CHICAGO (MarketWatch) -- News Corp. said Wednesday that its fiscal first-quarter profit fell 30% on losses related to its investment in a German pay-TV operator and comparisons with year-earlier results that included contributions from DirecTV and Gemstar-TV Guide, which have since been divested.

Due to the economic crisis and its impact on TV- and newspaper-advertising sales, News Corp. Chief Financial Officer Dave DeVoe told analysts that the company now expects fiscal 2009 operating income to drop by a percentage in the low to middle teens from $5.13 billion in fiscal 2008.

The media conglomerate NWS NWS, -3.57% (NWS) said that it earned $515 million, or 20 cents a share, compared with a profit of $732 million or 23 cents a share in the first fiscal quarter of 2008.

Revenue rose 6.3% to $7.51 billion.

On average, analysts polled by FactSet Research expected News Corp. to report a profit of 23 cents a share on sales of $7.66 billion.

Commenting during a conference call, Chairman Rupert Murdoch said he doesn't expect the administration of President-elect Barack Obama to spearhead an effort to "break up existing media companies," but added that under "under any Democratic attorney general ... mergers will get a much less friendly reception."

Also during the call, Murdoch said News Corp. is having no discussions with Yahoo YHOO, Microsoft MSFT, -1.04% or AOL TWX, about possible deals. Each of those companies is reported to be seeking ways to gain a larger share of the online ad market.

News Corp. needs to place more emphasis on subscription-based businesses to weather environments like the current one, said Murdoch. "We see in the cable channels the great benefits of the twin revenues coming from the subscribers and advertisers. We will be looking to start new channels where there are opportunities, and we certainly see that on a big scale internationally."

However, the company is unlikely to make a major move "until there's more visibility" into the near-term future of the financial markets, Murdoch said.

Operating income at the TV division fell 70% to $54 million on the divestiture of eight TV stations, lower ad sales at the company's remaining owned-and-operated TV stations and a decreased contribution from Asia-based Star TV. Local ad sales have been dismal at television stations across the United States, as a direct result of the economic downturn.

News Corp. Chief Operating Officer Peter Chernin said there seems to be more ad weakness on the East Coast, Texas, and the West Coast. "The real estate market is maybe a little worse in the suburbs of the large markets. That affects us," he said.

Chernin and Murdoch said the company feels comfortable with the 27 TV stations in its portfolio, which includes outlets in such top markets as New York, Los Angeles, Chicago, Philadelphia, and Boston. "I think you want big, strong affiliates, particularly in those big markets, in order to maximize the strength of the company's television business."

Fiscal first-quarter cable-network operating income, from such channels as FX, Fox News Channel and the regional Fox Sports networks, rose 31% to $379 million on improved results at Fox News, the sports networks, the Big Ten Network and the Fox International Channels. Revenue climbed 19% to $1.31 billion.

Newspaper and information-services income revenue climbed 37% to $1.71 billion, driven by the company's December 2007 acquisition of Dow Jones & Co., which includes The Wall Street Journal, Dow Jones Newswires, Barron's, Factiva and MarketWatch, the publisher of this report.

Operating income rose to $134 million from $93 million, as lower depreciation expense was partially offset by decreased ad revenue from the United Kingdom and Australia.

Murdoch said The Journal's online edition is "the big profit measure" of the Journal franchise. "It's the one Website you can charge for, and people are happy to pay for it," he said. "There's probably $100 million in subscriptions there. Certainly there is over $100 million in advertising on that one Website."

News Corp. still plans to put "even more emphasis than normal" on international expansion plans at Dow Jones, Murdoch added.

Operating income at the company's film and television studios fell 31% to $251 million. A year earlier, the quarter was lifted by the box-office performance of "The Simpsons Movie" and "Live Free or Die Hard."

Chernin says News Corp. is comfortable with the number of its yearly movie releases, though other studios have cut back to fewer theatrical titles.

He added that in the past three or four weeks, the company has begun to see a decline in DVD sales, though most of that drop-off has been affecting other studios. "We are a little cautious today about the DVD business," Chernin said.

In the category News Corp. classifies as "other," which includes the social-networking site MySpace, the company saw an operating loss of $101 million, compared with a loss of $43 million a year earlier. The greater loss reflects lower contributions from pay-TV technology provider NDS and the company's Eastern European TV stations.

At Fox Interactive Media, revenue rose 17% on advertising- and search-revenue growth at MySpace. Chernin offered a note of cautious optimism about the site's ad growth.

"We are beginning to see some softening at the end of this calendar year and looking into the first couple of quarters next year," he remarked. "I still believe we are doing slightly better than the marketplace."

News Corp.'s nonvoting shares fell $1.09, or 10%, to close at $9.79 ahead of the announcement on Wednesday.