For the Quarterly Period Ended
|
|
Commission File Number 1-11605
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June 30, 2018
|
|
|
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Incorporated in Delaware
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I.R.S. Employer Identification
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No. 95-4545390
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Large accelerated filer
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x
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Accelerated filer
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¨
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||
Non-accelerated filer
(Do not check if smaller reporting company)
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Quarter Ended
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Nine Months Ended
|
||||||||||||
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June 30,
2018 |
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July 1,
2017 |
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June 30,
2018 |
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July 1,
2017 |
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Services
|
$
|
13,142
|
|
|
$
|
12,097
|
|
|
$
|
38,646
|
|
|
$
|
35,990
|
|
Products
|
2,086
|
|
|
2,141
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|
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6,481
|
|
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6,368
|
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||||
Total revenues
|
15,228
|
|
|
14,238
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45,127
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42,358
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||||
Costs and expenses:
|
|
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||||||||
Cost of services (exclusive of depreciation and amortization)
|
(7,124
|
)
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|
(6,469
|
)
|
|
(20,762
|
)
|
|
(19,328
|
)
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||||
Cost of products (exclusive of depreciation and amortization)
|
(1,224
|
)
|
|
(1,248
|
)
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|
(3,856
|
)
|
|
(3,764
|
)
|
||||
Selling, general, administrative and other
|
(2,212
|
)
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|
(2,022
|
)
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(6,538
|
)
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(5,948
|
)
|
||||
Depreciation and amortization
|
(744
|
)
|
|
(711
|
)
|
|
(2,217
|
)
|
|
(2,074
|
)
|
||||
Total costs and expenses
|
(11,304
|
)
|
|
(10,450
|
)
|
|
(33,373
|
)
|
|
(31,114
|
)
|
||||
Restructuring and impairment charges
|
—
|
|
|
—
|
|
|
(28
|
)
|
|
—
|
|
||||
Other income/(expense), net
|
—
|
|
|
(177
|
)
|
|
94
|
|
|
(177
|
)
|
||||
Interest expense, net
|
(143
|
)
|
|
(117
|
)
|
|
(415
|
)
|
|
(300
|
)
|
||||
Equity in the income of investees
|
73
|
|
|
124
|
|
|
122
|
|
|
327
|
|
||||
Income before income taxes
|
3,854
|
|
|
3,618
|
|
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11,527
|
|
|
11,094
|
|
||||
Income taxes
|
(795
|
)
|
|
(1,144
|
)
|
|
(880
|
)
|
|
(3,593
|
)
|
||||
Net income
|
3,059
|
|
|
2,474
|
|
|
10,647
|
|
|
7,501
|
|
||||
Less: Net income attributable to noncontrolling interests
|
(143
|
)
|
|
(108
|
)
|
|
(371
|
)
|
|
(268
|
)
|
||||
Net income attributable to The Walt Disney Company (Disney)
|
$
|
2,916
|
|
|
$
|
2,366
|
|
|
$
|
10,276
|
|
|
$
|
7,233
|
|
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||||||||
Earnings per share attributable to Disney:
|
|
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||||||||
Diluted
|
$
|
1.95
|
|
|
$
|
1.51
|
|
|
$
|
6.81
|
|
|
$
|
4.55
|
|
|
|
|
|
|
|
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|
||||||||
Basic
|
$
|
1.96
|
|
|
$
|
1.51
|
|
|
$
|
6.84
|
|
|
$
|
4.58
|
|
|
|
|
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|
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||||||||
Weighted average number of common and common equivalent shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Diluted
|
1,498
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|
|
1,572
|
|
|
1,510
|
|
|
1,588
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic
|
1,491
|
|
|
1,562
|
|
|
1,502
|
|
|
1,578
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Dividends declared per share
|
$
|
0.84
|
|
|
$
|
0.78
|
|
|
$
|
1.68
|
|
|
$
|
1.56
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Net income
|
$
|
3,059
|
|
|
$
|
2,474
|
|
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$
|
10,647
|
|
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$
|
7,501
|
|
Other comprehensive income/(loss), net of tax:
|
|
|
|
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|
|
|
||||||||
Market value adjustments for investments
|
1
|
|
|
(5
|
)
|
|
7
|
|
|
(15
|
)
|
||||
Market value adjustments for hedges
|
260
|
|
|
(92
|
)
|
|
166
|
|
|
24
|
|
||||
Pension and postretirement medical plan adjustments
|
70
|
|
|
68
|
|
|
225
|
|
|
194
|
|
||||
Foreign currency translation and other
|
(363
|
)
|
|
70
|
|
|
(132
|
)
|
|
(153
|
)
|
||||
Other comprehensive income/(loss)
|
(32
|
)
|
|
41
|
|
|
266
|
|
|
50
|
|
||||
Comprehensive income
|
3,027
|
|
|
2,515
|
|
|
10,913
|
|
|
7,551
|
|
||||
Net income attributable to noncontrolling interests, including redeemable noncontrolling interests
|
(143
|
)
|
|
(108
|
)
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|
(371
|
)
|
|
(268
|
)
|
||||
Other comprehensive (income)/loss attributable to noncontrolling interests
|
115
|
|
|
(25
|
)
|
|
—
|
|
|
65
|
|
||||
Comprehensive income attributable to Disney
|
$
|
2,999
|
|
|
$
|
2,382
|
|
|
$
|
10,542
|
|
|
$
|
7,348
|
|
|
June 30,
2018 |
|
September 30,
2017 |
||||
ASSETS
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
4,326
|
|
|
$
|
4,017
|
|
Receivables
|
10,071
|
|
|
8,633
|
|
||
Inventories
|
1,322
|
|
|
1,373
|
|
||
Television costs and advances
|
1,241
|
|
|
1,278
|
|
||
Other current assets
|
769
|
|
|
588
|
|
||
Total current assets
|
17,729
|
|
|
15,889
|
|
||
Film and television costs
|
7,684
|
|
|
7,481
|
|
||
Investments
|
3,155
|
|
|
3,202
|
|
||
Parks, resorts and other property
|
|
|
|
||||
Attractions, buildings and equipment
|
55,284
|
|
|
54,043
|
|
||
Accumulated depreciation
|
(30,611
|
)
|
|
(29,037
|
)
|
||
|
24,673
|
|
|
25,006
|
|
||
Projects in progress
|
3,446
|
|
|
2,145
|
|
||
Land
|
1,254
|
|
|
1,255
|
|
||
|
29,373
|
|
|
28,406
|
|
||
Intangible assets, net
|
6,892
|
|
|
6,995
|
|
||
Goodwill
|
31,306
|
|
|
31,426
|
|
||
Other assets
|
2,653
|
|
|
2,390
|
|
||
Total assets
|
$
|
98,792
|
|
|
$
|
95,789
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable and other accrued liabilities
|
$
|
9,763
|
|
|
$
|
8,855
|
|
Current portion of borrowings
|
5,992
|
|
|
6,172
|
|
||
Deferred revenue and other
|
4,459
|
|
|
4,568
|
|
||
Total current liabilities
|
20,214
|
|
|
19,595
|
|
||
Borrowings
|
17,681
|
|
|
19,119
|
|
||
Deferred income taxes
|
3,222
|
|
|
4,480
|
|
||
Other long-term liabilities
|
6,467
|
|
|
6,443
|
|
||
Commitments and contingencies (Note 12)
|
|
|
|
|
|
||
Redeemable noncontrolling interests
|
1,137
|
|
|
1,148
|
|
||
Equity
|
|
|
|
||||
Preferred stock, $0.01 par value, Authorized – 100 million shares, Issued – none
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value,
Authorized – 4.6 billion shares, Issued – 2.9 billion shares |
36,574
|
|
|
36,248
|
|
||
Retained earnings
|
80,364
|
|
|
72,606
|
|
||
Accumulated other comprehensive loss
|
(3,262
|
)
|
|
(3,528
|
)
|
||
|
113,676
|
|
|
105,326
|
|
||
Treasury stock, at cost, 1.4 billion shares
|
(67,588
|
)
|
|
(64,011
|
)
|
||
Total Disney Shareholders’ equity
|
46,088
|
|
|
41,315
|
|
||
Noncontrolling interests
|
3,983
|
|
|
3,689
|
|
||
Total equity
|
50,071
|
|
|
45,004
|
|
||
Total liabilities and equity
|
$
|
98,792
|
|
|
$
|
95,789
|
|
|
Nine Months Ended
|
||||||
|
June 30,
2018 |
|
July 1,
2017 |
||||
OPERATING ACTIVITIES
|
|
|
|
||||
Net income
|
$
|
10,647
|
|
|
$
|
7,501
|
|
Depreciation and amortization
|
2,217
|
|
|
2,074
|
|
||
Deferred income taxes
|
(1,411
|
)
|
|
294
|
|
||
Equity in the income of investees
|
(122
|
)
|
|
(327
|
)
|
||
Cash distributions received from equity investees
|
587
|
|
|
584
|
|
||
Net change in film and television costs and advances
|
(601
|
)
|
|
