Walt Disney earnings beat market estimates; profit slips at parks

FE Team | Published: August 07, 2024 22:55:18

LOS ANGELES, Aug 7 (Reuters): Walt Disney reported on Wednesday quarterly earnings that exceeded Wall Street expectations, buoyed by the success of animated Pixar film "Inside Out 2", which helped overcome a profit decline at theme parks.
Shares of the company rose nearly 3 per cent in premarket trading.
April-June operating income nearly tripled at its Entertainment unit, with the combined streaming businesses of Disney+, Hulu and ESPN+ posting a profit for the first time.
However, the Experiences segment that includes parks and consumer products - and makes up just over half of profit - recorded an operating income drop of 3 per cent. Disney said "moderation" of demand at its US parks could continue through the next few quarters.
Operating income for the unit is likely to fall by "mid single digits" in the July-September quarter compared with the same period a year prior, Disney said.
Adjusted earnings-per-share reached $1.39 for Disney's fiscal third quarter, topping analyst estimates of $1.19, LSEG data showed. Revenue rose 4 per cent to $23.2 billion, beating forecasts of $23.1 billion.
Chief Executive Bob Iger touted success in the entertainment division, where Disney's combined streaming businesses turned a profit a quarter ahead of its projections.
"We are confident in our ability to continue driving earnings growth through our collection of unique and powerful assets," Iger said in a statement.
Novo Nordisk shares slid on Wednesday as it cut its 2020 for-profit outlook after reporting weaker than expected sales growth for blockbuster weight loss drug Wigovy.
Iger is working to rebuild Disney after billions of dollars in loss from streaming efforts, the decline of traditional television and a rough patch for its storied film studio.
The movie studio is showing signs of resurgence.
"Inside Out 2" notched $1.6 billion in global ticket sales and "Deadpool & Wolverine," which debuted in the current quarter, has brought in more than $850 million.
"After several years of misfires and muted successes, Disney has now in the span of a month and a half released the highest grossing animated film of all time and achieved the largest ever opening for an R-Rated film," MoffettNathanson media analyst Robert Fishman wrote ahead of Disney's earnings release.
While it remains to be seen whether those successes represent a return to form, Fishman said, the upcoming film slate is "filled with highly dependable" titles including "Moana 2" and Oscar-winning director Barry Jenkins' "Mufasa: The Lion King."
The Entertainment division, which includes the film, television and streaming businesses, reported operating income of $1.2 billion in the quarter.