Marvel released its Q2 report on Tuesday, and once again greatly exceeded expectations for financial performance, which in this case were last updated only two weeks ago (see 'Marvel Exceeds Financial Projections for Q2').  At that time, Marvel announced that it expected to exceed the high end of its guidance of $.25 to $.30 per share for the period.  It went far past those numbers, reporting earnings of $32.8 million for Q2, or $.42 per share, compared to $8.4 million or $.10 per share in the year ago period.  Sales were up 27% to $90 million from $70.9 million in Q2 2002. 

 

As has been the case throughout Marvel's amazing turnaround, licensing led the way, with a sales increase of around 330% behind sales of products based on Spider-Man and the Hulk, as well as the release of two movies -- X2 and The Hulk.  Publishing sales increased to $19.5 million from $17.9 million in Q2 last year, but not due to sales through retailers -- the increased sales were attributed to increases in custom publishing and advertising revenues.  Toy sales continued to decline as a reflection of the company's strategy of exiting the manufacture and sale of toys in favor of licensing Marvel brands to other companies.  Marvel earnings were also far above expectations for Q1 (see 'Marvel Blows Away Q1 Expectations'), for similar reasons.    

 

For the third time, Marvel increased its guidance for 2003 earnings, this time to $95 to $100 million in profits, over twice the $45 million it was expecting less than a year ago.  Those increases are expected to come from licensing and toy sales; publishing sales are expected to decline.