Walt Disney Co’s theme parks and a remake of The Lion King has boosted quarterly earnings past Wall Street targets as costs came in lower than expected for its big plunge into streaming entertainment.
Shares of Disney rose more than five per cent to $US140.77 in after-hours trading.
Disney is trying to transition from a cable TV leader to a powerhouse in the streaming video market dominated by Netflix.
Its family-friendly digital entertainment service, Disney+, is set to debut in the US on Tuesday.
Subscribers can access the programming through set-top boxes made by Apple, Alphabet Inc’s Google, Microsoft, Sony and Roku.
Disney+ will launch in Australia and New Zealand on November 19 and in western Europe, including the United Kingdom, on March 31.
Excluding certain items, Disney earned $US1.07 per share for the quarter that ended in September, above average analyst estimates of 95 cents per share, according to IBES data from Refinitiv.
Disney Chief Executive Bob Iger said the company had reached a deal to have Disney+ distributed on Amazon’s Fire TV devices as well as Samsung and LG Electronics devices.
Investments to build streaming media services increased form a year earlier.
The direct-to-consumer and international unit reported an operating loss of $US740 million from July through September, up from $US340 million the previous year, but less than the $US900 million that Disney had forecast.
Disney+ will offer a deep library of TV shows and movies from Disney, Pixar Animation, Marvel Studios, the Star Wars franchise and the National Geographic Channel, plus original programming such as a new High School Musical series and a remake of Lady and the Tramp.
It will cost less Netflix’s most popular plan – $A8.99 a month in Australia, compared to $A13.99 a month for Netflix’s standard plan.
The offering is a cornerstone of a major shift in Disney’s strategy to capture audiences that have ditched cable and migrated online.
The company also offers ESPN+, which streams sports not seen on the ESPN cable channel, and recently took full control of online video service Hulu.
Hulu will become the official streaming home for Disney’s FX Networks starting in March, the company said.
At the same time, Disney is integrating film and TV businesses it purchased from 21st Century Fox to feed its digital ambition.
At the theme parks and consumer products unit, operating income rose 17 per cent to $US1.4 billion.
Disney opened a costly Star Wars-themed land at Walt Disney World in Florida during the quarter.
A nearly identical section debuted at Disneyland in California in May.
The movie studio benefited from remakes of The Lion King and Aladdin plus Pixar sequel Toy Story 4.
Profit at the division jumped 79 per cent to nearly US$1.1 billion.
The company’s media networks division posted a three per cent decrease in operating income to $1.8 billion, Disney said.
Overall revenue rose 34 per cent to $19.10 billion, edging past analysts’ average estimate of $US19.05 billion.
AAP
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