Disney Raises Cost-Cutting Target To $7.5 Billion
Disney (DIS) reported fiscal fourth quarter earnings after the bell on Wednesday that beat expectations as the company increased its annual cost cutting goal to $7.5 billion, up from the previous $5.5 billion set in February. That includes a $4.5 billion annualized cut to content spending, up from the prior $3 billion.
The company's streaming figures came in much strong than expected with nearly 7 million core Disney+ net additions, compared to consensus calls of 2.68 million.
Streaming losses narrowed to $387 million from a loss of $1.41 billion in the prior year period after the company raised streaming prices for the second time this year, upping the monthly price of its ad-free Disney+ and Hulu plans by more than 20%.
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DIS
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Alexandra Canal
Alexandra Canal·Senior Reporter
Wed, November 8, 2023 at 10:05 PM GMT+1
In this article:
DIS
Disney (DIS) reported fiscal fourth quarter earnings after the bell on Wednesday that beat expectations as the company increased its annual cost cutting goal to $7.5 billion, up from the previous $5.5 billion set in February. That includes a $4.5 billion annualized cut to content spending, up from the prior $3 billion.
The company's streaming figures came in much strong than expected with nearly 7 million core Disney+ net additions, compared to consensus calls of 2.68 million.
Streaming losses narrowed to $387 million from a loss of $1.41 billion in the prior year period after the company raised streaming prices for the second time this year, upping the monthly price of its ad-free Disney+ and Hulu plans by more than 20%.
Analysts polled by Bloomberg had expected direct-to-consumer losses to mount to $454 million in the quarter. The company previously reported a loss of $512 million in Q3, a $659 million loss in Q2 and a $1.1 billion loss in Q1.
The results follow the official reveal of Disney's next CFO and commitment to purchase Comcast's 33% stake in Hulu.
On the earnings call, the company said it expects free cash flow to balloon to $8 billion in full-year 2024, assisted by lower content spend. Disney expects to spend $25 billion on content next year versus the $27 billion spent in full-year 2023.
It will also recommend a dividend by the end of the calendar year. Shares climbed almost 4% in pre-market trading following the results.
Adjusted earnings of $0.82 a share beat expectations of $0.69 per share and was more than double the prior-year period's earnings per share of $0.30. Revenue, meanwhile, slightly missed estimates of $21.43 billion to hit $21.24 billion, up 5% compared to the prior-year quarter's $20.15 billion.
Wednesday's results mark the first time the media giant delivered earnings under its new reporting structure after CEO Bob Iger reorganized the company into three core business segments: Disney Entertainment, which includes its entire media and streaming portfolio; Experiences, which encompasses the parks business; and Sports, which included ESPN networks and ESPN+.
Here's how those individual segments performed in the quarter versus Wall Street consensus estimates compiled by Bloomberg:
Entertainment revenue: $9.52 billion versus $9.77 billion expected
Sports revenue: $3.91 billion versus $3.89 billion expected
Experiences revenue: $8.16 billion versus $8.20 billion expected
Disney's stock has struggled, down about 3% since the start of the year and down 5% since Iger's return.
Disney's Experiences division, which includes its parks, cruise lines and consumer products, saw revenue leap 13% year-over-year in the quarter to hit $8.16 billion. Operating income came in at $1.76 billion, below estimates of $1.87 billion but 30% above Q4 2022's $1.34 billion total.
The company said lower results at its domestic parks and resorts stemmed from a decrease at Walt Disney World Resort due to inflation and lower guest spending.
Disney plans to invest $60 billion into its theme parks business over the next 10 years. Most of its full-year 2024 domestic parks growth will be in the second half of the year.
Price Momentum
DIS is trading near the bottom of its 52-week range and below its 200-day simple moving average.
What does this mean?
Investors have been pushing the share price lower, and the stock still appears to have downward momentum.
The company's streaming figures came in much strong than expected with nearly 7 million core Disney+ net additions, compared to consensus calls of 2.68 million.
Streaming losses narrowed to $387 million from a loss of $1.41 billion in the prior year period after the company raised streaming prices for the second time this year, upping the monthly price of its ad-free Disney+ and Hulu plans by more than 20%.
244
DIS
FDA approves Eli Lilly's Mounjaro for weight lossScroll back up to restore default view.
Alexandra Canal
Alexandra Canal·Senior Reporter
Wed, November 8, 2023 at 10:05 PM GMT+1
In this article:
DIS
Disney (DIS) reported fiscal fourth quarter earnings after the bell on Wednesday that beat expectations as the company increased its annual cost cutting goal to $7.5 billion, up from the previous $5.5 billion set in February. That includes a $4.5 billion annualized cut to content spending, up from the prior $3 billion.
The company's streaming figures came in much strong than expected with nearly 7 million core Disney+ net additions, compared to consensus calls of 2.68 million.
Streaming losses narrowed to $387 million from a loss of $1.41 billion in the prior year period after the company raised streaming prices for the second time this year, upping the monthly price of its ad-free Disney+ and Hulu plans by more than 20%.
Analysts polled by Bloomberg had expected direct-to-consumer losses to mount to $454 million in the quarter. The company previously reported a loss of $512 million in Q3, a $659 million loss in Q2 and a $1.1 billion loss in Q1.
The results follow the official reveal of Disney's next CFO and commitment to purchase Comcast's 33% stake in Hulu.
On the earnings call, the company said it expects free cash flow to balloon to $8 billion in full-year 2024, assisted by lower content spend. Disney expects to spend $25 billion on content next year versus the $27 billion spent in full-year 2023.
It will also recommend a dividend by the end of the calendar year. Shares climbed almost 4% in pre-market trading following the results.
Adjusted earnings of $0.82 a share beat expectations of $0.69 per share and was more than double the prior-year period's earnings per share of $0.30. Revenue, meanwhile, slightly missed estimates of $21.43 billion to hit $21.24 billion, up 5% compared to the prior-year quarter's $20.15 billion.
Wednesday's results mark the first time the media giant delivered earnings under its new reporting structure after CEO Bob Iger reorganized the company into three core business segments: Disney Entertainment, which includes its entire media and streaming portfolio; Experiences, which encompasses the parks business; and Sports, which included ESPN networks and ESPN+.
Here's how those individual segments performed in the quarter versus Wall Street consensus estimates compiled by Bloomberg:
Entertainment revenue: $9.52 billion versus $9.77 billion expected
Sports revenue: $3.91 billion versus $3.89 billion expected
Experiences revenue: $8.16 billion versus $8.20 billion expected
Disney's stock has struggled, down about 3% since the start of the year and down 5% since Iger's return.
Disney's Experiences division, which includes its parks, cruise lines and consumer products, saw revenue leap 13% year-over-year in the quarter to hit $8.16 billion. Operating income came in at $1.76 billion, below estimates of $1.87 billion but 30% above Q4 2022's $1.34 billion total.
The company said lower results at its domestic parks and resorts stemmed from a decrease at Walt Disney World Resort due to inflation and lower guest spending.
Disney plans to invest $60 billion into its theme parks business over the next 10 years. Most of its full-year 2024 domestic parks growth will be in the second half of the year.
Price Momentum
DIS is trading near the bottom of its 52-week range and below its 200-day simple moving average.
What does this mean?
Investors have been pushing the share price lower, and the stock still appears to have downward momentum.
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