Ladies and gentlemen, thank you for standing by. Welcome to the Fox Corporation Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct the question-and-answer session. I would like to emphasize that functionality for the question-and-answer queue will be given at that time.

[Operator Instructions] As a reminder, this conference is being recorded. I'll now turn the conference over to Chief Investor Relations Officer, Ms. Gabrielle Brown. Please, go ahead, Ms. Brown..

Thank you, operator. Good morning and welcome to our fiscal 2022 fourth quarter earnings call. Joining me on the call today are Lachlan Murdoch, Executive Chair and Chief Executive Officer; John Nallen, Chief Operating Officer; and Steve Tomsic, our Chief Financial Officer.

First, Lachlan and Steve will give some prepared remarks on the most recent quarter and then we'll take questions from the investment community. Please note that this call may include forward-looking statements regarding Fox Corporation's financial performance and operating results.

These statements are based on management's current expectations and actual results could differ from what is stated as a result of certain factors identified on today's call and in the company's SEC filings. Additionally, this call will include certain non-GAAP financial measures, including adjusted EBITDA, or EBITDA, as we refer to it on this call.

Reconciliations of non-GAAP financial measures are included in our earnings release and our SEC filings, which are available in the Investor Relations section of our website. And with that, I'm pleased to turn the call over to Lachlan. .

Thanks very much, Gabby, and welcome aboard. Well, we have concluded another successful fiscal year, achieving both the financial and operational goals we set ourselves with a relentless focus on strengthening our core brands, while investing in our high-growth digital initiatives.

Over the year, we delivered 8% total company revenue growth, including 7% affiliate revenue growth, notably, without the benefit of any meaningful renewals and 9% advertising revenue growth, despite the record political revenues we saw in the prior fiscal.

Those of you on this call, who were at our 2019 Investor Day, will remember our commitment to you that we would have achieved $1 billion of incremental Television segment affiliate revenue by the end of calendar 2022.

I'm more than pleased to confirm that we have achieved that $1 billion target in this past quarter a full six months ahead of schedule. As anticipated, our EBITDA was down modestly, as we continued our investment in Tubi and the FOX News Media digital properties, including FOX Nation and FOX Weather and with the launch of the USFL this past spring.

Most importantly, Fox continues to stand apart in a crowded media ecosystem, delivering a consistent operating performance and a robust free cash flow profile alongside an enviable balance sheet.

Our leadership position was again evident during the recent upfront advertising sales cycle, in which we booked volume commitments approximately 15% above last year's upfront, with nearly 25% of our current year commitments across our growing digital properties.

We achieved pricing increases in the high single to low double digits, as compared to last year's upfront. Sports led the upfront market, illustrated by the fact that we sold more NFL Sunday advertising in the current upfront market than we did across Sunday and Thursday combined in the prior year's market.

This excludes advertising commitments for the upcoming Super Bowl, where we are pacing well ahead of schedule and seeing very robust demand at record pricing levels. Our success in the upfront spanned our entire portfolio.

We were able to achieved broadcast level pricing increases at FOX News, boosted sellout at FOX Entertainment and importantly, drove significantly more incremental ad dollars into Tubi. We are, of course, aware of the chatter around advertising headwinds. And of course, we will be prepared if the market turns downward.

But let me be clear, we are currently not seeing an adverse advertising impact on our business. This speaks to the unique positioning and strength of our core platforms. Over two-thirds of our fiscal 2022 advertising revenue was generated by live content with sports and news, delivering 40% and 30% respectively.

Locally, base market advertising sales have been stable. In fact, we are currently seeing a return to growth in the auto category for the first time in a couple of years. This stability in the base market provides a good foundation for the upcoming political cycle where the outlook is remarkably strong.

On a comparable basis, our June quarter political advertising revenues were roughly three times larger than those of the fiscal fourth quarter of the last presidential election, which turned out to be an all-time record political cycle for the company.

