Second-quarter revenues at The Walt Disney Company rose by 3 percent to $14.9 billion, with net income rising to $5.4 billion, on the heels of its 21st Century Fox acquisition.
“We’re very pleased with our Q2 results and thrilled with the record-breaking success of Avengers: Endgame, which is now the second-highest grossing film of all time and will stream exclusively on Disney+ starting December 11,” said Robert A. Iger, chairman and CEO. “The positive response to our direct-to-consumer strategy has been gratifying, and the integration of the businesses we acquired from 21st Century Fox only increases our confidence in our ability to leverage decades of iconic storytelling and the powerful creative engines across the entire company to deliver an extraordinary value proposition to consumers.”
The financials include 11 days of 21st Century Fox activities, which tallied revenues of $373 million.
Revenues at the media networks were flat at $5.5 billion, while operating income slipped to $2.2 billion. The cable networks delivered revenues of $3.7 billion, 2 percent higher than the year-ago period, but broadcasting was down slightly to $1.8 billion. The segment reported improved affiliate revenues but lower ad revenues, higher programming costs and decreased program sales.
Studio entertainment revenues fell by 15 percent to $2.1 billion and profit was down 39 percent to $534 million as a result of lower theatrical and home entertainment distribution results, which were partially offset by an increase in TV/SVOD distribution.
The direct-to-consumer and international unit led by Kevin Mayer saw revenues rise by 15 percent to $955 million, but its loss almost doubled to $393 million. The increase in operating loss is a result of ongoing investments in ESPN+, costs associated with the upcoming launch of Disney+, a loss from the consolidation of Hulu and higher losses from streaming technology services. These were partially offset by an increase at the company’s international channels
Parks, experiences and products rose 5 percent to $6.2 billion, delivering a profit that was 15 percent higher at $1.5 billion.
The financials also reveal a $353 million impairment charge on Disney’s Vice investment.