Earnings Preview: Disney 2Q seen strong all around

Disney 2nd-quarter results expected to be strong, led by pay TV, parks

Associated Press

LOS ANGELES (AP) -- The Walt Disney Co. is expected to post higher earnings and revenue for its fiscal second quarter through March after the market closes Tuesday. Its movie studio fared well versus a year ago and a new series of deals to carry its ESPN network are expected to have pushed TV rights fees higher.

WHAT TO WATCH FOR: Analysts expect a strong quarter all around, with gains seen in every aspect of the business. The largest increases are expected to come from pay TV networks, which include ESPN, as well as parks and resorts.

New deals with a majority of the top TV distributors are expected to have boosted rights fees beginning Jan. 1, according to Todd Juenger, an analyst with research firm Bernstein Research.

The parks have benefited from higher attendance in part sparked by new attractions such as the new Cars Land, which opened at Disney California Adventure last summer.

The movie studio should also see an uptick in revenue and profit as "Oz the Great and Powerful" compared well to "John Carter" from a year ago. "Oz" has reaped $477 million at worldwide theaters since opening in early March. "John Carter," released at a similar time a year ago, took in $283 million globally, but its huge budget caused Disney to book a $200 million loss.

WHY IT MATTERS: Disney does business with consumers on multiple fronts and its health is an indicator for the broader economy. As it prepares to build a new theme park in Shanghai, the company's reach will broaden. Disney is one of the world's most popular brands.

WHAT'S EXPECTED: Analysts polled by FactSet expect Disney to post adjusted earnings of 76 cents per share on $10.48 billion in revenue.

LAST YEAR'S QUARTER: Disney posted adjusted earnings of 58 cents per share on revenue of $9.63 billion.

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