With the combination of political races and ballot issues across our markets, we continue to expect this election to deliver another record midterm cycle. In fact, excluding the impact of the Georgia runoffs in the last cycle, this midterm cycle looks certain to surpass the 2020 presidential cycle at our local stations.

There are US center races in 13 of our 18 markets, including what we expect to be heavy political spending in Arizona, Florida and Georgia. Additionally, there are gubernatorial races in 17 of our 18 markets, where we expect heavy spending in Arizona, Florida, Georgia, Michigan, Texas and Wisconsin.

Add to that the issue money in a few key markets and we are seeing an unprecedented wave of political spending which accelerates as we head towards November.

At the national level, we believe that we achieved the highest upfront pricing increases in cable news history at FOX News, which to a certain extent is to be expected, as the FOX News channel again closed the year, as cable's most watched network in prime time in total day and continues to generate audiences on par with those of the Big 4 broadcast networks.

FOX News was the only cable news network to post viewership gains in the fiscal year in the key adult 25 to 54 demo and total viewers, while extending its streak to 16 consecutive months beating CNN and MSNBC combined in prime and total day for both the key demo and total viewers.

For over two decades, FOX News has been the highest-rated cable news channel in prime time. Notably, FOX News just finished the month of July as the third most viewed network in weekday prime in all of television, trailing only CBS and NBC.

I've spoken about the political diversity of the FOX News audience previously, specifically about the fact that we have more independents and Democrats watching us than watch CNN or MSNBC, but the diversity of our audience extends beyond political affiliation.

In July, the Fox News Channel was the most viewed cable network with Asian and Hispanic viewers. In fact, in that month viewing among Hispanic households was up 38% and among Asian households, up 43%.

Elsewhere news, the FOX Nation platform increased its subscriber base by approximately 80% over the past fiscal year, supported by sustained and high conversion rates of trialists to paid subscribers and retention rates well above industry averages.

At FOX Sports, live event viewing was up 5% through the first half of the calendar year led by our NASCAR schedule, which generated viewership up a solid 10% over 2021. This spring was busy for FOX Sports, as we launched the inagural season of the USFL.

The USFL averaged over one million viewers on FOX, at least 20% higher than the EPL on NBC and regular season NHL broadcast on ABC and more than twice the viewership of MLS on FOX.

In its first season, the USFL clearly delivered on its most essential goal, which was to demonstrate that the league belongs alongside other long-established spring sports properties. And as you know, we have an incredibly strong year ahead in sports which includes the FIFA Men's World Cup beginning this November and the Super Bowl next February.

At FOX Entertainment, our content strategy is focused on ad-supported multi-platform television that can thrive both creatively and financially well into the future. We look to use our broadcast network to build and support businesses beyond our linear air.

An example of this approach is Next Level Chef which was the number one new broadcast entertainment program this past season and FOX' first owned production inside our partnership with Gordon Ramsay, whereas we used only to license Gordon's product from third parties, we now license hits like Next Level Chef to third parties and we have done so with the sale of the format to ITV in the UK.

Another example of how we extend and monetize our IP is the just launch of Gordon Ramsay FAST Channel on Tubi.

And speaking of Tubi one year ago -- one year into our focused investment cycle at Tubi, the platform generated TVT growth of nearly 40% and revenue growth of 45% across the fiscal year with both metrics coming in better than planned and reinforcing our decision to invest in this strategic asset.

During the June quarter 34% growth in TVT helped drive revenue growth in the low double digits, despite a more difficult prior year comparison when we began our ramped content and monetization strategy. In the quarter, we launched 25 linear channels, grew our VOD library to over 45,000 titles and premiered 13 efficient Tubi Originals.

We will continue to invest judiciously in Tubi with our sights set on achieving $1 billion in revenue run rate in the next couple of years. As you know, our affiliate renewal cycle begins in earnest this new fiscal year and we are again looking forward to industry-leading gains from the superior value of our channels and services.

