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Disney (DIS) Q1 Earnings Beat Estimates, Revenues Rise Y/Y
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The Walt Disney Company (DIS - Free Report) reported first-quarter fiscal 2023 adjusted earnings of 99 cents per share, beating the Zacks Consensus Estimate by 43.48% but declining 6.6% year over year.
Revenues increased 7.8% year over year to $23.51 billion and beat the consensus mark by 0.76%.
Segment Details
Media and Entertainment Distribution (62.8% of revenues) revenues increased 1.3% year over year to $14.78 billion.
Revenues from Linear Networks declined 5.4% year over year to $7.29 billion.
Direct-to-Consumer revenues increased 13.2% year over year to $5.31 billion.
The Walt Disney Company Price, Consensus and EPS Surprise
Content Sales/Licensing and Other revenues increased 1.1% year over year to $2.46 billion.
Parks, Experiences and Products revenues (37.2% of revenues) increased 20.8% year over year to $8.74 billion. Domestic revenues were $6.07 billion, up 26.5% year over year. International revenues jumped 27.1% year over year to $1.09 billion in the reported quarter.
Disney’s nearest peer, Comcast (CMCSA - Free Report) reported strong fourth-quarter 2022 results in its Theme Park business.
Comcast’s Theme Parks revenues increased 12% year over year to $2.11 billion, reflecting higher attendance and increases in guest spending at Comcast’s parks in the United States and Japan.
Meanwhile, revenues from Disney’s Consumer Products decreased 0.2% year over year to $1.57 billion.
Subscriber Details: Disney+
ESPN+ had 24.9 million paid subscribers at the end of the fiscal first quarter compared with 24.3 million at the end of the previous quarter.
Disney+, as of Dec 31, 2022, had 161.8 million paid subscribers compared with 164.2 million as of Oct 1, 2022.
Meanwhile, Disney’s Hulu ended the quarter with 48 million paid subscribers, up from 47.2 million reported in the year-ago quarter.
The average monthly revenue per paid subscriber for ESPN+ increased 14% year over year to $5.53.
The average monthly revenue per paid subscriber for Disney+ was $3.93, up 1% year over year.
The average monthly revenue per paid subscriber for Disney’s Hulu SVOD-only service increased 2% year over year to $12.46.
The average monthly revenue per paid subscriber for Disney’s Hulu Live TV + SVOD service rose 1% from the year-ago quarter to $87.90.
Operating Details
Costs & expenses increased 9.7% year over year to $21.52 billion in the reported quarter.
Segmental operating income was $3.04 billion, down 6.6% year over year.
Media and Entertainment Distribution’s segmental operating loss was $10 million.
Linear Networks’ operating income decreased 16.3% to $1.26 billion.
Direct-to-Consumer operating loss was $1.05 billion, wider than the year-ago quarter’s loss of $593 million.
Content Sales/Licensing and Other operating losses were $212 million compared with an operating loss of $98 million reported in the year-ago quarter.
Parks, Experiences and Products’ operating income was $3.05 billion, up 24.6% year over year.
The Domestic segment reported an operating income of $2.11 billion, up 35.9% year over year. The International segment reported an operating income of $79 million compared with an operating income of $21 million reported in the year-ago quarter.
Consumer Products’ operating profit decreased 1.5% year over year to $861 million.
Balance Sheet
As of Dec 31, 2022, cash and cash equivalents were $8.47 billion compared with $11.62 billion as of Oct 1, 2022.
Total borrowings were $48.38 billion as of Dec 31, 2022 compared with $48.37 billion as of Oct 1, 2022.
Free cash outflow was $2.16 billion in the reported quarter against free cash flow of $1.38 billion in the previous quarter.
Outlook
Disney expects to reduce annualized non-content-related expenses by roughly $2.5 billion. It also expects $3 billion of annualized savings in non-sports-related content spending. Management expects overall cost savings to be $5.5 billion over the next few years.
For 2023, Disney expects segment operating income to grow in the high single-digit percentage range.
Zacks Rank & Stocks to Consider
Disney currently has a Zacks Rank #5 (Strong Sell).
Disney shares have lost 24.1% in the past year, underperforming the Zacks Consumer Discretionary sector’s decline of 22.2%.
Cumulus Media (CMLS - Free Report) and Warner Bros. Discovery (WBD - Free Report) are a couple of better-ranked stocks that investors can consider in the broader sector. Cumulus currently sports a Zacks Rank #1 (Strong Buy) while Warner Bros. carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Cumulus Media is set to announce its fourth-quarter 2022 results on Feb 23. CMLS shares have declined 41.1% in the past year.
Warner Bros. is set to announce its fourth-quarter fiscal 2023 results on Feb 23. WBD shares have declined 51.2% in the past year.
