May 5, 2020 - Economy

Disney's stock up slightly after mixed earnings

Photo: Joe Raedle/Getty Images

Disney's stock whipsawed Tuesday after the entertainment giant reported that it beat Wall Street expectations on revenue, but missed on earnings. Its stock was slightly higher at market close than market open.

Why it matters: Analysts didn't expect this quarter to be impacted by the coronavirus as heavily as they expect next quarter to be. Still, Disney says operating income from its parks division was down 58% from this time last year.

By the numbers via CNBC:

  • Earnings per share (EPS): 60 cents, ex-items vs. 89 cents based on Refinitiv consensus estimates
  • Revenue: $18.01 billion vs. $17.80 billion based on Refinitiv consensus estimates

Details: The company says that in total it lost approximately $1 billion, primarily due to revenue deficits that are attributable to the pandemic.

  • Disney's parks and resorts sector, its largest business, saw a 10% decrease in revenue from the previous quarter. On an earnings call, executives said that it planned to open its Shanghai park on May 11, taking a phased approach.
  • Disney's studios division only dropped by 8% in revenue, given most theaters remained open until late March.
  • Disney's media networks division saw revenues increase 7% due to the strength of its broadcast network ABC. Its cable networks, which includes ESPN, grew slightly, but the company still cited heavy impacts of a loss of advertising revenue on the division.
  • Disney's direct-to-consumer international streaming businesses were a bright spot in the company's earnings, up to over $4 billion from more than $1 billion this time last year. Disney said its streaming division, which includes ESPN+, was impacted by a lack of live sports.

Be smart: It makes sense that Disney's revenues weren't heavily impacted over the past quarter, as its business was only exposed to the pandemic for a few weeks in the quarter in late March.

  • Analysts expect next quarter to be much more brutal.

The big picture: This is the first earnings report for CEO Bob Chapek. Disney's longtime CEO Bob Iger stepped down in late February, but he still remains with the company as executive chairman.

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