Stocks mostly moved sideways Wednesday, with the Dow Jones Industrial Average (DJINDICES: ^DJI) and the S&P 500 (SNPINDEX: ^GSPC) ending the session with small losses.
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The price of crude oil fell more than 3%, dragging down the energy sector; the SPDR S&P Oil & Gas Exploration & Production ETF (NYSEMKT: XOP) fell 1.6%. Banks had a good day, with the SPDR S&P Regional Banking ETF (NYSEMKT: KRE) closing up 0.8%.
As for individual stocks, Walt Disney (NYSE: DIS) reported an earnings disappointment and briefed analysts on its streaming plans, while 3D Systems (NYSE: DDD) soared on higher printer sales.
Image source: Getty Images.
Disney looks to the future
Disney reported second-quarter earnings that were below expectations, but took the opportunity to share more of its vision for its streaming service, emphasizing the role that will be played by the assets it is acquiring from Twenty-First Century Fox (NASDAQ: FOX) (NASDAQ: FOXA). Revenue grew 7% to $15.23 billion and earnings per share, adjusted for a one-time benefit from the new tax law, jumped 18.4% to $1.87. Analysts were expecting adjusted EPS of $1.95, and shares slumped 2.2%.
From a segment revenue perspective, media networks grew 5% to $6.2 billion, parks and resorts was up 6% to $5.2 billion, studio entertainment revenue jumped 20% to $2.9 billion, but consumer products and interactive media fell 8% to $1.0 billion.
In the conference call, Disney said it is on track for a late-2019 launch of its streaming service, and is investing in numerous projects to create content for it, including a live-action Star Wars series. The company is also creating new Marvel-based content, with the Fox deal giving it access to X-Men, The Fantastic Four, and Deadpool when the deal completes. Disney also plans to invest to expand National Geographic and FX to support its direct-to-consumer offerings.
Disney will likely have three streaming services by the end of next year: ESPN Plus, Hulu, and a family-oriented Disney service. With a strong offering from its studios in 2019, including Captain Marvel, Dumbo, Avengers, Aladdin, Toy Story 4, The Lion King, Artemis Fowl, Jungle Cruise, Frozen 2, and Star Wars: Episode IX, the company should have plenty of premium content in the pipeline to support pricing of the service.
3D Systems reports strong printer sales
3D Systems blew away analyst expectations with its second-quarter results, and shares skyrocketed 32.4%. Revenue grew 10.7% to $176.6 million, above the $165.9 million consensus forecast, and the company lost $0.08 on a GAAP basis. Non-GAAP earnings per share came in at $0.06, while Wall Street was expecting only $0.01.
Product revenue increased 13.5% to $110.8 million and services revenue was up 6.3% to $65.8 million. Printer revenue, part of the product category, increased 41% on 37% higher unit sales. Materials, which are consumed in the company's razor-and-blades model, had a 3% sales gain to $45.0 million. Healthcare solutions, a segment that spans both product and service categories, grew revenue by 26% to $61.4 million. Gross margin declined to 48.8% from 50.6% in the period a year earlier.
"We are pleased with our results for the second quarter, which were driven by strong revenue growth, including growth in both printer revenue and units as we continue to improve execution and are seeing the early returns on our investments in both innovation and go-to-market," CEO Vyomesh Joshi said in the press release.
Investors were pleased with the top-line printer growth for the rebounding company, especially since the numbers don't include revenue from new products that it is launching and that could provide an even bigger boost in the next few quarters.
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