News Corp said it is planning to lay off 5% of its workforce after earnings fell short.

News Corp said Thursday that it would cut 5% of its workforce, or 1,250 jobs, after the media conglomerate fell short of quarterly Wall Street estimates for profit and revenue, hurt by declines across its businesses, including news.

The company also said it incurred $6 million in one-time costs associated with its plans to merge with Fox Corp, which Rupert Murdoch, News Corp executive chairman and Fox co-chairman, scrapped in January.

A slump in advertising spending by businesses hit by rising inflation and higher interest rates has dented one of the major sources of revenue for companies such as News Corp (NWS), which publishes the Wall Street Journal.

“A surge in interest rates and acute inflation had a tangible impact on all of our businesses,” Chief Executive Robert Thomson said in a statement.

Shares of the company were down nearly 3% in extended trading Thursday.

To combat the slowdown, Thomson said there were a number of initiatives underway, including the job cuts. The layoffs will be made across all businesses and result in annual savings of at least $130 million.

The company said that in the third quarter it expects to see one-time costs related to the withdrawn Fox-News Corp proposal and its previously announced exploration of a sale of Move Inc, which operates the website, to CoStar Group.

The Dow Jones division, which includes the WSJ, reported an 11% rise in revenues to $563 million in the quarter, with strong growth in its professional information business.

Subscriptions for the WSJ and Barron’s Group approached 5 million for the first time. However, earnings were down 3% from a year ago, to $139 million.

News Corp’s advertising revenue in the second quarter fell 10.6% to $464 million. Fox’s ad revenue in the December quarter rose 4% thanks to a boost from the World Cup and the US midterm election.

Total revenue was $2.52 billion in the second quarter ended December 31, while analysts on average expected $2.55 billion, according to Refinitiv data.

Adjusted earnings per share were 14 cents, while analysts were expecting 19 cents.