Disney's Big Bets on Sports and Streaming

Disney has announced significant strides in both sports and streaming sectors, as revealed in its latest financial results.

Financial Highlights

• Revenue: $23.7 billion, up 2%
• Operating Income: $4.6 billion, up 8%

Streaming and Sports Deals

Disney's streaming business saw a 6% revenue increase to $6.2 billion, with 2.6 million new subscribers added to Disney+ and Hulu, primarily from international markets.

NFL Deal

• ESPN Stake: NFL gains a stake in ESPN.
• Streaming Rights: Includes major WWE events like WrestleMania.

CEO Insights

Bob Iger emphasized the benefits of combining Disney+ and Hulu for a better user experience and longer subscriber retention. Disney is focusing on international growth and experimenting with new features.

Division Performance

• Entertainment Division: Revenue up 1% to $10.7 billion, but operating income down 15% due to declines in linear TV networks.
• Experiences Division: Revenue up 8% to $9.1 billion, driven by higher spending at U.S. parks and the expansion of the Disney Cruise Line.

Expansion Plans

• Disney Adventure: First cruise ship in Singapore launching later this year.
• Asia Expansion: Iger sees this as a significant opportunity to grow the Disney brand in Asia.

Sports Revenue

• Revenue: Down 5% to $4.3 billion.
• Operating Income: Up 29% to $1 billion.

NFL Deal Benefits

• Economic Benefits: Increased revenue and operating income for ESPN.
• Churn Rates: Potential to lower churn rates for the ESPN app.
• Advertising Revenue: Expected increase.

Fiscal 2025 Guidance

• Adjusted EPS: $5.85, up from $5.75 last quarter.
• Direct-to-Consumer Operating Income: Targeting $1.3 billion.