(745
|
)
|
||
Equity-based compensation
|
307
|
|
|
278
|
|
||
Other
|
297
|
|
|
373
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables
|
(1,178
|
)
|
|
(786
|
)
|
||
Inventories
|
53
|
|
|
93
|
|
||
Other assets
|
(472
|
)
|
|
72
|
|
||
Accounts payable and other accrued liabilities
|
(316
|
)
|
|
(781
|
)
|
||
Income taxes
|
434
|
|
|
143
|
|
||
Cash provided by operations
|
10,442
|
|
|
8,773
|
|
||
|
|
|
|
||||
INVESTING ACTIVITIES
|
|
|
|
||||
Investments in parks, resorts and other property
|
(3,264
|
)
|
|
(2,728
|
)
|
||
Acquisitions
|
(1,581
|
)
|
|
(557
|
)
|
||
Other
|
(298
|
)
|
|
(5
|
)
|
||
Cash used in investing activities
|
(5,143
|
)
|
|
(3,290
|
)
|
||
|
|
|
|
||||
FINANCING ACTIVITIES
|
|
|
|
||||
Commercial paper borrowings/(payments), net
|
453
|
|
|
(112
|
)
|
||
Borrowings
|
1,056
|
|
|
4,053
|
|
||
Reduction of borrowings
|
(1,356
|
)
|
|
(1,736
|
)
|
||
Dividends
|
(1,266
|
)
|
|
(1,237
|
)
|
||
Repurchases of common stock
|
(3,577
|
)
|
|
(5,944
|
)
|
||
Proceeds from exercise of stock options
|
129
|
|
|
256
|
|
||
Other
|
(420
|
)
|
|
(1,072
|
)
|
||
Cash used in financing activities
|
(4,981
|
)
|
|
(5,792
|
)
|
||
|
|
|
|
||||
Impact of exchange rates on cash, cash equivalents and restricted cash
|
(51
|
)
|
|
(23
|
)
|
||
|
|
|
|
||||
Change in cash, cash equivalents and restricted cash
|
267
|
|
|
(332
|
)
|
||
Cash, cash equivalents and restricted cash, beginning of period
|
4,064
|
|
|
4,760
|
|
||
Cash, cash equivalents and restricted cash, end of period
|
$
|
4,331
|
|
|
$
|
4,428
|
|
|
Quarter Ended
|
||||||||||||||||||||||
|
June 30, 2018
|
|
July 1, 2017
|
||||||||||||||||||||
|
Disney
Shareholders
|
|
Non-
controlling
Interests
(1)
|
|
Total
Equity
|
|
Disney
Shareholders
|
|
Non-
controlling
Interests
(1)
|
|
Total
Equity
|
||||||||||||
Beginning balance
|
$
|
45,151
|
|
|
$
|
3,500
|
|
|
$
|
48,651
|
|
|
$
|
43,784
|
|
|
$
|
3,483
|
|
|
$
|
47,267
|
|
Comprehensive income
|
2,999
|
|
|
41
|
|
|
3,040
|
|
|
2,382
|
|
|
133
|
|
|
2,515
|
|
||||||
Equity compensation activity
|
156
|
|
|
—
|
|
|
156
|
|
|
174
|
|
|
—
|
|
|
174
|
|
||||||
Dividends
|
(1,249
|
)
|
|
—
|
|
|
(1,249
|
)
|
|
(1,208
|
)
|
|
—
|
|
|
(1,208
|
)
|
||||||
Common stock repurchases
|
(969
|
)
|
|
—
|
|
|
(969
|
)
|
|
(2,444
|
)
|
|
—
|
|
|
(2,444
|
)
|
||||||
Distributions and other, net
|
—
|
|
|
442
|
|
|
442
|
|
|
(157
|
)
|
|
(96
|
)
|
|
(253
|
)
|
||||||
Ending balance
|
$
|
46,088
|
|
|
$
|
3,983
|
|
|
$
|
50,071
|
|
|
$
|
42,531
|
|
|
$
|
3,520
|
|
|
$
|
46,051
|
|
(1)
|
Excludes redeemable noncontrolling interest
|
|
Nine Months Ended
|
||||||||||||||||||||||
|
June 30, 2018
|
|
July 1, 2017
|
||||||||||||||||||||
|
Disney
Shareholders
|
|
Non-
controlling
Interests
(1)
|
|
Total
Equity
|
|
Disney
Shareholders
|
|
Non-
controlling
Interests
(1)
|
|
Total
Equity
|
||||||||||||
Beginning balance
|
$
|
41,315
|
|
|
$
|
3,689
|
|
|
$
|
45,004
|
|
|
$
|
43,265
|
|
|
$
|
4,058
|
|
|
$
|
47,323
|
|
Comprehensive income
|
10,542
|
|
|
389
|
|
|
10,931
|
|
|
7,348
|
|
|
203
|
|
|
7,551
|
|
||||||
Equity compensation activity
|
319
|
|
|
—
|
|
|
319
|
|
|
404
|
|
|
—
|
|
|
404
|
|
||||||
Dividends
|
(2,515
|
)
|
|
—
|
|
|
(2,515
|
)
|
|
(2,445
|
)
|
|
—
|
|
|
(2,445
|
)
|
||||||
Common stock repurchases
|
(3,577
|
)
|
|
—
|
|
|
(3,577
|
)
|
|
(5,944
|
)
|
|
—
|
|
|
(5,944
|
)
|
||||||
Distributions and other, net
|
4
|
|
|
(95
|
)
|
|
(91
|
)
|
|
(97
|
)
|
|
(741
|
)
|
|
(838
|
)
|
||||||
Ending balance
|
$
|
46,088
|
|
|
$
|
3,983
|
|
|
$
|
50,071
|
|
|
$
|
42,531
|
|
|
$
|
3,520
|
|
|
$
|
46,051
|
|
(1)
|
Excludes redeemable noncontrolling interest
|
1.
|
Principles of Consolidation
|
2.
|
Cash and Cash Equivalents and Restricted Cash
|
|
|
June 30,
2018 |
|
September 30,
2017 |
||||
Cash and cash equivalents
|
|
$
|
4,326
|
|
|
$
|
4,017
|
|
Restricted cash included in:
|
|
|
|
|
||||
Other current assets
|
|
1
|
|
|
26
|
|
||
Other assets
|
|
4
|
|
|
21
|
|
||
Total cash, cash equivalents and restricted cash in the statement of cash flows
|
|
$
|
4,331
|
|
|
$
|
4,064
|
|
3.
|
Segment Information
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Media Networks
|
$
|
78
|
|
|
$
|
127
|
|
|
$
|
141
|
|
|
$
|
334
|
|
Parks and Resorts
|
(5
|
)
|
|
(3
|
)
|
|
(19
|
)
|
|
(8
|
)
|
||||
Consumer Products & Interactive Media
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Equity in the income of investees included in segment operating income
|
$
|
73
|
|
|
$
|
124
|
|
|
$
|
122
|
|
|
$
|
327
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Revenues
(1)
:
|
|
|
|
|
|
|
|
||||||||
Media Networks
|
$
|
6,156
|
|
|
$
|
5,866
|
|
|
$
|
18,537
|
|
|
$
|
18,045
|
|
Parks and Resorts
|
5,193
|
|
|
4,894
|
|
|
15,226
|
|
|
13,748
|
|
||||
Studio Entertainment
|
2,878
|
|
|
2,393
|
|
|
7,836
|
|
|
6,947
|
|
||||
Consumer Products & Interactive Media
|
1,001
|
|
|
1,085
|
|
|
3,528
|
|
|
3,618
|
|
||||
|
$
|
15,228
|
|
|
$
|
14,238
|
|
|
$
|
45,127
|
|
|
$
|
42,358
|
|
Segment operating income
(1)
:
|
|
|
|
|
|
|
|
||||||||
Media Networks
|
$
|
1,822
|
|
|
$
|
1,842
|
|
|
$
|
5,097
|
|
|
$
|
5,427
|
|
Parks and Resorts
|
1,339
|
|
|
1,168
|
|
|
3,640
|
|
|
3,028
|
|
||||
Studio Entertainment
|
708
|
|
|
639
|
|
|
2,384
|
|
|
2,137
|
|
||||
Consumer Products & Interactive Media
|
324
|
|
|
362
|
|
|
1,295
|
|
|
1,371
|
|
||||
|
$
|
4,193
|
|
|
$
|
4,011
|
|
|
$
|
12,416
|
|
|
$
|
11,963
|
|
(1)
|
Studio Entertainment revenues and operating income include an allocation of Consumer Products & Interactive Media revenues, which is meant to reflect royalties on sales of merchandise based on film properties. The increase to Studio Entertainment revenues and operating income and corresponding decrease to Consumer Products & Interactive Media revenues and operating income was
$119 million
and
$103 million
for the quarters ended
June 30, 2018
and
July 1, 2017
, respectively, and
$426 million
and
$391 million
for the
nine months
ended
June 30, 2018
and
July 1, 2017
, respectively.
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Segment operating income
|
$
|
4,193
|
|
|
$
|
4,011
|
|
|
$
|
12,416
|
|
|
$
|
11,963
|
|
Corporate and unallocated shared expenses
|
(196
|
)
|
|
(99
|
)
|
|
(540
|
)
|
|
(392
|
)
|
||||
Restructuring and impairment charges
|
—
|
|
|
—
|
|
|
(28
|
)
|
|
—
|
|
||||
Other income/(expense), net
|
—
|
|
|
(177
|
)
|
|
94
|
|
|
(177
|
)
|
||||
Interest expense, net
|
(143
|
)
|
|
(117
|
)
|
|
(415
|
)
|
|
(300
|
)
|
||||
Income before income taxes
|
$
|
3,854
|
|
|
$
|
3,618
|
|
|
$
|
11,527
|
|
|
$
|
11,094
|
|
4.
|
Acquisitions
|
|
Media
Networks
|
|
Parks and
Resorts
|
|
Studio
Entertainment
|
|
Consumer
Products & Interactive Media
|
|
Unallocated
(1)
|
|
Total
|
||||||||||||
Balance at Sept. 30, 2017
|
$
|
16,325
|
|
|
$
|
291
|
|
|
$
|
6,817
|
|
|
$
|
4,393
|
|
|
$
|
3,600
|
|
|
$
|
31,426
|
|
Acquisitions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dispositions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other, net
(1)
|
3,078
|
|
|
—
|
|
|
363
|
|
|
39
|
|
|
(3,600
|
)
|
|
(120
|
)
|
||||||
Balance at June 30, 2018
|
$
|
19,403
|
|
|
$
|
291
|
|
|
$
|
7,180
|
|
|
$
|
4,432
|
|
|
$
|
—
|
|
|
$
|
31,306
|
|
(1)
|
Other, net represents the allocation of BAMTech goodwill to segments based on the final purchase price allocation and also includes the impact of updates to our initial estimated fair value of intangible assets related to BAMTech.
|
5.
|
Borrowings
|
|
September 30,
2017 |
|
Borrowings
|
|
Payments
|
|
Other
Activity
|
|
June 30,
2018 |
||||||||||
Commercial paper with original maturities less than three months
(1)
|
$
|
1,151
|
|
|
$
|
—
|
|
|
$
|
(1,098
|
)
|
|
$
|
(3
|
)
|
|
$
|
50
|
|
Commercial paper with original maturities greater than three months
|
1,621
|
|
|
7,229
|
|
|
(5,678
|
)
|
|
11
|
|
|
3,183
|
|
|||||
U.S. and European medium-term notes
|
19,721
|
|
|
—
|
|
|
(1,300
|
)
|
|
16
|
|
|
18,437
|
|
|||||
BAMTech acquisition payable
|
1,581
|
|
|
—
|
|
|
(1,581
|
)
|
|
—
|
|
|
—
|
|
|||||
Asia Theme Parks borrowings
|
1,145
|
|
|
—
|
|
|
—
|
|
|
37
|
|
|
1,182
|
|
|||||
Foreign currency denominated debt and other
(2)
|
72
|
|
|
1,056
|
|
|
(56
|
)
|
|
(251
|
)
|
|
821
|
|
|||||
Total
|
$
|
25,291
|
|
|
$
|
8,285
|
|
|
$
|
(9,713
|
)
|
|
$
|
(190
|
)
|
|
$
|
23,673
|
|
(1)
|
Borrowings and payments are reported net.
|
(2)
|
The other activity is primarily market value adjustments for debt with qualifying hedges.
