Media giant Time Warner (NYSE: TWX) beat earnings expectations thanks largely to one fictional character: a hobbit.
The box-office success of “The Hobbit: An Unexpected Journey” boosted revenue in the company’s film and TV division by 23%. That propelled Time Warner earnings 82 cents per share, ahead of analyst estimates of 75 cents per share.
The latest from the world of J.R. Tolkien grossed more than $1 billion worldwide, making it the fourth most successful film in the history of Warner Bros. – a studio owned by Time Warner.
“The Hobbit” didn’t boost Time Warner’s earnings alone, however.
March Madness, which airs on Time Warner-owned networks TBS, TNT and truTV, gave the company’s TV wing a major boost as it was the most-watched NCAA Tournament in 19 years. The company also owns HBO, which had a nice quarter thanks in part to the return of its wildly popular show “Game of Thrones.”
Time Warner’s TV and film success offset the company’s continued struggles in its Time Inc. publishing business. However, overall revenue was roughly in line with last year’s first quarter. That has pushed TWX shares down 2.2% in early Wednesday trading.
Considering the stock was hovering near a five-year high entering the day, however, only a flawless earnings report would have sent Time Warner shares even higher.