The Walt Disney Co., the world’s largest entertainment company, reported quarterly profits that sailed beyond analyst estimates. Gains at its theme parks and consumer products division drove the company to a 10 percent increase in net income. On Tuesday, Disney announced a net income of $2.108 billion, or $1.23 a share, in its past quarter, up from $1.917 billion, or $1.08 a share. Revenue at the company’s media network division increased 13 percent and revenue at its parks and resorts increased 6 percent.
According to the research firm Zacks and 29 other analysts, Disney was expected to deliver earnings of $1.11, but the $1.23 reported easily beats that estimate. Analysts suggest that the company’s ever-popular domestic theme parks and consumer products caused such an increase. Robert Iger, the chairman and CEO of The Walt Disney Co., confirmed it when he said in a statement “Our second quarter performance, marked by increased revenue, net income and EPS of $1.23, demonstrates the incredible ability of our strong brands and quality content to drive results.”
The increase is impressive, considering that Disney has not had a major movie blockbuster since the release of “Frozen” in late 2013. Analysts were not expecting such a large and continuous sale of “Frozen” toys up until today. “Frozen” merchandise sales drove a 32 percent rise in consumer products profits. Retail sales of “Frozen” merchandise were almost 10 times higher than this time in 2014. Disney did release a successful remake of “Cinderella” this period and, though it did not compare to the success of “Frozen,” it generated about $450 million at the global box office. Disney profit fell less than expected because of the continuing sale of “Frozen” consumer products. It is definitely hard for Disney to beat this $1 billion-plus blockbuster that was still in theaters during its second quarter of 2014.
On a conference call with analysts, Disney Chief Financial Officer Jay Rasulo stated that the second quarter this year “was one of the best quarters in the studio’s history” but that the company had to deal with “very difficult (comparisons) due to the impact of ‘Frozen’ in the prior year.”
“Frozen” merchandise sales are not the only driving force behind Disney’s increase in income. The well-known characters Anna, Elsa, Olaf and Kristoff were given their own spot in Walt Disney World’s Magic Kingdom last year. Disney World visitors have continued to increase substantially, and in February, the company raised the price of a daily admission to its Magic Kingdom in Florida above $100. The “Frozen” characters do not seem to be going anywhere anytime soon. Disney has kicked off its “Coolest Summer Ever” campaign in Orlando, which will start June 17 and end September 7. The “Frozen” favorites will welcome Magic Kingdom park guests bright and early at 6 a.m., following an opening show. A large selection of entertainment and activities for all ages are planned throughout each day.
Also propelling highs in the consumer products division behind “Frozen” is Disney’s merchandise sales from its recent release of “Avengers: Age of Ultron.” The sales produced a 32 percent increase to $362 million in operating income for that divison.
What was supposed to be a rare weak quarter for Disney, after seemingly unthawing from its “Frozen” hangover this year, has turned out to be a surprisingly strong one. With help from characters such as Elsa and Iron Man, The Walt Disney Co. has managed to once again defy expectations and will likely continue to do so with releases of blockbusters that fill movie theater seats and Disney parks.