Disney Cable Revs Up 5%, Broadcast Struggles

Walt Disney’s ESPN’s advertising revenue had a difficult three months ending in June -- all due to tough year-ago comparisons when it had big-rated World Cup programming.

ESPN had lower advertising revenue, with growth in affiliate revenues. In addition, Disney Channels and ABC Family witnessed higher program sales -- including that from subscription video-on-demand services -- as well as higher affiliate revenue.

Overall, Disney’s cable networks grew 5% to $4.1 billion in revenue with operating income 7% higher to $2.1 billion.

Disney’s broadcasting businesses had a tougher time of it. While revenues improved 4% to $1.6 billion, operating income sank 15% to $300 million. ABC in particular had higher programming costs, lower advertising revenue and higher labor-related costs. ABC did make gains in affiliate fees and higher program sales revenue from SVOD distribution.

Disney’s studio entertainment business was a major positive for the company -- growing 13% in revenue to $2.0 billion. Its strong theatrical film, “Marvel’s Avengers: Age of Ultron,” was a major contributor.



Revenue at its parks and recreation businesses was up 4% to $4.1 billion. Benefits here were from higher levels of occupied rooms at Walt Disney World Resort and its Hawaii resort.

Consumer products were up 6% to $954 million from improved sales of “Frozen,” “The Avengers” and “Star Wars” merchandise. Disney’s Interactive sank 22% to $208 million in revenue from lower sales of console game titles.

Overall, Disney fiscal third-quarter revenues ending in June grew 5% to $13.1 billion -- with net income up 11% to $2.5 billion.

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