• by Wayne Friedman , May 8, 2018

Walt Disney grabbed a near 10% gain on first-quarter revenue, boosted by its parks/resorts and theatrical movies. Top-line results pulled in $14.6 billion -- a 9% hike -- with net income up 23% to $2.9 billion. Much of this net income gain came from the new U.S. tax law.

Theatrical movie “Black Panther” and the home entertainment business, driven from “Star Wars: The Last Jedi,” lifted results for its studio entertainment by 21%, rising to $2.5 billion. Guest spending at its parks -- benefitting from a shift in the timing of the Easter holiday worldwide -- helped revenues climb 13% to $4.9 billion.

Both studio and parks/resorts businesses posted big operating income improvements -- 29% (to $847 million) and 27% (to $954 million), respectively.

At the same time, media networks posted weaker results -- up 3% in revenue to $6.1 billion with declining operating income 6% lower to $2.1 billion.

Broadcasting revenues for networks and TV stations posted flat revenue at $1.9 billion, while affiliate revenue increased and advertising revenues declined. Cable TV network results fared a bit better in revenues -- up 5% to $4.3 billion. But operating income declined 4% to $1.7 billion.

Disney says lower operating cable TV income was primarily due to a loss at its digital media platform BAMTech and declines at its networks ESPN and Freeform. Lower BAMTech results were attributable to technology costs associated with the OTT app platform ESPN+. Lower ESPN operating income resulted from higher programming costs.

Speaking to CNBC, Bob Iger, chairman/CEO at Walt Disney, would not disclose subscriber specifics of the ESPN+ app, which started up in March. But he said: “We have seen pretty high adoption rates from what was a free [offer] to pay. That has been positive.”

Looking more broadly at the transition to digital media from traditional TV platforms, Iger said: “We believe you are going to continue to see real growth in digital platforms and continued erosion on the traditional side. Ultimately, the new business will eclipse the old business sooner than most people initially predicted.”