Earnings: Disney’s Q2 Needed All The Balloons In ‘Up’

Movie Still, Up

The Walt Disney Co. (NYSE: DIS) came down to earth in Q2 with double-digit declines in net income, down 26 percent to fall below $1 billion, and earnings per share, down 16 percent. That comes close to making a revenue drop of only 7 percent a bright spot. Disney split the difference on analysts’ estimates from “Thomson Reuters*, beating EPS expectations by a penny, and failing on the revenue side. (See chart below for the numbers.) The underlying message, though: given the economy, it could have been a lot worse.

2Q 2009 2Q 2008 Estimates
EPS $0.52 $0.62 $0.51
Net Income $954M $1.28B $N/A
Revenue $8.6B $9.23B $8.83B

Earning release | Webcast | Transcript (via SeekingAlpha)

Some segment results:

Interactive Media: The Disney Interactive Media Group, which doesn’t include the network sites or digital efforts in other segments, turned in better results on lower revenue. Sales dropped 20 percent, to $113 million from $142 million in the same quarter in 2008, but losses were cut to $75 million from $91 million because of lower marketing and product development costs.

Media networks: A narrow 2 percent drop in revenues to $3.96 billion from $4 billion in 2008, while operating income sunk 13 percent to $1.3 billion. Broadcast was the biggest problem in the latter, with operating income down 34 percent compared to 8 percent for the far more lucrative cable networks group. Broadcast was hit by the evil combo of higher primetime costs and lower ads sales locally and at ABC.

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