So much for the idea that Disney
The family-entertainment giant stumbled badly in its latest quarter. Revenue fell by 8% to $9.6 billion during the first quarter, weighed down by sluggish television advertising, slower turnstile clicks at its theme parks, and a tough slate of DVD releases relative to last year's winners.
Earnings fell by 35% to $0.41 a share before an investment sale gain. Analysts were expecting a profit of $0.51 a share on $10.1 billion in revenue. It's the second quarter in a row that Disney has come up short, and that's after blowing past Wall Street's bottom-line targets consistently during the early part of CEO Bob Iger's tenure.
The media titan's strongholds proved weak, with declines in media networks (5%), parks and resorts (4%), and studio (26%). Operating margins deteriorated in all three areas. The company scored gains in consumer products as the result of its Disney Store acquisition from Children's Place
Everyone knows that the economy is in a funk, and that means that even zealous Jonas Brothers fans are taking a breather.
Disney can't afford to be off. It's not like fellow park operators Cedar Fair
It doesn't help that Disney is now two years removed from its most recent Pirates of the Caribbean flick. One can argue that Miley Cyrus and High School Musical have also run their course.
Getting pumped about the current quarter is tough, too. Beyond the advertising headwinds and escalating cable programming costs that also smacks around rivals such as Viacom
Disney suffered a $40 million shift in operating profits when Easter went from being a fiscal third-quarter event to a second-quarter holiday break. Easter falls in April this year, so the quarter that ends in March is going to have an even harder act to follow.
The family-entertainment powerhouse has weathered financial downturns over the decades. It will bounce back this time, too. For Disney's sake, let's just hope it happens sometime before High School Musical 27 -- or when the Jonas Brothers are renamed the Jonas Grandfathers.
M-I-C ... see these other headlines: