Disney Shares On The Rise

mickeyLife is good in Mickey Mouse land: the Avengers have (re)assembled, the Force is forthcoming and, according to the second quarter earnings report out early Tuesday morning, Disney?s profit and revenue are up year-over-year. These results were good enough to beat Wall Street?s forecasts on both the top and bottom line, news that sent Disney shares higher in early Tuesday trading.

The Walt Disney DIS +0.17% Company reported Tuesday morning that it recorded $12.46 billion in second quarter revenue, a 7% increase over revenue recorded this time last year and a figure that edged above the Street?s $12.2 billion forecast. Net income for the quarter came in at $2.1 billion, up 10% year-over-year, resulting in earnings of $1.23 per share. This per-share earnings figure marks a 14% increase over the per-share profit Disney reported this time last year, easily beating the $1.11 analyst consensus.?

?Our second quarter performance, marked by increased revenue, net income and earnings per share of $1.23, demonstrates the incredible ability of our strong brands and quality content to drive results,? Bob Iger, Disney chairman and CEO, said in a statement Tuesday morning. ?The power of this winning combination is once again reflected in the phenomenal worldwide success of Marvel?s Avengers: Age of Ultron, which has opened at number one in every market so far.?

Within Disney?s business segments, operating results were mixed. While revenue was up in the parks and resorts, consumer products and media networks segments (by 13%, 6%, 10% and 13%, respectively), sales dipped in the studio entertainment and interactive divisions (by 6% and 12%, respectively). The company attributed the parks and resorts growth to increases in guest spending and guest volume; the consumer products segment was helped by the continued success of Frozen merchandise. Studio entertainment revenue was down, in part, because revenue from Big Hero 6 compared unfavorably to that of juggernaut Frozen in the year-ago quarter; interactive sales were down as a result of lower mobile game releases that led to lower mobile game sales.?

The strong performance by Disney?s media networks segment was largely due to the broadcast part of this division, which increased sales by 19% and operating income by a whopping 90%. Broadcast results were boosted by higher affiliate fees, program sales and advertising revenue; in a call with investors Tuesday morning, CFO Jay Rasulo noted that ad revenue at ABC alone was up in the mid single digits on higher prime-time ratings. Iger later added ABC was helped by the addition of new shows like black-ish, Fresh Off the Boat, and the Shonda Rhimes-produced How To Get Away With Murder. The cable part of media networks, meanwhile, saw operating income drop 9% on higher programming and production costs at ESPN .

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