By Michelle Chapman, Business Writer
BURBANK, Calif. (AP) --Disney returned to a profitable third quarter as its combined streaming business started making money for the first time and the movie Inside Out 2 did well in theaters.
Operating income for the entertainment segment nearly tripled to $1.2 billion thanks to better performances from its direct-to-consumer and content sales/licensing and Other segments.
The Walt Disney Co. said Wednesday that its direct-to-consumer business, which includes Disney+ and Hulu, reported a quarterly operating loss of $19 million, which was smaller than its loss of $505 million a year earlier. Revenue climbed 15% to $5.81 billion.
For the period ended June 29, Disney earned $2.62 billion, or $1.43 per share. A year earlier it lost $460 million, or 25 cents per share.
Stripping out one-time gains, earnings were $1.39 per share, easily topping the $1.20 analysts polled by Zacks Investment Research expected.
Revenue for the Burbank, California, company rose 4% to $23.16 billion, beating Wall Street’s estimate of $22.91 billion.
The company made $254 million in operating income from content sales and licensing helped by the strong performance of Inside Out 2 at movie theaters, which is now the highest-grossing animated film of all time.
Disney said Wednesday that the original Inside Out, which came out in 2015, helped drive more than 1.3 million Disney+ sign-ups and generated over 100 million views worldwide since the first Inside Out 2 teaser trailer dropped.
The combined streaming businesses, which includes Disney+, Hulu and ESPN+, achieved profitability for the first time thanks to a strong three months for ESPN+ and a better-than-expected quarterly performance from the direct-to-consumer unit.
Disney said in May that it expected its overall streaming business to soften in the third quarter due to its platform in India, Disney+Hotstar. The company also said at the time that it anticipated its combined streaming businesses to be profitable in the fourth quarter, so the money-making quarter was a surprise.
In the Experiences division, which includes theme parks, revenue climbed 3% in the third quarter. International rose 5%. Domestic parks and experiences operating income fell 6%, while international operating income edged up 2%.
Disney said that the decline in operating revenue for domestic parks and experiences was because of increased costs driven by inflation, technology spending and new guest offerings.
The company cautioned that the moderation in demand it saw in its domestic parks in the third quarter could linger for the next few quarters. It anticipates fourth-quarter Experiences operating income falling by mid single digits compared with the prior-year period due to the domestic parks moderation as well as cyclical softening in China and less people at Disneyland Paris due to the impact the Olympics had on normal consumer travel.
Disney now anticipates full-year adjusted earnings per share growth of 30%.
In April shareholders rebuffed efforts by activist investor Nelson Peltz to claim seats on the company board, standing firmly behind Iger as he tries to energize the company after a rough stretch.
In June Disney asked a federal appellate court to dismiss its lawsuit against Florida Gov. Ron DeSantis after his appointees approved a deal with the company on how Walt Disney World will be developed over the next two decades, ending the last piece of conflict between the two sides.
As part of the 15-year deal, Disney agreed to invest $17 billion into Disney World over the next two decades and the district committed to making infrastructure improvement on the theme park resort’s property.
Shares dipped slightly before the opening bell Wednesday.
Carrie Coon Relishes Being Part Of An Ensemble–From “The Gilded Age” To “His Three Daughters”
It can be hard to catch Carrie Coon on her own.
She is far more likely to be found in the thick of an ensemble. That could be on TV, in "The Gilded Age," for which she was just Emmy nominated, or in the upcoming season of "The White Lotus," which she recently shot in Thailand. Or it could be in films, most relevantly, Azazel Jacobs' new drama, "His Three Daughters," in which Coon stars alongside Natasha Lyonne and Elizabeth Olsen as sisters caring for their dying father.
But on a recent, bright late-summer morning, Coon is sitting on a bench in the bucolic northeast Westchester town of Pound Ridge. A few years back, she and her husband, the playwright Tracy Letts, moved near here with their two young children, drawn by the long rows of stone walls and a particularly good BLT from a nearby cafe that Letts, after biting into, declared must be within 15 miles of where they lived.
In a few days, they would both fly to Los Angeles for the Emmys (Letts was nominated for his performance in "Winning Time" ). But Coon, 43, was then largely enmeshed in the day-to-day life of raising a family, along with their nightly movie viewings, which Letts pulls from his extensive DVD collection. The previous night's choice: "Once Around," with Holly Hunter and Richard Dreyfus.
Coon met Letts during her breakthrough performance in "Who's Afraid of Virginia Wolfe?" on Broadway in 2012. She played the heavy-drinking housewife Honey. It was the first role that Coon read and knew, viscerally, she had to play. Immediately after saying this, Coon sighs.
"It sounds like something some diva would say in a movie from the '50s," Coon says. "I just walked around in my apartment in my slip and I had pearls and a little brandy. I made a grocery list and I just did... Read More