Disney reported quarterly earnings and revenue that beat analysts' expectations on Tuesday, amid major announcements including an over-the-top streaming service for DirecTV.
The company posted third-quarter earnings of $1.62 per share on $14.28 billion in revenue. Analysts expected Disney to post earnings of $1.61 per share on $14.15 billion in revenue, according to a Thomson Reuters consensus estimate.
The stock was last down 1 percent in extended trading.
Operating income for Disney's studio segment came in at $766 million, higher than analyst expectations for $720.7 million, according to FactSet. Overall, the company said operating income for the unit benefited from "strong performance" of its films including "Captain America: Civil War" and "Finding Dory."
Disney CEO Bob Iger said in a statement that the company's results "are evidence that our asset mix is strong, as is our ability to execute in ways that enhance the Disney brand and create value for our shareholders while we invest for future growth."
Separately, Disney also announced that it is taking a minority stake in BAMTech, which will be separated from Major League Baseball's digital arm as part of the deal. The Burbank, California-based company said that it will pay $1 billion in two installments and has an option to acquire majority ownership in the future.
Disney said that BAMTech will work with ESPN to launch a direct-to-consumer, subscription streaming service, featuring live sporting events at the regional, national and international levels. The company said, however, that current content on ESPN's linear networks will not be part of the service.
Iger told CNBC's "Closing Bell" that he thinks the stake in BAMTech is a "good investment."
"We love the business model. We think that in today's world having the ability to stream on a scaled basis live sports and live programming is a competitive advantage and something that is necessary," Iger said on Tuesday.
"Bringing a multi-sport service directly to fans is an exciting opportunity that capitalizes on BAMTech's premier digital distribution platform and continues ESPN's heritage of embracing technology to create new ways to connect fans with sports," said John Skipper, ESPN president and co-Chair of Disney Media Networks.
Live TV, especially sports, remains one of the biggest draws for traditional television. During the quarter, Disney said cable network revenue grew 1 percent to $2.09 billion, partially attributable to growth at ESPN.
The media giant said that ESPN saw higher advertising revenue, which Disney said "included the benefit of an additional NBA championship game."
Disney also said that the upcoming over-the-top streaming service from AT&T's DirecTV will include ESPN, ESPN2, ABC, freeform, Disney Channel, Disney XD and Disney Jr. in all subscription packages.