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Disney (DIS) Q3 Earnings Top Estimates, Revenues Rise Y/Y
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The Walt Disney (DIS - Free Report) reported third-quarter fiscal 2021 adjusted earnings of 80 cents per share that beat the Zacks Consensus Estimate by 40.3% and increased 900% year over year.
Revenues increased 44.5% from the year-ago quarter to $17.02 billion and beat the consensus mark by 1.17%.
The Walt Disney Company Price, Consensus and EPS Surprise
Media and Entertainment Distribution (74.5% of revenues) revenues climbed 18.4% year over year to $12.68 billion.
Revenues from Linear Networks increased 15.7% year over year to $6.95 billion. Direct-to-Consumer revenues surged 56.9% year over year to $4.25 billion. Content Sales/Licensing and Other revenues declined 23% year over year to $1.68 billion.
Parks, Experiences and Products revenues (25.5% of revenues) surged 307.6% year over year to $4.34 billion.
Domestic revenues increased from $213 million in the year-ago period to $2.65 billion in the reported quarter. International revenues surged 353.4% year over year to $526 million in the reported quarter.
Walt Disney World Resort and Shanghai Disney Resort were open for the entire quarter. In the prior-year quarter, Walt Disney World Resort was closed for the entire quarter and Shanghai Disney Resort was open for 48 days. Hong Kong Disneyland was open for 72 days in the current quarter and 10 days in the prior-year quarter. Disneyland Resort and Disneyland Paris were open for 65 days and 19 days respectively, during the current quarter, whereas these businesses were closed for all of the prior-year quarter.
Revenues from Consumer Products increased 57.5% year over year to $1.15 billion.
However, the company continued to be impacted by the suspension of cruise ship sailings (with an ongoing return of cruise ship sailings beginning in July 2021) and reduced operating capacities across many of the Disney Parks, Experiences and Products businesses in the fiscal third-quarter.
Subscriber Details
ESPN+ had 14.9 million paid subscribers at the end of the fiscal third quarter compared with 8.5 million at the end of the year-ago quarter.
Disney+, as of Jul 3, 2021, had 116 million paid subscribers compared with 57.5 million as of Jun 27, 2020.
Hulu ended the quarter with 42.8 million paid subscribers, up 21% year over year.
The average monthly revenue per paid subscriber for ESPN+ increased 7% year over year to $4.47 due to an increase in retail pricing and higher per-subscriber advertising revenues.
The average monthly revenue per paid subscriber for Disney+ was $4.16, down 10% year over year due to a higher mix of Disney+ Hotstar subscribers in the current quarter compared to the prior-year quarter.
The average monthly revenue per paid subscriber for Disney’s Hulu SVOD-only service increased 15% year over year to $13.15.
The average monthly revenue per paid subscriber for Disney’s Hulu Live TV + SVOD service rose 23% from the year-ago quarter to $84.09, owing to increases in retail pricing, per-subscriber advertising revenue and per-subscriber premium.
Operating Details
Costs & expenses increased 33.6% year over year to $15.6 billion in the reported quarter.
Segmental operating income surged 116.7% year over year to $2.38 billion.
Media and Entertainment Distribution segmental operating income declined 31.9% year over year to $2.02 billion.
Linear Networks operating income decreased 33.4% to $2.18 billion. Moreover, Direct-to-Consumer operating loss was $293 million compared with the year-ago quarter’s loss of $624 million.
Content Sales/Licensing and Other operating income was $132 million, down 58.2% year over year.
Parks, Experiences and Products operating income was $356 million against the year-ago quarter’s operating loss of $1.8 billion.
Domestic operating income came in at $2 million against operating loss of $1.5 billion in the year-ago period. International segment reported operating loss of $210 million compared with loss of $438 million in the year-ago quarter.
Consumer Products’ operating profit increased 291.7% year over year to $564 million.
Further, interest expenses increased 8% year over year to $445 million.
Balance Sheet
As of Jul 3, 2021, cash and cash equivalents were $16.07 billion compared with $15.89 billion as of Apr 3, 2021.
Total borrowings were $55.8 billion as of Jul 3, 2021 compared with $56.15 billion as of Apr 3, 2021.
Free cash flow was $446 million in the reported quarter compared with free cash flow of $623 million in the previous quarter.
Outlook
Disney+ now expects fewer net subscriber additions for its direct-to-consumer services in the second half of 2021. Moreover, the company now plans to launch STAR+, its stand-alone general entertainment and sports streaming service for Latin America, on Aug 31.
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Disney (DIS) Q3 Earnings Top Estimates, Revenues Rise Y/Y
The Walt Disney (DIS - Free Report) reported third-quarter fiscal 2021 adjusted earnings of 80 cents per share that beat the Zacks Consensus Estimate by 40.3% and increased 900% year over year.
