Monday, February 7, 2011

Avatar Bolsters News Corp.’s Earnings

Buoyed by the success of “Avatar,” the science fiction blockbuster that has become the highest-grossing movie to date, the News Corporation reported a quarterly profit on Tuesday that surpassed the expectations of Wall Street analysts.

“Avatar,” made by James Cameron and released by News Corporation’s 20th Century Fox film studio, has generated nearly $600 million at the North American box office, and more than $2 billion worldwide, making it the highest grossing movie to date in dollars not adjusted for inflation.

It surpassed “Titanic,” another film from Mr. Cameron, that had topped the list of moneymakers. Because of the success of “Avatar,” several Wall Street analysts raised their earnings estimates for the News Corporation in recent days.

At the company’s newspaper unit, which is central to the company and close to Mr. Murdoch’s heart, operating income increased from $200 million to $259 million. Revenue increased from $1.5 billion to $1.65 billion. The company attributed the profit gain to “increased advertising revenues at The Wall Street Journal and lower operating expenses throughout the newspaper businesses from prior year restructuring efforts,” according to a company statement.

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