Disney shares fall as it misses profit estimates
The company's ESPN sports network lost out on bids for major events over the quarter such as the World Cup and US Golf Open.
Wednesday 8 August 2018 01:36, UK
Walt Disney shares fell 2% on Tuesday after it missed quarterly profit estimates.
Higher programming costs and a fall in subscribers at its ESPN sports channel, meant that the media and entertainment giant's earnings and revenue fell short of Wall Street forecasts.
The third quarter to 30 June was a tough period for ESPN in particular, which had lost out in the bidding for the big sporting events of the last quarter, including the World Cup and US Golf Open.
Revenue from Disney's cable networks business, which includes ESPN and the Disney Channels, rose 2.5% to $4.19bn. Analysts on average had expected $4.28bn, according to Thomson Reuters.
Revenue from its film studio business, producing and acquires live-action and animated motion pictures, rose 20.3% to $2.88bn but missed the analyst estimates of $2.94bn.
Net attributable income rose 23% to $2.92bn (£2.25bn), or $1.95 per share, in the period ended 30 June, from $2.37bn (£1.83bn), or $1.51 per share, a year ago.
On an adjusted basis, Disney earned $1.87 per share, below estimates of $1.95 per share.
Total revenue rose 7% to $15.23bn, driven by box office successes as well as theme parks and resort visits, but missed analysts' $15.34bn forecast.
Disney has tabled a bid for the film and television assets of Rupert Murdoch's 21st Century Fox Inc for $71bn and said in August 2017 it would develop its own streaming services to grab digital viewers.
Disney raised its offer for the assets in June from $52.4bn to $71.3bn and also for the first time made an alternative available to Fox shareholders who would rather receive cash instead of Disney shares.
The sale would also includes Fox's stake in Sky plc, Europe's largest pay-television broadcaster, which owns Sky News.
The move came after US cable giant Comcast offered $65bn in cash for the assets, which include 20th Century Fox - the Hollywood film studio behind hits such as Avatar, X-Men and Ice Age - US cable TV networks including FX and National Geographic and international pay television assets including Star TV in India.