Despite an exciting quarter, Disney misses Wall Street expectations

Despite a quarter full of excitement, Disney’s revenue for the three months ending in June was lower than Wall Street expected.

Disney posted $20.2 billion in sales for the quarter, compared to analysts’ projection of $21.4 billion, the company announced after market close Tuesday. The company’s stock slid 4% in after hours trading.

Despite missing analyst expectations, sales in the quarter were up 33% from the same period last year, thanks to wins for the company in its studio entertainment and media networks businesses.

Disney had multiple box office blockbusters during the three months ending July, including “Toy Story 4,” which has made nearly $1 billion at the box office, and “Avengers: Endgame,” which became the highest grossing film from any studio in history. Those movies and others helped Disney set a record for the highest grossing year for a film studio ever, an achievement announced last week, just seven months into the year.

It was also the first quarter for the company to really reap the benefits of its $71 billion acquisition of the TV and film assets behind 21st Century Fox, which brought popular titles like “The Simpsons” under Disney’s roof. That deal helped beef up Disney’s streaming lineup ahead of the planned launch of its streaming service, Disney+, and also gave it a majority ownership stake in Hulu.

Ongoing investments in streaming continued to weigh on the company’s bottom line in the quarter. Net income in was down 51% to $1.4 billion. The company is hoping to turn around after the November Disney+ launch. The service will cost $6.99 per month and will help it compete with other heavy hitters in the streaming space such as Amazon and Netflix.