With some early meaningful station and affiliate deals already completed including the recently closed Verizon deal, we go into this renewal cycle with confidence the market appreciates the value of our brands.

In aggregate, these financial and operating achievements again highlight the fact that the FOX story is one of strength, one of focus and one of stability. We will see how the macroeconomic environment evolves during the months ahead. But as we have demonstrated over the course of the last few years, FOX is well positioned to outperform.

We remain encouraged by the FOX specific trends that I've highlighted and that we're observing in real-time, underpinned by the best balance sheet in the business the same solid balance sheet that helped us thrive, despite the challenges of COVID and that will continue to support our investments for long-term growth and shareholder returns.

And with that I will turn you over to Steve. .

Thanks Lachlan and good morning, everyone. We ended our third full fiscal year with total company revenue growth of 8% and topline growth across all of our operating segments in every quarter of fiscal '22.

Even in a year that for us was light on major sports events and was an off-cycle political year, total company advertising revenues led this growth with a 9% increase over fiscal 2021. Cable segment advertising revenues were up 9% and primarily benefited from higher pricing across our news and sports networks.

Television segment advertising revenues were up 8% on the back of increased engagement of Tubi, as well as higher pricing and the normalization of live event programming at the FOX Network, following COVID-related disruptions last year.

These gains were partially offset by the absence of the prior year's record political revenues and lower ratings of FOX Entertainment. Total company affiliate revenues increased 7% led by 10% growth at the Television segment and 5% at the Cable segment.

Total company other revenues increased 15%, driven by higher sports sublicensing revenues as compared to prior year pandemic-related disruptions, growth in FOX Nation subscription revenues and the consolidation of TMZ MarVista and Studio Ramsay Global.

This growth in other revenues was partially offset by the impact of the divestiture of the company's sports marketing businesses last fiscal year. We also delivered sustained momentum in our consolidated digital revenues with a nearly 30% increase year-over-year.

This digital growth was supported by the organic investments across our digital portfolio that we articulated at the outset of the fiscal year.

These investments the establishment of USFL and higher programming rights amortization associated with the normalized sports and entertainment schedules contributed to a modest decrease in our full year adjusted EBITDA which came in at $2.96 billion.

Full year net income attributable to stockholders was $1.21 billion or $2.11 per share, while adjusted EPS was $2.79, down modestly against the $2.88 billion – sorry, the $2.88 reported last year primarily due to the impacts on EBITDA I just mentioned.

Turning to the quarter, we delivered total company revenues of $3.03 billion, up 5% over the same period in 2021. This growth was led by a 7% increase in total company advertising revenues, highlighted by the strength of FOX News, record June quarter political revenues at FOX Television stations, and continued growth of TUBI.

Total company affiliate revenues grew 4%, with 7% growth at the Television segment, and 2% growth at the Cable segment. Once again this distribution revenue growth was driven by rate increases, as the rate of subscriber declines increased modestly in the quarter, with trailing 12-month industry sub losses running in the high 5% range.

Total company other revenues increased 4% as the consolidation of our entertainment production companies and continued momentum at FOX Nation, were partially offset by the timing of sports sublicensing revenues, which were impacted by COVID in the prior year.

Quarterly adjusted EBITDA was $770 million, up 7% over the comparative period in fiscal 2021, as our revenue growth was partially offset by higher expenses, including the impact of the anticipated digital investments of FOX News Media and TUBI, and the first year deficit associated with the launch of the USFL.

Net income attributable to stockholders of $306 million, or $0.55 per share, was higher than the $253 million or $0.43 per share in the prior year quarter. This variance reflects the EBITDA movement I just described, along with the mark-to-market adjustments associated with the company's investments recognized in other than that.

Excluding non-core items, adjusted EPS in the June quarter of $0.74, was up 14% over last year's $0.65. It is worth noting, our effective income tax rate was higher for both the quarter, and the full year, primarily due to a $30 million re-measurement of our net deferred tax assets, associated with changes in the mix of our jurisdictional earnings.

