Disney Posts Lower Q4 Revenue

BURBANK: For the quarter ended October 1, The Walt Disney Company saw its revenues slip 3 percent to $13.1 billion, with declines in its Media Networks division.

Net income for the quarter was up by 10 percent to $1.7 billion.

Media Networks revenues for the quarter decreased 3 percent to $5.7 billion, and segment operating income was down 8 percent to $1.7 billion.

Operating income at Cable Networks decreased $207 million to $1.4 billion for the quarter due to decreases at ESPN and the Disney Channels, partially offset by an increase at Freeform. The decrease at ESPN was due to lower advertising and affiliate revenue and higher programming and production costs. The lower results at the Disney Channels were primarily due to weaker affiliate revenue and program sales, partially offset by lower programming and production costs.

Operating income at the Broadcasting unit was up $60 million to $224 million, thanks to higher operating income from program sales and an increase in affiliate revenue, partially offset by higher programming costs, lower advertising revenue and an increase in equity losses from Hulu. The increase in program sales income was driven by sales of Luke Cage, Quantico and Golden Girls, though sales were lower for Scandal and Nashville.

Parks and Resorts revenues for the quarter increased 1 percent to $4.4 billion, and segment operating income was down 5 percent to $699 million. Consumer Products & Interactive Media revenues for the quarter decreased 17 percent to $1.3 billion, and segment operating income was down 5 percent to $424 million.

Studio Entertainment revenues were up 2 percent to $1.8 billion, while segment operating income decreased $149 million to $381 million. The decrease in operating income was driven by lower theatrical distribution results, partially offset by growth in TV/SVOD distribution—primarily due to a sale of classic Star Wars titles in the current quarter.

“We’re very pleased with our performance for the year, delivering the highest revenue, net income and earnings per share in Disney’s history,” said Robert A. Iger, the chairman and CEO of The Walt Disney Company. “Fiscal 2016 was our sixth consecutive year of record results, highlighted by the opening of Shanghai Disney Resort, the phenomenally successful return of Star Wars, and our studio’s record-breaking $7.5 billion in total box office. We remain confident that Disney will continue to deliver strong growth over the long-term as we further strengthen our brands and franchises, our technological capabilities, and our international presence.”