The Walt Disney Co’s net income fell sharply in its most-recent quarter, as the coronavirus pandemic still weighs heavily on many of its businesses, from theme parks to movies.
However, the results on Thursday surpassed Wall Street’s expectations thanks to subscribers flocking to Disney+ and the entertainment giant’s other streaming services.
Disney’s parks and resorts have been closed or operating at significantly reduced capacity since shortly after the pandemic forced lockdowns across the US in March of last year. Its cruise ships have also been suspended during that time, live sporting events have been canceled, and film and TV projects have been disrupted.
Photo: AP
Disney said it expects coronavirus disruption to cost about US$1 billion in its current fiscal year. The biggest hit to the company in the quarter that ended Jan. 2 was the closure and limited reopening of its theme parks, which cost the company about US$2.6 billion.
The company based in Burbank, California, has been focusing on its steaming services — Disney+, ESPN+, and Hulu — to drive growth. Disney+ subscribers totaled 94.9 million at the end of the quarter, more than double the subscriber base a year ago, when the service had been operating for only about two months. ESPN+ subscribers jumped 83 percent to 12.1 million and Hulu subscribers rose 30 percent to 39.4 million.
For Disney’s fiscal first quarter, net income totaled US$17 million, or US$0.01 per share, compared with US$2.1 billion or US$1.16 per share a year earlier. Excluding one-time items, net income totaled US$0.32 per share, compared with US$1.53 per share in the prior-year quarter.
Revenue fell 22 percent to US$16.25 billion from US$ 20.88 billion.
The results beat Wall Street expectations. The average estimate of 14 analysts surveyed by Zacks Investment Research was for a loss of US$0.45 per share. Eleven analysts surveyed by Zacks expected revenue of US$15.84 billion.
Disney’s stock rose about 1.7 percent in after-market trading following the release of the earnings report. The shares are up 5.4 percent since the start of the year, compared with a 4.3 percent rise in the S&P 500 index.
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