(News Bulletin 247) – The American entertainment specialist delivered results above expectations, helped by the acceleration in streaming growth and the theatrical success of the films Deadpool and Vice-versa 2.

The stars aligned for Walt Disney this summer. Thanks to the performance of its streaming division as well as the success of certain blockbusters in theaters, the American entertainment giant exceeded expectations in the fourth quarter of its 2023-2024 fiscal year.

Over this period from the beginning of July to the end of September, Walt Disney Co generated revenues of $22.57 billion, up 6% year-on-year, while its earnings per share stood at $1.14, showing a jump of 39%. According to an LSEG consensus cited by CNBC, analysts expected revenue of $22.45 billion and earnings per share of $1.10.

Disney studios notably benefited from the box office successes of the films “Vice-versa 2” and “Deadpool & Wolverine”, which between them generated around $3 billion in revenue worldwide.

This helped propel revenues from the “content sales, licensing and other” subcategory of Disney’s “entertainment” division to $2.59 billion, an increase of 39%. Operating income for this category went from a loss of $149 million to a profit of $316 million.

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Streaming is done with losses

“The fourth quarter was one of the best in the history of our studios, with Vice-versa 2 and Deadpool & Wolverine breaking numerous box office records, and becoming the two top films of the year,” he said. Disney CEO Bob Iger said in a statement.

Still in the “entertainment” division, Disney continues to improve the performance of streaming and in particular Disney+, which has long suffered from comparison with Netflix, by suffering heavy operational losses.

The direct-to-consumer (DTC) division, which includes the Disney+ services as well as Hulu and ESPN+, recorded revenue growth of 13% while its operating profit fell from a loss of $387 million to a profit of $321 million, when analysts were expecting a profit of $203 million, according to Bloomberg.

In addition to subscriber growth, this division was supported by price increases as well as an increase in advertising revenue, with the entry-level offerings of streaming services including advertising. Operating profit was also helped by lower marketing costs at Disney+.

“The profitability of our DTC streaming business has further improved and we are confident that it will be an important growth focus for the company,” said Bob Iger.

The emblematic director of Disney was recalled in a hurry at the end of 2022 to return to service and turn around a company which was then operating at record lows on the stock market. Bob Iger then undertook significant work in terms of content and costs, while favoring prices. This resulted in more than 8,000 job cuts, according to Newsweek. But its efforts seem to be paying off: over the entire 2023-2024 financial year, streaming activities generated an operating profit of 134 million compared to a loss of 2.61 billion dollars in 2022-2023.

Growth in earnings per share in 2025, 2026 and 2027

Elsewhere, revenue from amusement parks and cruises rose 1% to $8.24 billion in the fourth quarter, while operating profit fell 6% to $1.66 billion, due to higher costs.

In terms of perspectives, Disney was particularly forthcoming. For the financial year ending September 2025, the company has indicated that it is targeting “high single-digit” growth in its earnings per share, between 6% and 9% (while analysts were only expecting an increase of 4% , according to Bloomberg), dividend growth “in line with that of results”, and $3 billion in share buybacks. By division, the company notably anticipates a double-digit increase in its operating income in “entertainment”, including an improvement of $875 million in operating income from streaming activities.

Rarely, the company also provided outlooks over several years, for its financial years ending in 2026 and 2027.

For the financial year which will end in September 2026, Disney expects double-digit growth in its earnings per share, including an increase of at least 10% in its “entertainment” division. For 2027, Disney expects further double-digit earnings per share growth.

On Wall Street, Walt Disney shares are on fire, with the title gaining 10.84% ​​to $11.85 at the start of the session, around 3:40 p.m.

“Disney has a set of first-rate assets (in the field of content/intellectual property and theme parks)”, appreciates Bank of America which confirms its buy advice on the action and its price target at 120 dollars.