This had no impact on our cash taxes. Now, let's turn to the performance of our operating segments for the quarter, starting with Cable Networks, which reported a 4% increase in revenues.

This was led by a 14% increase in cable advertising revenues, driven by strong gains in both pricing and audience at FOX News, notwithstanding slightly higher levels of preemptions associated with our breaking news coverage.

Also, contributing to the overall segment revenue growth was a 2% increase in affiliate revenues, once again due to the healthy pricing gains across all of our networks.

Cable other revenues were unchanged compared to the prior year, as the continued subscription momentum at FOX Nation, and the addition of the USFL were offset by the impact of the timing of sports sublicensing revenues as a result of COVID in the prior year.

EBITDA at our Cable segment was down 7% against the prior year as these revenue increases were more than offset by increased expenses, including the planned digital investment and higher programming costs, including those associated with breaking news coverage at Fox News Media, as well as the launch of the USFL.

Our television segment reported a 5% increase in quarterly revenues. This was led by a 7% increase in television affiliate revenues, reflecting increases for both direct retransmission revenues at our owned and operated stations, and our programming fees from non-owned station affiliates.

Our Television segment delivered 4% growth in advertising revenues, driven by higher political advertising at the FOX Television stations, continued growth at TUBI, and the introduction of the USFL, partially offset by lower ratings of FOX Entertainment.

Other revenues at television increased 3% in the quarter, primarily due to the impact of the acquisitions of TMZ and MarVista Entertainment, and the consolidation of our stake in Studio Ramsay Global, partially offset by the timing of deliveries at Bento Box.

EBITDA at our Television segment increased over 50% as expenses were flat against the prior year quarter. Here, we saw an accelerated digital investment at TUBI, and the consolidation of the entertainment production assets offset by the timing of programming costs at FOX Entertainment.

During the full year, we generated free cash flow, which we define as net cash provided by operating activities less CapEx of $1.6 billion. Over the course of fiscal 2022, we returned $1 billion of capital through the repurchase of 18.7 million Class A shares and 8.7 million Class B shares.

This was supplemented by over $270 million in dividend payments and underlining our continued commitment to shareholder returns, today we announced an increase in our semi-annual dividend to $0.25 per share.

With the payment of this dividend, we will have cumulatively returned over $3.75 billion of capital to our shareholders since the formation of FOX. This includes share repurchases totaling over $2.65 billion against our buyback authorization of $4 billion.

From our balance sheet perspective, we ended the quarter with $5.2 billion in cash and approximately $7.2 billion in debt. Our fiscal 2022 financial performance along with the progress we have made on our strategic priorities provide a strong foundation for us to springboard into fiscal 2023 where the setup is incredibly favorable.

We remain confident that collectively the financial tailwinds from Super Bowl 57, the early exit of Thursday Night Football, the momentum heading into November's midterm elections, and the start of our next major distribution cycle will deliver record revenues and EBITDA in fiscal 2023.

As we've highlighted previously, our plans for fiscal 2023 incorporate maintaining our current level of investment in our digital growth initiatives. From an affiliate revenue perspective as you would expect, we make no predictions on industry subscriber volumes.

However, from a rate perspective given the timing and nature of our affiliate renewals, you should expect to see the financial benefit of these renewals skewed to the second half of the fiscal year and concentrated toward our Television segment. Our focused strategy and operational execution continue to distinguish us.

Together, they have delivered sustained financial outperformance since the establishment of FOX and will be showcased with a banner year of events in fiscal 2023. This momentum supported by the most robust balance sheet in the industry position us well to navigate the broader macroeconomic turbulence while creating value for our shareholders.

And with that, Gabby, let's now open it up for Q&A. .

Thank you, Steve. And now we will be happy to take questions from the investment community..

