Walt Disney Studios Aug. 4 reported third-quarter (ended June 27) home entertainment revenue of $416 million, which included $395 million from studio content and $21 million from direct-to-consumer. That compared with revenue of $456 million in the previous-year period. Through nine months of the fiscal year, however, home entertainment revenue topped $1.4 billion, up nearly 17% from $1.2 billion during the previous-year period.
With scant new releases due to the coronavirus pandemic, Disney continues to generate home video sales with titles such as Frozen II and Star Wars: The Rise of Skywalker, the two top-selling titles of 2020 according to the NPD Group’s VideoScan tracking service.
Meanwhile, Walt Disney Studios reported a 55% drop in third-quarter (ended June 27) revenue to $1.7 billion, from revenue of $3.8 billion in the previous-year period. Operating income declined 16% to $668 million, compared with income of $792 million in the prior-year period.
The decrease in operating income was due to lower theatrical distribution results, partially offset by growth from TV/SVOD distribution, a decrease in home entertainment marketing costs and lower film cost impairments.
Theatrical distribution in the quarter was negatively impacted by COVID-19 as theaters were generally closed domestically and internationally.
No significant titles were released in the current quarter compared with the release of Avengers: Endgame, Aladdin and Dark Phoenix in the prior-year quarter. Growth in TV/SVOD distribution was due to the sale of content to Disney+, including library titles, of The Rise of Skywalker and Pixar Animation’s Onward. This increase was partially offset by a decrease in sales to third parties in the pay-TV window.