Walt Disney's (DIS -1.13%) first quarter of fiscal 2018 marked a welcome change in the company's fortunes, with earnings per share returning to growth. After excluding a one-time tax benefit associated with the Tax Act and other items impacting comparability, Disney's earnings per share climbed 22% year over year, from $1.55 in the year-ago quarter to $1.89.
Comparatively, adjusted earnings per share fell 3% year over year in Disney's fourth quarter of fiscal 2017. Revenue similarly reversed directions in Q1, with Walt Disney recording 4% year-over-year revenue growth compared to a 1% year-over-year decline in Walt Disney's fourth quarter.
Of course, shareholders don't just want one quarter of growth. They want to know Disney can consistently deliver growth for years to come. Hopefully, a close look at Disney's first-quarter results across six key metrics can provide some clarity on the media giant's long-term potential.
Parks and resorts was Disney's biggest winner among its business segments during the quarter. Its new Avatar park and Guardians of the Galaxy ride helped drive higher attendance at Disney World and Disneyland domestically. In addition, momentum at parks and resorts internationally persisted. Management said Disneyland Paris, where Disney saw higher attendance and increased average ticket prices, was a key driver for the segment.
These catalysts helped Disney's parks and resorts revenue rise 13% year over year.
Parks and resorts operating income growth was even more impressive, rising 21% year over year, to $1.35 billion. The segment accounted for 34% of total operating income, up from 28% of operating income in the year-ago quarter.
Operating-income growth in the segment was driven by "increases at our domestic parks and resorts, cruise line and vacation club businesses, as well as at Disneyland Paris," Disney said.
Studio-entertainment revenue fell 1% year over year. Star Wars: The Last Jedi and Thor: Ragnarok were undoubtedly hits, leading to slight growth in Walt Disney's theatrical-distribution business. But they weren't enough to drive significant growth over Rogue One: A Star Wars Story and Doctor Strange in the year-ago quarter.
Studio-entertainment results during the quarter were negatively impacted slightly by decreases in home entertainment and TV and subscription video on demand.
Highlighting Walt Disney's ongoing ability to turn out bockbusters, Star Wars: The Last Jedi, Thor: Ragarok, and Coco collectively earned over $4.4 billion in global box office through Feb. 6.
Media-networks revenue was flat year over year, but media-networks operating income fell 12% year over year. This was primarily driven by a 25% year-over-year decrease in broadcasting operating income, higher losses from Hulu, and lower operating results from A&E Television Networks.
Weakness in broadcasting was driven by lower advertising revenue, higher production cost writedowns, and lower program sales. Hulu suffered from higher programming and labor costs, but it notably saw higher subscription and advertising.
Walt Disney's long-awaited new streaming service for ESPN -- one of two new services Disney plans to launch -- finally got a price point, well below most streaming TV subscriptions at $4.99 a month. Disney hopes it can convince ESPN users to pay for another layer of content.
Called ESPN+, the new service will be featured in a new app that will provide "countless scores and highlights," podcasts and other sports-related information, and access to live streams of all of ESPN's networks for users who are already subscribers to current ESPN multi-channel packages -- all alongside exclusive ESPN+ content.
This ESPN service will launch "sometime this spring," management said in the company's first-quarter earnings call.
Though the quarter's results show that Disney is still facing some headwinds -- particularly in media networks -- growth in parks and resorts and execution on its direct-to-consumer ESPN product are encouraging for Disney's long-term prospects.