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Disney Beat Q2 Earnings Estimates but Fell from the Previous Year

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May. 9 2019, Published 2:13 p.m. ET

Disney’s second-quarter earnings

The Walt Disney Company (DIS) reported adjusted EPS of $1.61 in the first quarter, exceeding analysts’ consensus expectation of $1.58. The company has beaten Wall Street analysts’ estimates in eight of the last ten subsequent quarters.

However, its earnings fell 13% YoY (year-over-year), marking its second YoY decline after delivering four consecutive quarters of double-digit earnings growth. In the first quarter of fiscal 2019, its adjusted earnings fell 3% YoY.

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A fall in YoY earnings

The fall in Disney’s YoY earnings growth was the result of a double-digit fall in its operating income in the second quarter of 2019. Significant investment in the launch of its streaming service and its lack of blockbuster movie releases in the quarter compared to the previous year’s quarter led to the fall.

Disney recently announced the November 12 launch of its Disney-branded streaming service, Disney+, with a monthly fee of $6.99. The company aims to directly compete with streaming rivals such as Netflix, Amazon Prime Video, AT&T’s HBO Now, and Alphabet’s YouTube TV. Like Disney, AT&T’s WarnerMedia is also planning to launch its streaming service in late 2019. Comcast’s NBCUniversal unit is debuting its streaming service in the first quarter of 2020.

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