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Disney earnings: The movie business suffers, but interactive turns around

Mickey at Disneyland

Thomas Samson/AFP/Getty Images

Disney made less money in its first fiscal 2013 quarter but still beat Wall Street expectations. And its online and social gaming segment swung to a profit.

The Walt Disney Co. just announced fiscal 2013 first quarter earnings. They slightly beat Wall Street expectations, at 79 cents per share on $11.34 billion in revenue; analysts who follow the company expected 76 cents per share on $11.21 billion in revenue.

Profits for the quarter were 3 percent lower than a year ago. In after hours trading, the stock was up almost 4 percent.

As with all Disney quarterly earnings announcement, you have to drill into how the company's operating segments performed to get the full picture.

The most interesting wrinkle for the first fiscal quarter was that Disney's movie business lagged all the other operating segments while the previously troubled Interactive segment began to show signs of life.

But before we get to that, let's put the overall business into perspective. Of that $11.34 billion in gross revenue, $5.1 billion — 45 percent — came from Media Networks, which includes ESPN, and believe it not, ESPN actually contributed to a loss in income for Disney in the quarter.

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Disney earnings: Maybe there isn't a tech-entertainment connection

World of Color

Susan Valot/KPCC

"World of Color," a water show that opened last year, is credited with drawing more people to Disney California Adventure.

Walt Disney Co. reported first-quarter earnings yesterday, and they were fairly good: net income was up 12 percent.

But the growth came largely from ESPN and theme parks. If you study the earnings statement, you can spot something alarming in two critical parts of the business of the Mouse: movies and video games.

This is from Bloomberg:

Seven Disney films in U.S. theaters in the quarter collected ticket sales of $239 million, a 33 percent drop from $357.6 million generated by nine movies a year ago, according to Box Office Mojo, an industry researcher.

The studio is in talks with Coinstar Inc.’s Redbox and other services to impose a 28-day delay on rentals of new DVDs, [CEO Bob] Iger said on the call. The delay is being sought because of the industrywide drop in DVD and Blu-ray sales, he said.

The consumer products unit reported profit little changed at $313 million on a 3 percent higher sales of $948 million.

Disney’s interactive division registered a loss of $28 million. Sales tumbled 20 percent to $279 million. The unit is cutting costs and taking steps to raise revenue with a goal of becoming profitable in the next fiscal year, Iger said. It hasn’t shown a profit since Disney began breaking out the results in the final three months of 2008.

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