Disney shares jump 5% while the company reports sales increases before launching new streaming services and rumors that CEO Bob Iger will NOT retire as planned in two years
- Disney reported positive results third quarter after the market closed on Thursday
- Disney earned $ 1.07 per share, above the analyst's average estimate of 95 cents
- Turnover was higher than expected with boosts from amusement parks and films
- Success The Lion King and Toy Story 4 compensated Disney's investment in streaming
- Disney + streaming service will be launched on 12 November
- Meanwhile, analysts are speculating that CEO Bob Iger will remain in 2021
Disney shares are rising rapidly after the company reported higher revenues and profits, despite huge investments in a streaming service that would be launched within a few days.
The company's shares rose more than 5% to $ 140.50 after trading on Thursday after the company reported an adjusted third-quarter earnings of $ 1.07 per share, which exceeded the average analyst estimate of 95 cents per share.
Turnover increased by 34% to $ 19.1 billion, almost meeting analysts' expectations of $ 19.18 billion, and boosted by the success of the Toy Story 4, The Lion King and Aladdin films.
It comes when Disney prepares for the & # 39; streaming wars & # 39; against Netflix, Hulu and others with its new family-friendly digital entertainment service, Disney +, which debuts on Tuesday.
Disney Chief Executive Bob Iger can be seen in a file photo. The shares of the company rose Thursday after trading hours after a positive quarterly report
A one-day display of Disney stock prices shows the rise in prices after closing time on Thursday
Speaking on CNBC television, Disney Chief Executive Bob Iger said the company had made a deal to distribute Disney + on Fire.com devices from Amazon.com Inc.
Iger has agreed to remain at the helm of Disney until 2021 after several contract extensions, but rumors are now swirling that he can stay much longer if the board peaks over a suitable successor.
& # 39; I don't think Iger will retire another ten years, & # 39; told media analyst Richard Tullo The wrap.
& # 39; If you let me bet today, I would bet that he would go beyond the … date it expires &, a former senior Disney director told the publication.
The latest financial results show that the company's investments to build streaming media services have increased sharply compared to a year earlier.
The direct-to-consumer and international unit reported an operational loss of $ 740 million from July to September, an increase of $ 340 million the previous year, but less than the $ 900 million that Disney had predicted.
Disney + offers a deep library of TV shows and films from Disney, Pixar Animation, Marvel Studios, the & # 39; Star Wars & # 39; franchise and the National Geographic Channel, plus original programming such as a new & # 39; High School Musical & # 39; series and a remake of & # 39; Lady and the wanderer. & # 39;
The centerpiece is a Star Wars television series, The Mandalorian, to which Disney has spent $ 100 million to develop.
It costs $ 7 a month, less than $ 13 for the most popular Netflix subscription.
The remake of The Lion King (above) was a huge boost for Disney in the quarter, with worldwide sales of $ 1.6 billion
The offer is a cornerstone of a major shift in Disney's strategy to target audiences who have left the cable and migrated online.
The company also offers ESPN +, which streams sports that cannot be seen on the ESPN cable channel, and has recently taken full control of the Hulu online video service.
At the same time, Disney is integrating film and TV companies that it has purchased from 21st Century Fox to fuel its digital ambition.
Operating income from theme parks and consumer products increased 17% to $ 1.4 billion. Disney opened a precious & # 39; Star Wars & # 39; theme during the quarter at Walt Disney World in Florida. An almost identical section debuted in May at Disneyland in California.
The film studio benefited from remakes of & # 39; The Lion King & # 39; and & # 39; Aladdin & # 39; plus Pixar sequel & # 39; Toy Story 4. & # 39; Profit at the division increased by 79% to almost $ 1.1 billion.
According to the company's Media Department, operating profit fell 3% to $ 1.8 billion. Sports network ESPN experienced higher programming, production and marketing costs.
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