Prime Highlights
- Disney’s earnings beat Wall Street expectations in the fiscal third quarter, though revenue came in slightly short at $25.25 billion.
- Disney’s parks and streaming segments both posted double-digit revenue growth, helping offset broader consumer spending concerns.
Key Facts
- Disney is a global entertainment company whose businesses include theme parks, streaming services, television and film production.
- Disney raised its fiscal 2026 share repurchase target to at least $9 billion, supported by the sale of its stake in A+E Global Media.
Background
Disney reported mixed quarterly results this week, with earnings far exceeding Wall Street expectations while revenue came in slightly below estimates. The company’s performance was lifted by strong growth in its parks and streaming divisions.
Revenue for Disney’s experiences segment, which includes theme parks and cruises, rose 10 percent year over year to $9.97 billion. Chief financial officer Hugh Johnston said domestic performance was strong, with US park attendance up 3 percent and per capita spending increasing 4 percent. He noted particularly strong attendance at Walt Disney World in Orlando, contrasting it with lower turnout reported by a competitor in the same region.
In the streaming division of Disney, made up of Disney+ and Hulu, the company’s revenue increased by 11% to $5.53 billion, owing to the increase in subscribers and advertising revenue. The wider entertainment sector, which comprises television and theatrical performances, recorded a revenue growth of 6% to $11.35 billion, with the help of the blockbuster performance of “Toy Story 5”, which made more than $1 billion worldwide.
Overall revenue climbed 7 percent to $25.25 billion, while adjusted earnings came in at $2.06 per share, up from $1.61 a year earlier. Net income fell to $2.64 billion from $5.26 billion in the same quarter last year, largely due to one-time tax benefits recorded previously. Shares of Disney rose more than 3 percent following the results.
The sports segment, led by ESPN, grew 4 percent to $4.5 billion, boosted by strong viewership of NBA and NHL postseason games. Disney also announced a global content-sharing deal with TikTok and raised its share buyback target to at least $9 billion for the fiscal year.
