It was a good year for The Walt Disney Company (NYSE:DIS). The media giant posted record results in fiscal year 2015 across all five of its business segments, paving the way for the year ahead where theme park additions and the revival of the Star Wars franchise will fuel its growth.
With Disney's fiscal year ending in September we don't have to guess as to the biggest contributor among its five subsidiaries. Media networks -- the segment that includes ESPN, ABC, Disney Channel, and more -- accounted for a whopping $23.3 billion, or 44% of Disney's $52.5 billion in revenue for the fiscal year. The impact is even more profound as we work our way down the income statement with media networks scoring 53% of the cumulative segment operating profit.
That's pretty big, but it wouldn't be fair to call media networks Disney's "best" business segment in 2015. For starters, it was defecting cable subscribers -- even for its ESPN cash cow -- that has soured the market on Disney stock in recent months. All of the praise that the House of Mouse should be garnering for its record theme park attendance and success in milking its Pixar, Marvel, and now Lucasfilm acquisitions into theatrical blockbusters has been set aside by fear that cord cutters will eat into Disney's media networks business.
It's not as if Disney's media networks arm is fading away. Revenue and operating profit rose 10% and 6%, respectively, in fiscal year 2015. However, it's hard to give media networks the baton here when it was the only segment that didn't post double-digit growth on the bottom line.
The business segment that was truly worthy of being called the best performer in 2015 has to be consumer products. We're not just talking about mouse ears and Mickey Mouse plush dolls. This is where Disney scores all of the fat profits when it licenses its characters to be on everything from board games to cereal boxes.
Consumer products may not seem to be a major contributor at first. It rang up $4.5 billion in revenue for the year, something that would be a major achievement for most companies, but clocks in at less than 9% of the total revenue at Disney. However, this is also where the media giant scores some of its juiciest margins, ultimately accounting for 12% of the segment operating income.
There's also the matter of growth. Disney's consumer products segment saw its revenue and operating profit climb 13% and 29%, respectively, in fiscal year 2015. That led the way among all five subsidiaries on both ends of the income statement. That's no easy feat for a company that's often firing on all cylinders. With Star Wars merchandise likely flying off the shelves this holiday shopping season, it wouldn't be a surprise if consumer products is also a major driver in delivering another year of record results in fiscal year 2016.