|
|
Committed
Capacity
|
|
Capacity
Used
|
|
Unused
Capacity
|
||||||
Facility expiring March 2019
|
$
|
6,000
|
|
|
$
|
—
|
|
|
$
|
6,000
|
|
Facility expiring March 2021
|
2,250
|
|
|
—
|
|
|
2,250
|
|
|||
Facility expiring March 2023
|
4,000
|
|
|
—
|
|
|
4,000
|
|
|||
Total
|
$
|
12,250
|
|
|
$
|
—
|
|
|
$
|
12,250
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Interest expense
|
$
|
(175
|
)
|
|
$
|
(134
|
)
|
|
$
|
(493
|
)
|
|
$
|
(370
|
)
|
Interest and investment income
|
32
|
|
|
17
|
|
|
78
|
|
|
70
|
|
||||
Interest expense, net
|
$
|
(143
|
)
|
|
$
|
(117
|
)
|
|
$
|
(415
|
)
|
|
$
|
(300
|
)
|
6.
|
International Theme Parks
|
|
June 30,
2018 |
|
September 30, 2017
|
||||
Cash and cash equivalents
|
$
|
745
|
|
|
$
|
843
|
|
Other current assets
|
427
|
|
|
376
|
|
||
Total current assets
|
1,172
|
|
|
1,219
|
|
||
Parks, resorts and other property
|
9,213
|
|
|
9,403
|
|
||
Other assets
|
96
|
|
|
111
|
|
||
Total assets
(1)
|
$
|
10,481
|
|
|
$
|
10,733
|
|
|
|
|
|
||||
Current liabilities
|
$
|
1,018
|
|
|
$
|
1,163
|
|
Long-term borrowings
|
1,182
|
|
|
1,145
|
|
||
Other long-term liabilities
|
370
|
|
|
371
|
|
||
Total liabilities
(1)
|
$
|
2,570
|
|
|
$
|
2,679
|
|
(1)
|
Total assets of the Asia Theme Parks were
$8 billion
at both
June 30, 2018
and
September 30, 2017
including parks, resorts and other property of
$7 billion
. Total liabilities of the Asia Theme Parks were
$2 billion
at both
June 30, 2018
and
September 30, 2017
.
|
|
June 30,
2018 |
||
Revenues
|
$
|
2,781
|
|
Costs and expenses
|
(2,702
|
)
|
|
Equity in the loss of investees
|
(19
|
)
|
7.
|
Income Taxes
|
•
|
Effective January 1, 2018, the U.S. corporate federal statutory income tax rate was reduced from
35.0%
to
21.0%
. Because of our fiscal year end, the Company’s fiscal 2018 statutory federal tax rate is
24.5%
, which is applicable to each quarter of the fiscal year, and will be
21.0%
thereafter.
|
•
|
The Company remeasured its U.S. federal deferred tax assets and liabilities at the rate that the Company expects to be in effect when those deferred taxes will be realized (either
24.5%
if in 2018 or
21.0%
thereafter). The Company recognized a benefit from the deferred tax remeasurement of approximately
$2.1 billion
in the nine months ended June 30, 2018.
|
•
|
A one-time tax is due on certain accumulated foreign earnings (Deemed Repatriation Tax), which is payable over eight years. The effective tax rate is generally
15.5%
on the portion of the earnings held in cash and cash equivalents and
8%
on the remainder. The Company recognized a charge for the Deemed Repatriation Tax of approximately
$0.3 billion
in the nine months ended June 30, 2018. Generally there will no longer be a U.S. federal income tax cost arising from the repatriation of foreign earnings.
|
•
|
The Company will be eligible to claim an immediate deduction for investments in qualified fixed assets and film and television productions placed in service in fiscal 2018 through fiscal 2022. This provision phases out through fiscal 2027.
|
•
|
The domestic production activity deduction was eliminated effective for the Company’s fiscal 2019.
|
•
|
Certain foreign derived income will be taxed in the U.S. at an effective rate of approximately
13%
(which increases to approximately
16%
in 2025) rather than the general statutory rate of
21%
. This will be effective for the Company in fiscal 2019.
|
•
|
Certain foreign earnings will be taxed at a minimum effective rate of approximately
13%
, which increases to approximately
16%
in 2025. This will be effective for the Company in fiscal 2019.
|
8.
|
Pension and Other Benefit Programs
|
|
Pension Plans
|
|
Postretirement Medical Plans
|
||||||||||||||||||||||||||||
|
Quarter Ended
|
|
Nine Months Ended
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||
|
June 30, 2018
|
|
July 1, 2017
|
|
June 30, 2018
|
|
July 1, 2017
|
|
June 30, 2018
|
|
July 1, 2017
|
|
June 30, 2018
|
|
July 1, 2017
|
||||||||||||||||
Service costs
|
$
|
87
|
|
|
$
|
90
|
|
|
$
|
262
|
|
|
$
|
273
|
|
|
$
|
3
|
|
|
$
|
3
|
|
|
$
|
8
|
|
|
$
|
9
|
|
Interest costs
|
122
|
|
|
113
|
|
|
367
|
|
|
336
|
|
|
15
|
|
|
14
|
|
|
45
|
|
|
42
|
|
||||||||
Expected return on plan assets
|
(225
|
)
|
|
(219
|
)
|
|
(677
|
)
|
|
(656
|
)
|
|
(13
|
)
|
|
(13
|
)
|
|
(39
|
)
|
|
(37
|
)
|
||||||||
Amortization of prior-year service costs
|
3
|
|
|
3
|
|
|
11
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Recognized net actuarial loss
|
86
|
|
|
101
|
|
|
261
|
|
|
303
|
|
|
3
|
|
|
4
|
|
|
10
|
|
|
12
|
|
||||||||
Net periodic benefit cost
|
$
|
73
|
|
|
$
|
88
|
|
|
$
|
224
|
|
|
$
|
264
|
|
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
24
|
|
|
$
|
26
|
|
9.
|
Earnings Per Share
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||
Shares (in millions):
|
|
|
|
|
|
|
|
||||
Weighted average number of common and common equivalent shares outstanding (basic)
|
1,491
|
|
|
1,562
|
|
|
1,502
|
|
|
1,578
|
|
Weighted average dilutive impact of Awards
|
7
|
|
|
10
|
|
|
8
|
|
|
10
|
|
Weighted average number of common and common equivalent shares outstanding (diluted)
|
1,498
|
|
|
1,572
|
|
|
1,510
|
|
|
1,588
|
|
Awards excluded from diluted earnings per share
|
12
|
|
|
8
|
|
|
12
|
|
|
11
|
|
10.
|
Equity
|
Per Share
|
|
Total Paid
|
|
Payment Timing
|
|
Related to Fiscal Period
|
$0.84
|
$1.2 billion
|
Fourth Quarter of Fiscal 2018
|
First Half of 2018
|
|||
$0.84
|
$1.3 billion
|
Second Quarter of Fiscal 2018
|
Second Half 2017
|
|||
$0.78
|
$1.2 billion
|
Fourth Quarter of Fiscal 2017
|
First Half 2017
|
|||
$0.78
|
$1.2 billion
|
Second Quarter of Fiscal 2017
|
Second Half 2016
|
|
|
|
|
|
Unrecognized
Pension and Postretirement Medical Expense |
|
Foreign
Currency Translation and Other |
|
AOCI
|
||||||||||
|
Market Value Adjustments
|
|
|||||||||||||||||
AOCI, before tax
|
Investments
|
|
Cash Flow Hedges
|
|
|||||||||||||||
Balance at March 31, 2018
|
$
|
24
|
|
|
$
|
(197
|
)
|
|
$
|
(4,690
|
)
|
|
$
|
(358
|
)
|
|
$
|
(5,221
|
)
|
Quarter Ended June 30, 2018:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Unrealized gains (losses) arising during the period
|
1
|
|
|
296
|
|
|
—
|
|
|
(286
|
)
|
|
11
|
|
|||||
Reclassifications of realized net (gains) losses to net income
|
—
|
|
|
26
|
|
|
96
|
|
|
—
|
|
|
122
|
|
|||||
Balance at June 30, 2018
|
$
|
25
|
|
|
$
|
125
|
|
|
$
|
(4,594
|
)
|
|
$
|
(644
|
)
|
|
$
|
(5,088
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at April 1, 2017
|
$
|
28
|
|
|
$
|
141
|
|
|
$
|
(5,638
|
)
|
|
$
|
(599
|
)
|
|
$
|
(6,068
|
)
|
Quarter Ended July 1, 2017:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
(1
|
)
|
|
(108
|
)
|
|
—
|
|
|
54
|
|
|
(55
|
)
|
|||||
Reclassifications of realized net (gains) losses to net income
|
—
|
|
|
(41
|
)
|
|
108
|
|
|
—
|
|
|
67
|
|
|||||
Balance at July 1, 2017
|
$
|
27
|
|
|
$
|
(8
|
)
|
|
$
|
(5,530
|
)
|
|
$
|
(545
|
)
|
|
$
|
(6,056
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at September 30, 2017
|
$
|
15
|
|
|
$
|
(108
|
)
|
|
$
|
(4,906
|
)
|
|
$
|
(523
|
)
|
|
$
|
(5,522
|
)
|
Nine Months Ended June 30, 2018:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
10
|
|
|
150
|
|
|
24
|
|
|
(121
|
)
|
|
63
|
|
|||||
Reclassifications of net (gains) losses to net income
|
—
|
|
|
83
|
|
|
288
|
|
|
—
|
|
|
371
|
|
|||||
Balance at June 30, 2018
|
$
|
25
|
|
|
$
|
125
|
|
|
$
|
(4,594
|
)
|
|
$
|
(644
|
)
|
|
$
|
(5,088
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at October 1, 2016
|
$
|
44
|
|
|
$
|
(38
|
)
|
|
$
|
(5,859
|
)
|
|
$
|
(521
|
)
|
|
$
|
(6,374
|
)
|
Nine Months Ended July 1, 2017:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
(11
|
)
|
|
192
|
|
|
5
|
|
|
(24
|
)
