Disney quarterly profit misses as programming costs surge

Walt Disney Co missed Wall Street estimates for quarterly profit on Tuesday due to higher programming costs and another drop in subscribers at ESPN.

Shares of the company, which have gained nearly 9 percent this year, fell 1.9 percent to $113.66 after the bell.

Disney`s cable networks business has been under pressure as viewers shift to streaming services such as Netflix Inc and Amazon.com Inc`s Prime.

As a counter, Disney is buying the film and television assets of Rupert Murdoch`s Twenty-First Century Fox Inc for $71 billion and said in August 2017 it would develop its own streaming services to grab digital viewers.

Revenue from the cable networks business, which includes ESPN and the Disney Channels, rose 2.5 percent to $4.19 billion. Analysts on average had expected $4.28 billion, according to Thomson Reuters I/B/E/S.

Revenue from Disney`s studio business, which produces and acquires live-action and animated motion pictures, rose 20.3 percent to $2.88 billion, missing the average analyst estimate of $2.94 billion.

Net income attributable to Disney rose to $2.92 billion, or $1.95 per share, in the third quarter ended June 30, from $2.37 billion, 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 percent to $15.23 billion, but missed analysts` expectation of $15.34 billion.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)