Disney reports strong EPS growth and attributes the gains to Shanghai Disney Resort.
Walt Disney Company reported results for its fiscal second quarter late Tuesday, with revenues of US$13.34 billion, seeing a three percent increase year-on-year, while analysts had expected $13.45 billion. But Disney’s earnings per share (ESP) for the quarter soared 15 percent to $1.50 per share, higher than the anticipated $1.41. The impressive gains were because of the Shanghai Disney Resort, which opened in the third quarter of 2016, as well as because of increases at its U.S. theme parks, the media giant said.
Revenues from parks and resorts sector increased by nine percent to $4.3 billion. “Our continued strong performance is a direct result of our proven strategic focus on great branded content, innovative technology, and global growth,” said Disney Chairman and CEO Bob Iger.
Last November, Disney Parks announced it would add “Toy Story Land” to the nearly 1,000-acre, $5.5-billion Shanghai Disney Resort. The new area will be Shanghai Disney’s seventh themed area and is set to open in 2018. The company said the park still has three square kilometers of land in Shanghai Pudong that is available for expansion.
China’s theme-park industry is projected to surpass the U.S. by 2020 — ticket sales at theme parks in the Middle Kingdom will jump to $12 billion in 2020 from $4.6 billion in 2015, while ticket revenues at U.S. theme parks is expected to hit $9 billion in 2020 from $8 billion in 2015 according to a joint report by market research firm Euromonitor International and World Travel Market.
Mobile gaming contributes big to NetEase Q1 financials
Chinese internet conglomerate NetEase, China’s second largest gaming player following Tencent, announced Wednesday that its Q1 revenues reached $2 billion, an increase of 72.3% year-on-year. Its online games segment generated $1.6 billion for the quarter, up 78.5% year-on-year.
“Our strong first-quarter results were led by our self-developed mobile games as we continued to bring innovative content to our massive audience,” William Ding, NetEase CEO, said in the statement.
The revenue contribution from online games rose to 73.3 percent from 63.7 percent during the same period a year earlier.
Netease’s flagship mobile game Onmyoji surpassed 200 million global downloads this February after its launch in Japan.
In addition to its footprint in Japan, NetEase is accelerating its global layout by planning to release Onmyoji in the West this summer. It is also planning for an international launch of its currently soft-launched Crusaders of Light around the same time.
LeSports to initiate significant staff cuts
LeSports, the sports subsidiary of China’s entertainment and internet conglomerate LeEco, is planning massive layoffs — a move that will eliminate half of its current workforce, reports Lanxiong Sports, a Beijing-based sports news portal.
In this layoff plan, the smart hardware sector will be eliminated completely. The number of LeSports employees from the paid subscriber sector and marketing sector will be reduced by 50 percent, bringing the total number of its staff to around 300, a big drop compared with the golden time when there were around 1,000 employees at LeSports.
This new downsizing plan comes just five months after LeSports laid off 100 employees, signaling the company’s worsening financial situation.
For LeSports, profits have been hard to come by for a long time. “LeSports paid RMB 1.35 billion ($196 million) for the digital rights to the Chinese Super League, but only received RMB 50 million ($7.2 million) in return. It cannot continue to do that anymore,” said Sun Hongbin, CEO of real estate titan Sunac China, which invested $2.2 billion in LeEco this January.
China’s live-streaming platform Inke to be acquired by Beijing-based communications agency
Shunya International Brand Consulting, an A-share-listed communications agency, announced this Tuesday it would acquire a controlling stake in Beijing Milaiwu Network Technology, the developer of China’s leading live-streaming platform Inke.
The deal is estimated to be roughly RMB 3.5 billion ($507 million) since Inke was valued at RMB 7 billion ($1 billion) last September. Shunya didn’t disclose the size of the deal, but said it will be completed in cash.
The live-streaming platform reported over 16 million monthly active users in January, making it China’s number one player in the live-streaming field, according to Analysys, an internet industry consulting firm.
But Inke seems to fall short of cash. The latest injection it received was back in September 2016, when it secured a pre-B round financing of RMB 210 million ($30.4 million) led by GX Capital.
Besides lacking funding, Inke also suffers from high marketing costs. Inke CEO Feng Yousheng told Caixin that Inke’s monthly marketing costs are about RMB 100 million ($14.5 million).