TLDR
- Disney beat Q3 earnings expectations with $1.61 per share, raising full-year profit outlook to $5.85
- Parks business delivered strong performance with 22% operating income growth and $9.09 billion revenue
- Streaming unit swung to $346 million profit from $19 million loss a year ago
- Linear TV business declined 15% in revenue, weighing on stock performance despite earnings beat
- ESPN secured NFL Media assets deal and launches standalone streaming service August 21
Disney delivered a third quarter earnings beat on Wednesday, posting adjusted earnings of $1.61 per share versus analyst expectations of $1.46. The entertainment giant raised its full-year profit forecast to $5.85 per share, up from the previous $5.75 guidance.
Revenue came in at $23.65 billion, roughly matching Wall Street’s $23.68 billion estimate. The 2% year-over-year growth reflected a mixed performance across Disney’s business segments.
The company’s domestic parks business continued its strong momentum with revenue of $9.09 billion, beating expectations of $8.87 billion. Operating income at domestic parks jumped 22% compared to the same quarter last year.
The Walt Disney Company, $DIS, Q3-25. Results:
📊 Adj. EPS: $1.61 🟢
💰 Revenue: $23.7B 🔴
📈 Net Income: $5.3B
🔎 Streaming turnaround continues with Direct-to-Consumer segment swinging to $346M profit and Disney+ + Hulu subs hitting 183M. pic.twitter.com/j6XPmobp2v— EarningsTime (@Earnings_Time) August 6, 2025
Guest spending at theme parks increased during the quarter. Hotel occupancy rates also improved, contributing to the parks division’s outperformance.
Disney’s cruise business added to the positive results. Passenger volumes rose following the successful launch of the Disney Treasure ship late last year.
Despite the earnings beat, Disney shares fell about 2% in pre-market trading. The decline reflected investor concerns about weakness in the company’s traditional television business.
Streaming Unit Returns to Profitability
Disney’s direct-to-consumer segment posted a $346 million profit for the quarter. This marked a turnaround from the $19 million loss recorded in the same period last year.
The streaming unit includes Disney+ and Hulu services. Disney+ added 1.8 million subscribers during the quarter, falling short of the 2.05 million that analysts expected.
Disney is targeting approximately $875 million in streaming profits for fiscal 2025. The company continues prioritizing consistent profitability over subscriber growth in its streaming strategy.
Looking ahead, Disney expects total Disney+ and Hulu subscriptions to grow by more than 10 million in the current quarter. Most of this growth is expected to come from Hulu due to an expanded distribution deal with Charter.
Disney+ is projected to see a more modest sequential increase in subscribers. The company is focusing on quality growth rather than rapid expansion.
ESPN Secures NFL Assets Deal
ESPN reached a preliminary agreement to acquire key NFL Media assets on Wednesday. The deal includes NFL Network, NFL RedZone, and NFL Fantasy in exchange for a 10% equity stake.
The NFL will also license certain content and intellectual property to ESPN for use across NFL Network and related assets. This represents a separate agreement between the two organizations.
ESPN is preparing to launch its standalone streaming service on August 21. The company confirmed this launch date early Wednesday morning.
A separate agreement extends ESPN’s NFL Draft rights and expands league content across the upcoming streaming service. The deal enables bundling NFL+ Premium with ESPN’s new platform.
Analysts view ESPN’s streaming debut as a key step toward more bundling opportunities with Disney+ and Hulu. Morgan Stanley noted that having the NFL as an investor makes ESPN’s long-term future more secure.
Traditional TV Business Weighs on Results
Disney’s linear networks segment experienced continued weakness during the quarter. Revenue in this division fell 15% year-over-year while operating income dropped 28%.
The traditional TV business includes ABC and Disney’s cable networks. These ongoing declines overshadowed strength in other business areas.
The weakness in linear television contributed to Disney’s stock slide despite the overall earnings beat. Investors remain concerned about the pace of cord-cutting and its impact on traditional media revenue.
Disney’s streaming profits are helping offset some linear TV losses. However, the decline in traditional television continues to present challenges for the company’s overall growth.
ESPN’s upcoming streaming launch represents Disney’s strategy to adapt to changing viewer preferences. The service aims to capture audiences moving away from traditional pay-TV packages.
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