News Corp has announced a fall in quarterly profits due to the losses incurred by the sale of MySpace.
The media giant said on Wednesday that profits for the last quarter declined 22% but figures for all the other segments were experiencing strong growth. The company suffered a loss of $240 million on the sale of the social networking site.
News Corp bought MySpace in 2005 for $580 million but only managed to sell the site for a disappointing $35 million back in June.
Chairman Rupert Murdoch said that the recent phone-hacking scandal had also caused the company some difficulty, after News Corp was forced to shut down the News of the World.
“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,” he said.
“We are acting decisively in the matter and will do whatever is necessary to prevent something like this from ever occurring again.”
It will be interesting to see how profits are affected by the closure of the paper in the next quarter, although News International only accounts for a small proportion of the company’s revenues.
Whilst the 39% of BSkyB that News Corps owns brings in plenty of revenue, it was a serious blow to have to abandon the bid for the remainder of the satellite broadcaster in the wake of the hacking scandal.