LONDON, UK / ACCESSWIRE / August 16, 2016 / Active Wall St. announces its post-earnings coverage on The Walt Disney Company (NYSE: DIS). The company reported third-quarter fiscal 2016 financial results after the markets closed on August 10, 2016. The diversified entertainment behemoth reported better-than-expected results driven by robust performance of the company's Studio entertainment division. Register with us now for your free membership at: http://www.activewallst.com/register/.

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Earnings Reviewed

For the quarter ended on June 30, 2016, Disney reported an 11.7% increase in earnings of $1.62 per share as compared to earnings of $1.45 per share in the year ago period. On the other hand, the company's revenue rose 9% to $14.28 billion in Q3 FY16 from revenue of $13.1 billion in Q3 FY15. Analysts were expecting earnings of $1.61 per share and $14.15 billion in revenue.

Disney's total operating income for the reported quarter came in at $4.46 billion, up 8% on y-o-y basis, the gain was driven by 62% and 8% increase in operating income from Studio Entertainment and Parks and Resorts, respectively.

Bob Iger, Chairman and CEO of Disney, commented:

"Disney delivered another quarter of double-digit EPS growth, and we are thrilled with our continued performance. Our results are evidence that our asset mix is strong, as is our ability to execute in ways that enhance the Disney brand and create value for our shareholders while we invest for future growth."

Segment Results

During Q3 FY16, revenue from Disney's Media Networks segment increased by 2% to $5.9 billion, primarily due to a 1% rise in Cable Networks' revenues to $4.20 billion and a 5% hike in broadcasting revenues to $1.71 billion.

For Q3 FY16, Parks and Resorts' segment revenues rose 6% to $4.4 billion and the segment operating income rose 8% to $994 million. While domestic operations were robust for the division, international operations were hampered by lower footfall and higher operating costs at Disneyland Paris and also due to higher pre-opening expenses of the Shanghai Disney Resort.

Revenue from Disney's Studio Entertainment unit soared 40% to $2.8 billion in Q3 FY16, while its operating income surged 62% to $766 million. The surge in operating income was bolstered by a rise in home entertainment and theatrical results. Consumer Products & Interactive Media division saw a 1% decline in revenues to $1.15 billion during the reported quarter. The units' operating income was down 7% to $324 million.

The Unbundling for Future Growth

Additionally, in a separate press release on August 10, 2016, Disney announced that it is acquiring a 33% stake in BAMTech, a leading technology services and video streaming company that was originally created by Major League Baseball. Under the terms of the transaction, Disney will pay $1 billion for the fast-growing platform with nearly 7.5 million subscribers; the company also has the option to acquire a majority ownership of BAMTech in the future.

A number of media companies are struggling to cope with "cord cutting" as consumers do not want to pay for large bundles of channels. Investing in BAMTech will provide one more avenue for Disney to reach out to cord cutters for its ESPN cash cow that peaked in popularity for conventional cable and satellite TV subscribers' years ago. Disney also announced this week that it struck a deal for seven of its networks, to be available on all the plans offered by AT&T Inc.'s upcoming DirecTV Now streaming service.

Stock Performance

At the close of yesterday's markets, Disney's shares ended the day at $97.10, 0.27% higher from its previous close. A total volume of 5.28 million shares was traded. The stock price has advanced 5.27% in the last six months.

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