Disney unveiled what's in store for the media and entertainment conglomerate with its Disney+ Day on Thursday, as well as an offer for new and returning subscribers to get the streaming service for $1.99 for one month. Meanwhile, D23 Expo kicks off Friday. Disney stock rose Friday.
The Disney+ Day event included the much-anticipated debut of "Marvel's Thor: Love and Thunder" and the premiere of the live-action version of the classic "Pinocchio," starring Tom Hanks as Gepetto. It also offered a sneak peek into "Andor," which is a prequel to the Star Wars spin-off film "Rogue One."
An ad-free Disney+ subscription is set to increase to $10.99 a month from $7.99 in November. That's no surprise, considering an industrywide subscription growth slowdown amid soaring production costs for new content. Disney also will introduce an ad-supported, lower-priced tier, something rival Netflix also is working on.
Meanwhile, Disney's multiday D23 Expo will feature presentations on its media businesses, theme parks and cruises, with product reveals and sneak peeks. The event runs from Sept. 9 to 11.
A new feature will be Disney & Marvel Games Showcase. It will focus on interactive entertainment. "Marvel's Spider-Man 2" is one of the most anticipated game releases. Disney's recent successes in this arena include "Marvel's Spider-Man," "Lego Star Wars: Skywalker Saga" and "Star Wars Jedi: Fallen Order."
Sneak peeks into Disneyland's Tiana's Bayou Adventure and new "Frozen" experiences on Disney cruise lines are expected, as well as an update on Florida's transformation of Epcot.
Disney Earnings
Disney's Q3 earnings rose 36% vs. the year-ago period to $1.09 a share. Sales grew 26% to $21.5 billion. Both beat Wall Street estimates.
The company added 14.4 million new Disney+ subscribers during the period, bringing the total to 152.1 million. That topped analyst views for an expected 147.9 million. Disney's total numbers across all its streaming channels, including Hulu and ESPN+, hit 221 million, well above expectations of 217.82 million.
But Disney cautioned that growth might slow down. It's now targeting 215 million to 245 million Disney+ subscribers by the end of 2024, down from its February forecast of 230 million to 260 million.
The most recent IBD/TIPP Poll seems to back up this outlook. Slightly more than three-quarters of respondents in August said they had rolled back on household spending as a result of price increases. Of those, 77% cut membership/subscription spending.
Elsewhere, Disney theme-park revenue jumped 70% year over the year to $7.39 billion for fiscal Q3, thanks to a post-pandemic rebound in travel. However, while theme parks in the U.S. have been fully reopened for a while, Shanghai Disney Resort has been slower to welcome back visitors en masse as China continues to impose strict Covid rules.
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Disney Stock
Shares rose 2.2% to 114.67 on the stock market today. Disney stock gapped up nearly 5% after reporting strong earnings on Aug. 10, according to MarketSmith. Shares raced up to 126.48 in the days that followed before giving up all those gains amid an overall market downturn.
Disney stock is trading above its 50-day line, but its relative strength line is going sideways after a long slide. Disney's RS Rating is a weak 40 out of a best possible 99. Its EPS Rating is 67.
Netflix stock crashed after the streaming leader reported its first subscriber loss in a decade in Q1, with a 200,000 decline.
Shares remain deflated as Netflix reported another decline in Q2, this time a loss of 970,000 subscribers. NFLX stock is trading near 233, well off its 52-week high of 700.99.
Follow Adelia Cellini Linecker on Twitter @IBD_Adelia.
