Ben Swinburne: Ask when Tom Brady is joining the Fox booth, so it might as well be me? And if you don’t want to answer that one, maybe just a couple of strategic questions, picking up on Phil’s. What do you guys think the value of FOX Bet is? And what could that business or that asset be over the longer term in sort of the bull case? And then you extended with Hulu not a huge shock, but just any comment on sort of whether that’s enough of a needle mover financially or how robust the market was for that content because obviously that’s a lot of licensing revenue potential. Just wondering if you could comment a little bit on how you approach that renewal and the outcome.
Lachlan Murdoch: Thanks, Ben. I’ll answer the Tom Brady part of the question and maybe the Hulu part, I’ll let Steve talk to the value of FOX Bet and importantly the — obviously the Flutter or FanDuel option. I won’t be the first to congratulate Tom on a stellar career and congratulate him on his retirement. The whole FOX Sports team and Fox Corporation overall is really excited to have Tom join the team here. That will be in the fall of next year, ’24. He is going to take a little bit of time to decompress, which he well deserves after such a stellar career. Let me just quickly talk to Hulu. The Hulu renewal was very important to us and also very important to Hulu. The kind of symbiotic relationship that we have with Hulu, it grows in significance as viewers more and more watch our content on a sort of catch-up basis.
So when we look at our hit shows, we’re not monetizing them in the first window in the live or even live plus same day window, as you all know, in the same manner that we used to. And so being able to capture the engagement after live and same day or even live plus seven days is critically important. And our Hulu deal really allows us to do that. For Hulu, it gives them tremendous content the next day and they are able to, I’d say, sort of benefit from or piggyback on the marketing spend and the reach that we give all of our content as we push it out. So it works very well for Hulu and it works very well for us. Steve, do you want to talk to the FOX Bet value?
Steve Tomsic: Yes. Ben, listen, on FOX Bet, I think we take a step back and just see how our betting in totality in terms of the investment. So FOX Bet is one component of it, and it’s an important component. We’d like to see it in more states than the four states it’s in at the moment. But it’s being operated by Flutter who bear the investment cost of that asset. And so in some respects, we’re behest in terms of how they develop that. But we look at it and it’s a clear marker for success in terms of FOX Bet Super 6 for us in terms of the way we’ve developed that and cross promoted that with our stations. And also it’s not just FOX Bet sports betting, but also includes the PokerStars non-sports betting assets. So it’s an important asset.
But when we look at the totality of our betting position, we increasingly think that the option that we have over FanDuel is the one that’s really important for us. It’s the leading market player. We have the opportunity over a long, long period of time to take a very, very new stake in a player that’s sort of head and shoulders market leader right now.
Gabrielle Brown: Operator, we can go to the next question.
Operator: Your next question comes from the line of Doug Mitchelson from Credit Suisse. Please go ahead.
Doug Mitchelson: Thank you. Good morning, Lachlan. Where are you with the life cycle for your digital investments? I’m just sort of curious, when I think about Tubi, pretty consistently you’ve been talking about growth every quarter on these calls and engagement viewer and adding more content. How much more content is there to add? How much more growth is there to drive at Tubi? And same question on the Fox digital side. Thanks.
Lachlan Murdoch: Thanks, Doug. So in terms of the life cycle for sort of digital investments, I think the reality is there are teenagers that are putting on muscle and growing pretty spectacularly. So if I look at Tubi, as an example and you think about the key metrics we’ve talked about now for several quarters is the total viewing time, total viewing time is — it’s not equivalent, but it’s like ratings. We continue to grow to total viewing time. The revenue that we’re seeing follow that, and we have 25% up in this quarter, which I think is pretty fantastic. But the opportunity is much higher, right? Because the total viewing time has grown faster at a much bigger rate, a faster rate than the revenue has. So already within Tubi and when we look at these metrics, there’s a ripeness for very significant revenue growth.
So digital investments are adolescents, but they’re a huge upside as they get older. And then when you talk about Fox digital, the digital assets, I was pretty amazed. We went through some numbers yesterday, just things like the local TV stations. The digital advertising business now at the local TV stations is really becoming quite significant. So when we look across our whole portfolio and we push further into our Web sites, our fast channels, our apps, this revenue is becoming very significant and even in parts of the company that you wouldn’t expect. So we believe the future of our business is obviously digital and we’re making that transition pretty rapidly and very robustly.
Gabrielle Brown: Operator, we have time for one more question.
Operator: Okay. That question comes from the line of John Hodulik from UBS. Please go ahead.
John Hodulik: First question on the balance sheet. Investors are definitely going to like the accelerated repurchase, but you still have $4 billion on the books, relatively low debt. Just maybe talk about sort of the usage of that cash? How much cash do you need on the books and maybe what the M&A environment looks like out there and what kind of opportunities do you see? And then on the affiliate line, you said you haven’t seen the impact of the renewals and the that you expect you’ll see over the renewals you’ll expect to do over the next couple of years. When do you expect to sort of get into the sort of the wheelhouse and see those lines really start to turn from the renewals? Thanks.
Lachlan Murdoch: Thanks, John. Steve jump in at any point. No, I’ll start. Thanks, John. So first of all on the balance sheet, I think we do have an enviable balance sheet. We’re going to deploy our capital as we have in a very disciplined manner and entirely focused on shareholder returns for all of our shareholders. That will be both as evidenced this morning with our accelerated share repurchase, which we think is a great sort of mechanism strategy to return some of this capital to our shareholders. But we will also, obviously, be looking at M&A and other opportunities to use to deploy our capital against. We don’t have anything on the table today, but we are I think in a strong position to capture opportunities when they present themselves.
And obviously, there are other companies in our sector that are not in a greater position and there will be things that we will I’m sure cast our eyes over. So we do expect the M&A will be part of — a more important part of our toolkit as we deploy capital, but we have nothing on the table in front of us today. Before I go on affiliates, Steve, do you have anything to add there?
