Disney dips as Q3 earnings disappoint
Disney disappointed with third quarter results, despite strong earnings growth driven by strong studio growth from new Marvel movies and Pixar’s 'Incredibles 2'.
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The House of Mouse reported revenues down 7% year on year to $15.2bn, just short of the $15.3bn expected by Wall Street analysts, as per FactSet.
Net profit for the third quarter of 2018 was $2.9bn up 23% from $2.3bn earned in the same period of 2017.
Earnings per share of $1.87 were up 18% from $1.58 in the same period last year, but could not beat expectations of $1.95 per share.
The company's shares dipped 2% in after-hours trade after the results were released but just after Wednesday's open were down less than 1% to $115.56.
Disney’s studio revenue rose 20% year over year to $2.88bn driven by the strong box office performances.
Disney’s media and networks rose to $6.16bn, better than the $6.10bn expected, though parks and resorts such as Disney World did not reach the estimated $5.28bn and stood at $5.19bn.
Disney’s results come as the entertainment arm is in the middle of acquiring most of Twenty-first Century Fox’s assets. In July both sides approved the $71.3bn cash and stock deal to combine Disney with Fox’s film and TV studios, including the rights to successful content such as X-Men, Avatar, The Simpsons and National Geographic. The move is designed to boost Disney’s new direct-to-consumer streaming service to be launched in 2019.