Disney said BAMTech, which has almost 7.5 million paid subscribers, will provide a platform to stream content from the entertainment giant’s broadcast units, including its sports network ESPN.
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The new service will have live regional, national and worldwide sporting events. Operating income rose 62 per cent to $766 million. Sales at the world’s largest entertainment company increased 9 percent to $14.3 billion in the period ended July 2, compared with estimates of $14.2 billion. The company will pay $1 billion in two installments, now and in January 2017.
On Tuesday, Shares of Walt Disney Co (NYSE:DIS) gained 0.96% to $96.67. Disney reported its third quarter earnings today and ESPN again saw declines in cable subscribers, a trend that’s been going on for the past several months and likely caused by the increasing number of cable-cutters.
Last week, Nielsen reported that ESPN had lost 2.2 million pay-TV subscribers from February to August.
The increases were “all-time records for the quarter”, said Christine McCarthy, Disney’s chief financial officer, during Tuesday’s investors’ conference call out of Burbank. It generated revenue of $5.9 billion, up 2% from a year ago, when sales were $5.8 billion billion.
Analysts on average had expected a profit of US$1.61 (RM6.43) per share and revenue of US$14.15bil (RM56.51bil). The May 6 release “Captain America: Civil War” is No. 1, with worldwide sales of $1.15 billion, according to researcher Box Office Mojo.
Also, ESPN and BAMTech will collaborate to launch a new digital service, separate from the traditional cable bundle. The Company’s business divisions include Media Networks, Parks and Resorts, Studio Entertainment, Consumer Products and Interactive.
Walt Disney Studios were the main contributor to the company’s growth as they scored major big screen hits.
ESPN – the company’s cash cow – grew in the quarter as a result of affiliate and advertising revenue growth, partially offset by higher programming costs, Disney said. Q3 saw Disney open its Shanghai theme park and has already seen a million guests since its opening on June 16.
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In other news, Walt Disney also announced that it is acquiring a minority stake in BAM Tech for $2 billion. BAMTech has almost 7.5 million total paid subscribers to its clients’ over-the-top products.
