Disney is set to announce its fiscal second-quarter earnings before the market opens on Tuesday, with analysts closely monitoring key metrics such as streaming subscriber growth, outlook, and visitation numbers at its theme parks.
Following CEO Bob Iger’s reorganization announcement over a year ago, which involved significant structural changes, job losses, and cost-cutting measures amounting to $5.5 billion, this earnings call will also mark Disney’s first since prevailing in a proxy fight against Nelson Peltz’s Trian Partners.
According to LSEG estimates, Wall Street expects Disney to report the following on Tuesday morning:
Earnings per share: Expected at $1.10
Revenue: Expected at $22.11 billion
The performance of Disney’s flagship streaming service, Disney+, will be a key focus once again. BofA Securities analyst Jessica Reif Ehrlich highlighted on CNBC’s “Squawk Box” that profitability for the streaming segment is anticipated to be achieved in the 4th quarter of 2024.
In the previous quarter, Disney’s direct-to-consumer unit, which encompasses Hulu and ESPN+, narrowed its losses to $216 million from $1.05 billion year-over-year.
Disney disclosed in February that it experienced a decline of 1.3 million core Disney+ subscribers during the quarter, attributed to price increases. However, the company noted an increase in average revenue per user due to the same pricing adjustments.
Updates on the integration of Hulu into Disney+ and the ongoing appraisal process to determine the value of Comcast’s stake in Hulu will also be closely watched by investors.
Additionally, attention will be on visitor traffic to Disney’s U.S. theme parks. A Deutsche Bank research note highlighted a slowdown in growth last year, particularly in Orlando. Comcast recently reported a deceleration in attendance at its Universal Orlando theme park, citing heightened competition from cruises. Analysts suggest this competitive landscape could work in Disney’s favor, especially considering its introduction of a new cruise ship.
