Streaming and subscribers
The entertainment streaming segment, excluding ESPN+, saw revenue rise 13% to $5.64 billion, with operating profit rising from a loss of $587 million last year to a gain of $47 million this quarter. This was attributed to an increase in Disney+ subscribers and higher average revenue per user. Disney+ Core’s subscriber count increased to 117.6 million, while Hulu’s subscriber base increased slightly to 50.2 million. However, ESPN+ saw a 2% subscriber decline.
Growth of parks and experiences
The U.S. parks and experiences sector saw revenue increase 7%, to $5.96 billion, while international sales jumped 29%, to $1.52 billion. This growth is driven by increased attendance and higher prices at the Hong Kong Disneyland Resort, highlighting Disney’s recovery in physical experience spaces post-pandemic.
Unlike streaming success, Disney’s traditional TV business has faced challenges, most notably with ESPN. Despite revenue rising 3% to $4.21 billion, ESPN’s operating profit fell 9% due to lower advertising revenue, fewer cable subscribers and the rising costs of broadcasting the College Football Playoff.
Market Forecast
Looking ahead, Disney’s strategic focus on streamlining its streaming operations and improving its experiences business could provide an optimistic outlook for the company’s stock in the near term. However, current difficulties in the traditional television sector could dampen this optimism unless significant adjustments are made.