[Operator Instructions] We have a question from John Hodulik with UBS. Please go ahead..

Okay, great. Thanks guys. Two quick ones if I could.

First of all on the Verizon renewal, anything you could tell us about pricing you got with that deal and how that positions you for the sort of upcoming renewal cycle? And then looking out into 2023 given the cash balance and sort of all these sort of EBITDA drivers, how should we think about capital return and the buyback? And do we have to wait for a resolution to the FanDuel situation, or how should we think about just sort of giving all the cash on the books and which you'll generate this year? Thanks..

Hey John, good morning. I'll start. I'll answer the Verizon renewal question and I'll let Steve answer the fun question about our cash on the books. So -- and he's got the keys. So, that's the important answer.

The -- like on the Verizon renewal, I'm obviously not going to give you a specific exact pricing, but it's absolutely in line with what our forecast and sort of long-term plan suggested. We're very happy with our partnership with Verizon.

And I think it's fair to say that we achieved industry-leading pricing increases for really are the best brands in the business between our local stations and retransmission renewals and the really incredible strength of FOX News and the loyalty and engagement of the FOX News audience, we're able to drive this industry leading pricing increases.

Just one added element to that, which I think is important for us, is we're also able to achieved distribution for FOX Weather, which will continue to include in our future upcoming renewals. And also, we expanded our relationship with Verizon to include distribution of TUBI.

So overall, we are very pleased with that renewal and we think it sets us up well for the next two years, but we have two-thirds of our distribution coming up. So we're very pleased and we appreciate the partnership with Verizon.

Steve?.

Yes, hi John. So, yes you're right. Listen, we've got a really strong balance sheet. We ended the year with a little over $5 billion in cash and we -- as the opening remarks indicate, we're really bullish about going into fiscal '23 from a revenue, EBITDA and cash flow perspective. But this now story remains consistent.

We're going to continue to -- our biggest use of cash since the inception of FOX from a capital perspective is to be -- is to actually return it to shareholders and in my opening remarks, I talked about the volume that we have returned to shareholders and we continue to remain committed to that. We have $4 billion authorization.

We have $1.35 billion of headroom left in that. But we're going to remain open to investing both organically and inorganically in the business. We're going to be balanced about that as we see opportunities on the horizon. So, a remarkably consistent story on our capital allocation..

Operator, we can go to the next question..

And that is from Phil Cusick with JPMorgan. Please go ahead..

Thank you, very much. Good morning. One quick follow-up on your comments on the ad market. Any sort of thing you're seeing overall in the macro environment, whether it's your own deals or not that we should be aware of? And then second, I wonder if you can talk about -- you mentioned, I think it was high 5s of industry declines.

I'm curious, if FOX affiliate customer accounts reflect that acceleration in the video industry decline or if maybe you're seeing a little bit less, given your different customer base? Thank you..

So, on the advertising market -- and good morning, Phil, I'll give you a little bit of color. I might jump around a little bit. But as I mentioned, for us, one of the most sort of pleasing things that we're seeing is actually in the local stations our base markets. So ex-political, the base market is very stable.

And as I mentioned in my remarks, particularly the return to growth for the auto category is -- it's obviously something that's concerned us over the last couple of years with COVID and the softness in the auto category, the return of growth in the auto category is a really strong indicator of things to come.

We are seeing locally two verticals or two categories that are soft. One is the local wagering sort of betting category soft. But that's really what we're seeing there. I think it's pretty interesting and perhaps predictable a shift of that business going to national.

So where we're seeing softness in local for wagering, we're seeing strength in national for the betting market. I think that's the purpose or the reason for that is obviously as more states become legalized in the national platform is particularly national sports is an efficient and a good buy for the betting businesses.

And then we're seeing some softness in government spending that was really COVID health spending over the last couple of years, which obviously is not there anymore. But that's being more than made up across our other strength in our other categories.

