Disney profit up beating expectations, as cable networks, ESPN improve performance

Walt Disney reported higher quarterly earnings, beating analysts' predictions, due to improved performance from ESPN and other cable networks.

Reuters has reported that ESPN and its other channels raked in higher advertising revenue, as well as more fees from paid TV. From the months of July to September, Disney's net income increased to $1.61 billion from last year's $1.50 billion. That means its profit rose 95 cents per share from 86 cents per share in the previous year. Excluding items, Disney made $1.20 per share, which is higher than Wall Street expectations of $1.14. In August, the company's stock went down as it acknowledged that subscribers at ESPN are dwindling, strengthening the skepticism that there is a shift from pay television to online video services.

According to The New York Times article, Disney's operating income for the recent quarter increased 27 percent, to $1.82 billion in its media networks division, which includes ESPN. The sports networks higher affiliate and ad revenues were the major reasons for Disney's increased earnings. This balances the expensive programming cost brought by the Unites States Open Tennis Tournament, as well as the Major League Baseball games.

Its movie and TV studio division reported flat revenues with $1.78 billion. Its profit doubled to $530 million due to higher revenues from increased TV and streaming distribution, as reported by The Los Angeles Times. The success of Disney movies such as "Ant-Man" and Pixar's "Inside Out" also helped boost the division's profit. Disney Chairman and Chief Executive Bob Iger said it is a "strong quarter" for the company.

ESPN announced in October that it plans to cut 300 jobs, which is about 4 percent of the network's workforce. ESPN shuttered last week its respected online magazine Grantland after a turbulent phase. The sports network said it would now focus on projects that have broader and more significant impact on Disney as a whole.