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Disney gets boost from parks, films ahead of streaming launch

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By Reuters
Disney gets boost from parks, films ahead of streaming launch
FILE PHOTO: The entrance to Walt Disney studios is seen in Burbank, California, U.S. August 6, 2018. REUTERS/Lucy Nicholson   -   Copyright  Lucy Nicholson(Reuters)

(Reuters) – Walt Disney Co <DIS.N> beat Wall Street estimates for quarterly profit on Thursday, as strong performance in its flagship theme parks and the box office success of its films like “The Lion King” and “Toy Story 4” offset huge investments to launch its streaming service Disney+.

Disney+ – a family-friendly subscription service set to launch on Nov. 12 in the United States – will offer a digital library of more than 1,000 shows and 10 original films or series on debut, as it looks to take on dominant player Netflix Inc <NFLX.O> and recent entrants such as Apple Inc’s <AAPL.O> Apple TV+.

The direct-to-consumer and international segment, which will house Disney+, reported an operating loss of $740 million (£577.36 million), compared with an operating loss of $340 million a year earlier.

The company had forecast that digital investments will lead to an operating loss of $900 million in the unit in the September quarter.

Operating income from its parks and consumer products business rose 17% to $1.38 billion.

Its studio entertainment segment, which includes Marvel, Pixar, Lucasfilms and Fox, reported an operating income of $1.08 billion, up 79% from a year earlier.

Operating income in its media unit, which includes ABC Studios and ESPN, fell 3% to $1.78 billion, hurt by a decrease at ESPN.

Excluding certain items, Disney earned $1.07 per share, above the average analyst estimate of 95 cents, according to IBES data from Refinitiv.

Revenue rose 34% to $19.10 billion, edging past analysts’ average estimate of $19.05 billion.

The company’s shares rose about 4% to $137.91 in trading after the bell.

(Reporting by Neha Malara and Lisa Richwine; Editing by Sriraj Kalluvila)