Discovery Communications Inc Earnings Cheat Sheet: Company Enjoys Fifth Straight Quarter of Double-Digit Growth

S&P 500 (NYSE:SPY) component Discovery Communications Inc (NASDAQ:DISCA) reported net income above Wall Street’s expectations for the third 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 for the Third Quarter

Results: Net income for Discovery Communications Inc rose to $237 million (59 cents per share) vs. $186 million (43 cents per share) in the same quarter a year earlier. This marks a rise of 27.4% from the year earlier quarter.

Revenue: Rose 18.3% to $1.09 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: DISCA beat the mean analyst estimate of 55 cents per share. It beat the average revenue estimate of $1.01 billion.

Quoting Management: David Zaslav, Discovery’s President and Chief Executive Officer said, “The strength of Discovery’s brands and the value of our content to consumers, distributors and advertisers alike were further demonstrated in our third quarter financial results. The appeal of our programming allowed us to continue to take advantage of the sustained health of the global ad market and further leverage existing and emerging distribution platforms worldwide. The breadth of our global distribution enables us to capitalize on the increasing penetration of traditional distribution models, while the diversity and appeal of our content allows us to strategically leverage evolving delivery methods.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose more than twofold and in the first quarter, the figure rose 80.5%.

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

Gross margin shrank three percentage points to 68.8%. The contraction appeared to be driven by increased costs, which rose 31% from the year earlier quarter while revenue rose 18.3%.

Revenue has risen the past four quarters. Revenue increased 10.8% to $1.07 billion in the second quarter. The figure rose 8.2% in the first quarter from the year earlier and climbed 5.3% in the fourth quarter of the last fiscal year from the year-ago quarter.

Looking Forward: Expectations for the company’s next quarter performance are higher than they were ninety days ago. Over the past three months, the average estimate for the fourth quarter has risen to 68 cents per share from 67 cents. For the fiscal year, the average estimate has moved up from $2.30 a share to $2.31 over the last ninety days.

Competitors to Watch: Scripps Networks Interactive, Inc. (NYSE:SNI), CBS Corporation (NYSE:CBS), Outdoor Channel Hldgs., Inc. (NASDAQ:OUTD), Liberty Media Corp (NASDAQ:LINTA), The Walt Disney Company (NYSE:DIS), News Corporation (NASDAQ:NWSA), Madison Square Garden, Inc. (NASDAQ:MSG), Time Warner Inc. (NYSE:TWX), and Point.360 (NASDAQ:PTSX).

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(Source: Xignite Financials)