Walt Disney Co. (NYSE:DIS) reported blowout fiscal third-quarter earnings, beating analyst expectations on subscriber growth, revenue, and earnings.
The company’s shares are up more than 5% in pre-market trading following the financial results.
Disney’s earnings per share (EPS) came in at $0.80 U.S. compared to $0.55 that had been forecast. The company’s revenue for the quarter amounted to $17.02 billion U.S. versus $16.76 billion U.S. that had been expected.
The Mouse House beat on subscriber estimates for its Disney+ streaming service, which came in at 116 million. Wall Street had expected the company to report 114.5 million subscribers for its fiscal third quarter. The segment had 103.6 million streaming subscribers in its previous quarter.
Overall, the company said it had nearly 174 million subscriptions across Disney+, ESPN+ and Hulu at the end of its third quarter. Revenue for its direct-to-consumer segments increased 57% to $4.3 billion U.S. Disney said the company’s total addressable streaming market is 1.1 billion households across the globe.
Disney’s Theme Parks, Experiences and Products segment returned to profitability for the first time since the pandemic began, though the parks alone are not yet profitable.
Revenue in the segment jumped 308% to $4.3 billion U.S., as all of its parks were reopened during the fiscal third quarter and attendance and consumer spending rose. Operating income reached $356 million U.S., compared with a loss of $1.87 billion U.S. during the same quarter last year.
Much of this profitability is attributable to the segment’s consumer products business, which saw operating income reach $564 million U.S. During the quarter, Disney garnered higher revenue from merchandise based on Mickey and Minnie, Star Wars, Disney princesses and Spider-Man.
Disney’s domestic parks eased restrictions in April, which led to a boost in attendance. Domestic parks reported operating income of $2 million U.S. International parks posted a loss of $210 million U.S.
Disney had reported a loss in operating income in the segment over each of the previous five quarters because of the Covid-19 pandemic.
The resurrection of the theme park industry is critical to Disney’s bottom line. In 2019, the segment, which includes cruises and hotels, accounted for 37% of the company’s $69.6 billion U.S. in total revenue.
