Disney exceeded expectations in its fourth quarter (Q4) earnings report. The company’s stock jumped after the initial release of its revenue statement.
Cable division down, sport streaming and theme parks up
Disney revealed that its Q4 revenue was $14.31 billion, surpassing the expected $13.73 billion. The company also noted that its studio division grew 50% from last year. The film section was boosted by the success of 'The Incredibles 2' and 'Avengers:Infinity War'. The corporation also reported that its earnings per share (EPS) was $1.34.
The conglomerate’s cable channels are in a viewership decline, but streaming services from Disney are successful. The company’s sport network, ESPN, experienced a ratings dip for flagship games like 'Monday Night Football'. Even though American football viewership is down, there is a major accomplishment with ESPN+. The app has added over one million subscribers since it launched in April. The online service's success is a sign that on-demand content will be important in the future.
Even though Disney is looking to new forms of entertainment, the corporation also had success with its stalwart theme parks that have entertained visitors for decades. The parks and resorts brought in $5.07 billion in revenue, with a 9% increase in customers.
Disney's chief executive offer (CEO), Bob Iger, spoke about Disney’s glowing results.
‘We’re very pleased with our financial performance in fiscal 2018, delivering record revenue, net income and earnings per share. We remain focused on the successful completion and integration of our 21st Century Fox acquisition and the further development of our direct-to-consumer business, including the highly anticipated launch of our Disney-branded streaming service late next year', said Iger.
The Fox factor
Disney is certain to improve its bottom line since its $71.3 billion blockbuster deal of purchasing most of from media mogul Rupert Murdoch. Fox's Q1 revenue grew on the strength of World Cup coverage on its sport networks. The corporation also increased profits after recording record ratings for its news outlet, Fox News Channel. The recent success of the music biopic 'Bohemian Rhapsody' also shows that the studio can add a new adult audience to compliment family-friendly Disney content once the two entertainment giants merge in 2019.
Disney’s future in Q1
Disney is eager to move ahead with its plans for a streaming service in Q1. The corporation wants to cut into Netflix's large online audience and give the company competition with its own paid subscription service, Disney+. The conglomerate hopes to increase Q1 profits with its online content provider that will feature hit movies like Star Wars and Black Panther. Investors will be eager to see how these changes will affect Disney in the new year.