Shares of the Walt Disney Co. gained 5% in after-hours trading Thursday after it reported quarterly results roughly in line with Wall Street analysts’ estimates — days before its much-anticipated streaming service begins.
Disney
said it earned $1.05 billion, or $1.07 a share, compared with $2.32 billion, or $1.55 a share, in the year-ago period.
Revenue rose 34% to $19.1 billion, from $14.3 billion a year ago.
Revenue from the company’s media networks rose to $6.5 billion, up 22% from $5.3 billion a year ago. Revenue from parks and resorts came in at $6.65 billion, up 8% from $6.14 billion a year ago. Disney’s studio entertainment segment brought in $3.3 billion in revenue, up 52% from $2.2 billion last year, thanks to strong box-office numbers.
“We’ve spent the last few years completely transforming the Walt Disney Co. to focus the resources and immense creativity across the entire company on delivering an extraordinary direct-to-consumer experience, and we’re excited for the launch of Disney+ on Nov. 12,” Disney Chief Executive Robert Iger said in a statement announcing the results.
Analysts polled by FactSet had expected Disney to report adjusted fiscal fourth-quarter earnings of 94 cents a share on sales of $19.2 billion.
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The company’s $6.99-per-month streaming service, Disney+, is scheduled to launch next week, featuring content from Marvel, Pixar, “Star Wars,” National Geographic and more. During a conference call with analysts late Thursday, Iger said he was not too concerned with competing services but he did not disclose pre-sale numbers for Disney+.
Disney+ also announced a distribution deal with Amazon.com Inc.
to carry its content on Fire TV, as well as through Samsung Electronics
and LG Electronics
smart TVs. Disney said beginning next year, its FX channel will create original content for Hulu, which Disney also owns.
The importance of Disney+ was underscored by “an extensive discussion” of it at the start of a conference call with analysts, Forrester Research analyst Jim Nail told MarketWatch in an email message. “Disney+ reinforces how much priority they are putting into the [direct-to-consumer] business,” Nail said. “They are connecting all Disney assets to Disney+, which is a good move to drive subscriptions and a significant investment in giving the service a fast start.”
The entertainment giant faces a gantlet of rivals, new and old, in the burgeoning streaming market: Apple Inc.
, which launched Apple TV+ on Nov. 1; industry leader Netflix Inc.
; and forthcoming services from AT&T Inc.’s
HBO Max and Comcast Corp.’s
NBCUniversal’s Peacock.
In August, Disney reported fiscal third-quarter profit and sales that missed Wall Street’s expectations, a disappointment Disney pinned on the integration of its $71 billion acquisition of assets from 21st Century Fox.
Disney had projected that the new business would skim about 35 cents a share off its profit, but it subtracted around 60 cents a share.
Disney shares have gained 20% so far this year, compared with 23% and 19% for the S&P 500
and the Dow Jones Industrial Average
, respectively, in the same period.
