Disney Q1 results: shares up after earnings revenue beats estimates

Disney beats earnings estimates despite competition from streaming services for entertainment.

Mickey Mouse after Disney Q4 results Source: Bloomberg

Disney's first quarter(Q1) revenue beat Wall Street estimates. The media company had positive earnings and revenue reports. Disney's stock rose in US after hours trading after the news.

Disney earnings: key figures

Earnings per share(EPS) $1.84
Revenue $15.30 billion
Media Networks $5.9 billion
Theme Park Revenue $6.8 billion
Studio Entertainment Revenue $1.8 billion

Disney earnings

Some earlier predictions were right about declining profits and Disney’s revenue did lessen year-over-year because of a lack of the specified timing of blockbuster films. However, Disney’s Q1 results did exceed expectations and made $15.3 billion, more than the projected $15.14 billion. Earnings per share (EPS) also beat the estimates of financial experts, making $1.84, surpassing the $1.55 projected. The Parks, Experiences, and Consumer Products section was also a bright spot in Disney’s revenue report. Visitors to the corporation’s theme parks increased 5% and grew to $6.8 billion for the quarter.

Disney’s Q1 results were mixed in its cable networks division. Disney’s cable revenue surged to $4.0 billion, but the operating income dropped 6% to $743 million. The company’s ESPN sports network had lower profits because of increased costs to carry more college American football games.

Disney Q1 results also had a downside with its movie division. Disney’s studio entertainment revenue was $1.8 billion, a decrease of 27%. Even with the success of films like ‘Mary Poppins Returns’ and ‘Ralph Breaks the Internet’, Disney’s Q1 revenue in film was lackluster.

What do Disney’s Q1 results mean for their share price?

Disney’s Q1 results could mean an increase for its share price. The corporation’s stock is up during US after hours trading and could grow slightly from Disney’s stock price of $112.61.

How do Disney’s Q1 results compare to other media stocks?

Disney’s Q1 results were positive, similar to the earnings report of entertainment rival,Comcast. Disney stock is also performing well in comparison to AT&T, whose stock went up despite an earnings miss.

Disney’s future

Disney had success with its ESPN + app, and plans to expand more into offering programming on numerous devices. Disney will have a streaming service, Disney +, to compete with Netflix. While the corporation already has a stake in another online entertainment service, Hulu, Disney wants to have its own subscription video on demand soon.

In addition to its foray into streaming entertainment, Disney will work to increase revenue after its $71.3 billion purchase of 21st Century Fox.While some financial experts are sceptical about Disney turning a profit while taking on Netflix and Amazon Prime,analysts from UBS are bullish on Disney’s subscription video on demand venture.

‘We believe Disney is the only traditional media company with scale, brand recognition and intellectual property to join Netflix and Amazon as a leader in the retail marketplace of subscription video,’ said analysts from UBS.

Disney's chief executive officer (CEO), Robert Iger, touted the success of the company and looked forward to the company’s future.

‘After a solid first quarter, we look forward to the transformative year ahead, including the successful completion of our 21st Century Fox acquisition and the launch of our Disney+ streaming service. Building a robust direct-to-consumer business is our top priority, and we continue to invest in exceptional content and innovative technology to drive our success in this space,’ said Iger.

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