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Disney’s Q2 FY24 Earnings Results Webcast
- Thread starter DCBaker
- Start date
Guessing there will be little in announcements considering the summer movie slate and D23 are so close, maybe a Tiana Opening Date/bob making vague comments about Avatar DL/the sports superapp/whatever is going on with Epic Games is talked about, but I would be surprised if a bunch of projects/pivots to previous projects (like Moana 2) were randomly announced again like the Q1 call.
EDIT: According to a CNBC thing that I don't have access to, D'Amaro may be announced as Disney's next CEO. I don't have any proof of this besides secondhand stuff, but make of that what you will.
EDIT: According to a CNBC thing that I don't have access to, D'Amaro may be announced as Disney's next CEO. I don't have any proof of this besides secondhand stuff, but make of that what you will.
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Surferboy567
Well-Known Member
Interesting the time of this call in the morning instead of the late afternoon.
GhostHost1000
Premium Member
That gives more time for the executives to drink the rest of the day
BrianLo
Well-Known Member
We accidentally have two threads @Mom or @wdwmagic can merge them?
On the other version our speculation last month was that there is something positive. To me that would be DTC flipping positive. Which I have a hard time comprehending how subscribers will grow 6.5 million like they projected and it wouldn’t flip. Unless the subscriber base rotates to lower prices dramatically… which also isn’t really possible as the December price hike plays out this quarter.
It might even be a ‘blowout’ flip. Like several hundred million+ positive.
Interesting to note Netflix has stopped providing subscriber updates in their earnings or projections of same.
Disney Streaming Comes Close to Profitability in Latest Quarter, Disney+ Subscribers Surge
Disney's combined streaming business only lost $18M in the quarter, as Charter's new deal with the company caused subs to rise and ARPU to fall.
www.hollywoodreporter.com
Disney+ was profitable!
Financial docs have been released if you wish to read through them before the earnings call.
Financial Results for the Quarter:
As a result of outperformance in the second quarter, our new full year adjusted EPS(1) growth target is now 25%.
We remain on track to generate approximately $14 billion of cash provided by operations and over $8 billion of free cash flow(1) this fiscal year.
We repurchased $1 billion worth of shares in the second quarter and look forward to continuing to return capital to shareholders.
The Entertainment Direct-to-Consumer business was profitable in the second quarter. While we are expecting softer Entertainment DTC results in Q3 to be driven by Disney+ Hotstar, we continue to expect our combined streaming businesses to be profitable in the fourth quarter, and to be a meaningful future growth driver for the company, with further improvements in profitability in fiscal 2025.
Disney+ Core subscribers increased by more than 6 million in the second quarter, and Disney+ Core ARPU increased sequentially by 44 cents.
Sports operating income declined slightly versus the prior year, reflecting the timing impact of College Football Playoff games at ESPN, offset by improved results at Star India.
The Experiences business was also a growth driver in the second quarter, with revenue growth of 10%, segment operating income growth of 12%, and margin expansion of 60 basis points versus the prior year. Although the third quarter’s segment operating income is expected to come in roughly comparable to the prior year, we continue to expect robust operating income growth at Experiences for the full year.
Message From Our CEO:
“Our strong performance in Q2, with adjusted EPS(1) up 30% compared to the prior year, demonstrates we are delivering on our strategic priorities and building for the future,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “Our results were driven in large part by our Experiences segment as well as our streaming business. Importantly, entertainment streaming was profitable for the quarter, and we remain on track to achieve profitability in our combined streaming businesses in Q4.
“Looking at our company as a whole, it’s clear that the turnaround and growth initiatives we set in motion last year have continued to yield positive results. We have a number of highly anticipated theatrical releases arriving over the next few months; our television shows are resonating with audiences and critics alike; ESPN continues to break ratings records as we further its evolution into the preeminent digital sports platform; and we are turbocharging growth in our Experiences business with a number of near- and long-term strategic investments.”
Domestic Parks and Experiences
The increase in operating income at our domestic parks and experiences was due to higher results at Walt Disney World Resort and Disney Cruise Line, partially offset by lower results at Disneyland Resort.
Higher international parks and experiences’ operating results were due to:
Financial Results for the Quarter:
- Revenues for the quarter increased to $22.1 billion from $21.8 billion in the prior-year quarter.
- Diluted earnings per share (EPS) was a loss of $0.01 for the current quarter compared to income of $0.69 in the prior-year quarter. Diluted EPS decreased to a nominal loss due to goodwill impairments in the quarter, partially offset by higher operating income at Entertainment and Experiences.
- Excluding certain items(1), diluted EPS for the quarter increased to $1.21 from $0.93 in the prior-year quarter.
Key Points:
As a result of outperformance in the second quarter, our new full year adjusted EPS(1) growth target is now 25%.
We remain on track to generate approximately $14 billion of cash provided by operations and over $8 billion of free cash flow(1) this fiscal year.
We repurchased $1 billion worth of shares in the second quarter and look forward to continuing to return capital to shareholders.
The Entertainment Direct-to-Consumer business was profitable in the second quarter. While we are expecting softer Entertainment DTC results in Q3 to be driven by Disney+ Hotstar, we continue to expect our combined streaming businesses to be profitable in the fourth quarter, and to be a meaningful future growth driver for the company, with further improvements in profitability in fiscal 2025.
