MySpace sale hits News Corp, but revenues up
Business digest: Rupert Murdoch praises ‘good quarter’ but admits phone hacking scandal presents ‘challenges’
News Corp has reported a 22 per cent drop in profits in the three months leading to June 30 from $875m this time last year to $683m, due largely to losses from its sale of social media website MySpace.
The media giant, of which Rupert Murdoch is CEO, bought MySpace for $580m in 2005, but ended up selling it for £35m in June this year.
Revenues rose 11 per cent, however, coming in at $8.96bn. The financial impact of the phone hacking scandal, which led to the closure of News Corp paper News of the World on July 10, will not be accounted for until the next quarter.
Murdoch said: "While it has been a good quarter from a financial point of view, our company has faced challenges in recent weeks relating to our London tabloid, News of the World."
Read a full report at BBC News.