Disney (DIS) Q3 FY2025 Earnings Beat and Guidance Raise
Stock Closed: $115.17 (−$3.24, −2.74%)
Summary
Disney reported a strong Q3 FY2025, with better-than-expected earnings and improving fundamentals across streaming and experiences. However, despite positive results and raised guidance, the stock declined approximately 2.7% on concerns over legacy media and investor caution around future growth expectations.
Key Financial Highlights
- EPS (Adjusted): $1.61
Beat estimates of approximately $1.45–$1.47; double-digit earnings surprise - Revenue: Approximately $23.7 billion
Roughly flat year-over-year; slightly below consensus - Full-Year EPS Guidance Raised:
Now $5.85 vs. prior guidance around $5.50–$5.60
Segment Performance
| Segment | Operating Income | Notes |
|---|---|---|
| Streaming (DTC) | $346 million | Turned profitable versus a loss last year |
| Parks & Experiences | $2.5 billion | Up 13% YoY; domestic parks up 22% |
| Traditional Entertainment | Declined ~15% YoY | Reflects linear TV and cable headwinds |
| Sports (ESPN) | Up 29% YoY | Rising content costs offset by higher revenue |
- Disney+ and Hulu combined subscribers reached approximately 183 million
NFL and Strategic Deals
- NFL Media Acquisition:
Disney (via ESPN) acquired NFL Network, RedZone, and NFL fantasy operations
In exchange, the NFL received a 10% equity stake in ESPN - WWE Deal:
Signed a $1.6 billion agreement to stream WWE premium events beginning in 2026 - New ESPN App Launch:
Launches August 21 at $29.99/month
Includes bundling options with Disney+ and Hulu
Market Reaction
- Stock closed down 2.74% despite the earnings beat and guidance raise
- Investor concerns focused on:
- Continued weakness in traditional media
- High content production costs
- Uncertainty around monetization timeline for the new ESPN platform
Conclusion
Disney delivered a solid quarter with strength in streaming profitability, park performance, and strategic sports media expansion. However, pressure from its declining legacy media business continues to weigh on investor sentiment, contributing to the stock’s post-earnings decline.