WALT Disney reported earnings that topped Wall Street’s estimates on Thursday (Nov 14), propelled by blockbuster ticket sales from the rude and irreverent summer Marvel film Deadpool & Wolverine, and provided an upbeat forecast for the coming year.
Financial Results
Shares of the company rose 2.3 per cent in premarket trading.
The company projected adjusted earnings-per-share percentage growth in the high single digits in fiscal 2025, even with capital expenditures of roughly US$8 billion. It also said it expects to buy back US$3 billion worth of stock.
Segment Performance
The entertainment giant’s recent success at movie theaters helped offset a decline in operating income at the company’s Experiences and Sports divisions. Lower attendance at international locations dragged on theme parks results, and higher programming and production costs hurt ESPN.
Disney reported adjusted per-share earnings of US$1.14 for its fiscal fourth quarter that ended in September. That compares with consensus estimates of US$1.10 per share, according to analysts polled by LSEG.
Revenue reached US$22.6 billion, slightly ahead of Wall Street forecasts of US$22.45 billion. Operating income rose 23 per cent from a year earlier to nearly US$3.7 billion.
CEO Comments
Chief executive Bob Iger, who returned to the company from retirement in November 2022, undertook aggressive cost-cutting and worked to revitalise the company’s film and TV units after a period of misfires.
“Thanks to the significant progress we’ve made, we have emerged from a period of considerable challenges and disruption well positioned for growth and optimistic about our future,” Iger said in a statement.
Outlook
In addition to the fiscal 2025 projection, Disney said it expected double-digit adjusted EPS growth in fiscal years 2026 and 2027.
“If you add it all up, our strategies are working, working very well, and we’ve got good visibility on where those strategies are likely to lead us,” Disney CFO Hugh Johnston said in an interview.
Conclusion
Disney’s strong earnings report was driven by the success of its film and TV units, as well as its streaming services. The company’s forecast for the coming year is upbeat, with projected adjusted EPS growth in the high single digits. Disney’s strategies are working, and the company is well-positioned for growth.
FAQs
Q: What drove Disney’s strong earnings report?
A: The success of Disney’s film and TV units, as well as its streaming services.
Q: What is Disney’s forecast for the coming year?
A: Disney projected adjusted EPS growth in the high single digits in fiscal 2025, and double-digit adjusted EPS growth in fiscal years 2026 and 2027.
Q: What are the challenges facing Disney’s Experiences and Sports divisions?
A: Lower attendance at international locations and higher programming and production costs are among the challenges facing Disney’s Experiences and Sports divisions.
