Fox Corporation stock slides on Tucker Carlson departure

Yahoo Finance’s Allie Canal joins the Live show to discuss the decline in stock for Fox Corporation following news that Tucker Carlson has parted ways from the network.

Video transcript

BRAD SMITH: Media shake up Fox shares sliding after the network ousted longtime host Tucker Carlson, raising fears among investors that Fox's large viewership might look somewhere else. The move comes amid a flurry of other big media shuffles. Here with more, we've got Yahoo Finance's Alexandra Canal Ali what do we know about this?

ALEXANDRA CANAL: This bombshell media shakeup, Tucker Carlson out. He aired his last show on Friday. In the meantime, in that coveted 8:00 PM slot, there will be a rotating cast of Fox News personalities until they can find a new host, but this is a big deal. The stock fell as much as 5% on the heels of the news yesterday, wiping off roughly $500 million from the value of Fox.

Shares have since recovered. They are trading relatively flat today, but it comes at a really crucial moment, considering this ousting comes less than a week after Fox settled that defamation lawsuit brought on by Dominion Voting Systems for nearly $800 million. It is unclear at this time whether Carlson's departure was related to that lawsuit, but the general vibe that I'm getting among industry-watchers is that it probably was, just considering the sheer amount of discovery, the redacted filings, the information that had Tucker Carlson's name largely tied to it.

Carlson, by the way, has not released any official statement of his own. Yahoo Finance did attempt to contact him for comment. He did not get back to us. But one thing that is clear, guys, is the sheer amount of viewership that this show brought to Fox.

According to the latest Nielsen ratings, the program averaged 4.2 million viewers during the week of March 27 to finish the week as the most-watched cable news program. So he is this undeniable force at Fox. It's clear the Murdaughs were trying to send a message that not one person is bigger than the network. We'll have to wait to see what more details come, but there's this reckoning across the whole industry right now.

JULIE HYMAN: Well, OK, so here's the question-- Tucker Carlson, personalities, politics aside, it all comes down to ad dollars and whether advertisers are going to stick with that prime time program with another person in the seat or with a rotating cast in the seat. Now, some of these ad deals are probably signed already for at least the next little while. But I think for an analyst, for an investor in the company, that's got to be the question-- are they going to hold on to the ad dollars that presumably were behind Tucker Carlson.

ALEXANDRA CANAL: Yeah. And there are some arguments that, look, maybe Carlson was a bit controversial and maybe that prevented some advertisers from wanting that prime time slot. But at the end of the day, money talks, viewership talks, so that is a big risk there. Fox does get the bulk of its revenue through affiliate fees.

But cable programming, that has added to overall revenue gains. The media giant reported $451 million in ad revenue from its cable programming in its latest earnings report. So it's still a significant chunk of this revenue, it's still a big question mark moving forward. It remains to be seen how much of an impact this will have moving forward, but we'll just have to wait and see how those viewership numbers shake out.

BRAD SMITH: All right, it seems like Flex Seal and MyPillow will have some new competition on the advertising front for that time slot.