Disney’s movie hits overshadow lackluster TV results
for Disney. Revenue in that segment rose 40 percent to $2.85 billion. "The pattern over the last few quarters has been that the company has outperformed for studio entertainment results, and underperformed media networks," said Nomura analyst Anthony DiClemente. "That trend is likely to continue."
BMO Capital Markets analyst Daniel Salmon also said that he expects the Burbank, California, company's film slate to be strong this year and next. For instance, the "Star Wars" offshoot "Rogue One" is due out in December. Successful movies could help offset the "secular challenges" at Disney's cable and network channels, he said.
WE'RE GOING TO DISNEYLAND
Meanwhile Disney's theme parks had their splashiest introduction to date when Shanghai Disney opened its gates in June after a decade of negotiations, five years of construction and weeks of testing. The company hopes the Chinese attraction will help revive its struggling international theme park business.
The new park should generate $1.5 billion to $4.5 billion a year in revenue, according to Drexel Hamilton analyst Tony Wible. Disney's state-owned Chinese partner, the Shanghai Shendi (Group) Co., which owns 57 percent of the 7.5-square-kilometer (2.9-square-mile) park, will get the lion's share.
Another possible bright spot could be an upcoming Hulu television service . Hulu, part owned by Disney, said Monday will stop offering free TV episodes as it readies a live-streaming service. Time Warner Inc. recently took a 10 percent stake in Hulu, joining Disney, 21st Century Fox and Comcast's NBCUniversal as co-owner.
Time Warner plans to contribute some of its channels, including TNT and TBS, to the new Hulu service. It will show broadcast and cable channels in real time, without making viewers wait until the next day for episodes.
"We see skinny bundles as a potentially valuable new source of distribution for ESPN and the upcoming Hulu skinny bundle (and reportedly YouTube now) can help support that," said BMO's Salmon. "However, skinny bundle distribution is very nascent and the contribution to overall subscriber revenue is still tiny."
Overall , Disney's net income rose 5 percent to $2.6 billion, or $1.62 per share, excluding one-time items. Revenue rose 9 percent to $14.28 billion, also beating expectations.