Nov. 10 (Bloomberg) -- News Corp., the media company controlled by Rupert Murdoch, posted a $433 million loss after an accounting change. Revenue rose 10 percent, buoyed by box office sales of ``Fantastic Four'' and advertising at Fox News Channel.

The first-quarter net loss was 13 cents a share, compared with net income of $625 million, or 21 cents, a year earlier, New York- based News Corp. said today in a statement. News Corp., the No. 4 U.S. media company, posted revenue of $5.68 billion.

Movie-ticket revenue and sales of films on home video including animated feature ``Robots'' boosted profit 26 percent at the 20th Century Fox unit. Fox News Channel's audience ratings rose 31 percent and ad sales increased, bolstering cable-network profit. Earnings at television stations and the Fox broadcast network fell on higher promotion and programming costs.

``Film was a big positive surprise,'' said Aryeh Bourkoff, an analyst at UBS Securities in New York who rates the shares ``buy 2.'' ``It's a well managed business for them.''

The company's Class A, non-voting shares rose 5 cents to $14.72 at 5:42 p.m. New York time in extended trading. The stock, which has fallen 21 percent this year, earlier today rose 11 cents to $14.67 in New York Stock Exchange composite trading.

Revenue exceeded the $5.58 billion estimated by Bourkoff and the $5.62 billion average estimate of 14 analysts surveyed by Thomson Financial. Excluding the accounting expense, profit fell to $580 million, or 18 cents a share.

The company reduced its operating income forecast for fiscal 2006 to 12 percent from the ``mid teens,'' citing costs of acquiring Internet businesses and restricted stock awards to employees, Chief Financial Officer David Devoe said on a conference call.

Malone

Talks to reduce Liberty Media Corp.'s 18 percent voting stake in News Corp. have stalled because Liberty Chairman John Malone hasn't found a way to sell the shares on a tax-free basis, Murdoch, 74, said on the call.

The companies' inability to come to terms has hurt News Corp.'s share price, Murdoch said. The Liberty stake is the second-largest in News Corp. after the Murdoch family's 29 percent.

``It's clearly been a distraction to the market,'' he said.

The $1 billion expense recorded in the quarter ended Sept. 30 was based on estimates of the value of Federal Communications Commission licenses in each city where News Corp. owns TV stations, Devoe said.

Film

News Corp.'s film unit benefited from superhero action film ``Fantastic Four,'' which had $323 million in worldwide box-office receipts, and pay-TV sales of ``Alien vs. Predator,'' News Corp. said. ``Robots'' and ``Hide and Seek'' and DVD also helped boost profit to $368 million at the unit. The unit's sales of $1.42 billion beat Bourkoff's estimate of $1.37 billion.

Profit at Fox News Channel, which on average drew 1.74 million viewers last week with commentators including Bill O'Reilly, rose 64 percent, News Corp. said. Cable sports networks, FX and Speed generated higher sales from advertising and fees paid by cable-TV providers. Profit at the cable channels rose 18 percent to $197 million.

Those gains outweighed higher programming costs for local sports and news coverage at News Corp.'s 35 Fox television stations. Profit at the broadcast business, which includes the fourth-rated Fox network, declined 31 percent to $160 million as expenses increased to promote the slate of shows that will debut in Fall, the company said.

Liberty

Profit at News Corp.'s newspaper group, which includes the New York Post and Times of London, rose 6 percent to $125 million as advertising sales in Australia rose. The inclusion of results from Queensland Press Group, acquired in November, 2004, helped bolster newspaper results.

Profit from U.K. newspaper operations declined as the company spent more on color presses and ad sales fell.

The loss at News Corp.'s direct broadcast satellite TV station, which includes the Sky Italia satellite-TV service, narrowed to $61 million from $121 million a year earlier. The unit gained subscribers, winning 568,000 new customers in the last 12 months, News Corp. said.

DirecTV Group Inc., which News Corp. controls, last week reported a profit of $95 million, its first in two years. Sales rose 13 percent to $3.23 billion as customers paid more for additional features such as digital recorders.

News Corp.'s HarperCollins book publishing unit posted a 17 percent increase as ``The Purpose Driven Life'' by Rich Warren and reprints of ``The Chronicles of Narnia'' by C.S. Lewis boosted sales.

The company, which has spent $1.4 billion buying Web sites this year, has budgeted $2 billion for Internet purchases, Murdoch said today. The company this year acquired My Space.com, which caters to teens and young adults, and Rottentomatoes.com, which features reviews of movies and video games.

News Corp.'s shares have stumbled this year partly because investors are concerned over how much Murdoch ultimately will spend on Internet properties, Credit Suisse First Boston analyst William Drewry said in an Oct. 18 report.

To contact the reporter on this story: Michael White in Los Angeles mwhite8@bloomberg.net.

Last Updated: November 10, 2005 19:36 EST