So, two areas of weakness locally in betting and government, but it's more than made up by strength in other categories. In terms of the scatter market, we're actually seeing a -- scatter for us before we get into the fall sports cycle is a quiet. The summer is a quiet period for us or it has been.

So we actually don't have a lot of scatter avails, but scatter pricing is up in the low double digits which is good to see that strength.

And then from a macro environment point of view, again, we're seeing no impact in our advertising across our businesses with the exception of softness in, which I think has been well reported in other areas, some softness in programmatic advertising. For us, that's sort of 10% of our advertising business.

So it's not having a significant or meaningful impact on us at all and that 10% is really due to programmatic advertising into TUBI and into our FOX News Media digital platforms.

Steve, do you want to answer the second part of the question?.

Yes. So Phil, just on the rate of subscriber erosion I think with our channels – our must-carry channels. So I think we're best positioned to buffer any sort of weakness in the subscriber universe.

I think where people find it challenging to reconcile between sort of how we report numbers and how – where you see numbers from the Street, there's a couple of things. One is we're in a two-month delay versus what's being reported by the distributors.

And the other piece is there's a fair amount of opacity around some of the platforms that don't report. So you got the – many of the virtual MVPDs don't break out their numbers and DIRECTV no longer breaks out its numbers. And so that's probably where you're seeing the sort of friction between the reported numbers..

Operator, we go to the next question, please..

That's the line of Robert Fishman with MoffettNathanson. Please go ahead..

Good morning, everyone. There's lots of chatter right now around the Big Ten renewal in the marketplace.

Just wondering if there's anything you can share specifically on those rights or maybe bigger picture of how FOX is positioned to renew key sports rights with your current portfolio of assets compared to either some of the pure digital companies or other media companies with SVOD services? And then how do you think about the ROI of the sports rights investments going forward?.

Hey, good morning, Robert. So, overall I mean I'll talk overall then I can come down to drill down to Big Ten. We're always going to look at sports rights as they become available. I think we've been very disciplined in terms of how we analyze and how we think about acquiring any additional incremental sports rights.

We look at it both obviously from what any individual sport can achieve both in terms of an audience and advertising revenue we can attach to that. We specifically also drill down into what we can see from our subscriber what we can attribute to our affiliation agreement with a distributor in terms of subscription revenue.

So we do take a pretty scientific and I think a very disciplined approach to how we view sports rights, but we do look at all the sports across the marketplace and see what would fit within FOX Sports.

I think the – if you look past – over the past years the store hasn't been written is the sports rights that we pass on right that we decide are too expensive or won't add any incremental revenue to our business. So – and that continues to be the way we look at it. As regards to Big Ten, Big Ten Network is a key strategic partner of ours.

We've had a great relationship with them. And we look forward to renewing those rights potentially with some new broadcast partners within the mix. That will be an announcement the Big Ten will make we expect in the near-term, but it's one that we will leave for them to make.

But we're looking forward to our continued long-term and profitable relationship with them..

Operator, we go to the next question, please..

That is the line of Ben Swinburne with Morgan Stanley. Please go ahead..

Hey. Good morning guys. Two questions, one, I think there's been a lot of enthusiasm over the past couple of years about Fox's opportunity in sports betting. I think it's gotten a little quieter on that front at least in terms of the market discussion.

Could you guys update us on, what you see ahead of the company there both directly with FOX Bet? And is there any timing on something with Flutter, and also just sort of the benefits to the broader business? And then I just wanted to clarify, Steve you said you expect to maintain the current investment level in fiscal 2023 versus 2022.

Is that a comment on just the amount of capital you're deploying, or is that sort of an EBITDA net impact on EBITDA, just to make sure we understood the comment there? Thanks..

Thanks Ben. So look, we continue to have beliefs or have a fundamentally strong belief in the sports betting business. We think it's a huge opportunity in the marketplace, specifically in its association with the FOX Sports brand. We drive the largest sports audiences in this country.

