Box office smash Moana 2 drives Disney profits in first quarter
The hit movie helped exceed analysts’ predictions.
Disney has easily topped first-quarter expectations thanks in part to the box office smash Moana 2.
There were some oversized expectations for the animated film, but Moana 2 – originally intended as a series for the company’s streaming service before it was produced for the big screen – blew predictions out of the water.
Its five-day opening set a new record for Thanksgiving moviegoing.
Newly-released figures show the Walt Disney Co earned 2.55 billion dollars (£2.04 billion), or 1.40 dollars per share, for the period ending December 28.
The firm, based in Burbank, California, earned 1.91 billion dollars (£1.53 billion), or 1.04 dollars per share, in the prior-year period.
Revenue rose 5% to 24.69 billion dollars (£19.84 billion), a bit better than analysts had projected.
Revenue in Disney’s Entertainment segment increased 9%. Revenue for content sales/licensing and Other jumped 34% due to the strong performance of Moana 2.
Disney’s direct-to-consumer business, which includes Disney+ and Hulu, reported quarterly operating income of 293 million dollars (£253 million) compared with an operating loss of 138 million dollars (£110.9 million) a year ago. Revenue increased 9% to 6.07 billion dollars (£4.87 billion).
The Disney+ streaming service enjoyed a 1% increase in paid subscribers domestically, which includes the US and Canada.
But there was a 2% drop internationally, which excludes Disney+ HotStar. Total paid subscribers for Disney+ dipped 1% in the quarter.
Jesse Cohen, senior analyst at Investing.com, said: “Disney’s earnings beat underscores the success of its cost-cutting initiatives and resilient performance in parks and studios, offsetting headwinds in streaming.
“However, the surprising loss of Disney+ subscribers – the first decline since its 2019 launch – raises red flags about saturation in a crowded market and the trade-offs of its pricing strategy.”
Looking ahead, Disney said it foresees a modest decline in Disney+ subscribers in the second quarter when compared with the first quarter.
The company still anticipates high-single digit adjusted earnings per share growth for fiscal 2025.
The Experiences division, which includes six global theme parks, its cruise line, merchandise and videogame licensing, reported operating income was basically flat at 3.11 billion dollars (£2.49 billion).
Operating income fell 5% at US theme parks, as hurricanes caused Walt Disney World in Orlando, Florida to close for a day and cancelled a cruise.
Operating income rose 28% for international parks and Experiences.
Shares rose slightly before the market opened on Wall Street on Wednesday.
