Adjusting for the tax windfall and other one-time items, earnings rose 22% from the year-ago quarter to $1.89 per share, well above the analysts’ consensus per FactSet of $1.61 per share.
Revenue slightly undershot estimates of $15.5 billion but reached $15.35 billion, up from $14.8 billion a year ago.
The company is at the beginning of the process of completing its $52.4 billion acquisition of 21st Century Fox assets, which is unlikely to close until mid-2019. It is also mounting two major stand-alone streaming efforts — one an ESPN-branded service designed to offset steady subscriber losses for the sports network, the other a general-entertainment service whose planned 2019 launch drove the Fox deal.
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While the Star Wars machinery is running fairly smoothly, the release this summer of Solo: A Star Wars Story comes after a bumpy shoot for the spinoff, with director Ron Howard stepping in to stabilize the ship.
Most of the questions about the company continue to center on ESPN, whose quarterly results continued to reflect a softer advertising environment, the company said. A decrease in ad impressions at the network reflected lower average viewership and fewer units delivered, Disney said, noting a negative impact on rates and average viewership from the shift in timing of College Football Playoff games.
Media Networks, the division that includes ABC, BAMTech and the cable networks, has historically been a fairly steady profit engine. It had flat performance this quarter, and the cable portion saw revenues inch up just 1% to $4.5 billion and operating income decline 1% to $900 million.
The company’s stakes in Hulu brought in $50 million in the quarter, less than half the year-ago level of $119 million.
Equity in the income of investees decreased from $119 million in the prior-year quarter to $50 million in the current quarter due to higher losses from Hulu and lower operating results from A+E Television Networks. The decrease at Hulu was due to higher programming and labor costs, partially offset by subscription and advertising revenue growth. The company blamed the dip at A+E was due to lower advertising revenue, higher marketing costs and increased programming costs.
Executives will discuss the results shortly during a conference call with Wall Street analysts. Check back for more details.
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