Despite missing analyst expectations on revenue, the House of Mouse beat its quarterly profit estimates, thanks to strong performances from Beauty and the Beast, Rogue One: A Star Wars Story and its Shanghai Disney Resort.
Earnings for the fiscal second quarter increased by 15% to US$2.39 billion, or US$1.50 a share. (Wall Street was expecting US$1.41 per share.) Revenue, meanwhile, rose 3% to US$13.34 billion versus the same quarter a year ago, but analysts were looking for US$13.45 billion.
Revenue for Disney’s Studio Entertainment division dropped by 1% to US$2.03 billion, while operating income shot up 21% to US$656 million.
In its quarterly statement, CEO Bob Iger noted that theatrical distribution results were comparable to the Q2 2016, and the segment’s higher operating income was bolstered by growth in TV/SVOD distribution, lower film cost impairments and a lift in home entertainment results.
As for parks and resorts, revenue increased by 9% to US$4.3 billion and operating income was up 20% to US$750 million. The gains were due to the opening of Shanghai Disney Resort in the third quarter of last year and better results at US theme parks.
Looking at Disney’s Media Networks segment, revenue increased by 3% to US$5.9 billion, while operating income fell by 3% to US$2.2 billion. Revenue for Cable Networks and Broadcasting both rose by 3% to US$4.1 billion and US$1.9 billion, respectively. The decrease in operating income for Cable Networks was due to higher programming costs for ESPN, partially offset by affiliate and advertising revenue growth.
On the Consumer Products and Interactive Media side, revenues dipped by 11% to US$1.1 billion due to lower sales of merchandise based on Star Wars and Frozen. Operating income, meanwhile, went up 3% to US$367 million, thanks to an improvement in the Games business after the discontinuation console IP Disney Infinity.
Disney’s Q2 results follow the launch of Disney Digital Network earlier this month, which will feature a curated set of Maker creators and influencers.