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Disney Quarter Three Shares Fall 3.1% After Earnings Call

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Disney’s stock price missed analyst expectations in its third-quarter this Tuesday, reports CNBC. In fact, the company’s day trading price fell close to 3.1% overall. According to Refinitiv, analysts expected Disney to hit $1.75 per share, but they only ended up with $1.35 per. The revenue gap was a $20.25 billion actual with $21.47 predicted.

According to Disney, the earnings drop was due to the multimedia giant integrating the recently purchased Fox entertainment into its day-to-day. Disney acquired Fox for $71 billion back in March.

That said, the company did bring in revenues of close to $3.8 billion in its Entertainment sector in quarter three. This is a 33% rise from the year before in the same period. Then, the Media Networks arm of Disney brought in $6.7 billion. This is 21% up from the same period last year as well.

Related: Check out our guide on the best investment brokers 2019 to invest in stocks like Disney!

Disney’s Parks space saw a revenue of $6.6 billion this quarter, 7% up from quarter three 2018. Then we saw its direct-to-consumer arm bring in $3.86 billion in quarter three, though operating losses were close to $553 million, a drop from $168 million. Disney accounts these operating losses to Hulu and their goal to put more money into ESPN+ and Disney+.

As you may know, Disney’s streaming service will launch this November, hitting around $6.99 a month to start. Users can also pay $69.99 a year. This is a pretty cheap price compared to other streaming services, especially considering this one will have Star Wars content, Pixar, Marvel, Fox, and other Disney properties. Also, the company plans to offer a bundle of Disney+, Hulu with ads, and ESPN+ for $12.99 a month. This is the same price as Netflix’s traditional plan.

On top of this, Disney doesn’t exactly expect its profits to fix themselves right away, either. In fact, the company claimed in its earnings call that it plans for its direct-to-consumer losses to hit $900 million in quarter four. This is because it plans to put in more money toward Disney+. A worthy investment, it seems.

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Max Moeller

Cryptocurrency and games writer. Looking to the future by studying how these two industries can blend. LinkedIn: https://www.linkedin.com/in/maxwell-moeller-912044b4/