Disney earnings beat estimates as visitors crowd theme parks

Disney earnings beat estimates as visitors crowd theme parks

By Lisa Richwine and Dawn Chmielewski

LOS ANGELES (Reuters) -Walt Disney Co‘s quarterly earnings on Wednesday topped Wall Street estimates as visitors packed the company’s theme parks and made up for losses from streaming media.

The Disney+ streaming service reported its first subscriber decline. The service shed 2.4 million subscribers as the company raised prices, bringing its total to 161.8 million. Analysts polled by FactSet had expected 162.7 million.

Chief Executive Bob Iger, in the companys earnings report, said Disney would reduce expenses as it embarked on “a significant transformation” that would lead to “growth and profitability for our streaming business, better position us to weather future disruption and global economic challenges, and deliver value for our shareholders.”

Shares of Disney rose 2% in after-hours trading.

Adjusted earnings per share came in at 99 cents for the fiscal first quarter that ended Dec. 31, beating the Refinitiv consensus estimate of 78 cents.

Revenue hit $23.512 billion, ahead of Wall Street estimates of $23.4 billion.

Net income came in at $1.279 billion, below analyst estimates of $1.429 billion.

Iger, who came out of retirement in November to run Disney for another two years, is under pressure to improve financial performance at the Mouse House.

The company‘s streaming media business is losing money as traditional TV viewership shrinks. Activist investor Nelson Peltz is fighting to join Disney’s board, arguing the company has overspent on streaming and fumbled succession planning.

The streaming media unit, which includes Hulu and ESPN+, lost $1.1 billion, narrower than the $1.5 billion loss in the prior quarter. The company has told investors the business will turn a profit by fiscal 2024, which starts in October.

The streaming results dragged down performance of the media and entertainment division, which reported a loss of $10 million.

Disneys theme parks posted operating income of $3.1 billion during the quarter, a 25% increase from a year earlier, helped by strong attendance over the Christmas holiday season.

(Reporting by Lisa Richwine and Dawn Chmielewski in Los AngelesAdditional reporting by Chavi Mehta in BengaluruEditing by Kenneth Li, Peter Henderson and Matthew Lewis)

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