Disney posted solid profits and revenue in the second quarter as its domestic theme parks thrived and the company added well over a million subscribers to its .
The company also boosted its profit expectations for the year, sending shares up 11% Wednesday.
Disney also announced that it will build a .
For the three months ended March 30, Disney earned $3.28 billion, or $1.81 per share. The Burbank, California, company lost $20 million, or a penny per share, a year earlier.
Removing one time charges or benefits, earnings were $1.45 per share, easily topping the $1.18 that Wall Street was expecting, according to a survey by Zacks Investment Research.
Revenue rose 7% to $23.62 billion, also topping projections.
Revenue for Disney Entertainment, which includes the company's movie studios and streaming service, climbed 9%, while revenue for the Experiences division, its parks, increased 6%.
Recent box office hits include 鈥淢oana 2鈥� and 鈥淢ufasa: The Lion King.鈥� Its latest film, 鈥淭hunderbolts(asterisk),鈥� is currently . CEO Bob Iger and Chief Financial Officer Hugh Johnston said in prepared remarks that they're confident in this year's movie slate, which includes 鈥淟ilo & Stitch,鈥� 鈥淭he Fantastic Four: First Steps鈥� and 鈥淎vatar: Fire and Ash.鈥�
Disney, however, faces potential ramifications from the launched by President Donald Trump. Other U.S. corporations have noted blowback by consumers in overseas markets and on Monday, opened a new salvo in his , targeting films made outside the U.S.
Trump on Monday said that he had he authorized a that are produced in Foreign Lands.鈥�
Disney is already under by the Trump administration. In March the head of the Federal Communications Commission said that he was opening an investigation into Disney and its ABC television network to determine if they are 鈥減romoting invidious forms of DEI discrimination."
As of now, Disney's streaming business continues to grow. Its direct-to-consumer business, which includes Disney+ and Hulu, posted quarterly operating income of $336 million compared with $47 million in the prior-year period. Revenue increased 8%.
The Disney+ streaming service had a 2% increase in paid subscribers domestically, which includes the U.S. and Canada. There was a 1% rise internationally, which excludes Disney+ HotStar.
Total paid subscribers for Disney+ edged up 1% in the quarter to surprising 126 million subscribers, from 124.6 million in the first quarter. The Walt Disney Co. previously said that it expected a modest decline in Disney+ subscribers in the second quarter when compared with the first three months of the year.
Disney+ and Hulu subscriptions totaled 180.7 million, up 2.5 million from the first quarter.
鈥淎 perfect cocktail of content helped Disney deliver a better than expected quarter as the company鈥檚 streaming business continues to grow profitability," Mike Proulx, Forrester vice president and research director said in an email. 鈥淎s Disney eyes investments in local international content, it could be a sign that it鈥檚 trying to more directly take on Netflix which is known for its strong international slate.鈥�
Disney has benefited doubly from success at the box office as those productions become content for its growing streaming service.
鈥淢oana 2" has more than 139 million hours streaming since hitting Disney+ on March 12, making it the biggest Walt Disney Animation Studios' premiere on the platform since 鈥淓ncanto,鈥� Iger and Johnston said. The first 鈥淢oana鈥� film remains the most watched movie on Disney+ with more than 1.4 billion hours streamed.
The Moana franchise also drives traffic at Disney's properties, with character meet and greets at theme parks and on cruise ships and the Journey of Water at Epcot at Walt Disney World in Orlando, Florida.
The Experiences division, which includes Disney's six global theme parks, its cruise line, merchandise and videogame licensing, reported operating income rose 9% to $2.5 billion. Operating income climbed 13% at domestic parks. Operating income dropped 23% for international parks and Experiences, due to softness at its Shanghai and Hong Kong theme parks.
While Disney continues to pull levers to successfully manage all of the different components of its business, it also continues to work on its search for a to Iger, the face of Disney for most of the past two decades.
Disney created a succession planning committee in 2023, but the search began in earnest last year when the company Morgan Stanley Executive Chairman James Gorman to lead the effort.
Disney does have some time, as Iger agreed to a contract that keeps him at the company through the end of 2026.
Disney is looking at internal and external candidates. The internal candidates are widely believed to include the chairman of Disney-owned ESPN, Jimmy Pitaro, Chairperson of Walt Disney Parks and Resorts Josh D鈥橝maro, Disney Entertainment Co-Chairman Alan Bergman and Disney Entertainment Co-Chairman Dana Walden.
Disney is projecting full-year adjusted earnings of $5.75 per share, which is better than the $5.43 per share that analysts polled by FactSet are looking for. The company鈥檚 previous guidance was for high-single digit adjusted earnings per share growth for .
Michelle Chapman, The Associated Press
