(By Salman - iStockAnalyst Writer)
The Walt Disney Co. (NYSE:
) is scheduled to report its fiscal
third-quarter earnings for the three months ended in June after the closing bell on Thursday, July 30. Analysts, on average, expect the entertainment giant to report earnings of 51 cents a share on revenue of $8.83 billion. In the year ago period, the company earned 66 cents a share on revenue of $9.24 billion.
The Walt Disney Company operates as a diversified entertainment company worldwide. The company's
Media Networks segment comprises domestic broadcast television network, television production and distribution operations, domestic television stations, cable/satellite networks, domestic broadcast radio networks and stations, and the Internet and mobile operations.
Media companies have been hit hard by the sharp decline in advertisement revenue and DVD sales. The company's major releases in the quarter included its Pixar division's "Up" and "Hannah Montana: The Movie." Disney has also suffered amid a significant pullback in consumer spending and is facing margin pressures. Though the company has been able to avoid a sharp drop in attendance at its theme parks, it has done so by using strategies such as discounting hotel rates. Late in June, Disney reached a $465M expansion deal with Hong Kong's government to expand the Disneyland theme park.
The company's fiscal
second quarter earnings slid 46% to $613 million, or 33 cents a share, in the quarter ended March 28, compared with a profit of $1.13 billion, or 58 cents a share, in the same quarter a year earlier. Revenue fell 7% to $8.1 billion.
Analysts on average were looking for earnings of 40 cents a share on revenue of $8.15 billion. Revenue at the company's film and television studios fell 21% to $1.44 billion, and operating income dropped 97% to $13 million. The company's media networks division, which includes
ABC,
ESPN and
Disney Channel, among other outlets, reported that its revenue rose 2% to $3.62 billion, but its operating profit fell 4% to $1.30 billion. Segment profit at the
theme parks and resorts in the second quarter fell 50% to $171 million, as revenue fell 12%. Lackluster attendance and steep drop in guest spending at
Walt Disney World,
Disney Vacation Club,
Disneyland and
Disneyland Paris is to be blamed for the decline. Overall, per capita guest spending at its domestic parks came in 6% lower compared to same quarter last year.
The company recently said that the
Hulu online video streaming site could one day charge for its content. Disney took an equity stake in the joint venture in April, joining its founders,
NBC Universal and
News Corp. (Nasdaq: NWS), and agreed to provide TV shows and movies to the site. The company is also working on a Disney-branded site that would make available movies, TV shows and games to consumers who pay for a subscription.
Shares of the company are currently trading at roughly 14 times consensus 2011 EPS estimates. In terms of stock performance, Disney shares have gained 9% since the beginning of the year. On Wednesday, shares of the company fell 48 cents or 1.83% to close at $25.89 in regular trade.
Disclosure: Author doesn’t own any of the stocks mentioned here.
