Walt Disney’s first fiscal quarter earnings beat estimates. But, the entertainment giant expressed caution against a possible dent in profit as the company launches its own streaming service Disney+ and therefore potentially lose some of its licensing revenues.
The company’s earnings during the three months ending December came in at $1.84 per share, outpacing analysts’ expected $1.55 a share. They were, however, -3% lower compared to the year-ago quarter.
Revenue at $15.303 billion was higher than analysts’ estimate of $15.1 billion.
In April, Disney will launch its streaming platform Disney+ which will show movies and its original content. Due to its streaming business, the company estimates a probable reduction of $150 million from its operating income over the year as it anticipates losing out on licensing fees that it would've received from other providers. Also, streaming does have substantial costs in programming and technology. The company, however, seems to believe that by investing in new endeavors like Disney+ would help it achieve solid growth in the long-term, as indicated by CEO Bob Iger .