Disney posts mixed earnings as streaming and parks offset TV slump and YouTube dispute
Disney reported a mixed fourth quarter, with weak TV and film results offset by strong growth in streaming and theme parks.
Its performance is further clouded by an unresolved licensing spat with YouTube that has left YouTube TV subscribers without access to ESPN, ABC and other key Disney networks.
The Walt Disney Co. earned $1.31 billion (€1.13 bn), for the three months leading up to September. It earned $460 million (€397 mn), in the prior-year period.
Revenue for the Burbank-based company totaled $22.46 billion (€19.35 bn), short of Wall Street’s estimate of $22.86 billion (€1.62 bn).
Revenue for Disney Entertainment, which includes the company’s movie studios and streaming service, dropped 6%, while revenue for the Experiences division and its parks climbed 6%.
Operating income from linear networks dropped 21% and revenue slipped 16%.
Disney said that its movie distribution results were weaker when compared to the same period last year when it was buoyed by “Deadpool & Wolverine” and spillover receipts from “Inside Out 2.”
Films released during the most recent quarter included “The Fantastic Four: First Steps,” “The Roses” and "Freakier Friday."
Disney’s direct-to-consumer business, which includes Disney+ and Hulu, posted quarterly operating income of $352 million (€303 mn) compared with $253 million (€218 mn) a year ago. Revenue rose 8%.
The Disney+ streaming service had a 3% increase in paid subscribers domestically, which includes the US and Canada. There was a 4% rise internationally, which excludes Disney+ HotStar.
The strong streaming results come shortly after the entertainment company saw Disney+ and Hulu subscription cancellations climb in September when ABC briefly cancelled “Jimmy Kimmel Live!.”
Walt Disney Co. owns the streaming platforms and ABC. ABC pulled the show off the air for less than a week in September in the wake of criticism over his comments related to the killing of conservative activist Charlie Kirk.
While Disney is also working on its search for a successor to CEO Bob Iger, the face of Disney for most of the past two decades.
The company created a succession planning committee in 2023, but the search began in earnest last year when the company enlisted Morgan Stanley Executive Chairman James Gorman to lead the effort.
While they do have some time, as Iger agreed to a contract extension that keeps him at the company through the end of 2026, Disney is looking at internal and external candidates.
The internal candidates are widely believed to include the chairman of Disney-owned ESPN, Jimmy Pitaro, Chairperson of Walt Disney Parks and Resorts Josh D’Amaro, Disney Entertainment Co-Chairman Alan Bergman and Disney Entertainment Co-Chairman Dana Walden.
Disney's stock climbed nearly 2% before the market open on Thursday.