Disney Q3 Earnings, Revenue Fall Shy of Wall Street Expectations

Despite recently setting a new record for total global box office, The Walt Disney Co. on Tuesday reported earnings and revenue for the fiscal third quarter that fell shy of Wall Street expectations.

The Mouse House spent $71.3 billion to acquire film and TV entertainment assets from Fox in March. That, along with the companies efforts to incorporate the business, had an impact on the company’s third-quarter results.

“Our third-quarter results reflect our efforts to effectively integrate the 21st Century Fox assets to enhance and advance our strategic transformation,” CEO Bob Iger said in a statement. “I’d like to congratulate The Walt Disney Studios for reaching $8 billion at the global box office so far this year–a new industry record–thanks to the stellar performance of our Marvel, Pixar and Disney films.

“The incredible popularity of Disney’s brands and franchises positions us well as we launch Disney+, and the addition of original and library content from Fox will only further strengthen our direct-to-consumer offerings,” he continued.

Also Read: To Infinity and Beyond: Can Disney Become the First $10 Billion Studio?

Disney reported per-share earnings of $1.35, which excluded certain items that affected comparability to prior quarters. That was down roughly 28% from the $1.87 per-share earnings Disney reported during the same quarter a year ago. The company said that earnings per share from its continuing operations were down 59% to 79 cents per share.

Analysts tracking the company’s stock via Yahoo Finance expected the media and entertainment company to report earnings of $1.75 per share.

Revenue for the quarter came in at $20.2 billion, an increase compared to the $15.2 billion in revenue the company reported a year ago. However, Disney’s third-quarter revenue fell just shy of analysts’ forecast of $21.5 billion.

The company’s shares were down roughly 4% in after-hours trading on Tuesday.

Also Read: Disney Continues Layoffs With Key Production, VFX Executives Let Go

Disney’s media networks contributed the most to third-quarter revenue, generating $6.7 billion in the quarter, compared to the $5.5 billion in revenue during the same quarter last year. The parks, experiences and products division contributed $6.6 billion in revenue, up from $6.1 billion a year ago and revenue for Disney’s direct-to-consumer and international divisions (those are reported together) jumped to $3.9 billion, compared with the $827 million generated in the year prior quarter.

Disney’s film studio brought in revenue of $3.8 billion, up 33% compared with last year’s $2.9 billion during the same quarter.

The increase in theatrical results was due to the box office performances of “Avengers: Endgame,” “Aladdin,” “Captain Marvel” and “Toy Story 4,” the company said. Disney noted, however, that the performance of Fox’s film business was less than expected, and saw an operating loss of more than $120 million in the quarter.

10 Top-Grossing Movies of All Time, Adjusted for Inflation (Photos)

49 Movies With A+ CinemaScore Since 2000, From 'Remember the Titans' to 'Avengers: Endgame' (Photos)

All 15 Disney Live-Action Remakes of Animated Classics, Ranked from Worst to Best (Photos)