Business

/

ArcaMax

Disney's profit surges in first quarter but revenue dips amid struggles in media networks

Daniel Miller, Los Angeles Times on

Published in Business News

LOS ANGELES -- Walt Disney Co. delivered stronger than expected profits in the first quarter -- thanks partly to a federal tax cut -- but its revenue dipped as the Burbank company saw continued declines at its ESPN cable channels and ABC broadcast network.

The Burbank company reported net income of $4.42 billion, up 78 percent from a year earlier, boosted by a $1.6 billion one-time tax benefit from the new federal income tax legislation.

Analysts had predicted earnings per share of $1.61 on revenue of $15.5 billion, according to FactSet, and Disney delivered adjusted per-share earnings of $1.89 on revenue of $15.4 billion.

Revenue rose 4 percent, but the company missed on analysts' expectations for sales.

Disney's earnings report comes amid a period of turbulence for global markets -- on Monday the Dow Jones industrial average plunged 1,175 points -- and the company's performance is sure to be scrutinized by anxious investors.

Shares of Disney rose 1.4 percent in regular trading to $106.17. In the after-hours session, the stock was up about 1 percent.

The media networks unit saw its operating income decline year-over-year for the seventh consecutive quarter.

The unit -- whose crown jewel is ESPN -- reported operating income of $1.2 billion, a drop of 12 percent from a year earlier.

Within the unit's cable networks group, segment operating income declined 1 percent to $858 million. Disney attributed the drop, in part, to declines at ESPN, which experienced a loss in subscribers.

The unit's broadcast group, which includes ABC, posted segment operating income of $285 million, a decrease of 25 percent. Disney has continued to face ratings struggles at the ABC television network, fewer syndication hits from its television studio and lower revenues at TV stations.

...continued

swipe to next page
 

Comments

blog comments powered by Disqus