Disney’s largest segment for revenue
The Walt Disney Company’s (DIS) Media Networks segment is the company’s largest in terms of revenue. It had 44% revenue share in fiscal 3Q15. Media Networks includes broadcast and cable television networks, television distribution and production, domestic television stations, and radio networks and stations.
Cable Networks includes ESPN, Disney Channel, and ABC Family. It also operates UTV Bindass in India (EPI). Disney’s broadcasting business includes domestic network ABC, television production and distribution operations, and eight domestic television stations.
Disney also has a 33% stake in Hulu, sharing ownership with Fox Entertainment Group (FOXA) and NBCUniversal (CMCSA). Hulu is an OTT (over-the-top), ad-supported streaming service that offers TV shows, clips, and movies on its free and subscription-based service. Hulu is similar to Netflix (NFLX), which is also an OTT streaming service.
As the above chart indicates, Cable Networks is a dominant business in Disney’s Media Networks segment, with a 72% share of revenues in fiscal 3Q15.
Cable Networks and Broadcasting in fiscal 3Q15
Disney’s Cable Networks segment had revenues of ~$4.1 billion, rising 5% from the same quarter last year, and operating income of $2 billion in fiscal 3Q15. Operating income for Disney’s Cable Networks business had a strong growth of 7%, primarily driven by Disney Channel’s and ABC Family’s strong original programming.
Disney’s Broadcasting, which makes up 28% of the Media Networks segment, had revenues of $1.6 billion and an operating income of $300 million in fiscal 3Q15. Operating income for Broadcasting fell by 15% in fiscal 3Q15 due to higher programming costs and lower advertising revenues.
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