News Corp said on Wednesday it was exploring a sale or other “strategic options” for Myspace, the ailing social network which has been eclipsed by Facebook.
“We recognize that the plan to allow Myspace to reach its full potential may be best developed under a new ownership structure and we’re evaluating those strategic alternatives,” News Corp chief operating officer Chase Carey said.
“With a new content focus and structure in place we believe now is the right time for News Corp to consider strategic options,” Carey said in a conference call with financial analysts to discuss News Corp’s second quarter earnings.
“It could be a sale. It could be a new investor coming into it. It could be us staying in with a restructuring,” said Carey, who put Myspace on notice in November saying the losses at the social network were “unsustainable.”
Carey said there was an “early window” on a decision for what to do with Myspace, purchased for US$580 million in 2005.
“It’s something you’ll see in the first half of the year,” he said.
Facebook has grown to more than 500 million members while Myspace’s numbers have dwindled. Earlier this month, Myspace announced it was cutting 500 jobs, nearly half its staff.
News Corp said net profit rose over 150 percent to US$642 million in the second quarter of its fiscal year on a strong performance by its television holdings.
Revenue was up slightly, rising to US$8.76 billion from US$8.68 billion in the same period a year ago. Earnings per share of US$0.29 were better than the US$0.28 per share forecast by Wall Street analysts.
“News Corporation’s second quarter results demonstrate the mounting vigor of our global channels business,” News Corp chairman and chief executive Rupert Murdoch said in a statement.
“In the US market, our cable channels are still expanding and adding subscribers, while increasing their revenues and profits at a double-digit pace,” he said.
Without providing figures, News Corp chief financial officer Dave DeVoe said results at Myspace have been “below our expectations.”
Carey said News Corp had received “a lot of interest” in Myspace.
“The interest to date has ranged from ‘A’ to ‘Z,’ from industry players, financial players to foreign to domestic,” he said.