|
|
162
|
|
|||||
Reclassifications of net (gains) losses to net income
|
(6
|
)
|
|
(162
|
)
|
|
324
|
|
|
—
|
|
|
156
|
|
|||||
Balance at July 1, 2017
|
$
|
27
|
|
|
$
|
(8
|
)
|
|
$
|
(5,530
|
)
|
|
$
|
(545
|
)
|
|
$
|
(6,056
|
)
|
|
|
|
|
|
Unrecognized
Pension and Postretirement Medical Expense |
|
Foreign
Currency Translation and Other |
|
AOCI
|
||||||||||
|
Market Value Adjustments
|
|
|||||||||||||||||
Tax on AOCI
|
Investments
|
|
Cash Flow Hedges
|
|
|||||||||||||||
Balance at March 31, 2018
|
$
|
(10
|
)
|
|
$
|
41
|
|
|
$
|
1,778
|
|
|
$
|
67
|
|
|
$
|
1,876
|
|
Quarter Ended June 30, 2018:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Unrealized gains (losses) arising during the period
|
—
|
|
|
(56
|
)
|
|
(2
|
)
|
|
38
|
|
|
(20
|
)
|
|||||
Reclassifications of realized net (gains) losses to net income
|
—
|
|
|
(6
|
)
|
|
(24
|
)
|
|
—
|
|
|
(30
|
)
|
|||||
Balance at June 30, 2018
|
$
|
(10
|
)
|
|
$
|
(21
|
)
|
|
$
|
1,752
|
|
|
$
|
105
|
|
|
$
|
1,826
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at April 1, 2017
|
$
|
(12
|
)
|
|
$
|
(50
|
)
|
|
$
|
2,113
|
|
|
$
|
137
|
|
|
$
|
2,188
|
|
Quarter Ended July 1, 2017:
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Unrealized gains (losses) arising during the period
|
(4
|
)
|
|
42
|
|
|
—
|
|
|
(9
|
)
|
|
29
|
|
|||||
Reclassifications of realized net (gains) losses to net income
|
—
|
|
|
15
|
|
|
(40
|
)
|
|
—
|
|
|
(25
|
)
|
|||||
Balance at July 1, 2017
|
$
|
(16
|
)
|
|
$
|
7
|
|
|
$
|
2,073
|
|
|
$
|
128
|
|
|
$
|
2,192
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at September 30, 2017
|
$
|
(7
|
)
|
|
$
|
46
|
|
|
$
|
1,839
|
|
|
$
|
116
|
|
|
$
|
1,994
|
|
Nine Months Ended June 30, 2018:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
(3
|
)
|
|
(44
|
)
|
|
(5
|
)
|
|
(11
|
)
|
|
(63
|
)
|
|||||
Reclassifications of net (gains) losses to net income
|
—
|
|
|
(23
|
)
|
|
(82
|
)
|
|
—
|
|
|
(105
|
)
|
|||||
Balance at June 30, 2018
|
$
|
(10
|
)
|
|
$
|
(21
|
)
|
|
$
|
1,752
|
|
|
$
|
105
|
|
|
$
|
1,826
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at October 1, 2016
|
$
|
(18
|
)
|
|
$
|
13
|
|
|
$
|
2,208
|
|
|
$
|
192
|
|
|
$
|
2,395
|
|
Nine Months Ended July 1, 2017:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
—
|
|
|
(66
|
)
|
|
(15
|
)
|
|
(64
|
)
|
|
(145
|
)
|
|||||
Reclassifications of net (gains) losses to net income
|
2
|
|
|
60
|
|
|
(120
|
)
|
|
—
|
|
|
(58
|
)
|
|||||
Balance at July 1, 2017
|
$
|
(16
|
)
|
|
$
|
7
|
|
|
$
|
2,073
|
|
|
$
|
128
|
|
|
$
|
2,192
|
|
|
|
|
|
|
Unrecognized
Pension and Postretirement Medical Expense |
|
Foreign
Currency Translation and Other |
|
AOCI
|
||||||||||
|
Market Value Adjustments
|
|
|||||||||||||||||
AOCI, after tax
|
Investments
|
|
Cash Flow Hedges
|
|
|||||||||||||||
Balance at March 31, 2018
|
$
|
14
|
|
|
$
|
(156
|
)
|
|
$
|
(2,912
|
)
|
|
$
|
(291
|
)
|
|
$
|
(3,345
|
)
|
Quarter Ended June 30, 2018:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
1
|
|
|
240
|
|
|
(2
|
)
|
|
(248
|
)
|
|
(9
|
)
|
|||||
Reclassifications of realized net (gains) losses to net income
|
—
|
|
|
20
|
|
|
72
|
|
|
—
|
|
|
92
|
|
|||||
Balance at June 30, 2018
|
$
|
15
|
|
|
$
|
104
|
|
|
$
|
(2,842
|
)
|
|
$
|
(539
|
)
|
|
$
|
(3,262
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at April 1, 2017
|
$
|
16
|
|
|
$
|
91
|
|
|
$
|
(3,525
|
)
|
|
$
|
(462
|
)
|
|
$
|
(3,880
|
)
|
Quarter Ended July 1, 2017:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
(5
|
)
|
|
(66
|
)
|
|
—
|
|
|
45
|
|
|
(26
|
)
|
|||||
Reclassifications of realized net (gains) losses to net income
|
—
|
|
|
(26
|
)
|
|
68
|
|
|
—
|
|
|
42
|
|
|||||
Balance at July 1, 2017
|
$
|
11
|
|
|
$
|
(1
|
)
|
|
$
|
(3,457
|
)
|
|
$
|
(417
|
)
|
|
$
|
(3,864
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at September 30, 2017
|
$
|
8
|
|
|
$
|
(62
|
)
|
|
$
|
(3,067
|
)
|
|
$
|
(407
|
)
|
|
$
|
(3,528
|
)
|
Nine Months Ended June 30, 2018:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
7
|
|
|
106
|
|
|
19
|
|
|
(132
|
)
|
|
—
|
|
|||||
Reclassifications of net (gains) losses to net income
|
—
|
|
|
60
|
|
|
206
|
|
|
—
|
|
|
266
|
|
|||||
Balance at June 30, 2018
|
$
|
15
|
|
|
$
|
104
|
|
|
$
|
(2,842
|
)
|
|
$
|
(539
|
)
|
|
$
|
(3,262
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at October 1, 2016
|
$
|
26
|
|
|
$
|
(25
|
)
|
|
$
|
(3,651
|
)
|
|
$
|
(329
|
)
|
|
$
|
(3,979
|
)
|
Nine Months Ended July 1, 2017:
|
|
|
|
|
|
|
|
|
|
||||||||||
Unrealized gains (losses) arising during the period
|
(11
|
)
|
|
126
|
|
|
(10
|
)
|
|
(88
|
)
|
|
17
|
|
|||||
Reclassifications of net (gains) losses to net income
|
(4
|
)
|
|
(102
|
)
|
|
204
|
|
|
—
|
|
|
98
|
|
|||||
Balance at July 1, 2017
|
$
|
11
|
|
|
$
|
(1
|
)
|
|
$
|
(3,457
|
)
|
|
$
|
(417
|
)
|
|
$
|
(3,864
|
)
|
Gains/(losses) in net income:
|
|
Affected line item in the
Condensed Consolidated
Statements of Income:
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||||
Investments, net
|
|
Interest expense, net
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6
|
|
Estimated tax
|
|
Income taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash flow hedges
|
|
Primarily revenue
|
|
(26
|
)
|
|
41
|
|
|
(83
|
)
|
|
162
|
|
||||
Estimated tax
|
|
Income taxes
|
|
6
|
|
|
(15
|
)
|
|
23
|
|
|
(60
|
)
|
||||
|
|
|
|
(20
|
)
|
|
26
|
|
|
(60
|
)
|
|
102
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Pension and postretirement
medical expense
|
|
Costs and expenses
|
|
(96
|
)
|
|
(108
|
)
|
|
(288
|
)
|
|
(324
|
)
|
||||
Estimated tax
|
|
Income taxes
|
|
24
|
|
|
40
|
|
|
82
|
|
|
120
|
|
||||
|
|
|
|
(72
|
)
|
|
(68
|
)
|
|
(206
|
)
|
|
(204
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total reclassifications for the period
|
|
|
|
$
|
(92
|
)
|
|
$
|
(42
|
)
|
|
$
|
(266
|
)
|
|
$
|
(98
|
)
|
11.
|
Equity-Based Compensation
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Stock options
|
$
|
21
|
|
|
$
|
20
|
|
|
$
|
67
|
|
|
$
|
62
|
|
RSUs
|
92
|
|
|
69
|
|
|
240
|
|
|
216
|
|
||||
Total equity-based compensation expense
(1)
|
$
|
113
|
|
|
$
|
89
|
|
|
$
|
307
|
|
|
$
|
278
|
|
Equity-based compensation expense capitalized during the period
|
$
|
17
|
|
|
$
|
19
|
|
|
$
|
54
|
|
|
$
|
61
|
|
(1)
|
Equity-based compensation expense is net of capitalized equity-based compensation and excludes amortization of previously capitalized equity-based compensation costs.
|
12.
|
Commitments and Contingencies
|
13.
|
Fair Value Measurements
|
|
Fair Value Measurement at June 30, 2018
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
41
|
|
Derivatives
|
|
|
|
|
|
|
|
||||||||
Foreign exchange
|
—
|
|
|
479
|
|
|
—
|
|
|
479
|
|
||||
Other
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
—
|
|
|
(370
|
)
|
|
—
|
|
|
(370
|
)
|
||||
Foreign exchange
|
—
|
|
|
(311
|
)
|
|
—
|
|
|
(311
|
)
|
||||
Total recorded at fair value
|
$
|
41
|
|
|
$
|
(188
|
)
|
|
$
|
—
|
|
|
$
|
(147
|
)
|
Fair value of borrowings
|
$
|
—
|
|
|
$
|
22,442
|
|
|
$
|
1,223
|
|
|
$
|
23,665
|
|
|
Fair Value Measurement at September 30, 2017
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Investments
|
$
|
36
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36
|
|
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
—
|
|
|
10
|
|
|
—
|
|
|
10
|
|
||||
Foreign exchange
|
—
|
|
|
403
|
|
|
—
|
|
|
403
|
|
||||
Other
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
—
|
|
|
(122
|
)
|
|
—
|
|
|
(122
|
)
|
||||
Foreign exchange
|
—
|
|
|
(427
|
)
|
|
—
|
|
|
(427
|
)
|
||||
Total recorded at fair value
|
$
|
36
|
|
|
$
|
(128
|
)
|
|
$
|
—
|
|
|
$
|
(92
|
)
|
Fair value of borrowings
|
$
|
—
|
|
|
$
|
23,110
|
|
|
$
|
2,764
|
|
|
$
|
25,874
|
|
14.
