Walt Disney (DIS) - Get Walt Disney Company Report posted much stronger-than-expected third quarter earnings Thursday as subscribers to its Disney+ streaming service topped 100 million less than two years after its initial launch.
Disney said adjusted diluted earnings for the three months ending on July 3, the group's fiscal third quarter, came in at 80 cents per share, well ahead of Street forecast of 55 cents and up from a loss of 8 cents per share over the same period last year. Group revenues, Disney said, rose 44.2% to $17.02 billion, while overall subscriber totals for its Disney+ streaming services hit 116 million, both of which we well ahead analysts' estimates.
Media revenues were up 18% to $12.7 billion while Theme Parks revenues surged more than three-fold from last year to $4.34 billion in the wake of COVID-related restrictions on attendance in the U.S. and elsewhere.
“We ended the third quarter in a strong position, and are pleased with the Company’s trajectory as we grow our businesses amidst the ongoing challenges of the pandemic,” said CEO Bob Chapek. “We continue to introduce exciting new experiences at our parks and resorts worldwide, along with new guest-centric services, and our direct-to-consumer business is performing very well, with a total of nearly 174 million subscriptions across Disney+, ESPN+ and Hulu at the end of the quarter, and a host of new content coming to the platforms.”
Walt Disney shares were marked 5.25% higher in extended hours trading immediately following the earnings release to indicate a Friday opening bell price of $188.68 each.
Last month, Disney's main streaming rival, Netflix (NFLX) - Get Netflix, Inc. (NFLX) Report, posted a rare decline in north American subscribers over the second quarter, and forecast weaker-than-expected additions over the summer months amid intensifying competition and a post-pandemic surge in outdoor activity.
Netflix lost 430,000 north American subs, the company said in its second quarter earnings report last night, although its total worldwide additions of 1.54 million topped Street forecasts and took its overall total to 209 million.
AT&T's (T) - Get AT&T Inc. Report planned $43 billion media merger with Discovery Communications (DISCA) - Get Discovery, Inc. Class A Report will also pressure near-term subscriber growth, with CEO David Zaslav vowing the combined group will spend $20 billion a year on new content while holding on to its CNN network and "leaning in" to news coverage.