Disney (DIS) second quarter 2022 results

In this image illustration, a close-up of a hand holding a TV remote control can be seen in front of the Disney+ logo.

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Disney on Wednesday reported higher-than-expected growth in streaming subscribers, but warned it is still seeing the impact of Covid on its theme parks in Asia.

Disney shares fell more than 4% ahead of Thursday’s bell day. The stock move comes after the company’s shares hit a 52-week low of $104.79 earlier Wednesday.

Disney reported that total Disney+ subscriptions rose to 137.7 million in the fiscal second quarter, more than the 135 million analysts had forecast, according to StreetAccount.

The company expects Disney+ net additions to be stronger in the second half than in the first half, but the rate of change “may not be as large as previously anticipated,” CFO Christine McCarthy said during the company’s earnings call on Wednesday.

Additionally, average revenue per user (ARPU) for domestic Disney+ subscribers increased 5% to $6.32.

“Our strong second quarter results, including the fantastic performance of our domestic parks and the continued growth of our streaming services – with 7.9 million Disney+ subscribers added in the quarter and total subscribers for all our DTC offerings in excess of 205 million – have once more proved that we are in a league of our own,” CEO Bob Chapek said in a statement on Wednesday.

Here are the results:

  • Earnings per share: $1.08 adj.
  • Revenue: $19.25 billion, including a $1 billion reduction due to the early termination of some licensing agreements
  • Total Disney+ subscriptions: 137.7 million versus 135 million expected, according to StreetAccount

Investors have been eager to see Disney’s subscription numbers after Netflix reported a loss of 200,000 subscribers last quarter, its first drop in paying users in more than a decade. The company forecast a global loss of 2 million paid subscribers in the second quarter.

Disney’s shares are down 30% since January and more than 40% from the same period last year, as investors question whether the company can sustain its streaming growth and how elevated inflation and a possible recession could impact its other business ventures.

The company showed signs of recovery from the Covid restrictions.

Disney’s Parks, Experiences and Products segment posted revenue of $6.7 billion for the quarter, more than doubling the prior-year period. The company said the growth was fueled by increased visitor numbers, hotel bookings and cruise ship travel, as well as higher ticket prices and higher spend on food, beverages and merchandise.

Disney said its domestic parks are beginning to see the return of international travelers, but not at the levels the company saw before the pandemic. This group of visitors once made up 18% to 20% of guests.

In addition, not all international parks were open continuously in the last quarter. As Paris Disneyland celebrates its 30th anniversary, Shanghai Disneyland and Hong Kong Disneyland each experienced temporary closures due to local Covid spikes.

While the Hong Kong location reopened on April 21, Shanghai remains closed. McCarthy noted that total operating income for the parks, experiences and consumer products segment in the current quarter could have a $350 million impact from these closures in Asia.

Read the winning announcement here.

https://www.cnbc.com/2022/05/11/disney-dis-fiscal-q2-2022-earnings.html Disney (DIS) second quarter 2022 results

Gary B. Graves

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