|
Derivative Instruments
|
|
As of June 30, 2018
|
||||||||||||||
|
Current
Assets
|
|
Other Assets
|
|
Other Current Liabilities
|
|
Other Long-
Term
Liabilities
|
||||||||
Derivatives designated as hedges
|
|
|
|
|
|
|
|
||||||||
Foreign exchange
|
$
|
172
|
|
|
$
|
192
|
|
|
$
|
(108
|
)
|
|
$
|
(60
|
)
|
Interest rate
|
—
|
|
|
—
|
|
|
(297
|
)
|
|
—
|
|
||||
Other
|
11
|
|
|
3
|
|
|
—
|
|
|
—
|
|
||||
Derivatives not designated as hedges
|
|
|
|
|
|
|
|
||||||||
Foreign exchange
|
92
|
|
|
23
|
|
|
(99
|
)
|
|
(44
|
)
|
||||
Interest rate
|
—
|
|
|
—
|
|
|
—
|
|
|
(73
|
)
|
||||
Gross fair value of derivatives
|
275
|
|
|
218
|
|
|
(504
|
)
|
|
(177
|
)
|
||||
Counterparty netting
|
(184
|
)
|
|
(173
|
)
|
|
245
|
|
|
112
|
|
||||
Cash collateral (received)/paid
|
—
|
|
|
—
|
|
|
137
|
|
|
17
|
|
||||
Net derivative positions
|
$
|
91
|
|
|
$
|
45
|
|
|
$
|
(122
|
)
|
|
$
|
(48
|
)
|
|
As of September 30, 2017
|
||||||||||||||
|
Current
Assets
|
|
Other Assets
|
|
Other Current Liabilities
|
|
Other Long-
Term
Liabilities
|
||||||||
Derivatives designated as hedges
|
|
|
|
|
|
|
|
||||||||
Foreign exchange
|
$
|
175
|
|
|
$
|
190
|
|
|
$
|
(192
|
)
|
|
$
|
(170
|
)
|
Interest rate
|
—
|
|
|
10
|
|
|
(106
|
)
|
|
—
|
|
||||
Other
|
6
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||
Derivatives not designated as hedges
|
|
|
|
|
|
|
|
||||||||
Foreign exchange
|
38
|
|
|
—
|
|
|
(46
|
)
|
|
(19
|
)
|
||||
Interest rate
|
—
|
|
|
—
|
|
|
—
|
|
|
(16
|
)
|
||||
Gross fair value of derivatives
|
219
|
|
|
202
|
|
|
(344
|
)
|
|
(205
|
)
|
||||
Counterparty netting
|
(142
|
)
|
|
(190
|
)
|
|
188
|
|
|
144
|
|
||||
Cash collateral (received)/paid
|
(20
|
)
|
|
(7
|
)
|
|
19
|
|
|
—
|
|
||||
Net derivative positions
|
$
|
57
|
|
|
$
|
5
|
|
|
$
|
(137
|
)
|
|
$
|
(61
|
)
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
Gain (loss) on interest rate swaps
|
$
|
(25
|
)
|
|
$
|
39
|
|
|
$
|
(191
|
)
|
|
$
|
(203
|
)
|
Gain (loss) on hedged borrowings
|
25
|
|
|
(39
|
)
|
|
191
|
|
|
203
|
|
|
Costs and Expenses
|
|
Interest expense, net
|
|
Income Tax expense
|
||||||||||||||||||
Quarter Ended:
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||||||
Net gains (losses) on foreign currency denominated assets and liabilities
|
$
|
(175
|
)
|
|
$
|
148
|
|
|
$
|
28
|
|
|
$
|
(7
|
)
|
|
$
|
35
|
|
|
$
|
4
|
|
Net gains (losses) on foreign exchange risk management contracts not designated as hedges
|
164
|
|
|
(144
|
)
|
|
(34
|
)
|
|
6
|
|
|
(31
|
)
|
|
21
|
|
||||||
Net gains (losses)
|
$
|
(11
|
)
|
|
$
|
4
|
|
|
$
|
(6
|
)
|
|
$
|
(1
|
)
|
|
$
|
4
|
|
|
$
|
25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net gains (losses) on foreign currency denominated assets and liabilities
|
$
|
(94
|
)
|
|
$
|
25
|
|
|
$
|
55
|
|
|
$
|
(3
|
)
|
|
$
|
23
|
|
|
$
|
16
|
|
Net gains (losses) on foreign exchange risk management contracts not designated as hedges
|
73
|
|
|
(26
|
)
|
|
(62
|
)
|
|
2
|
|
|
(15
|
)
|
|
4
|
|
||||||
Net gains (losses)
|
$
|
(21
|
)
|
|
$
|
(1
|
)
|
|
$
|
(7
|
)
|
|
$
|
(1
|
)
|
|
$
|
8
|
|
|
$
|
20
|
|
15.
|
Restructuring and Impairment Charges and Other Income
|
16.
|
New Accounting Pronouncements
|
•
|
For television and film content licensing agreements with multiple availability windows with the same licensee, the Company will defer more revenues to future windows than is currently deferred.
|
•
|
For licenses of character images, brands and trademarks subject to minimum guaranteed license fees, we currently recognize the difference between the minimum guaranteed amount and actual royalties earned from licensee merchandise sales (“shortfalls”) at the end of the contract period. Under the new guidance, projected guarantee shortfalls will be recognized straight-line over the remaining license period once an expected shortfall is identified.
|
•
|
For licenses that include multiple television and film titles subject to minimum guaranteed license fees that are recoupable against the licensee’s aggregate underlying sales from all titles, the Company will allocate the minimum guaranteed license fee to each title and recognize the allocated license fee as revenue when the title is made available to the customer. License fees in excess of the allocated by-title minimum guarantee are deferred until the aggregate contractual minimum guarantee has been exceeded and thereafter recognized as earned based on the licensee’s underlying sales. Under current guidance, an upfront allocation of the minimum guarantee is not required as license fees are recognized as earned based on the licensee’s underlying sales with any shortfalls recognized at the end of the contract period.
|
•
|
For renewals or extensions of license agreements for television and film content, we will recognize revenue when the licensed content becomes available under the renewal or extension, instead of when the agreement is renewed or extended.
|
|
Quarter Ended
|
|
% Change
|
|
Nine Months Ended
|
|
% Change
|
||||||||||||||
(in millions, except per share data)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse)
|
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse)
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Services
|
$
|
13,142
|
|
|
$
|
12,097
|
|
|
9
|
%
|
|
$
|
38,646
|
|
|
$
|
35,990
|
|
|
7
|
%
|
Products
|
2,086
|
|
|
2,141
|
|
|
(3)
|
%
|
|
6,481
|
|
|
6,368
|
|
|
2
|
%
|
||||
Total revenues
|
15,228
|
|
|
14,238
|
|
|
7
|
%
|
|
45,127
|
|
|
42,358
|
|
|
7
|
%
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Cost of services (exclusive of depreciation and amortization)
|
(7,124
|
)
|
|
(6,469
|
)
|
|
(10)
|
%
|
|
(20,762
|
)
|
|
(19,328
|
)
|
|
(7)
|
%
|
||||
Cost of products (exclusive of depreciation and amortization)
|
(1,224
|
)
|
|
(1,248
|
)
|
|
2
|
%
|
|
(3,856
|
)
|
|
(3,764
|
)
|
|
(2)
|
%
|
||||
Selling, general, administrative and other
|
(2,212
|
)
|
|
(2,022
|
)
|
|
(9)
|
%
|
|
(6,538
|
)
|
|
(5,948
|
)
|
|
(10)
|
%
|
||||
Depreciation and amortization
|
(744
|
)
|
|
(711
|
)
|
|
(5)
|
%
|
|
(2,217
|
)
|
|
(2,074
|
)
|
|
(7)
|
%
|
||||
Total costs and expenses
|
(11,304
|
)
|
|
(10,450
|
)
|
|
(8)
|
%
|
|
(33,373
|
)
|
|
(31,114
|
)
|
|
(7)
|
%
|
||||
Restructuring and impairment charges
|
—
|
|
|
—
|
|
|
nm
|
|
|
(28
|
)
|
|
—
|
|
|
nm
|
|
||||
Other income/(expense), net
|
—
|
|
|
(177
|
)
|
|
nm
|
|
|
94
|
|
|
(177
|
)
|
|
nm
|
|
||||
Interest expense, net
|
(143
|
)
|
|
(117
|
)
|
|
(22)
|
%
|
|
(415
|
)
|
|
(300
|
)
|
|
(38)
|
%
|
||||
Equity in the income of investees
|
73
|
|
|
124
|
|
|
(41)
|
%
|
|
122
|
|
|
327
|
|
|
(63)
|
%
|
||||
Income before income taxes
|
3,854
|
|
|
3,618
|
|
|
7
|
%
|
|
11,527
|
|
|
11,094
|
|
|
4
|
%
|
||||
Income taxes
|
(795
|
)
|
|
(1,144
|
)
|
|
31
|
%
|
|
(880
|
)
|
|
(3,593
|
)
|
|
76
|
%
|
||||
Net income
|
3,059
|
|
|
2,474
|
|
|
24
|
%
|
|
10,647
|
|
|
7,501
|
|
|
42
|
%
|
||||
Less: Net income attributable to noncontrolling interests
|
(143
|
)
|
|
(108
|
)
|
|
(32)
|
%
|
|
(371
|
)
|
|
(268
|
)
|
|
(38)
|
%
|
||||
Net income attributable to Disney
|
$
|
2,916
|
|
|
$
|
2,366
|
|
|
23
|
%
|
|
$
|
10,276
|
|
|
$
|
7,233
|
|
|
42
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings per share attributable to Disney
|
$
|
1.95
|
|
|
$
|
1.51
|
|
|
29
|
%
|
|
$
|
6.81
|
|
|
$
|
4.55
|
|
|
50
|
%
|
|
Quarter Ended
|
|
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
% Change
Better/(Worse)
|
|||||
Interest expense
|
$
|
(175
|
)
|
|
$
|
(134
|
)
|
|
(31)
|
%
|
Interest and investment income
|
32
|
|
|
17
|
|
|
88
|
%
|
||
Interest expense, net
|
$
|
(143
|
)
|
|
$
|
(117
|
)
|
|
(22)
|
%
|
|
Quarter Ended
|
|
|
||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
Change
Better/(Worse)
|
||||
Effective income tax rate
|
20.6
|
%
|
|
31.6
|
%
|
|
11.0
|
|
ppt
|
•
|
A reduction in the Company’s fiscal 2018 U.S. statutory federal income tax rate to 24.5% from 35.0% in the prior year. Net of state tax and other related effects, the reduction in the statutory rate had an impact of approximately 8.6 percentage points on the effective income tax rate.
|
•
|
A net benefit of approximately $110 million from updating our prior quarter estimates of the remeasurement of our net federal deferred tax liability to the new statutory rates and a one-time tax on certain accumulated foreign earnings (Deemed Repatriation Tax). This update includes the impact from finalizing our fiscal 2017 income tax return.This benefit had an impact of approximately 2.9 percentage points on the effective income tax rate.
|
|
Quarter Ended
|
|
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
% Change
Better/(Worse)
|
|||||
Net income attributable to noncontrolling interests
|
$
|
143
|
|
|
$
|
108
|
|
|
(32)
|
%
|
|
Nine Months Ended
|
|
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
% Change
Better/(Worse)
|
|||||
Interest expense
|
$
|
(493
|
)
|
|
$
|
(370
|
)
|
|
(33)
|
%
|
Interest and investment income
|
78
|
|
|
70
|
|
|
11
|
%
|
||
Interest expense, net
|
$
|
(415
|
)
|
|
$
|
(300
|
)
|
|
(38)
|
%
|
|
Nine Months Ended
|
|
|
||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
Change
Better/(Worse)
|
||||
Effective income tax rate
|
7.6
|
%
|
|
32.4
|
%
|
|
24.8
|
|
ppt
|
•
|
A net benefit of approximately $1.8 billion, which reflected an approximate $2.1 billion benefit from remeasuring our deferred tax balances to the new statutory rate, partially offset by a charge of approximately
$0.3 billion
from accruing the Deemed Repatriation Tax. This net benefit had an impact of approximately 15.6 percentage points on the effective income tax rate.
