Walt Disney Company (The)

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Walt Disney Company (The) NYSE
 
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Aug 112022

Hot diggity dog look at those earnings

Disney does what Disney does best and releases a little bit of magic into the world, this time in the form of its latest earrings report.

  • Disney shares popped around 7% in extended trading on Wednesday after its latest earnings report boasted a beat on both ends, blowing past estimates with EPS of $1.09 on revenues that jumped 26% from the same time last year to hit $21.5bn – increased spending at its US theme parks was a large driver of the impressive growth.
  • Disney+ was the triumphant flag at the top of the castle tho and managed to buck a slowdown in the streaming world this szn. Disney+ added 14.4m subscribers in the quarter, which is over 45% more than analysts were expecting and takes its total worldwide subscriber count to a whopping 221m – taking over Netflix for the first time.
  • That being said, the brand agreed with competitors’ sentiments regarding rising costs and it lost $1.1bn across all its streaming services. It plans to raise prices across the board to try and make its streaming business profitable by the end of 2024, but it also lowered its 2024 subscriber guidance, hinting that the streaming market could be approaching saturation after all.
See all reported financials
Mika Baumeister / Unsplash

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May 122022

The Disney castle has a few hidden cracks

Disney’s castle is standing tall, with a strong streaming spire and a flourishing parks wing – but shares take a dip in the red after the media empire tempers its outlook.

  • Disney shares slumped 3% in extended trading on Wednesday to erase all of its pandemic gains – down over 30% since January. It came on the back of a Q1 miss, reporting EPS of $1.08 on revenues that were up 23% at $19.25bn – that includes a $1bn hit for ending license deals early, and it may have met estimates if not for that.
  • Theme parks revenue more than doubled to $6.7bn, bouncing back in a big way from covid and seeing increased attendance and more hotel and cruise bookings. But, the segment has been hurt by lockdowns in China that could leave a $350m mark. As we all know, travel is booming, so perhaps that can help make up for the loss.
  • It avoided Netflix’s fate by smashing its streaming numbers. Disney added 7.9m subscribers to beat estimates with a new total of 137.7m, and each of those are bringing in over 5% more revenue. However, outlook was tepid and expects net additions to slow in the second half of the year and production and content costs to eat into revenues.
See all reported financials
Mahdis mousavi / Unsplash
Apr 212022

Disney gets dragged into politics

Disney could be about to lose some of its magic to politics as the Florida government mixes business with pleasure.

  • Disney World in FL has been a “special district” since 1967, meaning it has the authority to basically act as its own little country, boasting unique tax laws and the ability to run its own emergency services and city planning (that’s why they have no potholes) – but it could be about to lose that status.
  • The brand has been opposing a piece of legislation from Florida’s government, and let’s just say Republican Gov. Ron DeSantis ain’t happy about it. Disney’s unique tax laws save it tens of millions of dollars a year and help it run smoothly and efficiently, but its employees are vehemently against the bill, so the company is kinda stuck rn.
  • Streaming platforms were streaming with tears yesterday after Netflix nuked the market with earnings, losing $54bn in market cap and wiping 35% off its share price in its biggest one-day drop ever, and other streaming platforms sank in sympathy – Disney and Roku both lost around 6%, and Paramount declined 8.6%.
Brian McGowan / Unsplash
Mar 072022

Disney adds another tier to its castle

Disney’s streaming platform plans to add a new, cheaper tier to its subscription options.

🔍 Key points:

  • Disney Plus is adding an ad-supported tier sometime later this year for the first time, starting with the U.S. with plans to expand internationally.
  • The move is a “building block” for the company’s plans to hit up to 260m subscribers by the end of fiscal 2024 (up from 129.8m at the end of 2021), which is increasingly important for Disney as it watches subscriber growth slow in recent quarters.
  • Ad-supported options have become increasingly popular for streaming sites as competition in the industry hits new highs, and Disney follows the likes of NBC, Discovery, Paramount, and even Amazon in offering free streaming tiers with ads – will Netflix and Apple be next?
Thibault Penin / Unsplash
Feb 102022

Disney’s show stopping earnings

There’s much fanfare in Disneyland after a dazzling fiscal Q1 show from both of its core businesses.

