Disney earnings top expectations as streaming, parks offset TV headwinds

Disney reported results for its fiscal third quarter – posting earnings that topped expectations but revenue that came in just shy of analyst projections – as the company’s streaming business grew and its theme parks saw higher spending from consumers. 

CFO Hugh Johnston credited the quarter in part to the success of Disney’s streaming unit, anchored by its flagship service, Disney+: “Just as a reminder, it was only a couple of years ago that we were losing a billion dollars a quarter on that business,” Johnston told CNBC’s Squawk Box. “It was trading purely on subs and not on financial results. We now really have a solid foundation.” The growth in streaming has recently started to help to suuplant the losses of the cash cow traditional TV business, which has been bleeding customers for years now.

Here is what Disney reported for the quarter ended June 28 compared with what Wall Street expected, according to LSEG:

• Earnings per share: $1.61 adjusted vs. $1.47 expected
• Revenue: $23.65 billion vs. $23.73 billion expected

Net income for the quarter was $5.26 billion, or $2.92 per share, more than double the $2.62 billion, or $1.43 a share, that the company reported for the same period last year. Adjusting for one-time items, primarily related to tax benefits associated with Disney’s purchase of Comcast’s Hulu stake, Disney reported earnings per share of $1.61. 

Disney’s overall revenue rose 2% to $23.65 billion, missing analyst expectations for the first time since May 2024. 

The company reported continued growth in its streaming business despite headwinds in the traditional TV bundle, which has suffered from declining customers. 

Streaming, parks, ESPN results

Revenue for Disney’s experiences segment, which includes theme parks, resorts and cruises as well as consumer products, increased 8% to $9.09 billion. Domestic theme parks revenue was up 10% to $6.4 billion, in particular as there was an increase in spending at theme parks and higher volumes in passenger cruise days and resort stays. 

Johnston told Squawk Box that Walt Disney World had its “biggest” third quarter ever, adding that traffic at the Orlando, Florida, park was solid: “I know there’s a lot of concern about the consumer in the U.S. right now. We don’t see it. Our consumer is doing very, very well,” he said.

International parks and experiences revenue was up 6% to about $1.7 billion. In May, Disney announced it reached a deal to bring a theme park and resort to Abu Dhabi. The expansion into the United Arab Emirates is not part of the earlier Disney pledge to spend $60 billion on theme parks over the next decade.

Quelle: cnbc.com

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