The Walt Disney Company dropped its fiscal third-quarter earnings, and it’s safe to say Mickey Mouse is doing a victory dance. Net income soared to $5.94 billion, crushing Wall Street’s puny $2.3 billion guess. A cheeky one-time tax break from Hulu’s streaming antics deserves a big high-five for that win.
Disney’s streaming game is flexing some serious muscle. Disney+, Hulu, and ESPN+ snagged 2.6 million new subscribers, bringing the total to a whopping 183 million. The company’s plotting to merge Hulu into Disney+ and launch a standalone ESPN streaming service, because apparently, they want all your screen time.
The ESPN+ platform is getting a major glow-up with some blockbuster deals. Disney inked a deal with the NFL, snatching up the league’s media assets, including NFL Network and RedZone, for a 10% stake in ESPN. They also locked in a five-year deal with WWE for premium live events, so expect WrestleMania to crash your ESPN app soon.
Theme parks are still Disney’s cash cow, raking in $9.1 billion in revenue, up from $8.4 billion last year. That’s a solid leap past the $8.2 billion analysts predicted, proving that people will always pay to hug Goofy. New cruise ships and a shiny Abu Dhabi resort are keeping the magic alive.
But it’s not all fairy tales and pixie dust. The film studio took a hit, swinging to a $21 million loss from a $254 million profit last year. Flops like Elio, Thunderbolts, and Lilo & Stitch couldn’t match the Inside Out 2 juggernaut of 2024.
Linear television is also feeling the pinch, with declining viewership dragging down ad revenue. The entertainment division still posted $1 billion in profit, but that’s a 15% dip from last year. Disney’s juggling act between old-school TV and streaming is trickier than a barrel of monkeys.
Sports revenue at ESPN dipped 5% to $4.3 billion, but profit jumped 29% to $1 billion, thanks to no longer bleeding cash on Star India. Domestic ad revenue crept up 3%, though higher NBA and college sports costs took a bite. The NFL and WWE deals are Disney’s big bet to keep sports fans glued to their screens.
Adjusted earnings per share hit $1.61, beating the $1.45 Wall Street expected and up from $1.43 last year. Total revenue clocked in at $23.7 billion, a 2% bump from $23.2 billion, matching analysts’ forecasts to the penny.
Disney’s stock, up 6.3% this year, took a 1% dip in premarket trading, probably just catching its breath.
CEO Bob Iger is practically bursting with optimism. “We’re taking major steps in streaming and have more park expansions than ever,” he said, probably while sipping coffee from a Mickey mug. The company’s eyeing a $5.85 adjusted EPS for the full year, up from their earlier $5.75 guess.
The Hulu tax benefit was the quarter’s secret weapon, turning a good performance into a great one. Without it, Disney would’ve still beaten expectations, but not with such flair. It’s like finding an extra churro in your park bag—unexpected and delightful.
Disney’s theme park business is shrugging off competition from Universal’s new Epic Universe in Orlando. Domestic parks saw higher guest spending and more cruise passengers, despite some pre-opening costs for the Disney Treasure ship. International parks, meanwhile, are riding a wave of higher attendance and spending.
The streaming division’s $346 million profit is a far cry from last year’s $19 million loss. Disney+ alone hit 128 million subscribers, and Hulu’s at 55.5 million, though its Live TV option shed a few users. The upcoming ESPN streaming service is set to launch this fall, and Disney’s betting big on sports to keep the momentum going.
The NFL deal is a game-changer, giving ESPN control of valuable assets like NFL Fantasy. Analysts peg the NFL’s stake in ESPN at $2 billion to $3 billion, which is a lot of mouse money. The WWE deal adds some serious muscle, with events like Royal Rumble joining the ESPN roster.
Disney’s not resting on its laurels. They’re planning a new theme park in Abu Dhabi, their first big Middle East venture. With more cruise ships and global expansions in the works, Disney’s building an empire faster than you can say “Hakuna Matata.”
The stock market’s been a bit of a rollercoaster for Disney, with a 26% drop in April over tariff worries. But with a 6.3% gain this year, they’re not far behind the S&P 500’s 7.1%. Investors are probably just waiting for the next big Pixar hit to calm their nerves.
Disney’s Q3 shows a company firing on most cylinders. Streaming and parks are carrying the day, while the film studio and linear TV play catch-up. With ESPN’s new deals and a tax trick up its sleeve, Disney’s proving it’s still the king of the entertainment jungle.
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