Disney took a big gamble back in 2012 when it paid $4 billion for Lucasfilm. That bet appears to have paid off. Today Disney reported its earnings for the first quarter of 2016. It boasted revenue of $15.24 billion and a profit of $2.88 billion, a jump of 32 percent over the same period last year and a new record for the company. The performance of Star Wars helped to offset declines in profit at Disney's cable and broadcast networks.
Disney said that ESPN was the main culprit behind its sinking cable profits. On the flip side, it pointed to sales of classic Star Wars films as the driver of big increases in its video on demand business. Star Wars also helped to prop up the licensing and toy business, stepping in to help make up for the slowly fading juggernaut of Frozen.
The success of the Star Wars franchise made Disney an outlier among traditional media companies. Both 21st Century Fox and Viacom reported disappointing earnings this week and have seen their share prices slide in response. It's not clear yet if the boost from Star Wars will allow investors to shrug off the drag from ESPN, with Disney shares dipping down about 3 percent in after hours trading. A company's stock falling after it reports its best profit of all time, however, says a lot more about the skittish nature of the current bear market than it does about Disney's fundamentals.