Revenues increased 44.5% from the year-ago quarter to $17.02 billion and beat the consensus mark by 1.17%.
The Walt Disney Company Price, Consensus and EPS Surprise
The Walt Disney Company price-consensus-eps-surprise-chart | The Walt Disney Company Quote
Segment Details
Media and Entertainment Distribution (74.5% of revenues) revenues climbed 18.4% year over year to $12.68 billion.
Revenues from Linear Networks increased 15.7% year over year to $6.95 billion. Direct-to-Consumer revenues surged 56.9% year over year to $4.25 billion. Content Sales/Licensing and Other revenues declined 23% year over year to $1.68 billion.
Parks, Experiences and Products revenues (25.5% of revenues) surged 307.6% year over year to $4.34 billion.
Domestic revenues increased from $213 million in the year-ago period to $2.65 billion in the reported quarter. International revenues surged 353.4% year over year to $526 million in the reported quarter.
Walt Disney World Resort and Shanghai Disney Resort were open for the entire quarter. In the prior-year quarter, Walt Disney World Resort was closed for the entire quarter and Shanghai Disney Resort was open for 48 days. Hong Kong Disneyland was open for 72 days in the current quarter and 10 days in the prior-year quarter. Disneyland Resort and Disneyland Paris were open for 65 days and 19 days respectively, during the current quarter, whereas these businesses were closed for all of the prior-year quarter.
Revenues from Consumer Products increased 57.5% year over year to $1.15 billion.
However, the company continued to be impacted by the suspension of cruise ship sailings (with an ongoing return of cruise ship sailings beginning in July 2021) and reduced operating capacities across many of the Disney Parks, Experiences and Products businesses in the fiscal third-quarter.
Subscriber Details
ESPN+ had 14.9 million paid subscribers at the end of the fiscal third quarter compared with 8.5 million at the end of the year-ago quarter.
Disney+, as of Jul 3, 2021, had 116 million paid subscribers compared with 57.5 million as of Jun 27, 2020.
The rapidly growing subscriber base strengthens this Zacks Rank #3 (Hold) company’s position in the increasingly saturated streaming space currently dominated by Netflix (NFLX - Free Report) . The launch of services from Apple (AAPL - Free Report) , Comcast (CMCSA - Free Report) and AT&T has further intensified competition. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hulu ended the quarter with 42.8 million paid subscribers, up 21% year over year.
The average monthly revenue per paid subscriber for ESPN+ increased 7% year over year to $4.47 due to an increase in retail pricing and higher per-subscriber advertising revenues.
The average monthly revenue per paid subscriber for Disney+ was $4.16, down 10% year over year due to a higher mix of Disney+ Hotstar subscribers in the current quarter compared to the prior-year quarter.
The average monthly revenue per paid subscriber for Disney’s Hulu SVOD-only service increased 15% year over year to $13.15.
The average monthly revenue per paid subscriber for Disney’s Hulu Live TV + SVOD service rose 23% from the year-ago quarter to $84.09, owing to increases in retail pricing, per-subscriber advertising revenue and per-subscriber premium.
Operating Details
Costs & expenses increased 33.6% year over year to $15.6 billion in the reported quarter.
Segmental operating income surged 116.7% year over year to $2.38 billion.
Media and Entertainment Distribution segmental operating income declined 31.9% year over year to $2.02 billion.
Linear Networks operating income decreased 33.4% to $2.18 billion. Moreover, Direct-to-Consumer operating loss was $293 million compared with the year-ago quarter’s loss of $624 million.
Content Sales/Licensing and Other operating income was $132 million, down 58.2% year over year.
Parks, Experiences and Products operating income was $356 million against the year-ago quarter’s operating loss of $1.8 billion.
Domestic operating income came in at $2 million against operating loss of $1.5 billion in the year-ago period. International segment reported operating loss of $210 million compared with loss of $438 million in the year-ago quarter.
Consumer Products’ operating profit increased 291.7% year over year to $564 million.
Further, interest expenses increased 8% year over year to $445 million.
Balance Sheet
As of Jul 3, 2021, cash and cash equivalents were $16.07 billion compared with $15.89 billion as of Apr 3, 2021.
Total borrowings were $55.8 billion as of Jul 3, 2021 compared with $56.15 billion as of Apr 3, 2021.
Free cash flow was $446 million in the reported quarter compared with free cash flow of $623 million in the previous quarter.
Outlook
Disney+ now expects fewer net subscriber additions for its direct-to-consumer services in the second half of 2021. Moreover, the company now plans to launch STAR+, its stand-alone general entertainment and sports streaming service for Latin America, on Aug 31.