Disney Beats Earnings Expectations, Falls Short on Revenue

3 things to watch as Disney reports first-quarter earnings

Disney Earnings: Fox Acquisition, 'Star Wars' Fatigue Fears May Overshadow ESPN Subscribers

"With this service having massive amounts of sports content, it's the ideal foray into streaming in our opinion with Disney's standalone service coming down the pike slated for 2019, with the Fox acquisition and Hulu ownership making the company a legitimate streaming player".

In December, Disney announced a $66.1 billion deal, including debt, to acquire many parts of Fox.

ESPN has faced declining subscriber numbers and ad revenue.

GBH Insights analyst Daniel Ives is out with a first glance at the entertainment giant's quarterly show, calling the performance "solid", even if revenue was a "mixed bag".

Net income soared 78% to $4.4 billion - largely as a result of the one-time benefit from the new federal tax laws. For the new ESPN app, we expect it to include a more personalized experience with usual relevant scores and highlights next to streaming versions of ESPN's cable broadcasts and podcasts. Overall, he added, the company is "pleased by the response in the creative community to the idea of creating original properties for our direct-to-consumer app". ESPN's advertising revenue declined 11% y-o-y in the first quarter, as higher rates were more than offset by a decrease in impressions.

Theatrical distribution revenue was higher due to three big movies: "Star Wars: The Last Jedi", "Thor: Ragnarok" and "Coco", which generated over $4.4 billion in global box office.

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Disney CEO Bob Iger is expected to address the company's pending $66.1 billion acquisition of 21 Century FOX's film and television assets during an earnings call with analysts Tuesday afternoon.

Iger also emphasized that Disney's output deal with Netflix for Black Panther, Incredibles 2 and other films released through the end of 2018 doesn't last forever. Disney announced separately that it's hired the creators of TV series "Game of Thrones" to make a new series of Star Wars films. Cable accounted for 72 percent of Disney's TV revenues, or $4.49 billion.

Several of its segments missed the mark on the revenue front as well, including its media and networks branch, which raked in $6.24 billion. It's broader, direct-to-consumer streaming service, meanwhile, is set to be available some time in 2019.

"The third feature is a plus service, we're calling it ESPN Plus", he told them.

Excluding special items, earnings for the quarter rose to $1.89 per share from $1.55 per share past year.

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