Disney Beats Revenue, Earnings Forecasts Helped By ‘Incredibles 2’ & Film Unit; Investors Await Fox Plan Details

It blamed lower revenue from licensing. The only group to show decrease in income was the consumer products an interactive media unit, which reported an 8% drop in revenue to $1.1 billion.
"Will Disney move all Fox movies (even R-rated content) off their global Pay 1 deals and put those titles in a Disney-branded OTT service? "These unknowns could swing results in a much more material way than any of the other well-discussed variables."” /> Family Guy, Modern Family) to an exclusive window on Hulu or Disney OTT?," Nathanson wrote in a recent investor note. Will Disney move Fox's syndicated off-network content (e.g.
Veteran media analyst Michael Nathanson noted the difficulty in financial forecasting for Disney, because it's not yet clear what changes the company might make to Fox's content distribution strategy.
beat Wall Street's earnings and revenue forecasts for its fourth quarter, thanks to a strong performance by the film studio. UPDATED with earnings numbers: The Walt Disney Co.
It booked record revenues of $14.3 billion, exceeding Wall Street's projections of $13.73 billion. The company reported adjusted per-share earnings of $1.48, topping analysts forecasts of $1.34 for the fiscal fourth quarter.
Theme parks also posted a 9% revenue gain in the quarter, up to $5 billion, which compared favorably to a year ago, when Hurricane Irma shut down Walt Disney World in Florida.
Disney already has announced which Fox television and film executives  would be joining the Burbank entertainment colossus following the merger. The acquisition is expected to close January 1, bringing the Avatar and X-Men film franchises, and popular TV shows like The Simpsons, into the Mouse House, alongside Black Panther, The Incredibles and Black-ish.
The film studio's revenue jumped 50% in the quarter to $2.2 billion, buoyed by the box office success of Incredibles 2, which rang in more than $1.2 billion globally, and Ant-Man and the Wasp, at $622 million in worldwide ticket sales.
Disney CEO Robert Iger will speak shortly to investors, who will be listening for more details about its plans for 21st Century Fox's entertainment assets.
Disney's streaming strategy will likely be a major focus for Wall Street. The company reported its ESPN+ streaming service had reached more than 1 million in the first five months. Investors will likely anticipate an update on that service, and more insight into plans for the Disney-branded streaming service, which launches late next year.
The deal already has won Justice Department approval, and earlier this week got a thumbs up from European antitrust regulators. The Burbank entertainment giant won a bidding war with Comcast for Fox's assets, which include the company's film and television studios and Star India, and its stake in the streaming service Hulu.
The media networks group, which includes broadcast and cable television, saw revenues rise 9% to nearly $6 billion in the quarter ending September 29. It reported an operating income of $1.5 billion that was impacted by losses associated with BAMtech, the technology powering Disney's ESPN+ streaming service.

Snap Stock Hits New Low; Analyst Says It’s “Quickly Running Out Of Money”

Forecasting lower growth in revenue and users, Nathanson lowered his 12-month price target to $6.50 from $8, though he kept his neutral rating on the shares.
During the final hour of the session, shares dipped to an all-time low of $6.84. The stock dropped more than 6% today to close at $7, the lowest closing price since the company's IPO in March 2017. Trading volume was double the average level.
"If the current cash burn holds, Snap will have to raise new funding in the back half of 2019!" "As capital expenditures have remained relatively modest, the main culprit behind Snap's diminishing cash balance has been its core operations," Nathanson wrote.
Since going public, Nathanson contends, Snap has shown it is "not quite ready for the big leagues." Free cash flow has declined to negative $250 million per quarter in 2018, the analyst noted.
Nathanson cited a memo from Snap CEO Evan Spiegel that leaked last week. While the memo suggests Snap is "attempting to do the impossible," the analyst wrote, "Facebook is ramping [Instagram] Stories usage and monetization across its massive installed base." In it, Spiegel outlined 2019 goals of accelerating revenue growth while achieving positive full-year cash flow and profitability.
Veteran media and tech analyst Michael Nathanson put the social media giant on notice in a blistering note to clients, warning that the social media company is "quickly running out of money" and needs a "miracle" solution. Its war chest could be completely empty by 2020, he projected.
UPDATED with closing price: Shares in Snapchat parent Snap Inc. took a dive after a harsh report from a Wall Street analyst, who warned that the company is "quickly running out of money."
The "self-inflicted damage" of an unpopular app redesign in fall 2017, along with its forthcoming Android app, Nathanson said, has been accompanied by increased competition. Facebook-owned Instagram has increased daily active user levels for Stories to about 400 million in July 2018, from 250 million in July 2017.” />

Google Parent Alphabet Surpasses Second Quarter Earnings Expectations, Excluding Fine

"While many had feared that GDPR would be an Armageddon to upend the digital advertising industry, we instead wondered whether it would be more akin to the Y2K bug, which after all the hype, turned out to be much ado about nothing," wrote media analyst Michael Nathanson in a report published this morning. "After checking in on various players across the digital advertising ecosystem, from agencies managing spend to publishers monetizing content, we heard that business for the major platforms is as strong as ever."
And that the decision would upset the "careful balance" of Android, which the company allows phone makers to use for free but generates advertising revenue whenever consumers use its apps. In a blog post, Google CEO Sundar Pichai argued that Android has enabled consumer choice, not stifled it.
The company has indicated it's willing to absorb those fines as it appeals the ruling. Google has 90 days to end its conduct or face additional penalties.
Considered the most sweeping changes in data privacy in two decades, it requires digital advertising companies and publishers to obtain a consumer's explicit consent to use their personal data. Also during the quarter, the European Union's new privacy rules took effect.
The company reported per-share earnings of $11.75, excluding the impact of a $5.07 billion charge in connection with a European Commission fine. That compares with analysts' earnings estimates of $9.66 per share.
Taking into account the fine imposed by European regulators, second-quarter earnings dropped 9.3%.
Investors reacted positively to the earnings report, driving Alphabet's stock price up more than 4% in after-hours trading to $1,258.39.” />
European regulators said Google's parent company unfairly favored its own services by forcing phone makers to pre-install the Chrome browser and Google search app in a bundle with the app store, Play. It also violated competition rules by preventing phone makers from selling phones that run modified versions of the Android software.
Google parent Alphabet blasted past Wall Street's earnings estimates in its second quarter, sending the stock up in after-hours trading.
Wall Street forecast revenue of $25.6 billion. Revenue for the second quarter reached nearly $32.7 billion, up 26% from a year ago.
This is Alphabet's first earnings report since the European Commission slapped it with a record fine for abusing the dominance of its Android mobile operating system.
The regulations, aimed at the digital powerhouses Alphabet and Facebook, appears not to have made a dent.