Walt Disney Pressured By Sagging ESPN Performance

By Ezequiel Minaya 

Walt Disney Co. reported Tuesday that ESPN once again weighed on its business, as revenue for the fiscal first quarter came in below expectations.

During the three-month period ended Dec. 31, the entertainment giant had a runaway success with the latest installment of the Star Wars franchise, "Rogue One: A Star Wars Story."

But the company's cable operations were pressured by the performance of sports network ESPN amid declining advertising and shifting tastes as more consumers elect to cut cable out of their budgets.

Shares, up 16% this year, fell 2% to $106.75 in recent after-hours trading.

For the quarter, revenue in Disney's media networks segment, which includes its cable operations, decreased 2% to $6.23 billion and operating earnings fell 4% to $1.36 billion. Cable revenue declined 2% to $4.43 billion and operating profit fell 11% to $864 million amid declines at ESPN.

Over all, Walt Disney reported a profit of $2.48 billion, or $1.55 a share, down from $2.88 billion, or $1.73 a share, a year earlier. Excluding certain items, earnings remained at $1.55 down from $1.63 a year earlier. Revenue decreased 3% to $14.78 billion.

Analysts polled by Thomson Reuters expected per-share profit of $1.49 and revenue of $15.26 billion.

Write to Ezequiel Minaya at [e-mail]

(END) Dow Jones Newswires

February 07, 2017 16:53 ET (21:53 GMT)

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