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(Disney earnings article updated with additional information from Walt Disney's fourth quarter financial report.)

BURBANK, Calif. (


) --

Walt Disney

(DIS) - Get The Walt Disney Company Report

shares fell in late afternoon trading after its fourth quarter earnings came in below analyst expectations. Shares dropped more than 3% to as low as $35.15 after the earnings became available to the market before Disney's official release. Company management says it will investigate as to how the information was prematurely released.

For the quarter ended October 2, the company saw earnings fall 7.2% to $835 million, or 43 cents per diluted share, compared with earnings of $895 million, or 47 cents per diluted share, in the same period a year ago. Earnings from continuing operations were 45 cents a share, below analyst estimates of 46 cents a share.

Revenue fell 1.3% to $9.74 billion from $9.87 billion during the quarter as the company saw decreases at its media networks and its parks and resorts division, which are its two largest business segments. The company also attributed much of its segment declines to having one less week of operations in the fourth quarter 2010 than in the prior-year quarter.

Media networks revenue fell 6.6% to $4.41 billion from $4.73 billion as it saw declines in both its broadcasting and cable networks. Cable networks operating income fell 27.8% due to weaker revenue at ESPN, however management estimates that advertising revenue was up 22%.

While ESPN saw subscriber growth and increased advertising revenues, it was hurt by the impact of one fewer week in the quarter than a year ago.

Disney's parks and resorts segment revenue declined slightly to $2.82 billion from $2.84 billion in the year prior, reflecting higher expenses at its domestic resorts and lower results at Disney Vacation Club.

Its studio entertainment segment saw revenues increase 6.4% and its operating income skyrocketed on the strong international performance of Pixar's

Toy Story 3


"The 2010 fiscal year was a financial and strategic success for the Walt Disney company with performance driven by great content like

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Toy Story 3

and the way we benefited from that content across our many businesses," president and CEO Robert Iger said. "With the acquisition of Marvel, our brand and franchise portfolio is stronger than ever and we're confident our global growth strategy positions the company well to thrive in the coming years."

Earnings for the fiscal year rose 19.8% to $3.96 billion, or $2.03 a share, compared with earnings of $3.31 billion, or $1.76 a share, in the same period a year ago.

Revenue rose 5.3% to $38.06 billion from $36.15 billion. The company saw a 5.9% gain in its media networks revenue to $17.16 billion from $16.21 billion, due to growth at ESPN and the international Disney channels.

Its parks and resorts segment revenue increased slightly to $10.76 billion from $10.67, attributed to improved results at its international operations, Hong Kong Disneyland Resort and Disneyland Paris.

Revenue from its studio entertainment division grew 9.2% to $6.7 billion from $6.14 billion due to the strong performance of

Toy Story 3


Alice in Wonderland


Iron Man 2

in 2010.

Management is looking forward to the release of

Cars 2


Pirates of the Caribbean: On Stranger Tides

in 2011.

-- Written by Theresa McCabe in Boston.

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