Disney reported a strong fourth-quarter performance, surpassing Wall Street's expectations with an adjusted profit of $460 million, or 25 cents per share, compared to $264 million, or 14 cents per share, a year earlier. The company's earnings of $1.14 per share exceeded analysts' estimates of $1.09 per share, leading to a more than 9% increase in shares before the market opened on Thursday.
Revenue for the quarter rose by 6% to $22.57 billion, slightly below the estimated $22.59 billion. Operating income for Disney's entertainment segment quadrupled to $1.07 billion, driven by strong performances from its movie studio and television wing.
The direct-to-consumer business, including Disney+ and Hulu, reported quarterly operating income of $253 million, a significant improvement from the $420 million loss a year earlier. Revenue for this segment increased by 15% to $5.78 billion.
Disney+ saw a 2% increase in paid subscribers domestically and a 5% rise internationally, excluding Disney+ HotStar. The streaming platform ended the quarter with 174 million Disney+ Core and Hulu subscriptions, with over 120 million Disney+ Core paid subscribers.
CEO Bob Iger expressed optimism about Disney's streaming platform, noting the significant impact of successful movie releases on streaming viewership. Analysts also praised Disney's streaming business, highlighting its better-than-expected subscriber growth and improved profitability.
Disney's Experiences division, which includes theme parks and merchandise licensing, reported a 6% drop in operating income to $1.7 billion. The company attributed this decline to challenges in international parks and Experiences.
Looking ahead, Disney anticipates high-single digit adjusted earnings per share growth for fiscal 2025, with double-digit growth projected for fiscal 2026 and 2027. The company is in the process of selecting a new CEO to succeed Bob Iger, with James Gorman set to become the next chairman in early 2025.
Disney's recent agreement with Florida Gov. Ron DeSantis on the development of Walt Disney World over the next two decades marked the resolution of a longstanding conflict, with Disney committing to invest $17 billion in the theme park resort.
