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(Bloomberg) — Walt Disney Co. surged to an all-time high after posting quarterly sales and earnings that beat analysts’ estimates, driven by “Frozen” gifts over the holidays.

The shares jumped 7.6 percent to close at a record $101.28 in New York. It was the biggest gain for a company in the Standard and Poor’s 500 Index. The world’s largest entertainment company reported first- quarter net income rose 19 percent to $2.18 billion, or $1.27 a share. That beat the $1.07 a share average of analysts’ estimates compiled by Bloomberg. Profit from the hit movies “Frozen” and “Guardians of the Galaxy” flow from the film studio to other parts of the company. This year, Disney will come out with its first “Star Wars” picture and is gearing up to introduce related attractions at its theme parks in California, Florida and Shanghai, now set to open in spring 2016. “We’ve developing plans right now for a substantial increase in ‘Star Wars’ presence in multiple places,” Chief Executive Officer Bob Iger said on Bloomberg Television. “Our Imagineers are hard at work. You’ll see a lot more ‘Star Wars’ at Disney and Disney parks in the future.” Growth in consumer products, theme parks, the Disney film studio and ABC countered higher sports programming costs for ESPN, the result of new contracts for the National Football League and college football playoffs.

‘Frozen’ Goods

Revenue grew 8.8 percent to $13.4 billion for the period ended Dec. 27, the Burbank, California-based company said Tuesday in a statement. Analysts had projected $12.9 billion.
Profit from consumer products grew 46 percent to $626 million on the continued strength of the 2013 release “Frozen.” Revenue increased 22 percent, the company said. Disney Channel properties, Mickey and Minnie, Spider-Man and Avengers also contributed.
“They are just outstanding, despite some tough comparisons,” said Bill Smead, chief executive officer of Smead Capital Management Inc. in Seattle, which owns Disney stock. “You can sell a lot of stuff with ‘Frozen’ characters. That’s got to be a 100 percent markup.”
Disney’s film studio reported profit rose 33 percent percent to $544 million, buoyed by its share of sales from “Frozen” merchandise. Home-entertainment revenue from “Guardians of the Galaxy” and “Maleficent” also contributed. The company will show a short “Frozen” film, including a new song, with its new live-action feature “Cinderella,” opening in March, Iger said.
Theatrical releases in the quarter, including “Big Hero 6” and “Into the Woods,” couldn’t match “Frozen” and “Thor: The Dark World” from a year earlier, and revenue for the division fell 2 percent to $1.86 billion.

ESPN Profit

Operating income at Disney’s largest division, its media networks, increased 3 percent to $1.5 billion, as soaring profit at ABC offset a 2 percent drop in cable earnings. ABC benefited from higher affiliate fees and program sales, while advertising revenue declined.
ESPN’s profit shrank, a reflection of rising costs, especially for sports programming, and lower ad sales. “Each of the big three segments — media networks, parks and filmed entertainment — posted solid revenue growth,” Paul Sweeney, a Bloomberg Intelligence analyst, said in an e-mail.
Profit at Disney’s theme parks grew 20 percent to $805 million, led by the domestic parks. The company’s U.S. resorts saw an increase in visitors and higher guest spending.

Shanghai Costs

Pre-opening expenses in Shanghai tempered the gains at the domestic parks, Disney said in the statement. Additions to the project announced last year led to the delayed opening, Iger said.

The immersive experience that parks provide can introduce consumers in specific markets to Disney’s characters, Iger said, citing the Tokyo resort as an example.
“That can be a huge boost to the strength of a brand in a market,” Iger said.
Disney’s interactive division posted a 36 percent gain in profit to $75 million, with the company crediting mobile games. Sales at the unit, which makes video games and operates websites, declined 5 percent to $384 million, the result of lower results for the console business.

To contact the reporter on this story: Christopher Palmeri in Los Angeles at cpalmeri1@bloomberg.net To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net Rob Golum