'Still a lot to wonder about ahead,' says analyst as Disney's strong earnings push S&P 500, Dow to new peaks

Record ID: 1632039

  • Title: 'Still a lot to wonder about ahead,' says analyst as Disney's strong earnings push S&P 500, Dow to new peaks
  • Date: 13th August 2021
  • Summary: NEW YORK, NEW YORK, UNITED STATES (FILE - APRIL 16, 2019) (REUTERS) HULU MOBILE APP VARIOUS OF HULU ON COMPUTER SCREEN
  • Embargoed: 27th August 2021 18:25
  • Keywords: COVID-19 Disney+ Walt Disney coronavirus earnings movies online steaming parks results studios
  • Location: NEW YORK, NEW YORK, + ANAHEIM, + BURBANK, CALIFORNIA, UNITED STATES
  • City: NEW YORK, NEW YORK, + ANAHEIM, + BURBANK, CALIFORNIA, UNITED STATES
  • Country: USA
  • Topics: Company News Markets,Economic Events,United States
  • Reuters ID: LVA007EQ47F47
  • Aspect Ratio: 16:9
  • Story Text: Walt Disney Co earnings on Friday (August 13) topped Wall Street forecasts for the most recent quarter as its streaming services picked up more customers than expected and pandemic-hit U.S. theme parks returned to profitability.
    Shares of the entertainment company rose 5% in after-hours trading. Before the earnings report, shares were roughly flat from the start of the year.
    Disney Chief Financial Officer Christine McCarthy said that upcoming theme park reservations at the company's two U.S. parks, including the flagship Walt Disney World, remained strong, even as COVID cases surge.
    Florida, home to Walt Disney World, is the epicenter of the latest U.S. COVID outbreak, posting record cases and hospitalizations in recent days.
    Disney was more optimistic than some other companies about the Delta variant's impact on operations.
    Southwest Airlines and vacation rental firm AirBnB both warned that the surge in cases could hurt their businesses.
    For April through July 3, Disney posted earnings per share of 80 cents, excluding certain items. Wall Street had expected 55 cents, according to the average projection of analysts surveyed by Refinitiv.
    Disney's theme parks welcomed more visitors as pandemic restrictions eased.
    Theme park revenue rose for the first time in five quarters, hitting $4.34 billion.
    Net income for that division, which includes consumer products, reached $356 million, compared with a loss of nearly $1.9 billion a year earlier when many Disney parks were closed.
    The U.S. parks eked out a profit of $2 million, while international parks lost $210 million.
    Disney has staked its future on building streaming services to compete with Netflix in the crowded market for online entertainment.
    Disney+, Hulu and ESPN+ - the company's three online subscription offerings - gained close to 15 million new subscribers to total nearly 174 million. Disney+ had 116 million paying customers at the end of the quarter, just ahead of the 115.2 million consensus of analysts surveyed by FactSet.
    At the media and entertainment distribution unit, operating income fell 32% from the prior year, to $2.0 billion, as programming costs rose.
    A year earlier, cable network ESPN's bills had been reduced when many sporting events were canceled.
    The direct-to-consumer division, which includes Disney+, reported a loss of $293 million as it invested in TV shows, movies and other costs. That compared to a loss of $624 million a year earlier.
    The company's overall revenue rose 45% to $17.02 billion in the third quarter, topping analysts' estimate of $16.76 billion, according to IBES data from Refinitiv.
    Net income from continuing operations was $923 million, or 50 cents per share, compared with a loss of $4.72 billion, or $2.61 per share, a year earlier.
    (Production: Aleksandra Michalska)
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