Movers: Alphabet, Disney, PacWest Bancorp, Unity Software

Scott Peters
11 May, 2023
New York City

Walt Disney Company declined 8.8% to $92.29 after the theme park operator and media company reported a significant decline in streaming subscribers even as quarterly loss in the division improved. 

Revenue in the first quarter increased 13% to $21.8 billion from $19.2 billion and net income from continuing operations more than doubled to $1.2 billion from $470 million and diluted earnings per share rose to 69 cents from 26 cents a year ago. 

Disney television networks segment revenue declined 7% to $6.6 billion from $7.1 billion and streaming services revenue increased 12% to $5.5 billion from $4.9 billion a year ago. 

Disney streaming services subscribers in the U.S. and Canada declined to 46.3 million from 46.6 million and international subscribers including Hotstar edged up 2% to 58.6 million from 57.7 million a year ago. 

ESPN+ subscriber base increased 2% to 25.3 million from 24.9 million in the previous year's quarter. 

Unity Software Inc rose 11.4% to $31.95 after the video game software developer lifted its revenue estimate for 2023. 

Revenue jumped 56% to $500.3 million from $320.1 million and net loss expanded to $253.7 million from $177.5 million and diluted loss per share rose to 67 cents from 60 cents a year ago. 

Disney theme parks, products and experiences revenue in the first quarter increased 17% to $7.7 billion from $6.6 billion in the previous year's comparable quarter. 

Operating income in the segment increased 23% to $2.1 billion from $1.78 billion in the first quarter a year ago. 

PacWest Bancorp plunged 19.5% to $4.88 after the regional bank said deposits declined 9.5% for the week  ended May 5. 

In the first quarter, total interest income increased to $517.7 million from $322.9 million and the company swung to a net loss of $1.2 billion from a profit of $120.1 million and diluted earnings per share was ($10.22) from $1.01 a year ago. 

The goodwill impairment charge of $1.38 billion led to a net loss $1.2 billion in the quarter. 

The goodwill charge is a non-cash charge and had no impact on bank's regulatory capital ratios, cash flows, or liquidity position.

Total deposits decreased by $5.7 billion or 16.9% in the first quarter and most of the decrease in deposits was from uninsured deposits, which resulted in the percentage of insured deposits to total deposits to increase from 48% at December 31, 2022 to 71% of total deposits at  March 31, 2023.

Following the closure and sale of First Republic Bank on May 1, during the week ended May 5, 2023, deposits declined approximately 9.5%, with a majority of that decline occurring on May 4th and May 5th after the news reports on the afternoon of May 3rd when the company was the focus of financial news across the nation. 

Other regional banks declined on the news and Western Alliance and Zions Bancorp fell 3%. 

Alphabet Inc Class A stock gained 5.0%to $117.0 after the company released AI tools at its annual conference for developers in Mountainview, California.

The parent of Google and YouTube also released a foldable phone with AI search tools that cost as much as $1,799.