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Fox lost $800 million in value after announcing Tucker Carlson's departure

Fox Corporation's worth as a public company has sunk more than $800 million after the media company on Monday announced that it is parting ways with star host Tucker Carlson, raising questions about the future of Fox News and the future of the conservative network's prime time lineup.

Carlson, whose last show was on Friday, April 21, is leaving Fox News even as he remains a top-rated host for the network, drawing 334,000 viewers in the coveted 25- to 54-year-old demographic in the 8 p.m. slot for the week ended April 20, according to AdWeek. That was more than twice the audience of his competitors at CNN and MSNBC in the same hour, and also represented a bigger audience than other Fox News hosts such as Sean Hannity or Laura Ingraham. 

Shares of Fox dropped to a low of $29.27 on Monday, a decline of 5.2%, representing a loss in market value of more than $800 million, before rebounding slightly later in the day. Shares also fell slightly on Tuesday, but the stock regained ground on Wednesday, rising 28 cents, or almost 1%, to $30.

Carlson's abrupt departure comes less than a week after Fox reached a $787.5 million settlement with Dominion Voting Systems, which had sued the company in a $1.6 billion defamation case over the network's coverage of the 2020 presidential election. 

In the near-term, the financial impact on Fox may be minimal because advertisers typically book their slots in advance, but "if the ratings really crater" there could be an issue, Joseph Bonner, senior securities analyst at Argus Research, told CBS MoneyWatch.

He added, "Intermediate to longer term, perhaps [there is] some financial impact depending on who takes Carlson's place and their success, or lack thereof."

Fox News said that it will air "Fox News Tonight" at 8 p.m. on Monday as an interim program until a new host is named. 

The programming change may be due to the need for Fox News to attract more mainstream advertisers, noted Huber Research analyst Doug Arthur in a research note. Advertising at Fox's cable networks had been "weak/disappointing" despite its dominance in ratings, he added.

"[A] shift away from fanatical conspiracy content, less 'My Pillow' stuff, might begin to re-attract big-time advertisers," he wrote, referring to the company owned by Mike Lindell, the businessman who has promoted election conspiracies in the wake of President Donald Trump's loss in the 2020 election.

Range of responses

Carlson became a focal point in the Dominion case aftedocuments revealed scornful text messages from him about former President Donald Trump, including one that said, "I hate him passionately."

The host's comments about Fox management, which also emerged in the Dominion case, played a role in his leaving the network, the Washington Post reported, citing a personal familiar with Fox's thinking. 

On his final show on Friday, Carlson gave no indication that it would be his final appearance. Responses to his departure ranged from glee, with the audience of "The View" reportedly breaking into applause, to disappointment, with Eric Trump tweeting, "What is happening to Fox?"

Some social media users decried Carlson's exit, with others also urging viewers to contact their cable providers to complain. "Fox News has fired Tucker Carlson because they are going woke!!!" one commenter wrote.

Dominion CEO on Fox News: “They knew the truth” 01:05

The departure means that Fox News is losing a top audience draw, coming several years after the network cut ties with Bill O'Reilly, one of its superstars. 

Can Fox produce a new star?

O'Reilly left the network in 2017 after sexual harassment claims were filed against him, with Carlson taking his spot in the 8 p.m. hour. But Carlson's ratings are far below O'Reilly, who averaged 728,000 viewers ages 25 to 54 in the first quarter of 2017, according to the Hollywood Reporter. By comparison, Carlson's viewership in that demographic during the first three months of this year averaged 443,000. 

"While commentators may talk about the sky falling at the loss of a major star, Fox has done quite well at producing new stars over time," Bonner noted. "We need to think about how much is it about the person and how much is it the platform."

At the same time, Carlson is facing allegations from a former employee about the network's "toxic" work environment. Abby Grossberg, who worked as head of booking on Carlson's show, claimed last month in court papers that she endured an environment that "subjugates women based on vile sexist stereotypes, typecasts religious minorities and belittles their traditions, and demonstrates little to no regard for those suffering from mental illness."

Grossberg also alleged Fox's legal team "coerced" her into providing misleading testimony in Dominion's defamation case.

In a statement issued Monday, Grossberg called Carlson's departure "a step towards accountability for the election lies and baseless conspiracy theories spread by Fox News, something I witnessed first-hand at the network, as well as for the abuse and harassment I endured while head of booking and senior producer for Tucker Carlson Tonight."

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