Walt Disney Co`s reported quarterly earnings on Tuesday that topped Wall Street estimates thanks to the company`s booming theme park business and growth at the ABC broadcast network.
Shares of Disney rose 1.8 percent to $114.70 in after-hours trading.
Disney, whose media properties include ESPN and the Disney Channels along with ABC, is trying to transform into a digital entertainment company to compete with Netflix Inc and other online video outlets that deliver programming directly to customers.
For the fiscal first quarter that ended in December, Disney reported adjusted earnings per share of $1.84. Analysts on average had expected $1.55, according to I/B/E/S data from Refinitiv.
Disney has reorganized its divisions for its streaming future, and Tuesday`s earnings report was the first to reflect the company`s new structure.
Operating income at the media networks unit, Disney`s largest, rose 7 percent from a year earlier to $1.3 billion. The ABC broadcast division saw profit jump 40 percent thanks to growth in affiliate fees, advertising revenue and programme sales.
The theme parks and consumer products division reported profit of $2.2 billion, up 10 percent from a year earlier. Results were buoyed by increased guest spending and higher occupancy rates at Disney`s U.S. theme parks.
"Disney’s earnings momentum shows that the company will be entering a highly competitive video-streaming market from a position of strength," said Haris Anwar, senior analyst at Investing.com.
"If its existing media assets are churning out good cash and it`s able to contain its costs, the video streaming push later this year should make investors excited and help the stock to get out of its current sluggish spell,” he said.
Profit at Disney`s movie studio plunged 63 percent to $309 million as films including "Mary Poppins Returns" could not match the strong lineup of a year earlier, which included "Star Wars: The Last Jedi."
A new division, direct-to-consumer and international, reported a $136 million loss for the quarter. That included spending to set up Disney , a streaming service for family entertainment that the company plans to debut later this year.
Disney also is in the process of buying film and TV assets from 21st Century Fox Inc to expand its programming portfolio.
"Building a robust direct-to-consumer business is our top priority, and we continue to invest in exceptional content and innovative technology to drive our success in this space," Chief Executive Bob Iger said in a statement.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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