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Disney (DIS) Q1 Earnings Beat Estimates, Revenues Rise Y/Y
The Walt Disney Company (DIS - Free Report) reported first-quarter fiscal 2023 adjusted earnings of 99 cents per share, beating the Zacks Consensus Estimate by 43.48% but declining 6.6% year over year.
Revenues increased 7.8% year over year to $23.51 billion and beat the consensus mark by 0.76%.
Segment Details
Media and Entertainment Distribution (62.8% of revenues) revenues increased 1.3% year over year to $14.78 billion.
Revenues from Linear Networks declined 5.4% year over year to $7.29 billion.
Direct-to-Consumer revenues increased 13.2% year over year to $5.31 billion.
The Walt Disney Company Price, Consensus and EPS Surprise
The Walt Disney Company price-consensus-eps-surprise-chart | The Walt Disney Company Quote
Content Sales/Licensing and Other revenues increased 1.1% year over year to $2.46 billion.
Parks, Experiences and Products revenues (37.2% of revenues) increased 20.8% year over year to $8.74 billion. Domestic revenues were $6.07 billion, up 26.5% year over year. International revenues jumped 27.1% year over year to $1.09 billion in the reported quarter.
Disney’s nearest peer, Comcast (CMCSA - Free Report) reported strong fourth-quarter 2022 results in its Theme Park business.
Comcast’s Theme Parks revenues increased 12% year over year to $2.11 billion, reflecting higher attendance and increases in guest spending at Comcast’s parks in the United States and Japan.
Meanwhile, revenues from Disney’s Consumer Products decreased 0.2% year over year to $1.57 billion.
Subscriber Details: Disney+
ESPN+ had 24.9 million paid subscribers at the end of the fiscal first quarter compared with 24.3 million at the end of the previous quarter.
Disney+, as of Dec 31, 2022, had 161.8 million paid subscribers compared with 164.2 million as of Oct 1, 2022.
Meanwhile, Disney’s Hulu ended the quarter with 48 million paid subscribers, up from 47.2 million reported in the year-ago quarter.
The average monthly revenue per paid subscriber for ESPN+ increased 14% year over year to $5.53.
The average monthly revenue per paid subscriber for Disney+ was $3.93, up 1% year over year.
The average monthly revenue per paid subscriber for Disney’s Hulu SVOD-only service increased 2% year over year to $12.46.
The average monthly revenue per paid subscriber for Disney’s Hulu Live TV + SVOD service rose 1% from the year-ago quarter to $87.90.
Operating Details
Costs & expenses increased 9.7% year over year to $21.52 billion in the reported quarter.
Segmental operating income was $3.04 billion, down 6.6% year over year.
Media and Entertainment Distribution’s segmental operating loss was $10 million.
Linear Networks’ operating income decreased 16.3% to $1.26 billion.
Direct-to-Consumer operating loss was $1.05 billion, wider than the year-ago quarter’s loss of $593 million.
Content Sales/Licensing and Other operating losses were $212 million compared with an operating loss of $98 million reported in the year-ago quarter.
Parks, Experiences and Products’ operating income was $3.05 billion, up 24.6% year over year.
The Domestic segment reported an operating income of $2.11 billion, up 35.9% year over year. The International segment reported an operating income of $79 million compared with an operating income of $21 million reported in the year-ago quarter.
Consumer Products’ operating profit decreased 1.5% year over year to $861 million.
Balance Sheet
As of Dec 31, 2022, cash and cash equivalents were $8.47 billion compared with $11.62 billion as of Oct 1, 2022.
Total borrowings were $48.38 billion as of Dec 31, 2022 compared with $48.37 billion as of Oct 1, 2022.
Free cash outflow was $2.16 billion in the reported quarter against free cash flow of $1.38 billion in the previous quarter.
Outlook
Disney expects to reduce annualized non-content-related expenses by roughly $2.5 billion. It also expects $3 billion of annualized savings in non-sports-related content spending. Management expects overall cost savings to be $5.5 billion over the next few years.
For 2023, Disney expects segment operating income to grow in the high single-digit percentage range.
Zacks Rank & Stocks to Consider
Disney currently has a Zacks Rank #5 (Strong Sell).
Disney shares have lost 24.1% in the past year, underperforming the Zacks Consumer Discretionary sector’s decline of 22.2%.
Cumulus Media (CMLS - Free Report) and Warner Bros. Discovery (WBD - Free Report) are a couple of better-ranked stocks that investors can consider in the broader sector. Cumulus currently sports a Zacks Rank #1 (Strong Buy) while Warner Bros. carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Cumulus Media is set to announce its fourth-quarter 2022 results on Feb 23. CMLS shares have declined 41.1% in the past year.
Warner Bros. is set to announce its fourth-quarter fiscal 2023 results on Feb 23. WBD shares have declined 51.2% in the past year.