Disney Falls on Mixed Earnings, Streaming Results

Disney fell short of analysts' revenue expectations, as well as for paid subscribers for streaming service Disney+.

Shares of The Walt Disney Company  (DIS) - Get Walt Disney Company Report dropped Thursday after the media and entertainment giant reported mixed results for the quarter ended April 3.

The company reported fiscal second quarter earnings of 79 cents per share, a 32% increase year-over-year, on revenue of $15.61 billion. Analysts were expecting Disney to report earnings of 26 cents per share on revenue of $15.86 billion.

Shares of Disney were down 3.7% to $171.74 in after-hours trading on Thursday.

"We’re pleased to see more encouraging signs of recovery across our businesses, and we remain focused on ramping up our operations while also fueling long-term growth for the Company," said Disney CEO Bob Chapek. 

The company said the pandemic had most adversely affected its parks, experiences and products division, with most of its theme parks closed or operating at significantly limited capacity, and its cruise ship sailings suspended.

Disney+, the company's streaming service, had 103.6 million paid subscribers at the end of the quarter. Analysts polled by Bloomberg were expecting 110.3 million subscribers. 

TheStreet Recommends

Disney's Hulu service had a total of 41.6 million paid subscribers, including 3.8 million for its live television offering. And ESPN+ saw a 75% year-over-year jump in paid subscriptions to 13.8 million. 

Average revenue per user for Disney+ was $3.99 and $4.55 for ESPN+, while Hulu's live television and subscription video-on-demand package reported average revenue per user of $81.83. 

The company's media and entertainment division saw generally flat revenue of $12.4 billion in the quarter, with its theme park segment seeing a 44% year-over-year decline to $3.17 billion. 

The company said that it will continue to incur charges related to the government regulations and safety measures for its employees and guests totaling about $1 billion in the fiscal year. 

Earlier in the day, analysts at Credit Suisse published a bullish note while maintaining a $218 price target. 

Read More: Puke or Profit? How to Ride Disney After Earnings

Disney is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells DIS? Learn more now.