Strength in all of Disney’s primary businesses — theme parks, cable television, movies and consumer products — helped the entertainment conglomerate increase its quarterly profit 32 percent from a year earlier, to $1.51 billion. Revenue climbed 10 percent, to $10.55 billion.
The financial results, reported on Tuesday, revealed a couple of smaller weak spots: the ABC broadcast network and Disney’s video game division. But the company’s performance as a whole beat that of rivals like Comcast, Time Warner and Viacom, and Disney shares climbed 1.6 percent to close at $66.07. Earnings were reported after the close of regular trading.
Reasons for Disney’s growth include the improving economy; expanded theme parks in Florida, California and Hong Kong; a stabilizing moviemaking operation; and climbing merchandise sales, particularly for products related to the Disney Channel. The company also benefited from a calendar quirk that moved part of the New Year’s and Easter holidays into the quarter and reduced revenue deferrals at ESPN.
Operating income at Media Networks, a division that includes ESPN, the Disney Channel and Disney Junior, was $1.86 billion in the quarter, an 8 percent improvement from the year-earlier period. During the quarter, which ended on March 30, ESPN delayed $120 million in subscriber payments, compared with deferments of $190 million a year ago.
Walt Disney Parks and Resorts reported operating income of $383 million, a 73 percent increase. New attractions — a “Cars”-themed land in California, a Fantasyland expansion in Florida — helped Disney’s North American parks notch increases in attendance and per-capita spending on food and hotel rooms. A new cruise ship, the Fantasy, also contributed to the division’s results.
In the year-earlier quarter, Disney’s movie studio lost money as it struggled with runaway costs tied to the science-fiction debacle “John Carter.” On Tuesday, Walt Disney Studios, citing the successful release of “Oz the Great and Powerful,” reported operating income of $118 million.
Moreover, the road ahead looks bright for the studio: “Iron Man 3,” which arrived in North American theaters last week, is expected to take in $1 billion or more at the worldwide box office, to say nothing of DVD sales, and analysts have high hopes for Pixar’s coming “Monsters University.”
“Iron Man” and other Marvel-related merchandise contributed to operating income of $200 million at Disney’s consumer products unit, a 35 percent increase. Disney Channel properties and Mickey and Minnie Mouse also saw strong retail sales.
Over all, Disney reported earnings per share of 79 cents for the quarter, up 36 percent from 58 cents a year earlier. Analysts expected earnings per share of 76 cents.
With so much going right for the company, Disney’s two troubled areas — broadcast television and video games — stood out. But both of those businesses have a relatively small impact on Disney’s financial performance.
Broadcasting operating income fell 40 percent, to $138 million, as lower advertising revenue and higher programming costs at the struggling ABC network offset sturdy financial results at Disney’s local TV stations. Disney’s Interactive division, which includes Disney.com and video games, lost $54 million in the quarter, an improvement from a loss of $70 million in the year-ago period.
Disney continues to hope that a turnaround is on the horizon for its video game business. On Monday, the company announced an exclusive multiyear deal with Electronic Arts to produce “Star Wars” games aimed at young men, with the first offerings likely to be available in 2015.
Disney is also preparing to introduce Infinity, an ambitious video game and toy initiative that it hopes will be its version of Skylanders, an Activision Blizzard product that has generated more than $1 billion in global sales since its 2011 arrival. Infinity was initially supposed to arrive in June but was delayed and is now scheduled for release in stores in August.
This article has been revised to reflect the following correction:
Correction: May 7, 2013
An earlier version of this article misstated the performance of Disney’s stock on Tuesday. Disney shares rose 1.6 percent to $66.07 at the end of regular trading, not during after-hours trading.
Article source: http://www.nytimes.com/2013/05/08/business/media/disney-profits-soar-as-most-divisions-show-strength.html?partner=rss&emc=rss