And no other broadcaster can achieve kind of the reach and engagement that we deliver, during the -- certainly during the autumn and the fall on a weekly basis. And so, we've proven this last couple of years with FOX Bet's, Super 6 which really taking our sports audiences.

And I know we've talked about it, before then by taking our sports audiences from television into FOX Bet Super 6 provide a tremendous funnel, which FOX Bet is the ultimate beneficiary of. That continues to be our strategy and it continues to be very successful. As regards to, Flutter we're still in our arbitration process with them.

We look forward to the clarity of getting through that process, which we expect to be in the next couple of months certainly sort of by the beginning of the autumn. But once that situation is clarified and also in early September as you see the NFL season kick off again, you'll see a lot more activity around FOX Bet and FOX Bet Super 6..

Hey Ben just picking up on your question around organic investment. So the way we define -- we had -- we called out $200 million to $300 million of net EBITDA of our investment for fiscal 2022. So put another way our fiscal 2022 EBITDA would have be $200 million to $300 million higher than what it was had we not made those investments.

We don't -- we anticipate maintaining that level of investment meaning that when you compare 2023 to 2022 you will not have that drag on the results. So that explains that for you..

Operator, we have time for one more question..

Very good. That's the line of Doug Mitchelson with Crédit Suisse. Please go ahead..

Thanks so much. If I could get a clarification on the Big Ten, you have digital rights for Big Ten games and you'll maintain those in any new deal that you're looking at? Another clarification, I'm wondering if you have upfront volumes ex-Super Bowl and ex-FIFA.

I'm just trying to get an ex-unusual, how strong are your upfront volumes? And then, lastly Steve, any swing factors in that free cash flow outlook for fiscal 2023 that we should be thinking about working capital or CapEx or anything like that? And good morning everybody. Thank you..

Hi, good morning, Doug. And hope you’re well. So on -- we have a Big Ten digital rights and we will keep those in the new deal. So I hope that clarifies, that again I don't want to say too much because it's really -- it's for the Big Ten to announce their new agreements.

In terms of upfront volumes ex, I think your question was what are they ex-Super Bowl. Obviously, we look at everything ex-Super Bowl, because it's obviously such a huge year for us. We're looking forward to we're getting record pricing for Super Bowl, and we're well ahead of plan in terms of selling our Super Bowl position.

But ex-Super Bowl upfront volumes were about 15% higher than the last upfront. I think one of the -- and that's across entertainment sports and news. I think the important thing to note there, though is that the upfront volumes to some degree, are a metric that we control.

We chose a very purposefully and I think in a very disciplined and hopefully, a judicious way to sell more volume into this upfront, because we felt it was a period where having certainty around or the highest level of certainty we can around, our sales and our inventory was important.

So for instance, in years where we would -- in the past years where we would sell in the mid-70s percent of our kind of available ad impressions. We announced we sold in this upfront, in the low to mid-80s.

And I think that was sort of a smart decision and one that we felt was appropriate, given any uncertainty around the economy of the advertising market going forward. .

Doug, it's Steve. Just on the free cash flow. I think from a working capital perspective a big swing factors, I think from an accounting version of working capital, remember, that going into we're into a Super Bowl year. So therefore, we amort a ton of the NFL costs in a Super Bowl year, so it has an impact on our working capital.

Our CapEx was down to a touch over $300 million this year, which was down from a touch north of $480 million. The year before, you should expect the $300 million to go up a touch. But the rest of it is, I think really pretty much stock in trade in terms of, cash flow swings.

There's nothing particularly unique about next year apart from, the tailwinds that we have going into it from an operating perspective. .

Great. At this point, we are out of time. But if you have any further questions, please give me or Dan Carey, a call. Thank you once again for joining today's call. .

Thanks everyone. .

Thank you. .

Ladies and gentlemen, that does conclude your conference for today. Thank you for using AT&T Executive Teleconference. You may now disconnect..