and Joanna Gaines, Rick Warren, Sarah Young and Agatha Christie and popular titles such as

The Hobbit, Goodnight Moon, To Kill a Mockingbird, Jesus Calling and Hillbilly Elegy

•

Digital Real Estate Services

—The Digital Real Estate Services segment consists of the Company’s 61.6% interest in REA Group and 80% interest in Move. The remaining 20% interest in Move is held by REA Group. REA Group is a market-leading digital media business specializing in property and is listed on the ASX (ASX: REA). REA Group advertises property and property-related services on its websites and mobile apps across Australia and Asia, including Australia’s leading residential, commercial and share property websites, realestate.com.au, realcommercial.com.au, Flatmates.com.au and spacely.com.au, and property portals in Asia. In addition, REA Group provides property-related data to the financial sector and financial services through an

end-to-end

digital property search and financing experience and a mortgage broking offering.

Move is a leading provider of online real estate services in the U.S. and primarily operates realtor.com

, a premier real estate information and services marketplace. Move offers real estate advertising solutions to agents and brokers, including its Connections

Plus and Advantage

Pro products as well as its Opcity performance and subscription-based services. Move also offers a number of professional software and services products, including Top Producer

and ListHub

•

Other

—The Other segment consists primarily of general corporate overhead expenses, the corporate Strategy Group and costs related to the U.K. Newspaper Matters. The Company’s Strategy Group identifies new products and services across its businesses to increase revenues and profitability and targets and assesses potential acquisitions, investments and dispositions.

Segment EBITDA is defined as revenues less operating expenses and selling, general and administrative expenses. Segment EBITDA does not include: depreciation and amortization, impairment and restructuring charges, equity losses of affiliates, interest (expense) income, net, other, net and income tax (expense) benefit. Segment EBITDA may not be comparable to similarly titled measures reported by other companies, since companies and investors may differ as to what items should be included in the calculation of Segment EBITDA.

Segment EBITDA is the primary measure used by the Company’s chief operating decision maker to evaluate the performance of and allocate resources within the Company’s businesses. Segment EBITDA provides management, investors and equity analysts with a measure to analyze the operating performance of each of the Company’s business segments and its enterprise value against historical data and competitors’ data, although historical results may not be indicative of future results (as operating performance is highly contingent on many factors, including customer tastes and preferences).


	For the fiscal years ended June 30,
	2019			2018			2017
	(in millions)
Revenues:
News and Information Services	$	4,956		$	5,119		$	5,069
Subscription Video Services		2,202			1,004			494
Book Publishing		1,754			1,758			1,636
Digital Real Estate Services		1,159			1,141			938
Other		3			2			2

Total Revenues	$	10,074		$	9,024		$	8,139

Segment EBITDA:
News and Information Services	$	417		$	397		$	412
Subscription Video Services		380			173			123
Book Publishing		253			239			195
Digital Real Estate Services		384			401			324
Other		(190	)		(139	)		(172	)
Depreciation and amortization		(659	)		(472	)		(449	)
Impairment and restructuring charges		(188	)		(351	)		(927	)
Equity losses of affiliates		(17	)		(1,006	)		(295	)
Interest (expense) income, net		(59	)		(7	)		39
Other, net		33			(324	)		135

Income (loss) before income tax expense		354			(1,089	)		(615	)
Income tax expense		(126	)		(355	)		(28	)

Net income (loss)	$	228		$	(1,444	)	$	(643	)


	For the fiscal years ended June 30,
	2019		2018		2017
	(in millions)
Depreciation and amortization:
News and Information Services	$	223	$	223	$	283
Subscription Video Services		292		107		32
Book Publishing		42		52		52
Digital Real Estate Services		97		87		78
Other		5		3		4

Total Depreciation and amortization	$	659	$	472	$	449


	For the fiscal years ended June 30,
	2019		2018		2017
	(in millions)
Capital expenditures:
News and Information Services	$	172	$	173	$	165
Subscription Video Services		307		81		14
Book Publishing		7		17		11
Digital Real Estate Services		78		78		66
Other		8		15		—

Total Capital expenditures	$	572	$	364	$	256


	As of June 30,
	2019		2018
	(in millions)
Total assets:
News and Information Services	$	5,482	$	6,039
Subscription Video Services		4,406		4,738
Book Publishing		2,074		1,898
Digital Real Estate Services		2,229		2,171
Other (a)		1,185		1,107
Investments		335		393

Total assets	$	15,711	$	16,346

(a)	The Other segment primarily includes Cash and cash equivalents.


	As of June 30,
	2019		2018
	(in millions)
Goodwill and intangible assets, net:
News and Information Services	$	2,617	$	2,730
Subscription Video Services		2,595		2,853
Book Publishing		772		804
Digital Real Estate Services		1,589		1,502
Other		—		—

Total Goodwill and intangible assets, net	$	7,573	$	7,889

Geographic Segments


	For the fiscal years ended June 30,
	2019		2018		2017
	(in millions)
Revenues: (a)
U.S. and Canada (b)	$	4,044	$	3,998	$	3,880
Europe (c)		1,664		1,766		1,671
Australasia and Other (d)		4,366		3,260		2,588

Total Revenues	$	10,074	$	9,024	$	8,139

(a)	Revenues are attributed to region based on location of customer.

(b)	Revenues include approximately $3.9 billion for fiscal 2019, $3.9 billion for fiscal 2018 and $3.7 billion for fiscal 2017 from customers in the U.S.

(c)	Revenues include approximately $1.3 billion for fiscal 2019, $1.4 billion for fiscal 2018 and $1.3 billion for fiscal 2017 from customers in the U.K.

(d)	Revenues include approximately $4.0 billion for fiscal 2019, $2.9 billion for fiscal 2018 and $2.3 billion for fiscal 2017 from customers in Australia.


	As of June 30,
	2019		2018
	(in millions)
Long-lived assets: (a)
U.S. and Canada	$	983	$	937
Europe		654		682
Australasia and Other		1,847		1,772

Total long-lived assets	$	3,484	$	3,391

(a)	Reflects total assets less current assets, goodwill, intangible assets, investments and deferred income tax assets.

There is no material reliance on any single customer. Revenues are attributed to countries based on location of customers.

Australasia comprises Australia, Asia, Papua New Guinea and New Zealand.