Disney reports earnings miss
WALT Disney, an investor favourite for consistently beating Wall Street earnings targets, reported a rare miss this week as advertising and subscriptions declined at sports channel ESPN and theme park revenue came in weaker than expected.
The home of Mickey Mouse got a boost from animated film ‘Zootopia’ but it announced an exit from the console video game business as it dropped the Infinity title it launched less than three years ago.
Shares of the world’s best-known entertainment company fell more than 5pc in extended trading.
Disney and other media companies have been hit by the trend of “cord-cutting” as younger viewers opt for streaming services over cable and satellite TV channels. Investors are particularly focused on how ESPN, one of the strongest cable brands, weathers the storm.
“Cable networks continue to face meaningful headwinds and Disney has yet to really answer how they are going to restore growth,” BTIG analyst Richard Greenfield said.
Excluding some items, Disney earned $1.36 per share, missing analyst average expectation of $1.40 (€1.22) per share. Revenue rose to $12.97bn (€11.38bn) from $12.46bn, below the Wall Street target of $13.19bn, according to Thomson Reuters I/B/E/S.
Chief executive Bob Iger told analysts he does not “currently have any plans” to stay at Disney beyond his contract’s expiration in June 2018. The company’s board is still searching for Iger’s successor.