Walt Disney Co. had mixed results on earnings and revenue in the pandemic-whacked fiscal third quarter.
The Burbank entertainment and media giant on Tuesday reported a net loss of $4.7 billion (-$2.61 cents a share) for the quarter ending June 27, compared with net income of $1.8 billion (97 cents) in the same period a year earlier. Revenue fell by 42 percent to $11.8 billion.
On an adjusted basis, the company had earnings of 8 cents a share, compared to $1.34 in the third quarter of last year.
Wall Street expected more revenue but less earnings. Analysts on average expected adjusted earnings of -64 cents on revenue of $12.4 billion, according to Thomson Financial Network.
Out of the four business units at Disney, none was hurt as much during the quarter than Parks, Experiences and Products where revenue decreased by 85 percent to $1 billion as its theme parks in the United States remained closed during the quarter due to the coronavirus outbreak. Its Shanghai and Hong Kong theme parks re-opened in May and June respectively although the latter closed again in July.
Also hard hit by the coronavirus pandemic was studio entertainment, which experienced a 55 percent decrease in revenue to $1.7 billion. With the health crisis keeping movie theaters closed around the globe, Disney did not release any films during the quarter, compared with the release of “Avengers: Endgame” and “Aladdin” in the same quarter of 2019.
The one bright spot was Direct-to-Consumer and International, which saw revenue increase by 2 percent to $4 billion, although its operating loss increased to $706 million due to costs associated with the launch of streaming service Disney+.
Chief Executive Bob Chapek said that despite the challenges of the COVID-19 pandemic, the company continues to build on the success of Disney+.
“The global reach of our full portfolio of direct-to-consumer services now exceeds an astounding 100 million paid subscriptions – a significant milestone and a reaffirmation of our DTC strategy, which we view as key to the future growth of our company,” Chapek said in a statement.
Disney announced its quarterly earnings after the market closed. Shares in Disney closed up 94 cents, or 0.8 percent, to $117.29 on the New York Stock Exchange on Tuesday, a day when the Dow Jones industrial average closed up 0.6 percent and the Nasdaq closed up 0.4 percent.