The “Partners” statue of Walt Disney and Mickey Mouse, at Cinderella Castle in the Magic Kingdom, at Walt Disney World, in Lake Buena Vista, Florida, is photographed on Saturday, June 3, 2023.
Joe Burbank | Tribune News Service | Getty Images
Disney The company reports earnings before the bell, and Wall Street will be paying close attention to the company's ongoing turnaround since Bob Iger returned as CEO in 2022 — especially results from its streaming and theme park businesses.
Here's what Wall Street expects Disney to announce, according to LSEG:
Earnings per share: $1.19 expected Revenue: $23.071 billion expected
On the streaming front, Disney+ and Hulu reported profits for the first time last quarter.
During Disney’s second quarter, Disney+ Core subscribers — which excludes Disney+ Hotstar in India and other countries in the region — grew by more than 6 million to 117.6 million global customers. Hulu’s total subscribers increased 1% to 50.2 million; meanwhile, ESPN+ subscribers fell 2% to 24.8 million.
Like all of its media peers, Wall Street is closely watching Disney's streaming unit — which includes Disney+, Hulu and ESPN+ — especially since the company has said it aims to achieve profitability for the combined services by the end of the year.
While Disney came close to that milestone last quarter thanks to Disney+ and Hulu, Paul Verna, vice president of content at eMarketer, said that “continued losses at ESPN+ and soft guidance… point to a difficult road ahead.”
During the company's most recent earnings call, executives cautioned that they don't expect to see customer additions in the third quarter but do expect a return to growth in the fourth quarter.
While ESPN+ has weighed on Disney’s streaming unit, its network counterpart remains a bright spot for the company’s traditional TV business. However, traditional TV is expected to decline as customers continue to cut the cord on pay-TV packages.
Meanwhile, Disney's theme park divisions are also a major focus, serving as the company's profit engine. The state of Disney's theme parks in the United States will be of particular interest.
Disney has pledged to spend $60 billion on its theme park investments over the next decade, a clear sign of the importance of this work.
In the most recent quarter, U.S. parks and experiences revenue rose 7% to $5.96 billion, with international sales up 29% to $1.52 billion on higher attendance and prices at Hong Kong Disneyland Resort. eMarketer’s Verna expects the parks’ “positive momentum” to continue.
However, Disneyland Resort in California was under pressure as profits fell. Executives attributed the year-over-year decline to cost inflation, including higher labor costs.
Last month ComcastComcast’s earnings have been hit hard by its Universal theme parks, which the company attributed to increased competition from cruises and international tourism. However, Comcast executives said they remain “optimistic” about the business, especially with a new theme park opening in 2025.
Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.