|
•
|
A reduction in the Company’s fiscal 2018 U.S. statutory federal income tax rate to 24.5% from 35.0% in the prior year. Net of state tax and other related effects, the reduction in the statutory rate had an impact of approximately 8.8 percentage points on the effective income tax rate.
|
|
Nine Months Ended
|
|
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
% Change
Better/(Worse)
|
|||||
Net income attributable to noncontrolling interests
|
$
|
371
|
|
|
$
|
268
|
|
|
(38)
|
%
|
|
Quarter Ended
|
|
% Change
|
|
Nine Months Ended
|
|
% Change
|
||||||||||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Media Networks
|
$
|
6,156
|
|
|
$
|
5,866
|
|
|
5
|
%
|
|
$
|
18,537
|
|
|
$
|
18,045
|
|
|
3
|
%
|
Parks and Resorts
|
5,193
|
|
|
4,894
|
|
|
6
|
%
|
|
15,226
|
|
|
13,748
|
|
|
11
|
%
|
||||
Studio Entertainment
|
2,878
|
|
|
2,393
|
|
|
20
|
%
|
|
7,836
|
|
|
6,947
|
|
|
13
|
%
|
||||
Consumer Products &
Interactive Media
|
1,001
|
|
|
1,085
|
|
|
(8)
|
%
|
|
3,528
|
|
|
3,618
|
|
|
(2)
|
%
|
||||
|
$
|
15,228
|
|
|
$
|
14,238
|
|
|
7
|
%
|
|
$
|
45,127
|
|
|
$
|
42,358
|
|
|
7
|
%
|
Segment operating income:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Media Networks
|
$
|
1,822
|
|
|
$
|
1,842
|
|
|
(1)
|
%
|
|
$
|
5,097
|
|
|
$
|
5,427
|
|
|
(6)
|
%
|
Parks and Resorts
|
1,339
|
|
|
1,168
|
|
|
15
|
%
|
|
3,640
|
|
|
3,028
|
|
|
20
|
%
|
||||
Studio Entertainment
|
708
|
|
|
639
|
|
|
11
|
%
|
|
2,384
|
|
|
2,137
|
|
|
12
|
%
|
||||
Consumer Products &
Interactive Media
|
324
|
|
|
362
|
|
|
(10)
|
%
|
|
1,295
|
|
|
1,371
|
|
|
(6)
|
%
|
||||
|
$
|
4,193
|
|
|
$
|
4,011
|
|
|
5
|
%
|
|
$
|
12,416
|
|
|
$
|
11,963
|
|
|
4
|
%
|
|
Quarter Ended
|
|
% Change
|
|
Nine Months Ended
|
|
% Change
|
||||||||||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
||||||||||
Income before income taxes
|
$
|
3,854
|
|
|
$
|
3,618
|
|
|
7
|
%
|
|
$
|
11,527
|
|
|
$
|
11,094
|
|
|
4
|
%
|
Add/(subtract):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Corporate and unallocated shared expenses
|
196
|
|
|
99
|
|
|
(98)
|
%
|
|
540
|
|
|
392
|
|
|
(38)
|
%
|
||||
Restructuring and impairment charges
|
—
|
|
|
—
|
|
|
nm
|
|
|
28
|
|
|
—
|
|
|
nm
|
|
||||
Other income/(expense), net
|
—
|
|
|
177
|
|
|
nm
|
|
|
(94
|
)
|
|
177
|
|
|
nm
|
|
||||
Interest expense, net
|
143
|
|
|
117
|
|
|
(22)
|
%
|
|
415
|
|
|
300
|
|
|
(38)
|
%
|
||||
Segment Operating Income
|
$
|
4,193
|
|
|
$
|
4,011
|
|
|
5
|
%
|
|
$
|
12,416
|
|
|
$
|
11,963
|
|
|
4
|
%
|
|
Quarter Ended
|
|
% Change
|
|
Nine Months Ended
|
|
% Change
|
||||||||||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
||||||||||
Media Networks
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cable Networks
|
$
|
42
|
|
|
$
|
34
|
|
|
(24)
|
%
|
|
$
|
126
|
|
|
$
|
105
|
|
|
(20)
|
%
|
Broadcasting
|
23
|
|
|
21
|
|
|
(10)
|
%
|
|
71
|
|
|
67
|
|
|
(6)
|
%
|
||||
Total Media Networks
|
65
|
|
|
55
|
|
|
(18)
|
%
|
|
197
|
|
|
172
|
|
|
(15)
|
%
|
||||
Parks and Resorts
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Domestic
|
340
|
|
|
333
|
|
|
(2)
|
%
|
|
1,053
|
|
|
983
|
|
|
(7)
|
%
|
||||
International
|
189
|
|
|
187
|
|
|
(1)
|
%
|
|
546
|
|
|
500
|
|
|
(9)
|
%
|
||||
Total Parks and Resorts
|
529
|
|
|
520
|
|
|
(2)
|
%
|
|
1,599
|
|
|
1,483
|
|
|
(8)
|
%
|
||||
Studio Entertainment
|
15
|
|
|
13
|
|
|
(15)
|
%
|
|
41
|
|
|
36
|
|
|
(14)
|
%
|
||||
Consumer Products & Interactive Media
|
14
|
|
|
15
|
|
|
7
|
%
|
|
41
|
|
|
46
|
|
|
11
|
%
|
||||
Corporate
|
55
|
|
|
60
|
|
|
8
|
%
|
|
164
|
|
|
189
|
|
|
13
|
%
|
||||
Total depreciation expense
|
$
|
678
|
|
|
$
|
663
|
|
|
(2)
|
%
|
|
$
|
2,042
|
|
|
$
|
1,926
|
|
|
(6)
|
%
|
|
Quarter Ended
|
|
% Change
|
|
Nine Months Ended
|
|
% Change
|
||||||||||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
||||||||||
Media Networks
|
$
|
20
|
|
|
$
|
3
|
|
|
>100 %
|
|
|
$
|
40
|
|
|
$
|
9
|
|
|
>(100)
|
%
|
Parks and Resorts
|
2
|
|
|
1
|
|
|
(100)
|
%
|
|
3
|
|
|
3
|
|
|
—
|
%
|
||||
Studio Entertainment
|
16
|
|
|
16
|
|
|
—
|
%
|
|
48
|
|
|
48
|
|
|
—
|
%
|
||||
Consumer Products & Interactive Media
|
28
|
|
|
28
|
|
|
—
|
%
|
|
84
|
|
|
88
|
|
|
5
|
%
|
||||
Total amortization of intangible assets
|
$
|
66
|
|
|
$
|
48
|
|
|
(38)
|
%
|
|
$
|
175
|
|
|
$
|
148
|
|
|
(18)
|
%
|
|
Quarter Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Affiliate fees
|
$
|
3,332
|
|
|
$
|
3,176
|
|
|
5
|
%
|
Advertising
|
1,948
|
|
|
2,006
|
|
|
(3)
|
%
|
||
TV/SVOD distribution and other
|
876
|
|
|
684
|
|
|
28
|
%
|
||
Total revenues
|
6,156
|
|
|
5,866
|
|
|
5
|
%
|
||
Operating expenses
|
(3,725
|
)
|
|
(3,500
|
)
|
|
(6)
|
%
|
||
Selling, general, administrative and other
|
(602
|
)
|
|
(593
|
)
|
|
(2)
|
%
|
||
Depreciation and amortization
|
(85
|
)
|
|
(58
|
)
|
|
(47)
|
%
|
||
Equity in the income of investees
|
78
|
|
|
127
|
|
|
(39)
|
%
|
||
Operating Income
|
$
|
1,822
|
|
|
$
|
1,842
|
|
|
(1)
|
%
|
|
Quarter Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Cable Networks
(1)
|
$
|
4,188
|
|
|
$
|
4,086
|
|
|
2
|
%
|
Broadcasting
|
1,968
|
|
|
1,780
|
|
|
11
|
%
|
||
|
$
|
6,156
|
|
|
$
|
5,866
|
|
|
5
|
%
|
Segment operating income
|
|
|
|
|
|
|||||
Cable Networks
(1)
|
$
|
1,383
|
|
|
$
|
1,462
|
|
|
(5)
|
%
|
Broadcasting
|
361
|
|
|
253
|
|
|
43
|
%
|
||
Equity in the income of investees
(1)
|
78
|
|
|
127
|
|
|
(39)
|
%
|
||
|
$
|
1,822
|
|
|
$
|
1,842
|
|
|
(1)
|
%
|
(1)
|
Cable Networks results in the current quarter include the consolidated results of BAMTech, whereas in the prior-year quarter the Company’s share of BAMTech’s results was reported in equity in the income of investees.
|
|
Quarter Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Domestic
|
$
|
4,089
|
|
|
$
|
3,935
|
|
|
4
|
%
|
International
|
1,104
|
|
|
959
|
|
|
15
|
%
|
||
Total revenues
|
5,193
|
|
|
4,894
|
|
|
6
|
%
|
||
Operating expenses
|
(2,807
|
)
|
|
(2,687
|
)
|
|
(4)
|
%
|
||
Selling, general, administrative and other
|
(511
|
)
|
|
(515
|
)
|
|
1
|
%
|
||
Depreciation and amortization
|
(531
|
)
|
|
(521
|
)
|
|
(2)
|
%
|
||
Equity in the loss of investees
|
(5
|
)
|
|
(3
|
)
|
|
(67)
|
%
|
||
Operating Income
|
$
|
1,339
|
|
|
$
|
1,168
|
|
|
15
|
%
|
|
Domestic
|
|
International
(2)
|
|
Total
|
||||||||||||||||||
|
Quarter Ended
|
|
Quarter Ended
|
|
Quarter Ended
|
||||||||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||||||
Parks
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Increase/(decrease)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Attendance
|
1
|
%
|
|
8
|
%
|
|
2
|
%
|
|
72
|
%
|
|
1
|
%
|
|
22
|
%
|
||||||
Per Capita Guest Spending
|
5
|
%
|
|
2
|
%
|
|
4
|
%
|
|
(1)
|
%
|
|
4
|
%
|
|
(2)
|
%
|
||||||
Hotels
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Occupancy
|
86
|
%
|
|
88
|
%
|
|
87
|
%
|
|
84
|
%
|
|
86
|
%
|
|
87
|
%
|
||||||
Available Room Nights (in thousands)
|
2,517
|
|
|
2,533
|
|
|
793
|
|
|
772
|
|
|
3,310
|
|
|
3,305
|
|
||||||
Per Room Guest Spending
|
|
$357
|
|
|
|
$330
|
|
|
|
$301
|
|
|
|
$302
|
|
|
|
$344
|
|
|
|
$324
|
|
(1)
|
Per room guest spending consists of the average daily hotel room rate, as well as food, beverage and merchandise sales at the hotels. Hotel statistics include rentals of Disney Vacation Club units.
