Disney Q2 Tops With 'Star Wars' Plans Eyed

Response to the upcoming "Star Wars" movie has "well exceeded expectations," and the rejuvenated franchise presents a "huge opportunity" for Walt Disney's parks and resorts, Disney CEO Bob Iger said Tuesday. The media and entertainment giant, which got a boost from its theme parks unit in the second quarter, is doing some development work on potential "Star Wars" attractions, Iger said during a conference call.

"I think we've got something here that's very, very special, that's going to create value for the company for many, many years to come across the world," Iger said of the Lucasfilm movies.

Shares closed down 0.2% at 110.81, after rising as much as 2% earlier in the day.

Disney's (DIS) fiscal Q2 earnings rose 11% to $1.23 per share, 12 cents ahead of forecasts. Revenue grew 7% to $12.46 billion, above views for $12.25 billion.

The lingering success of "Frozen" helped drive up its consumer products revenue 10%. The animated film, which was released in late 2013, grossed over $1.2 billion worldwide at the box office.

But its blockbuster success also led to difficult year-over-year comparisons in Disney's studio entertainment division, as revenue fell 6%. Parks and resorts revenue grew 6% on higher average ticket prices at U.S. theme parks and cruise lines. Media networks revenue rose 13%, though increased programming and production costs at ESPN weighed down the cable networks segment's operating income by 9%.

Conversely, operating income at the broadcasting segment soared 90%, helped in part by affiliate fee growth plus higher primetime ratings that led to more ad revenue for ABC. The sale of Marvel's "Daredevil" series, airing on Netflix (NFLX), also lifted revenue.

'Ultron' To Lift Q3

Disney's Q3 should get a boost from "Avengers: Age of Ultron," which brought in $191.3 million in its U.S. opening weekend. While below some analyst estimates, the result was still among record domestic opening highs — second only to the film's predecessor, 2012's "The Avengers.

It remains to be seen whether the "Avengers" sequel or "Star Wars: Episode VII — The Force Awakens" will be the bigger box office hit. Buzz is already ramping up ahead of the latter's December release.

"We've been overwhelmed with interest," said Iger.

Advertisement