The box office success of “Incredibles 2” and “Ant-Man and the Wasp” combined with the popularity of the Walt Disney Co.’s theme parks bolstered quarterly earnings at the Hollywood conglomerate.
Brent Lang of Variety had the news:
Diluted earnings per share for the fourth quarter increased 37% to $1.55, while revenues climbed 12% to $14.3 billion. Net income also improved, jumping 33% to $2.3 billion. That smashed Wall Street’s projections.
Analysts had predicted that Disney would post revenues of $13.7 billion and earnings of $1.33 cents per share. It’s a momentous time for the company behind Pixar, LucasFilm, and Marvel. Disney is wrapping up its $71.3 billion purchase of much of 21st Century Fox’s film and television assets — a pact that is expected to transform the media company into an entertainment leviathan with few equals.
At the same time, Disney is preparing to launch a streaming service in 2019, which it hopes will one day rival Netflix and enable it to connect to cord-cutting consumers who are ditching cable for digital video. To that end, Disney has been winding down its licensing deals as it prepares to debut its service with some of the biggest franchises in its film and television arsenal.
Christine Wang of CNBC.com reported that Disney is increasing its investment in Hulu:
In a Thursday earnings call, Iger said that Disney sees an opportunity to increase investment in Hulu, particularly in its programming. He said the acquisition of Fox assets gives Disney rights to valuable intellectual property as well as a greater pool of talent, particularly in television.
“We aim to use the television production capabilities of the combined company to fuel Hulu with a lot more original programming, originally programming that we feel will enable Hulu to compete even more aggressively in the marketplace,” Iger said.
Hulu already has an advantage when it comes to demographics, Iger said. When you compare the demographics on Hulu with that of viewers of the same shows on traditional network television, Iger claimed that Hulu’s audience can sometimes be 20 years younger.
“That’s clearly attractive to advertisers, which I think has been somewhat underappreciated about Hulu in that it is a very strong play for advertisers because it can offer targeted ads and it has great demos and it’s just a great user experience,” he said.
Jon Lafayette of Broadcasting & Cable reported that its cable network unit is lackluster:
Operating income for Disney’s cable networks business was down 6% to $1.159 billion as revenue rose 5% to $4.1 billion. The decline was caused by the consolidation of BAMTech, which had an operating loss.
Disney Channel and Freeform had increases in operating income, the company said.
ESPN was flat as affiliate revenue growth was offset by higher programming .and production costs and lower ad revenue.
Broadcasting operating income jumped 66% to $379 million as revenues rose 21% to $1.833 billion. Increased program sales and affiliate revenue growth drive the gains. Two Marvel series and Black-ish were sold during the quarter.
