DIS Walt Disney Co

By Ben Fritz 

Walt Disney Co. is scheduled to announce its fiscal first-quarter earnings after the market closes Tuesday. Here's what you need to know:

EARNINGS FORECAST: Net income of $1.50 a share is the consensus of analysts surveyed by Thomson Reuters, down from $1.63 reported a year earlier. The company doesn't provide earnings guidance.

REVENUE FORECAST: Analysts expect revenue of $15.27 billion, slightly above the $15.24 billion reported a year earlier.

WHAT TO WATCH:

-- CABLE DECLINES AND THE FUTURE OF ESPN: A big drop in Disney's television business, led by ESPN, caused a rare miss for the entertainment giant as its earnings came in below Wall Street expectations in the quarter that ended in October. With headlines continuing to abound over struggles for the pay-television business and consumers' migration to streaming services, investors will first and foremost dissect Disney's results for signs of whether the bad news is abating or accelerating. They will also be eager for more details on the company's plan to offer some ESPN content "over the top" in a direct-to-consumer offering expected to launch later this year.

-- STAR WARS PRODUCTS: The 2015 holiday season was huge for Disney's consumer products, in large part due to the launch of the company's first "Star Wars" movie. This past December's "Star Wars" spinoff, "Rogue One," was a hit, but not on the same level as "The Force Awakens, " which has made more money than any other at the domestic box office. Analysts will be eager to know if toy and clothing sales fell similarly short of the high bar set by "The Force Awakens." Chief Financial Officer Christine McCarthy said at an investor conference in early January that results for the consumer-products unit would be down about 20% year-over-year.

-- OUTLOOK FOR THE YEAR: Ms. McCarthy presented a generally somber outlook for Disney's fiscal 2017, citing tough comparisons for the movie and consumer-products businesses as well as a rise in sports-rights costs at ESPN due to a new contract with the National Basketball Association. Any signs that 2017 is turning out a little better than expected is sure to excite investors, most of whom are already looking forward to 2018.

-- POLITICS: International tourism is a big source of income for Disney's parks and resorts business, which draws many foreigners to its two resorts in the U.S. and has three locations overseas. Will conflicts sparked in the first two weeks of President Donald Trump's administration affect attendance at Disney theme parks in the U.S. and abroad? CEO Bob Iger will likely be asked the delicate question of what impact he thinks the new president could have on the company in the months and years to come.

(END) Dow Jones Newswires

February 07, 2017 05:44 ET (10:44 GMT)

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