Key points:
  • The stock popped 7% in Thursday morning trading after it easily topped on both ends. It reported EPS of $1.06 (vs $0.63 expected) on revenues that were up 34% y-o-y to hit $21.82bn (vs the $20.91bn expected).
  • Its media division grew 15% to $14.5bn, largely thanks to Disney+, which beat estimates with 129.8m total subscribers – it’s splashing the big bucks on content for Q4 2022 and CEO Bob Chapek reiterated their goal of having between 230m and 260m subscribers by 2024.
  • Its parks business got love’s true kiss and came back to life. The division posted record revenues that had more than doubled y-o-y to hit $7.2bn thanks to a flood of people coming to their theme parks, booking hotels and going on cruises thanks to fewer covid restrictions.
See all reported financials
Jayme McColgan / Unsplash
Nov 112021

Disney goes "Minnie"

Disney disappoints with earnings, struggling to attract subscribers to a slowing streaming service.

  • Disney missed estimates across the board in Q3 and the poor performance sent prices down 4% after-hours.
  • Disney+ has lost its magic despite becoming a key growth driver during Covid, adding just 2.1m subscribers compared to ambitious estimates of 9.4m.
  • Theme parks were the bright spot in a dark quarter, making a comeback as travel picked up and seeing revenue double from Q3 last year.
  • Disney still forecasts 260m subscribers by 2024 – there are currently 118.1m.
  • Analysts don’t think that’s realistic and Disney got its first downgrade of the year from Barclays this week.
Aug 132021

Disney's fairytale earnings

Disney reports blowout Q3 earnings (its fiscal year runs September to September), beating expectations on both the top and bottom lines thanks to the burgeoning Disney+ and the reopening of its theme parks.

Disney reported some fairytale earnings on Thursday, leaping ahead of expectations on the back of its rapidly growing streaming service and the reopening of theme parks as restrictions are lifted around the country. The media giant reported earnings per share of $0.80 on revenue of $17.02 billion, compared to the $0.55 in earnings per share on revenue of $16.76 billion that analysts were expecting. The industry behemoth also smashed subscriber estimates for Disney+ in the third fiscal quarter, reporting 116 million compared to estimates of 114.5 million, and up significantly from the 103.6 million the company boasted last quarter – its total addressable market is now up to 1.1 billion households across the world.

The results should go some way towards easing investor concerns regarding Disney’s post-pandemic rebound. Many streaming services have struggled as restrictions ease and fewer people are locked at home desperately searching for entertainment of an evening. The solid report can also be attributed to the reopening of theme parks across the country, which prompted a threefold increase in the segments’ revenue numbers.

We’ve only just begun our journey and as I think you see what’s really going to make the difference for Disney is our spectacular content, told by the best storytellers, against our powerhouse franchises. In terms of the impact of the Delta variant, we see strong demand for our parks continuing. The primary noise that we’re seeing right now is really around group or convention cancellations …But on the whole, we see really strong demand for our parks,

said CEO Bob Chapek.
May 132021

Hi ho, hi ho, it's off to work we go...

Disney investors are certainly not in the happiest place on earth after seeing the company’s latest earnings, which disappointed on subscriber growth but gave some hope on the back of strong demand for its recently reopened theme parks.

The media company reported lower-than-expected second quarter earnings, with poor revenues and disappointing subscriber growth. Disney reported earnings per share of $0.79 on revenues of $15.61 billion, compared to expectations of $0.27 in earnings per share on revenue of $15.87 billion.

The company’s streaming service, Disney+, has been boosting the business during the pandemic as almost everything else was forced to shut, but it seems growth on the platform is already starting to slow. Average monthly revenue per streamer dipped almost 30% from last year, and paid subscriber numbers were also a swing and a miss, coming in at 103.6 million versus expectations of 109 million. Disney still hopes to see between 230 million and 260 million Disney+ subscribers by 2024 though, or so it says.

(Disney+) growth is significantly decelerating as the initial pandemic boost has waned,

said eMarketer analyst Eric Haggstrom.

Given Disney's content investments, subscriber growth should return strongly once this short-term turbulence ends.

So there is hope. Investors can also rest easy knowing that Disney’s theme parks have been back up and running since April 30th, receiving a super positive customer response and solid booking numbers. Revenues from this recovery should come out more clearly in Q3 earnings, so watch this space. The theme parks segment posted an operating loss of $406 million this quarter though, understandably, as its Disneyland California and Paris parks were shut for the full three months.

This quarter’s numbers were exactly as we projected internally, so no disappointment here,

said CEO Bob Chapek.

We’re pleased to see more encouraging signs of recovery across our businesses, and we remain focused on ramping up our operations while also fueling long-term growth for the Company. This is clearly reflected in the reopening of our theme parks and resorts, increased production at our studios, the continued success of our streaming services, and the expansion of our unrivaled portfolio of multi year sports rights deals for ESPN and ESPN+.