Disney CEO Bob Iger Talks Earnings, 'Avengers,' and International Growth

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On the heels of a record-breaking weekend for "The Avengers," Disney reported better-than-expected fiscal second quarter results. Earnings grew 18 percent over the year-ago quarter, to 58 cents, 3 percent more than Wall Street expected, and revenue grew 6 percent to $9.629 billion.

"The Avengers" wasn't included in the quarter, but CEO Bob Iger made some news about the hit movie, saying that a sequel is in the works.

That's in addition to "Iron Man 3" due out in May 2013, "Thor 2" in November 2013, and "Captain America 2" in April 2014. Iger pointed out that this hit franchise has positive impact beyond the studio: it's already lifting Disney's consumer products division. Iger says based on early figures demand for "Avengers" merchandise has been "very strong" — they can't make the products fast enough.

Disney CFO Jay Rasulo also made some news, dropping some heavy hints that the company will continue to repurchase stock at least at the rate the company did last year.

As we head into the "upfront" TV ad sales period, Iger's outlook is positive, pointing to hit shows and higher ad rates. So far this quarter, scatter, or last minute ad pricing, is up 20 percent over last year's, which certainly bodes well. In this most recent quarter, ad revenue at ABC network grew 6 percent while revenue at the affiliate stations declined 8 percent.

Iger spoke off-camera to me about the growing importance of digital revenue. Revenue at the "Interactive Media" division grew 13 percent and operating losses were slashed by 39 percent. But that doesn't include the incremental revenue Disney is seeing at its media networks, from, say, Netflix licensing fees, or at its movie studio from, say, digital downloads. Iger assured me that these new digital streams are purely incremental and they aren't seeing signs of cannibalization.

Iger led off the earnings call with a heavy emphasis on international growth, China in particular. Iger says China is a "priority" and that the Shanghai resort, which is now under construction, will be very important for international growth. He also said he's "very optimistic" about expansion of the parks and resorts, including at Hong Kong Disney, which had a particularly strong quarter, helpIng drive the 10 percent increase in revenue.

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