The Walt Disney Company reported fiscal third-quarter earnings and revenue that missed analysts' expectations on Tuesday. Here's how the company did compared with what Wall Street expected: Earnings: $1.87 per share vs. $1.95 per share forecast by Thomson Reuters Revenue: $15.23 billion vs. $15.34 billion forecast by Thomson Reuters In the year-ago quarter, Disney reported adjusted earnings of $1.58 per share on revenue of $14.24 billion. Shares of Disney initially slipped 2 percent in after-hours trade. The stock was last seen edging slightly above its closing price. Despite the top and bottom line miss, the entertainment giant saw strong growth in its studio, parks and broadcast units. Disney said its studio revenue grew 20 percent year over year to $2.88 billion, driven by the strong box office performances of Marvel's "Avengers: Infinity War" and Pixar's "Incredibles 2." Both movies quickly crossed the $1 billion mark in the global box office. "Avengers: Infinity War" — which had the biggest opening weekend of all time both domestically and overseas — crossed that milestone in just 11 days. That pace is faster than any other movie in history. Here's what each business unit reported in revenue compared with what analysts expected, according to StreetAccount consensus estimates: Media and networks: $6.16 billion vs. $6.10 billion forecast by StreetAccount Parks and resorts: $5.19 billion vs. $5.28 billion forecast by StreetAccount Studio: $2.88 billion vs. $2.89 billion forecast by StreetAccount Consumer and interactive: $1.00 billion vs. $1.11 billion forecast by StreetAccount While the parks business posted a 6 percent year-over-year increase in revenue, the segment saw operating income surge 15 percent year-over-year to $1.34 billion. Disney said the the surge in operating income was driven by higher guest spending amid higher average ticket prices and room rates as well as increases in food, beverage and merchandise spending.<doc-sep>As Disney prepares to close its blockbuster Fox deal, its third fiscal-quarter results came up short. Disney's (DIS) - Get Report fiscal third quarter results disappointed after the market close Tuesday, but investors will listen for Chairman and CEO Bob Iger commentary about its purchase of Fox (FOXA) - Get Report television and film assets and the future of media on the company's call. Earnings of $1.87 per share missed forecasts of $1.95 per share, on a non-GAAP basis, while revenues of $15.2 billion came in below consensus estimates of $15.4 billion. Shares fell 2% to $114.29 in after-hours trading. Year to date, shares of Disney were up about 9%. Beyond quarterly details, the big issues on the call, which begins at 4:30 p.m. ET, will be Disney's $71.3 billion purchase of Fox's film and TV studios and whether the company will make a new bid for European satellite TV outfit Sky. Other hot topics will be the"Disneyflix" streaming service that the company will launch next year and box office results for films such as "Black Panther" and "Solo: A Star Wars Story." The Department of Justice and shareholders have already approved Disney's purchase of the Fox assets, but the merger partners still need approval from overseas regulators.<doc-sep>The Walt Disney Company released its fiscal third-quarter earnings today, and the results show yet again that the Mouse House is relying more heavily on its theme parks and theatrical releases as its traditionally lucrative TV businesses yield fewer gains. Here’s how the numbers shook out for Disney’s four main business units: Media networks : revenue up 5%. Operating income down 1%. : revenue up 5%. Operating income down 1%. Parks & resorts : revenue up 6%. Operating income up 15%. : revenue up 6%. Operating income up 15%. Studio entertainment : revenue up 20%. Operating income up 11%. : revenue up 20%. Operating income up 11%. Consumer products & interactive: revenue down 8%. Operating income down 10%. The lift for Studio Entertainment was thanks to the huge success of Incredibles 2 and Avengers: Infinity War, which far outperformed last year’s third-quarter releases, Guardians of the Galaxy Vol. 2 and Cars 3. But Disney’s cable business continues to struggle, with a 5% decrease in the segment’s operating income. Disney attributed the decline to investments in BAMTech and its poorly performing Freeform network.<doc-sep>Walt Disney Co. shares declined after the company released a disappointing earnings report Tuesday afternoon, but turned around after Chief Executive Robert Iger laid out plans for Disney’s acquisition of 21st Century Fox assets and its coming Disney-branded streaming service. Disney DIS, +0.17% stock has been pressured by concerns about its television assets, especially cable networks like ESPN, and the company has launched a direct-to-consumer ESPN streaming service called ESPN+ and plans another one based on Disney content in late 2019. In an earnings report that fell short of expectations overall Tuesday afternoon, Disney missed on revenue projections for its cable networks, which may have spooked investors — after the earnings report hit, Disney shares slid more than 2%. Don’t miss: Disney’s shareholders have voted to buy those Fox assets. Now what? Those fears didn’t seem to last long, however, as the stock rebounded to roughly break-even after Iger took the stage in a conference call, as has happened before. Iger said that the decline in subscribers to media networks slowed