By Yasin Ebrahim
Investing.com - Walt Disney (NYSE:DIS) reported a surprise third-quarter profit as cost cuts helped offset a coronavirus-led $2.9 billion hit to its businesses.
Walt Disney shares lost 3.36% in after-hours trade following the report, but turned positive soon after.
Walt Disney announced earnings per share of 8 cents on revenue of $11.78 billion. Analysts polled by Investing.com anticipated LPS of 61 cents on revenue of $12.44 billion.
"Results in the quarter were adversely impacted by the novel coronavirus (Covid-19). The most significant impact was at the Parks, Experiences and Products segment as most of our theme parks and resorts were closed for the entire quarter and our cruise ship sailings were suspended," the company said. "We estimate the net adverse impact of Covid-19 on our current quarter segment operating income across all of our businesses was approximately $2.9 billion."
Parks, experiences and products revenues for the quarter decreased 85% to $1 billion.
Studio entertainment revenues for the quarter decreased 55% to $1.7 billion, while direct-to-consumer & international revenues for the quarter increased 2% to $4 billion.
The company's streaming service Disney+ racked up 57.5 million users in the quarter.
"It’s obvious from this report that financial hemorrhage is continuing as Disney’s parks and other entertainment assets are unable to operate when the pandemic is spreading. In this, otherwise, quite gloomy earnings outlook, Disney’s explosive growth in its streaming business is the only silver lining which is grabbing investors’ attention. The company is taking full advantage of the stay-at-home environment and adding subscribers at a robust pace," Investing.com analyst Haris Anwar said.
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