|
(2)
|
Per capita guest spending growth rate is stated on a constant currency basis. Per room guest spending is stated at the fiscal 2017
third
quarter average foreign exchange rate.
|
|
Quarter Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Theatrical distribution
|
$
|
1,505
|
|
|
$
|
1,044
|
|
|
44
|
%
|
Home entertainment
|
415
|
|
|
488
|
|
|
(15)
|
%
|
||
TV/SVOD distribution and other
|
958
|
|
|
861
|
|
|
11
|
%
|
||
Total revenues
|
2,878
|
|
|
2,393
|
|
|
20
|
%
|
||
Operating expenses
|
(1,403
|
)
|
|
(1,099
|
)
|
|
(28)
|
%
|
||
Selling, general, administrative and other
|
(736
|
)
|
|
(626
|
)
|
|
(18)
|
%
|
||
Depreciation and amortization
|
(31
|
)
|
|
(29
|
)
|
|
(7)
|
%
|
||
Operating Income
|
$
|
708
|
|
|
$
|
639
|
|
|
11
|
%
|
|
Quarter Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Licensing, publishing and games
|
$
|
674
|
|
|
$
|
746
|
|
|
(10)
|
%
|
Retail and other
|
327
|
|
|
339
|
|
|
(4)
|
%
|
||
Total revenues
|
1,001
|
|
|
1,085
|
|
|
(8)
|
%
|
||
Operating expenses
|
(413
|
)
|
|
(431
|
)
|
|
4
|
%
|
||
Selling, general, administrative and other
|
(222
|
)
|
|
(249
|
)
|
|
11
|
%
|
||
Depreciation and amortization
|
(42
|
)
|
|
(43
|
)
|
|
2
|
%
|
||
Operating Income
|
$
|
324
|
|
|
$
|
362
|
|
|
(10)
|
%
|
|
Nine Months Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Affiliate Fees
|
$
|
9,934
|
|
|
$
|
9,479
|
|
|
5
|
%
|
Advertising
|
6,185
|
|
|
6,466
|
|
|
(4)
|
%
|
||
TV/SVOD distribution and other
|
2,418
|
|
|
2,100
|
|
|
15
|
%
|
||
Total revenues
|
18,537
|
|
|
18,045
|
|
|
3
|
%
|
||
Operating expenses
|
(11,393
|
)
|
|
(10,899
|
)
|
|
(5)
|
%
|
||
Selling, general, administrative and other
|
(1,951
|
)
|
|
(1,872
|
)
|
|
(4)
|
%
|
||
Depreciation and amortization
|
(237
|
)
|
|
(181
|
)
|
|
(31)
|
%
|
||
Equity in the income of investees
|
141
|
|
|
334
|
|
|
(58)
|
%
|
||
Operating Income
|
$
|
5,097
|
|
|
$
|
5,427
|
|
|
(6)
|
%
|
|
Nine Months Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Cable Networks
(1)
|
$
|
12,933
|
|
|
$
|
12,576
|
|
|
3
|
%
|
Broadcasting
|
5,604
|
|
|
5,469
|
|
|
2
|
%
|
||
|
$
|
18,537
|
|
|
$
|
18,045
|
|
|
3
|
%
|
Segment operating income
|
|
|
|
|
|
|||||
Cable Networks
(1)
|
$
|
3,967
|
|
|
$
|
4,117
|
|
|
(4)
|
%
|
Broadcasting
|
989
|
|
|
976
|
|
|
1
|
%
|
||
Equity in the income of investees
(1)
|
141
|
|
|
334
|
|
|
(58)
|
%
|
||
|
$
|
5,097
|
|
|
$
|
5,427
|
|
|
(6)
|
%
|
(1)
|
Cable Networks results in the current period include the consolidated results of BAMTech, whereas in the prior-year period the Company’s share of BAMTech’s results was reported in equity in the income of investees.
|
|
Nine Months Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Domestic
|
$
|
12,223
|
|
|
$
|
11,231
|
|
|
9
|
%
|
International
|
3,003
|
|
|
2,517
|
|
|
19
|
%
|
||
Total revenues
|
15,226
|
|
|
13,748
|
|
|
11
|
%
|
||
Operating expenses
|
(8,461
|
)
|
|
(7,817
|
)
|
|
(8)
|
%
|
||
Selling, general, administrative and other
|
(1,504
|
)
|
|
(1,409
|
)
|
|
(7)
|
%
|
||
Depreciation and amortization
|
(1,602
|
)
|
|
(1,486
|
)
|
|
(8)
|
%
|
||
Equity in the loss of investees
|
(19
|
)
|
|
(8
|
)
|
|
>(100)
|
%
|
||
Operating Income
|
$
|
3,640
|
|
|
$
|
3,028
|
|
|
20
|
%
|
|
Domestic
|
|
International
(2)
|
|
Total
|
||||||||||||||||||
|
Nine Months Ended
|
|
Nine Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||||||
Parks
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Increase/(decrease)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Attendance
|
4
|
%
|
|
2
|
%
|
|
4
|
%
|
|
64
|
%
|
|
4
|
%
|
|
15
|
%
|
||||||
Per Capita Guest Spending
|
6
|
%
|
|
3
|
%
|
|
7
|
%
|
|
(1)
|
%
|
|
6
|
%
|
|
(1)
|
%
|
||||||
Hotels
(1)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Occupancy
|
89
|
%
|
|
89
|
%
|
|
85
|
%
|
|
82
|
%
|
|
88
|
%
|
|
87
|
%
|
||||||
Available Room Nights (in thousands)
|
7,540
|
|
|
7,663
|
|
|
2,380
|
|
|
2,222
|
|
|
9,920
|
|
|
9,885
|
|
||||||
Per Room Guest Spending
|
|
$349
|
|
|
|
$321
|
|
|
|
$282
|
|
|
|
$271
|
|
|
|
$334
|
|
|
|
$311
|
|
(1)
|
Per room guest spending consists of the average daily hotel room rate, as well as food, beverage and merchandise sales at the hotels. Hotel statistics include rentals of Disney Vacation Club units.
|
(2)
|
Per capita guest spending growth rate is stated on a constant currency basis. Per room guest spending is stated at the fiscal
2017
nine
-month average foreign exchange rate.
|
|
Nine Months Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Theatrical distribution
|
$
|
3,630
|
|
|
$
|
2,715
|
|
|
34
|
%
|
Home entertainment
|
1,299
|
|
|
1,454
|
|
|
(11)
|
%
|
||
TV/SVOD distribution and other
|
2,907
|
|
|
2,778
|
|
|
5
|
%
|
||
Total revenues
|
7,836
|
|
|
6,947
|
|
|
13
|
%
|
||
Operating expenses
|
(3,355
|
)
|
|
(2,970
|
)
|
|
(13)
|
%
|
||
Selling, general, administrative and other
|
(2,008
|
)
|
|
(1,756
|
)
|
|
(14)
|
%
|
||
Depreciation and amortization
|
(89
|
)
|
|
(84
|
)
|
|
(6)
|
%
|
||
Operating Income
|
$
|
2,384
|
|
|
$
|
2,137
|
|
|
12
|
%
|
|
Nine Months Ended
|
|
% Change
|
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|||||
Revenues
|
|
|
|
|
|
|||||
Licensing, publishing and games
|
$
|
2,310
|
|
|
$
|
2,409
|
|
|
(4)
|
%
|
Retail and other
|
1,218
|
|
|
1,209
|
|
|
1
|
%
|
||
Total revenues
|
3,528
|
|
|
3,618
|
|
|
(2)
|
%
|
||
Operating expenses
|
(1,409
|
)
|
|
(1,406
|
)
|
|
—
|
%
|
||
Selling, general, administrative and other
|
(699
|
)
|
|
(708
|
)
|
|
1
|
%
|
||
Depreciation and amortization
|
(125
|
)
|
|
(134
|
)
|
|
7
|
%
|
||
Equity in the income of investees
|
—
|
|
|
1
|
|
|
—
|
%
|
||
Operating Income
|
$
|
1,295
|
|
|
$
|
1,371
|
|
|
(6)
|
%
|
|
Quarter Ended
|
|
% Change
|
|
Nine Months Ended
|
|
% Change
|
||||||||||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Better/
(Worse) |
||||||||||
Corporate and unallocated shared expenses
|
$
|
(196
|
)
|
|
$
|
(99
|
)
|
|
(98)
|
%
|
|
$
|
(540
|
)
|
|
$
|
(392
|
)
|
|
(38)
|
%
|
•
|
The Company’s federal statutory income tax rate was reduced from 35.0% to 24.5% for fiscal 2018 and to 21.0% for following years.
|
•
|
For the nine-month period ended June 30, 2018, the Company recognized a net benefit of approximately $1.8 billion, which reflected an approximate $2.1 billion benefit from remeasuring our deferred tax balances to the new statutory rate, partially offset by a charge of approximately
$0.3 billion
from accruing a Deemed Repatriation Tax.
|
•
|
Generally, there will no longer be a U.S. federal income tax cost on the repatriation of foreign earnings.
|
•
|
The Company will be eligible to claim an immediate deduction for investments in qualified fixed assets and film and television productions placed in service during fiscal 2018 through fiscal 2022. This provision phases out through fiscal 2027.
|
•
|
Certain provisions of the Act are not effective for the Company until fiscal 2019 including:
|
•
|
The elimination of the domestic production activities deduction.
|
•
|
The taxation of certain foreign derived income in the U.S. at an effective rate of approximately 13% (which increases to approximately 16% in 2025) rather than the general statutory rate of 21%.
|
•
|
A minimum effective tax on certain foreign earnings of approximately 13%.
|
•
|
We expect a cash tax benefit similar to the reduction in the statutory rate, as well as a benefit from the immediate deduction for investments in qualified fixed assets and film and television productions.