for a fourth consecutive quarter, largely thanks to the rise of so-called skinny bundles, and laid out his plans for additional assets that Disney expects to acquire from Fox FOX, +0.72% . Shares ended after-hours trading down 0.5%. “We have always believed we have the brands and content to be extremely competitive and to thrive alongside Netflix NFLX, +0.20% , Amazon AMZN, +0.19% and anyone else in the market,” Iger said in Tuesday’s conference call. “And adding the Fox brands and creative assets ... make our [direct-to-consumer] products even more compelling for consumers.” Iger specifically mentioned Fox’s FX and National Geographic networks, as well as the Fox Searchlight and core Fox movie studios, as stars of the assets Disney expects to acquire. He also named several properties within the Fox assets that will mix well with Disney’s current intellectual property. “It gives us the opportunity to be associated with and to expand iconic movie franchises like ‘Avatar,’ Marvel’s ‘X Men,’ ‘The Fantastic Four,’ ‘Deadpool,’ ‘Planet of the Apes,’ ‘Kingsman’ and many others,” Iger said. Iger also informed investors that ESPN+, the first direct-to-consumer streaming service the company launched since acquiring BamTech, has been attracting paying subscribers, though he did not give specific numbers. “It’s still early days, but conversion rates from free trials to paid subscriptions are strong and subscription growth is exceeding our expectations,” he said. Opinion: Disney’s approach to streaming ESPN could determine the future of television Overall, Disney reported second-quarter net income of $2.92 billion, or $1.95 a share, on sales of $15.23 billion, up from $14.24 billion a year ago. After adjustments for comparability with a year ago, the company reported earnings of $1.87 a share, up from $1.58 a year ago. Analysts on average expected Disney to report adjusted earnings of $1.95 a share on revenue of $15.35 billion, according to FactSet. Disney’s largest segment, media networks, reported revenue of $6.16 billion, up from $5.87 billion a year ago, the only segment to grow year-over-year and beat analyst estimates. The beat was powered by broadcast networks, though, as ABC brought in higher affiliate fees and sold rights to a number of hit shows to beat expectations by more than $100 million. Cable network revenues of $4.19 billion came in lower than average analyst estimates of $4.27 billion, according to FactSet. Disney reported $5.19 billion in sales in its Parks and Resorts segment, up 6% from $4.89 billion a year ago but lower than the average analyst estimate of $5.28 billion. The film business reported sales of $2.88 billion, up from $2.39 billion last year but lower than the average analyst expectation of $2.89 billion, according to FactSet. The “Consumer Products and Interactive Content” segment reported revenue of $324 million, down from $362 million a year ago and lower than the average analyst estimate of $372 million. See also: Disney’s upcoming ‘Star Wars’ streaming series expected to cost $100 million In one other effect from the Fox acquisition, Chief Financial Officer Christine McCarthy disclosed in the call that Disney will halt share repurchases until Disney can better balance cash and debt as it spends billions in cash to acquire the assets. “Given our pending acquisition of Fox and the expected increase in leverage in order to fund the $35.7 billion cash component, we will not be an active buyer of our stock until our total leverage ratios return to levels consistent with a single-A credit rating,” McCarthy said.<doc-sep>
Walt Disney on Tuesday reported second-quarter earnings and revenue that missed Wall Street estimates amid higher costs and mixed results in its media networks business. Disney’s cable networks, particularly ESPN, have come under pressure in recent quarters as more consumers opt for cheaper pay-TV packages and video streaming services such as Netflix. Disney launched ESPN+, a $4.99-a-month streaming service, in April to attract viewers looking for cheaper alternatives. The media networks business – Disney’s largest by revenue – posted a 1% decline in operating income despite stronger revenue. An increase in operating income at ESPN was offset by a loss at BAMTech and weaker results for cable network Freeform, Disney said. The company also reported a decline in operating income for its consumer products and interactive media business. Disney’s theme parks and resorts recorded stronger results, while the studio entertainment division saw higher operating income on 20% revenue growth. The media giant reported overall net income of $2.92 billion, a 23% increase compared to the same quarter last year. On an adjusted basis, earnings came in at $1.87 per share, compared to a consensus estimate of $1.95. Revenue grew 7% to $15.23 billion. Analysts were looking for $15.34 billion in revenue. Expenses rose $97 million to $196 million due to costs related to Disney’s agreement to purchase certain assets from 21st Century Fox. The company also cited higher compensation costs. Ticker Security Last Change Change % DIS THE WALT DISNEY CO. 178.71 +2.31 +1.31% Disney’s second-quarter report comes after Comcast dropped its rival bid for 21st Century Fox’s entertainment assets, allowing Disney to move forward with a $71 billion acquisition. Fox and Disney shareholders approved the deal in June. 21st Century Fox is the parent company of FOX Business.