LOS ANGELES — Net income at The Walt Disney Co. increased 27 percent in the second quarter, boosted by strong results from its film studio, advertising sales at ESPN and international sales of its TV shows, including "Desperate Housewives."

The media conglomerate, based in Burbank, said Tuesday its net income for the quarter ended March 31 was $931 million, or 44 cents per share, compared with $733 million, or 37 cents per share, in the same period a year ago.

Revenue grew slightly to $8.07 billion from $8.03 billion in the same period last year.

The company's per share earnings easily beat estimates of 38 cents per share from analysts surveyed by Thomson Financial, although its revenue missed analyst expectations of $8.13 billion.

The company reported profit growth at all segments, including theme parks and consumer products.

CISCO PROFIT SURGES IN THIRD QUARTER

SAN FRANCISCO — Cisco Systems Inc.'s third-quarter profit surged 34 percent as widespread networking upgrades continued to fuel the company's robust growth.

Net income for the three months ended April 28 was $1.87 billion, or 30 cents per share, compared with $1.4 billion during the same period last year.

Excluding one-time charges, San Jose-based Cisco earned 34 cents a share, a penny higher than analysts surveyed by Thomson Financial were expecting.

Cisco, the world's largest networking equipment maker, rang up $8.87 in billion in sales during the quarter, higher than the $8.76 billion analysts were anticipating.

The company's sales totaled $7.32 billion a year ago.

REUTERS CEO WOULD BE LEADER IF MERGER PANS OUT

LONDON — Thomson Corp. said Tuesday that Reuters CEO Tom Glocer would lead the combined company if Thomson succeeds in its $17.5 billion bid for Reuters Group PLC, creating the world's biggest financial news and information provider.

A combined Thomson-Reuters — the name proposed by Thomson — would have a market capitalization of around $45 billion, or a third of the global market, leapfrogging current market leader Bloomberg LP in providing real-time data to traders and investment professionals.

The companies outlined details of the proposed deal for the first time Tuesday, revealing that several issues had already been agreed even while stressing that nothing had been finalized and there was no certainty a deal would proceed.

Analysts were optimistic, saying the proposed offer of 352.5 pence ($7.03) per Reuters share in cash and 0.16 Thomson shares for each Reuters Group PLC share was likely to go ahead without any major roadblocks.

CVS/CAREMARK SEES RISE IN EARNINGS

PROVIDENCE, R.I. — CVS/Caremark Corp. said Tuesday its earnings rose 24 percent on strong revenue growth in the first quarter as the huge drugstore chain operator absorbed the nation's second-largest pharmacy benefits manager.

Net income after paying preferred dividends grew to $405.4 million, or 43 cents per share, from $326.1 million, or 39 cents per share, a year ago.

The results include 10 days of the operations of drug benefits manager Caremark, which was acquired by Woonsocket-based CVS for $26.5 billion on March 22. The deal was designed to help the combined company compete better with rivals Walgreen Co., Wal-Mart Stores Inc. and Medco Health Solutions Inc., the largest benefits manager.

Excluding about 3 cents per share of merger and integration expenses as well as related share dilution, the company would have earned 46 cents per share in the latest period.

PARTIAL VICTORY FOR FORMER NYSE CHAIRMAN

NEW YORK — Former New York Stock Exchange chairman Richard Grasso has won a partial victory in his legal fight to hold on to his $187.5 million compensation package.

The New York Appellate Division in Manhattan threw out four rulings against Grasso on Tuesday that had been made by a lower court last year.

The high court has not yet addressed other issues at the heart of the dispute. They include whether Grasso is entitled to a jury trial, and whether he can be ordered to pay back the disputed money without any trial, as the lower court judge ordered. Another issue is whether the lower court judge should recuse himself; Grasso contends, among other things, that the judge, Charles Ramos, had tried years ago to become an NYSE board member.

SEC ACCUSES COUPLE OF 'UNLAWFUL TRADING ACTIVITY'

NEW YORK — The Securities and Exchange Commission Tuesday accused two Hong Kong residents of "widespread and unlawful trading activity" when they bought $15 million of Dow Jones & Co. stock ahead of an announcement that News Corp. was seeking to buy the company.

The lawsuit in U.S. District Court in Manhattan named as defendants Kan King Wong and Charlotte Ka On Wong Leung, a married couple. It alleged they made "highly profitable and highly suspicious" stock purchases based on inside information between April 13 and April 30.

The lawsuit did not explain how the couple would have obtained inside information on the pending offer. There was no information on whether the couple has a lawyer in the United States. A message left with the SEC lawyer who filed the lawsuit was not immediately returned.

According to the lawsuit, Wong and his wife bought 415,000 shares of Dow Jones stock in the two weeks before the May 1 announcement that News Corp. had offered to buy Dow Jones.

DOW CHEMICAL EXEC SUES FOR BREACH OF CONTRACT

GRAND RAPIDS, Mich. — A 37-year veteran of Dow Chemical Co. who spent 10 years as its chief financial officer before being fired as a senior adviser sued the company and its top executive on Tuesday for libel and breach of contract.

Dow Chemical fired J. Pedro Reinhard and another executive this year for allegedly holding buyout talks without the board of director's knowledge.

Reinhard's lawsuit against the Midland-based company and Chairman and Chief Executive Andrew N. Liveris was filed in U.S. District Court for the Southern District of New York. Reinhard is seeking at least $75 million in damages.

TURNAROUND EFFORTS PAYING OFF FOR HP

SAN JOSE, Calif. — Hewlett-Packard Co.'s turnaround efforts are paying off as the computer and printer maker said it is poised to bulldoze its earlier quarterly earnings targets and rake in an extra $1 billion in sales than previously expected.

The raised outlook sent shares up 2.8 percent Tuesday and underscored HP's market gains against Dell Inc. and others. It also helped mitigate some concerns of inventory buildup and increased competition.

Some analysts think HP, which has been working to slash costs and streamline its businesses under the regime of CEO Mark Hurd, has yet to reach its financial peak.