Bob Iger's Bullish on Advertising, Consumer, and Digital Revenue

Disney's stock is trading nearly five percent higher todayon news that the company's strong brands are successfully riding the advertising recovery and return of consumer spending .

The Dow component reported much stronger than expected fiscal first quarter growth— 54 percent higher profit than the year-ago quarter and 10 percent higher revenue — blowing past Wall Street expectations (the company doesn't provide any guidance). I sat down with Disney CEO Bob Iger for an exclusive interview about the company's results and his outlook.

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Iger is optimistic that consumer spending and an advertising rebound are gaining momentum.

In the ad market, the recovery seems to be both broad-based and long lasting. Disney is seeing major ad gains not just in a single quarter, but several quarter in a row, and the strength comes from multiple sectors: auto, consumer products, retail, tech, telcos, and consumer products.

The fact that it's not one or few businesses coming back, is a good thing.

Disney's parks performance shows a consumer eager to spend — Iger says there's no doubt that consumers feels better about spending money than they did a year ago. He even goes as far as to say that he's seeing more confidence among American consumers than the consumer sentiment numbers suggest. But he's still somewhat cautious, saying that the American consumer still has concerns and suffers from a lack of long-term confidence.

When it comes to Iger's long-term economic outlook, he tells us he's confident that the government absolutely *gets* the importance of creating a good environment for business and understands: "as business goes, so goes the country." Disney's been talking to the administration, and he says "certainly in the last few months, it's been a very positive dialogue." Iger didn't get into the nitty gritty details of what he thinks the administration should be doing that it's not, but said that the White House is taking certain steps recently that reflect the needs of the country.

And Iger has never sounded more confident in the company's content assets.

ESPN and the Disney channel led the media networks group to a stunning 47 percent growth.

He acknowledged that ABC needs improvement in primetime, but he says he feels good about the direction ABC is going, saying that it still fits with the company's mix of assets.

He noted that scatter market ad pricing is up dramatically from last year's 'Upfront' prices.' Iger pointed out that the array of TV assets put the company in a good position when they're negotiating distribution deals with cable and satellite carriers. He wouldn't get into details, but we can certainly expect more subscription and retransmission growth. And the movie studio, after going through a rough patch in 2009, is clearly back on track, with "Tangled" and the ongoing success of "Alice in Wonderland" and "Toy Story 3" on home video.

Looking to the future, Iger is taking a multi-pronged approach to offer a range of digital content on a range of digital platforms. Iger stressed that the company is determined to experiment, to figure out what generates the best value for consumers. On the heels of a Netflix deal for older ABC content, he says that platforms like Netflix will help drive incremental revenue. Is Netflix a threat to premium cable? Not to Disney's, because they're only distributing older TV content, so the revenue should be purely additive.

Questions? Comments?