News Corporation (ticker: NWS) has announced an update to its ongoing share buy-back program, as detailed in its recent 8-K filing dated June 23, 2025. This strategic move involves a repurchase program authorized for up to an aggregate of US\(1 billion of the company’s Nasdaq-listed Class A and Class B common stock. As of the latest update, News Corp has repurchased approximately US\)687.4 million worth of shares, with 22,144,861 shares bought back on June 20, 2025, at a total consideration of approximately US$455 million. This buy-back initiative is designed to enhance shareholder value by reducing the number of outstanding shares, potentially increasing earnings per share (EPS) and supporting the stock price.
The buy-back program is classified as an “Other buy-back” type, distinct from on-market or employee share scheme buy-backs, and does not require shareholder approval or impose restrictions on foreign participation. The repurchases are executed through brokers, including Morgan Stanley & Co. LLC, and are subject to market conditions and stock price fluctuations. The highest price paid during the program was US\(30.69 per share on February 19, 2025, while the lowest was US\)14.88 on September 29, 2022.
From a financial perspective, News Corp’s recent Q2 2025 results show a challenging operating environment with an operating margin of -27.05%, a deterioration from -21.31% in Q2 2024. The company reported a negative free cash flow of $31 million in Q2 2025, indicating cash outflows exceeding inflows from operating activities. Additionally, the debt-to-equity ratio stands at a high 2.57, reflecting significant leverage on the balance sheet. These metrics suggest that while the company is actively returning capital to shareholders through buy-backs, it faces operational and financial headwinds that warrant close monitoring.
The buy-back program aligns with News Corp’s capital allocation strategy to enhance shareholder returns amid a complex macroeconomic backdrop characterized by economic uncertainty and evolving market conditions. Historically, News Corp’s management has emphasized disciplined capital deployment and shareholder value creation in its earnings calls, reinforcing the strategic rationale behind this buy-back initiative.
Looking forward, the impact of this buy-back program on News Corp’s financial statements will be material. By reducing the share count, the company can improve EPS metrics, potentially offsetting some of the negative operating performance. However, the elevated leverage and negative free cash flow highlight the need for prudent financial management to sustain long-term value creation.
In conclusion, News Corporation’s updated share buy-back program represents a significant capital return mechanism aimed at enhancing shareholder value. Investors should consider the interplay between the buy-back activity, operational challenges, and financial leverage when assessing the company’s future prospects.
Source Document: News Corporation 8-K Buy-Back Update June 2025
Tags: NWS, News Corporation, Q2 2025, share buy-back program, capital allocation, financial leverage