The “Partners” statue of Walt Disney and Mickey Mouse at Cinderella Castle within the Magic Kingdom, Walt Disney World, in Lake Buena Vista, Florida, photographed on Saturday, June 3, 2023.
Joe Burbank | Tribune News Service | Getty Images
Disney reported fiscal second-quarter earnings on Tuesday that beat analysts’ estimates after narrowing streaming losses. Sales met expectations.
Total Disney segment earnings rose 17% as Disney’s entertainment streaming applications – Disney+ and Hulu – turned a profit for the primary time this quarter. Combined with ESPN+, the streaming firms lost $18 million within the quarter, much lower than the $659 million loss the division reported a yr earlier.
Entertainment streaming revenue (excluding ESPN+) rose 13% to $5.64 billion within the quarter, and operating income was $47 million, following a lack of $587 million a yr earlier. Disney cited increases in Disney+ subscribers and better average revenue per user for the profits.
The variety of Disney+ Core subscribers increased by greater than 6 million to 117.6 million global customers within the second quarter. Total Hulu subscribers rose 1% to 50.2 million. ESPN+ subscribers fell 2% to 24.8 million.
Here’s something Disney reported in comparison with Wall Street expectations, in keeping with LSEG:
- Earnings per share: $1.21 adjusted versus expected $1.10 cents
- Revenue: $22.08 billion vs. expected $22.11 billion
“Our results were driven in large part by our Experiences segment as well as our streaming business,” Disney Chief Executive Officer Bob Iger said in an announcement. “Importantly, entertainment streaming was profitable in the quarter and we remain on track to become profitable in our combined streaming businesses in the fourth quarter.”
U.S. parks and experiences revenue increased 7% to $5.96 billion and international revenue increased 29% to $1.52 billion on account of higher attendance and pricing at Hong Kong Disneyland Resort .
Disney reported a loss attributable to the corporate of $20 million, or 1 cent per share, compared with a profit of $1.27 billion, or 69 cents per share, within the year-ago period. Adjusted for restructuring and impairment charges, amongst other things, Disney reported earnings of $1.21 per share.
Traditional firms are struggling
Disney’s TV business continues to lag as hundreds of thousands of Americans abandon cable television annually. While ESPN’s revenue rose 3% to $4.21 billion, operating income fell 9% to $799 million. Lower promoting revenue, a decline in cable subscribers and better programming costs on account of the College Football Playoff led to the decline.
Linear network revenue across the Disney portfolio, excluding ESPN, fell 8% to $2.77 billion. Operating income fell 22% to $752 million. Disney cited fewer subscribers and a decline in international affiliate fees on account of lower contract rates as the rationale for the declines. Declining promoting revenue on account of “lower average viewership” was also an element, Disney said.
Content sales, licensing and other revenue, which incorporates box office, fell 40% to $1.39 billion within the quarter as Disney released no blockbuster movies within the quarter. Disney noted that the year-ago quarter also benefited from the sustained performance of “Avatar: The Way of Water,” which opened in theaters in December 2022 and grossed greater than $2.3 billion worldwide.
This story is developing. Please check back for updates.
