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Ahead Of Disney Earnings, Economic Impact Is Key

Disney
CNBC.com
Disney

Disney reports after the bell today, and Wall Street's expecting revenues of $9.1 billion, up one percent from a year ago, and projecting earnings up 5 percent to 61 cents per share. (This according to the consensus Thompson estimates).

The big question is how Disney is weathering the economic downturn, which puts Disney's parks division in the spotlight. So far in the consumer spending slowdown, the parks attendance and revenues have held up remarkably well. But it seems investors are waiting for the other shoe to drop.

Disney's cable networks have also been growing fast-- ESPN continuing to deliver boffo numbers and the Disney Channel delivering both numbers and brands (like Hannah Montana) that can be expanded and exploited across all of Disney's platforms.

The question now-- will the advertising downturn hit ad revenue at these cable networks? And Disney's studio and Pixar have continued to churn out hits, most recently Wall-E. But its Narnia sequel didn't have the huge performance the original one had. The real challenge for that division: the comparisons to the year-ago quarter when Pirates of the Caribbean III broke box office records.

CEO Bob Iger's strategy to build brands that fit with the Disney brand and that it can take across all the company's platforms seems to be working remarkably well. The question is, can it hold up through an economic downturn. And how much can the weak dollar help international revenues boost foreigners visits to the theme parks.