Disney’s profit drops, but ‘Star Wars’ saves the day
LOS ANGELES — The Walt Disney Company reported weaker-than-expected quarterly earnings on Thursday, partly because of bleak results at ABC, an animated feature film that ended up on the shelf and light “Cars 3” toy sales. Disney shares fell 3 percent in after-hours trading, but recovered and ultimately increased after the company announced the beginning of a new trilogy of “Star Wars” films.
Disney-owned Lucasfilm said Rian Johnson, the director of “Star Wars: The Last Jedi,” which is scheduled to arrive in theatres on Dec. 15, would shepherd the series, introducing “new characters from a corner of the galaxy that ‘Star Wars’ lore has never before explored.”
Fresh details about the exclusive programming that Disney has planned for a Netflix-style streaming service also perked up investors.
That service, scheduled to arrive in 2019, will include a liveaction “Star Wars” series, a new installment in the “High School Musical” franchise and a show based on Pixar’s “Monsters, Inc.”
Robert A. Iger, Disney’s chief executive, disclosed those tidbits on a conference call with analysts.
But there was no way around the quarterly results: Disney suffered declines in revenue and profitability at three of its four major divisions.
Only theme parks had growth — albeit tamped down by Hurricane Irma, which closed Walt Disney World in Florida for two days and forced the cancellation of Disney Cruise Line itineraries.
ABC and its sister production arm, ABC Studios, have suffered a dry spell. In the quarter, operating income at the division anchored by ABC fell 15 percent, to $229 million, because of a lack of hits and lower political advertising at Disney’s chain of local television stations.
“We’ve had some disappointments on the ABC side, but we’ve been focused on turning that around,” Mr. Iger said.
“Some improvement from a quality aspect would be helpful.” He added that he was encouraged by viewership for a new drama, “The Good Doctor,” which is produced by Sony Pictures Television.
For its fourth fiscal quarter, Disney had net income of $1.75 billion, or $1.13 a share, compared with $1.77 billion, or $1.10 a share, a year earlier. Revenue totaled $12.78 billion, a 3 percent decline.