Sky TV profit tumbles on ‘challenging’ economy, satellite disruption

Sky’s CEO Sophie Moloney. Photo / Alex Burton

Sky TV has reported a 59% fall in net profit to $20.2 million for the year to June 30.

The broadcaster delivered some brighter news shortly ahead of its FY2025 financials. It has renewed rugby rights with an expanded deal that locks in All Blacks, Black Ferns and Super Rugby rights until 2030.

Chief executive Sophie Moloney would not put a price tag on the deal, citing commercial sensitivity. Sources told the Herald the deal is worth between $75m and $80m annually. Moloney would only allow that the new deal would have a “more muted impact” on operating earnings.

The final deal was only wrapped up at 7.30am this morning, the Sky boss said.

The company said its result was delivered in the context of “a challenging economic environment and a complex satellite migration, along with the completion of number of important projects including the necessary preparation to successfully acquire Discovery NZ.”

Revenue fell 2.1% to $750.7m.

Ebitda fell 3% to $148m.

The full year dividend was 22 cents per share, from 19cps in FY2024, as free cash flow increased 5% to $24.8m.

Sky Box and Sky Pod customers fell from 479,000 to 448,000 over the financial year.

Sky Sport Now customers monthly and annual subscription customers increased from 125,000 to 150,000. Neon customers increased by 1000 to 259,000.

Sky was forced to shift customers to a temporary satellite earlier this year, with partner Optus running two years late with a replacement for the increasingly wobbly D2. Direct costs of the disruption were put at $4.4m in Sky’s full-year results.

Moloney said the overall impact would be “broadly cash neutral” by the end FY2026, thanks to Optus chipping around $8 million in compensation to Sky.

The tough economy was a less transitory problem.

“I don’t see that it’s picking up at the moment. Kiwi household budgets are under massive pressure,” Moloney said.

“We’re not expecting it to get any easier. We’re not expecting it to get any easier, especially for the first half of the financial year [calendar year June to December], in terms of the economy. That’s reflected in our guidance, which is muted.”

Sky shares closed Thursday at $2.98. The stock is up 5.3% for the year.

The firm has forecast revenue of $745-$770m revenue for FY2026 and ebitda of $142 -$162m.

The company has stuck by its long-standing promise to double its dividend (from its 2023 level) to at least 30 cents per share in FY2026.

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Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.