The Walt Disney Co. saw a return to profitability in the third quarter as its streaming business began generating profit and the movie Inside Out 2 received positive results in theaters. For the quarter ending on June 29, Disney reported earnings of $2.62 billion, equivalent to $1.43 per share, a significant improvement from the previous year’s loss of $460 million, or 25 cents per share. Adjusted earnings were $1.39 per share, surpassing analysts’ expectations of $1.20 per share.
Revenue for the California-based company increased by 4% to $23.16 billion, exceeding Wall Street’s projection of $22.91 billion. The entertainment segment’s operating income nearly tripled to $1.2 billion, attributed to stronger performances in its direct-to-consumer and content sales/licensing segments.
Disney announced that its direct-to-consumer business, which includes Disney+ and Hulu, reported a quarterly operating loss of $19 million, a significant improvement from the previous year’s loss of $505 million, with revenue rising by 15% to $5.81 billion. The Content sales/licensing and Other segment reported $254 million in operating income, credited to the success of Inside Out 2 in theaters.
The company now expects a 30% growth in full-year adjusted earnings per share. Earlier in the year, shareholders rejected attempts by activist investor Nelson Peltz to secure seats on the board, showing support for CEO Bob Iger’s leadership amidst company challenges.
In June, Disney moved to dismiss its lawsuit against Florida Gov. Ron DeSantis after reaching an agreement on the development of Walt Disney World over the next 20 years. The 15-year deal involves Disney investing $17 billion into Disney World and the district committing to infrastructure improvements on the theme park resort’s property.
