Disney Earnings Results Were Anything But Magical

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Cinderella Castle Partners statue at Walt Disney World

Credit: Disney

The Walt Disney Company reported its fourth-quarter earnings results this afternoon. Unfortunately for investors, the earnings missed Wall Street estimates.

Brian Hull
Credit: YouTube Brian Hull

The Walt Disney Company reported weaker-than-expected fourth-quarter earnings on Tuesday as losses further escalated within its direct-to-consumer AKA, “streaming” business, which offset the stronger-than-expected performance in the Disney Theme Parks segment.

Some of the highlights from the earnings release for The Walt Disney Company can be found below:

  • Earnings per share: 30 cents per share adj. vs. 55 cents expected
  • Revenue: $20.15 billion vs. $21.24 billion expected
  • Disney+ total subscriptions: 164.2 million vs. 160.45 million expected

Shares of The Walt Disney Company stock have been down roughly 35% since the beginning of 2022 and more than ~42% over the past 12 months as investors contemplate if the company can sustain its streaming growth amid higher inflation. There’s also concern that a looming recession could impact Disney’s other business ventures like studios and Theme Park segments.

bob chapek
Credit: Screenshot via Annual Shareholders Meeting

Disney Chief Executive Officer Bob Chapek has stated to investors that Disney Plus is entering a new phase that prioritizes generating profits over high subscriber growth. Still, thus far, the company has struggled to translate subscriber additions into gains. Mr. Chapek addressed this concern on the earnings call by stating that Disney will start focusing on profitable growth as Disney Plus continues to grow.

Disney’s parks, experiences, and consumer products division has been an outperformer in recent quarters, as more Guests visit its domestic theme parks and spend money on merchandise. As Disney moves forward, its film division should get a boost from ticket sales of Marvel’s “Black Panther: Wakanda Forever,” followed by 20th Century’s “Avatar: The Way of Water” in mid-December. Both movies are expected to be significant drivers of ticket sales for movie theaters.

What do you think about the Disney earnings results?

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