Disney lifts profit outlook after delivering solid parks, streaming results

Disney (DIS) reported fiscal second quarter earnings on Wednesday that beat expectations on both the top and bottom lines, driven by a rebound in its domestic parks business and strong performance in its streaming unit.

The company raised its full-year profit forecast to $5.75 a share, up 16% from fiscal 2024 and roughly double its prior guidance for high single-digit growth. Analysts had expected 2025 adjusted EPS to come in at $5.44. Shares jumped as much as 8.5% in early pre-market trading before paring gains to around 5%

The report comes as President Trump's shifting tariff policies cast a shadow over many companies this earnings season. In its release, the company acknowledged the uncertainty, stating, "We continue to monitor macroeconomic developments for potential impacts to our businesses and recognize that uncertainty remains regarding the operating environment for the balance of the fiscal year.'"

Disney+ added 1.4 million subscribers in the quarter, a beat compared to the 1.25 million subscriber loss analysts polled by Bloomberg had expected. The company reported a drop of 700,00 paying users in Q1 as a result of expected user churn on the back of recent price hikes.

In the midst of those price increases, along with other initiatives like password sharing crackdowns, the company's direct-to-consumer (DTC) streaming unit — which includes Disney+ and Hulu — posted a profit of $336 million. That's up from $47 million one year ago and also ahead of analyst expectations.

It marked the fourth straight quarter of profitability for the streaming business.

Achieving consistent profits in streaming is critical for Disney and other media giants as more consumers shift to DTC services from traditional pay-TV packages. The company has a streaming profit target of approximately $875 million in fiscal 2025.

Overall, revenue of $23.62 billion beat expectations of $23.05 billion in the quarter and represented a 7% increase from the prior-year period.

Adjusted earnings per share of $1.45 came in ahead of the $1.20 analysts polled by Bloomberg had expected. Earnings increased 20% from a year ago.

Disney's parks business is expected to face continued pressure from broader economic uncertainties and intensifying competition, particularly with the upcoming launch of NBCUniversal's Epic Universe, which could draw visitors away from Disney’s Florida attractions.

But that didn't weigh on domestic profits in the second quarter.

The company posted a 13% rise in operating income at its domestic parks, aided by an uptick in theme park attendance and the successful launch of the Disney Treasure cruise ship. This was a stark rebound compared to the 5% decline in domestic operating income the company reported in Q1.