Disney+ Core subscribers increased by more than 6 million in the second quarter, and Disney+ Core ARPU increased sequentially by 44 cents.
Sports operating income declined slightly versus the prior year, reflecting the timing impact of College Football Playoff games at ESPN, offset by improved results at Star India.
The Experiences business was also a growth driver in the second quarter, with revenue growth of 10%, segment operating income growth of 12%, and margin expansion of 60 basis points versus the prior year. Although the third quarter’s segment operating income is expected to come in roughly comparable to the prior year, we continue to expect robust operating income growth at Experiences for the full year.
Message From Our CEO:
“Our strong performance in Q2, with adjusted EPS(1) up 30% compared to the prior year, demonstrates we are delivering on our strategic priorities and building for the future,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “Our results were driven in large part by our Experiences segment as well as our streaming business. Importantly, entertainment streaming was profitable for the quarter, and we remain on track to achieve profitability in our combined streaming businesses in Q4.
“Looking at our company as a whole, it’s clear that the turnaround and growth initiatives we set in motion last year have continued to yield positive results. We have a number of highly anticipated theatrical releases arriving over the next few months; our television shows are resonating with audiences and critics alike; ESPN continues to break ratings records as we further its evolution into the preeminent digital sports platform; and we are turbocharging growth in our Experiences business with a number of near- and long-term strategic investments.”
Domestic Parks and Experiences
The increase in operating income at our domestic parks and experiences was due to higher results at Walt Disney World Resort and Disney Cruise Line, partially offset by lower results at Disneyland Resort.
- At Walt Disney World Resort, higher results in the current quarter compared to the prior-year quarter were due to:
- Increased guest spending attributable to higher average ticket prices
- Higher costs due to inflation, partially offset by lower depreciation and cost saving initiatives
- Growth at Disney Cruise Line was due to an increase in average ticket prices, partially offset by higher costs
- The decrease in operating results at Disneyland Resort was due to:
- Higher costs driven by inflation
- An increase in guest spending attributable to higher average ticket prices and daily hotel room rates
- Higher volumes due to attendance growth, partially offset by lower occupied room nights
Higher international parks and experiences’ operating results were due to:
- An increase in operating results at Hong Kong Disneyland Resort attributable to:
- Guest spending growth due to increases in average ticket prices and food, beverage and merchandise spending
- Higher volumes resulting from increases in attendance and occupied room nights. Volume growth benefitted from additional days of operations in the current quarter as well as the opening of World of Frozen in November 2023
- Increased costs driven by inflation and new guest offerings
*Disney+ and Hulu combined were profitable.Disney Streaming Comes Close to Profitability in Latest Quarter, Disney+ Subscribers Surge
Disney's combined streaming business only lost $18M in the quarter, as Charter's new deal with the company caused subs to rise and ARPU to fall.
Disney+ was profitable!*
WB Discovery did a similar thing to claim Max was profitable (combining its revenue with linear HBO), still I guess it being profitable is the reason why its so early, they wanted to try to pump up the stock with the earnings report.
The ESPN+ segregation is an intentional sleight of hand typical with Disney. Same thing with the 6M more core subscribers, of which all are wholesale Charter customers. How much of an organic loss in subscriber count loss did this offset?
Wall Street not liking $DIS in pre market trading. Down ~5%
cjkeating
Well-Known Member
Maybe they'll stick to after hours going forward.
Here’s a direct link to listen to the earnings call: https://edge.media-server.com/mmc/p/y2ig9589
It’s the market realization of where does TWDC go from here on DTC.
Hulu is destined to become fully integrated on D+ as a blade on the Home Screen. It seems many believe that effectively killing Hulu will not be a good thing.
ESPN is a disaster that’s only going to get worse with no solution short of breaking it up and selling it piecemeal or finding a large tech company to buy it outright.
We’ll see how it shakes out today. The headline number is bad but also influenced by a huge write down on their Indian business that they more or less own by accident. The traders haven’t had their coffee yet.
I’m not saying it will wind up positive, just that tracking for premarket earnings can move.
I think the most concerning new news in the earnings as an investor is the softness in domestic hotel demand. Especially at Disneyland which is historically always sold out.
Couple random notes,
Free Cash Flow was really strong at $2.4B, the highest I can remember seeing since before the pandemic. Their FCF for the whole year last year was $4.9B.
So the bankruptcy doom and gloomers had a bad quarter.
Also EBIT was 17.4% of revenue which again is a significant beat of both recent results and Wall Street expectations. In dollars it was $3.8B for the quarter which is more than their EBIT for all of 2020 or 2021.
I dunno it doesn’t seem that bad of a quarter to me?
Free Cash Flow was really strong at $2.4B, the highest I can remember seeing since before the pandemic. Their FCF for the whole year last year was $4.9B.
So the bankruptcy doom and gloomers had a bad quarter.
Also EBIT was 17.4% of revenue which again is a significant beat of both recent results and Wall Street expectations. In dollars it was $3.8B for the quarter which is more than their EBIT for all of 2020 or 2021.
I dunno it doesn’t seem that bad of a quarter to me?
We Were the Lucky Ones soundtrack
All of You (from Encanto)
Stock had a climb for the past two days and after closing. The pre-market this morning went down and coming back up. A large amount of trading just took place bringing it up to where it was just two days ago.
And someone has a huge order in for $117 and so it's bouncing back and forth between 110 and 117. Crazy.