Discovery Communications Earnings: Higher-Than-Expected Net Income

S&P 500 (NYSE:SPY) component Discovery Communications Inc (NASDAQ:DISCA) reported net income above Wall Street’s expectations for the second quarter. Discovery Communications is a global media and entertainment company that offers programming across multiple distribution platforms in more than 170 other countries.

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Discovery Communications Inc Earnings Cheat Sheet

Results: Net income for Discovery Communications Inc rose to $293 million (76 cents per share) vs. $254 million (62 cents per share) in the same quarter a year earlier. This marks a rise of 15.4% from the year-earlier quarter.

Revenue: Rose 7% to $1.14 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Discovery Communications Inc beat the mean analyst estimate of 60 cents per share. It beat the average revenue estimate of $1.06 billion.

Quoting Management: David Zaslav, Discovery’s President and Chief Executive Officer said, “Discovery’s consistent focus on investing in our global platform, building new brands and developing additional growth opportunities resulted in continued strong operating results during the second quarter. The steps we have taken to broaden our international content offerings, along with the continued evolution of pay-tv globally, are driving international expansion, while domestically we are generating significant returns from the sustained programming initiatives and audience growth across our younger networks. Our financial momentum and strong balance sheet have enabled us to accelerate the pace of our capital returns as we continue to invest in both new and existing strategic growth initiatives to further build shareholder value.”

Key Stats:

The company has now topped analyst estimates for the last four quarters. It beat the mark by 2 cents in the first quarter, by 4 cents in the fourth quarter of the last fiscal year, and by 2 cents in the third quarter of the last fiscal year.

Revenue has increased for four quarters in a row. Revenue increased 16% to $1.1 billion in the first quarter. The figure rose 10.5% in the fourth quarter of the last fiscal year from the year earlier and climbed 18.3% in the third quarter of the last fiscal year from the year-ago quarter.

Net income has increased 45.7% year-over-year on average across the last five quarters. The biggest gain came in the second quarter of the last fiscal year, when income climbed more than twofold from the year-earlier quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the third quarter has moved down from 74 cents a share to 73 cents over the last seven days. For the fiscal year, the average estimate has moved down from $2.81 a share to $2.78 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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