Disney returns to earnings as streaming accomplishment offsets pandemic-hit parks

Walt Disney swung to a good surprise quarterly profit due to The Mandalorian and Soul lifted its fast-growing streaming business, outweighing pandemic worries about its hobbled theme recreation area operations.

Investors overlooked a 53 per cent decline in park earnings in the one fourth and welcomed Disney+ streaming reaching 94.9 million subscribers.

The Star Wars-inspired Mandalorian series and Pixar's animated Soul movie helped position the year-old Disney+ as a credible threat to the dominance of Netflix in the streaming video wars.

Incorporating Hulu and ESPN+, Disney's paid streaming membership topped 146 million.

"Disney+ has been a massive achievement and is a good testament to Disney's company equity and expertise found in storytelling," eMarketer analyst Eric Haggstrom said. "This has been one of the most successful consumer item launches in recent storage."

The business posted earnings of 32 cents per share for October through December. Wall structure Street had expected a loss of 41 cents per share, in line with the normal forecast of analysts surveyed by Refinitiv.

Quarterly earnings fell to $16.25 billion from $20.88bn a year earlier, but was still above analysts' average estimate around $15.93bn, according to IBES info from Refinitiv.

Through the pandemic "we've made significant changes even though finding new and impressive ways to conduct the businesses", leader Bob Chapek said.

"But concurrently, we have chartered a training course for an even more deliberate and extreme [streaming] push."

As the coronavirus pandemic drags on, Disney's theme parks in California, Hong Kong and Paris remain closed and others have limited attendance to allow for social distancing. The business expects Disneyland in California and Disney Paris to stay shut through March and hopes its recreation area in Hong Kong can reopen sometime before April, chief fiscal officer Christine McCarthy stated.

The movie studio has delayed several important releases as much theatres remain shut.

The media and entertainment distribution unit, which include streaming, the motion picture studio and traditional TV networks, reported operating income of $1.5bn, a 2 % decline from a year earlier.

At the parks and consumer items division, operating loss hit $119 million, compared with a profit of $2.52bn a year previous.

The closures and reduced businesses cost about $2.6bn, Disney estimated.

Looking ahead, the company said it expected costs to adhere to government regulations and to implement safety measures by parks and in Television set and film development to attain $1bn in fiscal 2021.

The direct-to-consumer segment, which houses Disney+, reported an operating lack of $466m, compared with an operating lack of $1.11bn found in the year-earlier quarter.