|
|
Nine Months Ended
|
|
% Change
Better/ (Worse) |
|||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
|
||||||
Cash provided by operations
|
$
|
10,442
|
|
|
$
|
8,773
|
|
|
19
|
%
|
Cash used in investing activities
|
(5,143
|
)
|
|
(3,290
|
)
|
|
(56)
|
%
|
||
Cash used in financing activities
|
(4,981
|
)
|
|
(5,792
|
)
|
|
14
|
%
|
||
Impact of exchange rates on cash, cash equivalents and restricted cash
|
(51
|
)
|
|
(23
|
)
|
|
>(100) %
|
|
||
Change in cash, cash equivalents and restricted cash
|
$
|
267
|
|
|
$
|
(332
|
)
|
|
nm
|
|
|
Nine Months Ended
|
||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
||||
Beginning balances:
|
|
|
|
||||
Production and programming assets
|
$
|
8,759
|
|
|
$
|
7,547
|
|
Programming liabilities
|
(1,108
|
)
|
|
(1,063
|
)
|
||
|
7,651
|
|
|
6,484
|
|
||
Spending:
|
|
|
|
||||
Television program licenses and rights
|
6,252
|
|
|
6,025
|
|
||
Film and television production
|
4,303
|
|
|
3,863
|
|
||
|
10,555
|
|
|
9,888
|
|
||
Amortization:
|
|
|
|
||||
Television program licenses and rights
|
(6,280
|
)
|
|
(5,986
|
)
|
||
Film and television production
|
(3,674
|
)
|
|
(3,157
|
)
|
||
|
(9,954
|
)
|
|
(9,143
|
)
|
||
|
|
|
|
||||
Change in film and television production and programming costs
|
601
|
|
|
745
|
|
||
Other non-cash activity
|
(192
|
)
|
|
19
|
|
||
Ending balances:
|
|
|
|
||||
Production and programming assets
|
8,925
|
|
|
8,012
|
|
||
Programming liabilities
|
(865
|
)
|
|
(764
|
)
|
||
|
$
|
8,060
|
|
|
$
|
7,248
|
|
|
Nine Months Ended
|
||||||
(in millions)
|
June 30,
2018 |
|
July 1,
2017 |
||||
Media Networks
|
|
|
|
||||
Cable Networks
|
$
|
161
|
|
|
$
|
70
|
|
Broadcasting
|
54
|
|
|
44
|
|
||
Total Media Networks
|
215
|
|
|
114
|
|
||
Parks and Resorts
|
|
|
|
||||
Domestic
|
2,368
|
|
|
1,682
|
|
||
International
|
466
|
|
|
721
|
|
||
Total Parks and Resorts
|
2,834
|
|
|
2,403
|
|
||
Studio Entertainment
|
72
|
|
|
64
|
|
||
Consumer Products & Interactive Media
|
14
|
|
|
17
|
|
||
Corporate
|
129
|
|
|
130
|
|
||
|
$
|
3,264
|
|
|
$
|
2,728
|
|
Period
|
|
Total
Number of
Shares
Purchased
(1)
|
|
Weighted
Average
Price Paid
per Share
|
|
Total Number
of Shares
Purchased as
Part of Publicly
Announced
Plans or
Programs
|
|
Maximum
Number of
Shares that
May Yet Be
Purchased
Under the
Plans or
Programs
(2)
|
||||
April 1, 2018 - April 30, 2018
|
|
4,754,175
|
|
|
$
|
100.47
|
|
|
4,726,100
|
|
|
162 million
|
May 1, 2018 - May 31, 2018
|
|
4,883,104
|
|
|
101.77
|
|
|
4,857,000
|
|
|
157 million
|
|
June 1, 2018 - June 30, 2018
|
|
23,964
|
|
|
105.63
|
|
|
—
|
|
|
157 million
|
|
Total
|
|
9,661,243
|
|
|
101.14
|
|
|
9,583,100
|
|
|
157 million
|
(1)
|
78,143 shares were purchased on the open market to provide shares to participants in the Walt Disney Investment Plan (WDIP). These purchases were not made pursuant to a publicly announced repurchase plan or program.
|
(2)
|
Under a share repurchase program implemented effective June 10, 1998, the Company is authorized to repurchase shares of its common stock. On January 30, 2015, the Company’s Board of Directors increased the share repurchase authorization to a total of 400 million shares as of that date. The repurchase program does not have an expiration date.
|
|
|
|
|
|
THE WALT DISNEY COMPANY
|
|
|
(Registrant)
|
|
|
|
By:
|
|
/s/ CHRISTINE M. MCCARTHY
|
|
|
Christine M. McCarthy,
Senior Executive Vice President and Chief Financial Officer
|
|
|
|
|
|
Number and Description of Exhibit
(Numbers Coincide with Item 601 of Regulation S-K)
|
|
Document Incorporated by Reference from a Previous Filing or Filed Herewith, as Indicated below
|
||
|
|
|
|
|
2.1
|
|
Amended and Restated Agreement and Plan of Merger, dated as of June 20, 2018, among Twenty-First Century Fox Inc., The Walt Disney Company, TWDC Holdco 613 Corp., WDC Merger Enterprises I, Inc. and WDC Merger Enterprises II, Inc.*
|
|
|
|
|
|
|
|
10.1
|
|
Amended and Restated Voting Agreement dated as of June 20, 2018, among The Walt Disney Company, Murdoch Family Trust, and Cruden Financial Services, LLC
|
|
|
|
|
|
|
|
10.2
|
|
Description of Directors Compensation
|
|
|
|
|
|
|
|
12.1
|
|
Ratio of Earnings to Fixed Charges
|
|
|
|
|
|
||
31(a)
|
|
Rule 13a-14(a) Certification of Chief Executive Officer of the Company in accordance with Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
||
31(b)
|
|
Rule 13a-14(a) Certification of Chief Financial Officer of the Company in accordance with Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
||
32(a)
|
|
Section 1350 Certification of Chief Executive Officer of the Company in accordance with Section 906 of the Sarbanes-Oxley Act of 2002**
|
|
|
|
|
|
||
32(b)
|
|
Section 1350 Certification of Chief Financial Officer of the Company in accordance with Section 906 of the Sarbanes-Oxley Act of 2002**
|
|
|
|
|
|
||
101
|
|
The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Statements of Income, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows, (v) the Condensed Consolidated Statements of Equity and (vi) related notes
|
|
Filed
|
*
|
Certain schedules and exhibits have been omitted pursuant to 601(b)(2) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished supplementally to the SEC upon request.
|
**
|
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
|
•
|
Each Director will receive a Board retainer of $115,000 (prorated for partial periods of service), payable in quarterly installments in arrears.
|
•
|
Each Director will receive an annual Committee retainer of $10,000 (prorated for partial periods of service) for each Committee of which he or she is a member, payable in quarterly installments in arrears.
|
•
|
The Chairs of the following committees will receive an additional annual Committee Chair retainer of the amounts indicated (prorated for partial periods of service), payable in quarterly installments in arrears: Audit Committee - $25,000; Compensation Committee - $20,000; Governance and Nominating Committee - $15,000.
|
•
|
Each Director will receive a quarterly deferred stock unit grant, with a value equal to $47,500 (i.e., $190,000 per year) (prorated for partial periods of service), based on the average of the high and low trading prices of the Company’s common stock averaged over the last ten trading days of the quarter. These units will be fully vested upon crediting and will be distributed to the Director on the second anniversary of the grant date unless the Director makes an election prior to the end of the preceding calendar year (or, for Board service beginning during a calendar year, within 10 calendar days of commencement of service) to defer distribution until termination of the Director’s service on the Board. The units will be distributed 100% in shares of the Company’s common stock.
|
•
|
Unless the Board exempts a Director, each Director will be required to retain at all times stock representing no less than 50% of the after-tax value of exercised options and shares received upon distribution of deferred stock units until the director holds shares sufficient to meet any equity retention guidelines set forth in the Company’s
Corporate Governance Guidelines
.
|
•
|
The Director elected Lead Director shall receive as compensation for his or her services as Lead Director a fee of $50,000 per year in addition to the compensation received by the Director for his or service as a Director and on Committees of the Board.
|
|
Nine Months Ended
|
|
Fiscal Year Ended
|
||||||||||||||||||||||||
|
Jun. 30,
2018 |
|
Jul. 1,
2017 |
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||||||
EARNINGS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Income from continuing operations before income taxes
|
$
|
11,527
|
|
|
$
|
11,094
|
|
|
$
|
13,788
|
|
|
$
|
14,868
|
|
|
$
|
13,868
|
|
|
$
|
12,246
|
|
|
$
|
9,620
|
|
Equity in the income of investees
|
(122
|
)
|
|
(327
|
)
|
|
(320
|
)
|
|
(926
|
)
|
|
(814
|
)
|
|
(854
|
)
|
|
(688
|
)
|
|||||||
Cash distributions received from equity investees
|
587
|
|
|
584
|
|
|
788
|
|
|
799
|
|
|
752
|
|
|
718
|
|
|
694
|
|
|||||||
Interest expense, amortization of debt discounts and premiums on all indebtedness and amortization of capitalized interest
|
566
|
|
|
430
|
|
|
589
|
|
|
433
|
|
|
325
|
|
|
360
|
|
|
415
|
|
|||||||
Imputed interest on operating leases
(1)
|
230
|
|
|
215
|
|
|
289
|
|
|
282
|
|
|
286
|
|
|
294
|
|
|
292
|
|
|||||||
TOTAL EARNINGS
|
$
|
12,788
|
|
|
$
|
11,996
|
|
|
$
|
15,134
|
|
|
$
|
15,456
|
|
|
$
|
14,417
|
|
|
$
|
12,764
|
|
|
$
|
10,333
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
FIXED CHARGES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest expense and amortization of debt discounts and premiums on all indebtedness
|
$
|
493
|
|
|
$
|
370
|
|
|
$
|
507
|
|
|
$
|
354
|
|
|
$
|
265
|
|
|
$
|
294
|
|
|
$
|
349
|
|
Capitalized interest
|
85
|
|
|
67
|
|
|
87
|
|
|
139
|
|
|
110
|
|
|
73
|
|
|
77
|
|
|||||||
Imputed interest on operating leases
(1)
|
230
|
|
|
215
|
|
|
289
|
|
|
282
|
|
|
286
|
|
|
294
|
|
|
292
|
|
|||||||
TOTAL FIXED CHARGES
|
$
|
808
|
|
|
$
|
652
|
|
|
$
|
883
|
|
|
$
|
775
|
|
|
$
|
661
|
|
|
$
|
661
|
|
|
$
|
718
|
|
RATIO OF EARNINGS TO FIXED CHARGES
(2)
|
15.8
|
|
|
18.4
|
|
|
17.1
|
|
|
19.9
|
|
|
21.8
|
|
|
19.3
|
|
|
14.4
|
|
(1)
|
The portion of operating rental expense which management believes is representative of the interest component of rent expense.
|
(2)
|
The ratio does not adjust for interest on unrecognized tax benefits that are recorded as a component of income tax expense.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of the Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a)
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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August 7, 2018
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By:
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/s/ ROBERT A. IGER
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Robert A. Iger
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Chairman and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of the Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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August 7, 2018
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By:
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/s/ CHRISTINE M. MCCARTHY
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Christine M. McCarthy
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Senior Executive Vice President and Chief Financial Officer
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1.
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The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
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By:
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/s/ ROBERT A. IGER
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Robert A. Iger
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Chairman and Chief Executive Officer
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August 7, 2018
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*
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A signed original of this written statement required by Section 906 has been provided to The Walt Disney Company and will be retained by The Walt Disney Company and furnished to the Securities and Exchange Commission or its staff upon request.
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1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
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|
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By:
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/s/ CHRISTINE M. MCCARTHY
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|
|
Christine M. McCarthy
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Senior Executive Vice President and Chief Financial Officer
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August 7, 2018
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*
|
A signed original of this written statement required by Section 906 has been provided to The Walt Disney Company and will be retained by The Walt Disney Company and furnished to the Securities and Exchange Commission or its staff upon request.
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