Disney Beats Earnings Expectations, Sees Stock Boost

On Thursday, the Walt Disney Company (DIS) reported quarterly earnings that were better than analysts had predicted, leading to a stock price surge.

The company beat estimates on two counts- adjusted profits and revenue. Last year, the company brought in $21.24 billion in revenue, and it beat that number with $22.57 billion this quarter. Its net income was $460 million, and that is well below the expected $1.74 billion. This leaves Disney with earnings per share of $0.25.

Disney stock jumped 8.99% Thursday morning in premarket trading, and it is expected to climb even higher as the market opens. The stock has benefitted from a strong year so far from the entertainment company, with massive income generated by Disney+, ESPN+, and Hulu. These three streaming services raked in an estimated $253 million and earned a profit last quarter, which is the first time they have done so.

The company’s streaming services have often been a drain on Disney’s profits, costing more than they bring in, but with a wealth of new additions to the services which come from preexisting libraries, Disney has been able to earn a profit off of its streaming services. The issue they face now is that in order to keep their services feeling fresh, they have to continually fill them with new and interesting content, which is expensive for a service that exists outside of the regular television services where advertisements are more commonplace. They rely on subscriptions to fuel the bulk of their earnings.

Bright Prospects Ahead

Disney had to account recently for $1.5 billion costs that should not have to be repeated, which included restructuring expenses. The adjusted earnings per share are now at $1.14, which is higher than anticipated.  

The company’s streaming services are expected to grow in 2025, with new movies and shows and even more subscribers to look forward to. Disney is also bringing in $8.24 billion from its theme parks, which is an increase from the previous year. As the economy improves (which it has), the company expects to see even more revenue from its Disney’s Experiences arm.