Feb. 7 (Bloomberg) -- Walt Disney Co., the second-largest U.S. media company, said first-quarter profit more than doubled on asset sales and income from last year's two biggest-selling DVD releases, ``Pirates of the Caribbean'' and ``Cars.''

Net income rose to $1.7 billion, or 79 cents a share, from $734 million, or 37 cents, a year earlier, Burbank, California- based Disney said today in a statement. Sales climbed 9.8 percent to $9.73 billion. Profit excluding some items was 50 cents, beating the 40-cent average estimate in a Bloomberg survey.

Studio profit jumped more than fourfold, while income at Disney's media networks surged 24 percent, helped by spot, or scatter, advertising sales for ABC shows such as ``Grey's Anatomy.'' Chief Executive Officer Robert Iger is making family friendly movies and selling films and TV shows on the Web.

``Media-networks results were very strong,'' Sanders Morris Harris analyst David Miller said in an interview. ``The fact that scatter premiums were up 10 percent was definitely a surprise.''

Shares of Disney, also the world's biggest theme-park operator, rose 68 cents, or 1.9 percent, to $36.16 in extended trading. They rose 29 cents to $35.48 at 4:02 p.m. in New York Stock Exchange composite trading and have gained 33 percent in the past year.

Profit included a gain of $1.1 billion from the sale of Disney's interests in E! Entertainment Television and US Weekly, as well as costs of $48 million for equity-based compensation. Sales beat the $9.53 billion average estimate.

Cable, ABC

News Corp., the third-largest media company, said today that second-quarter profit rose 18 percent to $822 million, or 26 cents a share, from $694 million, or 21 cents, excluding a gain from asset sales in the year-ago period. Revenue at the New York- based company jumped 18 percent on the box-office hit ``Borat.''

Time Warner Inc., the world's biggest media company, last week said profit rose 35 percent, driven by its cable-TV unit.

Profit at Disney's media networks, which include ABC TV, the ESPN cable channel and radio stations, climbed to $750 million on a 6 percent increase in sales to $3.91 billion.

Broadcast sales including ABC rose 1 percent to $1.82 billion after the departure of Monday Night Football, while sales at cable channels such as ESPN, the game's new home, rose 12 percent to $2.09 billion in the period ended Dec. 30.

Moving football opened space for advertising sales at ABC, Chief Financial Officer Thomas Staggs said on a conference call.

``They have really bolstered their Thursday night, which has been an Achilles heel for two decades,'' said Brad Adgate, director of research with Horizon Media Inc. in New York.

Theme Parks, Film

Iger, 55, took over as CEO in October 2005. He is adding theme park attractions and developing video games based on Pixar characters to sustain profit growth after net income surged 33 percent in the year ended Sept. 30.

Theme parks posted a profit of $405 million, an 8 percent increase from the year-ago period, when earnings spiked 51 percent during the 50th anniversary promotion. Revenue rose 4 percent to $2.49 billion.

Lower attendance and guest spending at the company's Hong Kong resort hurt profit. In an interview, Iger said the company is meeting challenges at the park ``head-on.''

``They are struggling in Hong Kong because of the same problems they faced in opening a park in Paris,'' said Los Angeles-based Miller, who has a ``hold'' rating on Disney shares and doesn't own any. ``They are having trouble marketing a park that's so uniquely American in a foreign country.''

Film Unit

Studio profit rose to $604 million from $128 million a year ago, as sales jumped 29 percent to $2.63 billion. ``Pirates of the Caribbean: Dead Man's Chest'' and ``Cars'' were the two biggest DVD sellers of last year, according to the trade publication Video Business.

Iger said this ``should be a good year for the studio overall,'' with the release of the third ``Pirates'' film, ``Meet the Robinsons'' and ``Ratatouille'' from Pixar.

Profit at Disney's consumer products division fell 13 percent to $235 million on a 6 percent drop in sales to $692 million.

Disney's 6.375 percent notes maturing in March 2012 rose 0.2 cent to 105 cents on the dollar, according to Trace, the bond-price reporting system of the NASD. The yield fell to 5.24 percent.

Thirteen analysts monitored by Bloomberg rate Disney shares ``buy,'' 14 say ``hold'' and one says ``sell.''

Disney this week merged the advertising staff for children's media, including Disney Channel, Disney.com, radio and print, to coordinate cross-platform purchases. Iger also has overhauled the Web site.

To contact the reporter on this story: Andy Fixmer in Los Angeles at afixmer@bloomberg.net

Last Updated: February 7, 2007 19:26 EST