Disney delivered better-than-expected fiscal first-quarter results, though the stock swung from early gains to losses as investors weighed the details.
The company posted adjusted earnings per share of $1.63, topping the $1.57 Wall Street estimate despite being down 7 percent from a year ago. Revenue came in at $25.98 billion, ahead of the $25.7 billion consensus, helped by a 7 percent rise in entertainment segment revenue. Management reaffirmed its outlook for double-digit adjusted EPS growth this year and said it remains on track to complete a $7 billion stock buyback. At the same time, Disney flagged “international visitation headwinds” at its US theme parks for the current quarter.
Streaming Finally Pulling Its Weight
Streaming was a standout. Revenue in the division rose 11 percent, while operating income jumped 72 percent year over year to $450 million, beating expectations. Disney now expects $500 million in streaming profit next quarter, showing that repeated price hikes on the ad-free Disney+ tier are helping margins.
Beyond the numbers, big strategic shifts are in motion. Disney’s board is reportedly close to promoting theme parks chief Josh D’Amaro to CEO, with a vote expected this week, while current CEO Bob Iger has said he plans to step down before the end of 2026. The company has also been leaning into AI and new formats, recently licensing more than 200 characters to OpenAI and planning to roll out TikTok-style vertical video on Disney+ as it fights for attention in a crowded streaming landscape.