NEW YORK (AP) — Shares of Walt Disney Co. dipped in premarket trading on Friday on a worse-than-expected fourth-quarter performance from the pay TV unit housing its ESPN network.
On Thursday Disney said that revenue at its pay TV networks, including ESPN, rose a tepid 1 percent to $3.57 billion, largely because a big chunk of fees from distributors came in during the previous quarter as the division met its audience obligations early. The unit's profit fell 7 percent.
Chief Financial Officer Jay Rasulo said, excluding that fee-timing issue, revenue and profits would have been up 6 percent.
The company's fourth-quarter earnings and revenue beat Wall Street's expectations.
Tony Wible of Janney Capital Markets said in a client note that stronger performances from the studio and consumer business weren't enough to alleviate concerns about the television operations. The analyst said that cable ad revenue missed expectations, but he remains upbeat about the company's prospects.
"We still see Disney benefiting from new market opportunities tied to park expansion, new networks, new franchises, new consumer concepts, and growing exposure to emerging economies," Wible wrote.
The analyst kept a "Neutral" rating and $71 price target.
Disney's stock shed 67 cents to $66.48 in premarket trading.