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Updated with comments from TheStreet's Jim Cramer and CNBC interview with Disney CEO Robert Iger.

LOS ANGELES (TheStreet) -- The cracks at Disney's (DIS) - Get Walt Disney Company Report core television business are starting to show -- and for the largest entertainment company on earth, there might not be enough Star Wars, merchandising and theme parks to cover it up.

Disney's television unit is a profit engine, led by cable sports network ESPN and broadcaster ABC. It posted a 5% revenue increase for the quarter ended June 27, but pressure from online streaming and overall declines in live-TV viewership appears to be taking its toll.

Despite posting a record net income and earnings per share of $1.45, overall revenue for the quarter missed Wall Street expectations of $13.2 billion by $100 million. That snapped the company's seven-quarter streak of beating sales estimates.

Investors reacted negatively to the numbers and what they may portend for the world's largest entertainment company. Shares of Disney were falling 8.6% on Wednesday to $111.18.

The decline in Disney shares, said TheStreet's Jim Cramer, provides a buying opportunity for long term investors. "If you can get the stock under $109, where it traded last quarter, I think you're doing pretty well," Cramer told TheStreet.

"You sell it today you will be selling it into one of the great buybacks of all time-so I would like to suggest that you think a little long term," said Cramer, portfolio manager of the Action Alerts PLUS Charitable Trust Portfolio. "This is the pullback that refreshes."

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Nonetheless, the Burbank, Calif.-based company revised down its income guidance on its cable networks unit, signaling that it isn't immune from what ails the traditional-TV industry. The company had previously told investors to expect profit growth in the high-single digits over the course of the 2013 to 2016 fiscal years. But now with less than a year and a half left in that window, CFO Christine McCarthy told analysts on Tuesday to expect growth only in the mid-single digits. Declining cable subscribers and a strong dollar hurting exchange rates didn't help, McCarthy added.

"That's where some of the concern lies," Edward Jones analyst Robin Diedrich told Reuters.

As viewership habits, Disney will be under pressure to sustain revenue through means other than the traditional pay-TV bundle. Since 2010, 18- to 24-year-olds have cut bac on traditional-TV watching by 32%. TV watching by 25- to 34-year-olds has also declined by 23%, according to Nielsen.

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In an interview with CNBC, Disney CEO Robert Iger on Wednesday acknowledged that Disney's cable-TV business has weakened compared to where it stood in recent years. "We felt that given the importance of ESPN to the company and cable networks in general, it was important for us to be candid about what we see in the environment," Iger said.

The younger viewers advertisers covet most are leaving behind traditional TV for streaming. And competition for ratings-proof live sports content has driven up costs.

ESPN along with Time Warner's (TWX) TNT will shell out nearly $2.7 billion annually for nine years beginning next year for the rights to National Basketball Association games. That's on top of a $7 billion deal for rights to the college football playoff and bowl games. The network pays $1.9 billion annually to broadcast a slate of NFL Monday Night Football Games, about four times the rate of other networks.

ESPN shed an estimated 4.3% of subscribers from 2012 to 2014, leaving it with 94.6 million, according to SNL Kagan. Disney CEO Bob Iger pushed back against published ESPN subscriber declines in the analyst call, but also declined to reveal the company's own figures.

Iger is also resisting pressure to make ESPN available as a standalone online subscription offering, which Time Warner has done with HBO NOW.

"We don't really see dramatic declines over, say, the next five years or so," Iger said about its cable business. "Therefore we're not taking what I'll call radical steps to move our product into over-the-top businesses ... because we don't think right now that it's necessarily the greatest opportunity. We just don't think it's necessary."

But Disney's struggles, which had seemed immaterial just three months ago, were clearly highlighted by 1.2% decline in operating income at it cable networks over the company's past three fiscal quarters, said BTIG analyst Rich Greenfield in an investor note. While Disney's cable business comprised half of Disney's total operating income at this same time a year year, it's fallen to 46%.

"Investors have become increasingly concerned about what kind of growth, if any, they can count on for ESPN going forward," Bloomberg Intelligence analyst Paul Sweeney told Bloomberg. "This guidance cut will not allay any of those fears."

Lucky for Disney, its competitors like 21st Century Fox (FOXA) - Get Fox Corporation Class A Report, Time Warner, CBS (CBS) - Get CBS Corporation Class B Report and Comcast's (CMCSA) - Get Comcast Corporation Class A Report NBCUniversal are in the same boat, heading toward a future of standalone services and eroding cable subscription fees. It's just they don't have the cash cow of ESPN, which commands more than $6 a month in fees per subscriber, according to SNL Kagan. That's about four times greater than any other cable network.

The shakeup is coming. It's just a matter of time, and Iger knows it. 

This article is commentary by an independent contributor. At the time of publication, the author held no position in the stocks mentioned.