New York: Walt Disney Co. chief executive officer Robert Iger laid out his vision for the firm’s big bet on streaming, including a new flagship service due late next year that will be called Disney+.
Iger, who has led Disney since 2005, outlined his plans on Thursday after Disney reported quarterly sales and profit that beat Wall Street projections. The results sent the shares up as much as 3.2% in after-hours trading.
Disney’s CEO is plotting a future with at least three online platforms, including ESPN+, the sports service introduced in April, and Hulu, which Disney gains control over with its purchase of 21st Century Fox Inc. assets. The company is closing in on that $71 billion deal, its largest ever, and now expects the takeover to be completed as early as April.
Along with revealing the new name, Iger gave more insight into the kinds of movies and TV shows the Disney+ service will offer. They’ll include a live-action remake of “Lady and the Tramp" and multiple “Star Wars" TV series, such as a prequel to the movie “Rogue One" featuring lead actor Diego Luna. There will also be a series based on the Marvel Comics character Loki, played by Tom Hiddleston.
Disney+ “will feature elegant navigation, personalization and content segmented primarily by our core brands," Iger said on a call with investors, allowing users to quickly get to content tied to specific brands, such as Marvel, Pixar and soon, National Geographic.
While Disney+ will feature family entertainment, Hulu will be packed with programming created by the soon-to-be acquired Fox TV studio, Iger said. In an interview on Bloomberg TV, Disney’s CEO said he would be interested in acquiring the rest of Hulu, if co-owners Comcast Corp. and AT&T Inc. want to sell. Iger also said he didn’t anticipate the company’s push into streaming would lead to major changes in how Disney releases films, which typically run in theaters for several months before they come to television.
Films such as “Ant-Man and the Wasp" and “Incredibles 2" helped the Burbank, California-based company’s studio division more than double profit in the fiscal fourth quarter. The company’s theme parks, meanwhile, benefited from the busy summer travel season, attracting more free-spending guests. “We have a studio that is doing extremely well and the formula that is serving us really well in terms of its bottom line," Iger said.
Those businesses are helping Disney continue to grow as Iger tries to steer his largest division, television, toward a new future built around streaming. The company is creating the new online video services and buying much of Fox to bulk up its web-based programming in a looming faceoff with Netflix Inc. As part of its earnings report, Disney said it wrote down the value of its investment in Vice Media, the youth-oriented news group, by $157 million.
Disney’s earnings grew to $1.48 a share, excluding some items, in the quarter ended September 29, the company said Thursday. That exceeded the average estimate of $1.34. Revenue climbed 12% to $14.3 billion and also beat Wall Street projections.
Disney is dominating the movie industry again this year on the strength of films from its Marvel, Pixar and Lucasfilm business. In the last quarter, Pixar’s “Incredibles 2" led the way, with global ticket sales of $1.24 billion, according to Box Office Mojo.
They lifted revenue by 50% for the film division, the company said. Disney’s grip on movie fans will only tighten with the pending takeover of Fox assets next year. That deal will bring “Avatar" sequels, the X-Men and “Planet of the Apes" movies under Disney’s wing.
Disney’s parks, meanwhile, attracted more visitors and coaxed guests to spend more during the summer vacation stretch, boosting revenue by 9% to $5.07 billion and profit by 11%.
TV, Disney’s biggest business, managed to grow as well, helped by higher sales of TV shows and the fees that the ABC network gets from pay-TV providers. That countered weaker results from cable networks that are investing heavily in streaming. At the same time, subscriber losses at ESPN, historically Disney’s biggest moneymaker, are moderating, Iger said.
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