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Disney Shares Fall After Rough Earnings Report and No Guidance

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Disney  (DIS)  shares fell after the company reported worse-than-expected earnings. 

The stock fell as much as 1.25% in postmarket trading Tuesday. It has consistently underperformed the S&P 500, up just 2% last month and down 31% year-to-date. 

Here were the results versus Wall Street expectations: 

  • Revenue: $18.001B v. $17.81B 
  • Operating Margin: 5% v. 15.9% 
  • EPS: 60 cents v. 86 cents

Revenue grew 21%, as lockdowns hadn’t started until March. The Operating margin fell from 25% last year. EPS fell 63%. The second quarter and calendar year 2020 are expected to show declines across the board. 

Management said its parks business lost significant amounts of revenue, as the parks are closed. And while poor advertising sales hurt Media Networks revenue results, as there are no sports, the segment posted $7.3 billion of revenue, against estimates of $6.6 billion. 

Direct-to-consumer revenue was $4.1 billion, up four-fold over last year, as Disney Plus shined. 

Management offered no guidance and not much on when Parks will reopen. 

A bearish Moffett Nathanson analyst, Michael Nathanson, thinks parks will reopen in July. 

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