Disney (DIS) earnings Q3 2025

Disney reported results for its fiscal third quarter on Wednesday – posting earnings that topped expectations but revenue that came in just shy of analyst projections – as the company’s streaming business grew and its theme parks saw higher spending from consumers. 

CFO Hugh Johnston credited the quarter in part to the success of Disney’s streaming unit, anchored by its flagship service, Disney+.

“Just as a reminder, it was only a couple of years ago that we were losing a billion dollars a quarter on that business,” Johnston told CNBC’s “Squawk Box” on Wednesday. “It was trading purely on subs and not on financial results. We now really have a solid foundation.”

The growth in streaming has recently started to help to supplant the losses of the cash cow traditional TV business, which has been bleeding customers for years now.

Disney shares were down 2% in premarketing trading Wednesday.

Here is what Disney reported for the quarter ended June 28 compared with what Wall Street expected, according to LSEG:

Earnings per share: $1.61 adjusted vs. $1.47 expectedRevenue: $23.65 billion vs. $23.73 billion expected

Net income for the quarter was $5.26 billion, or $2.92 per share, more than double the $2.62 billion, or $1.43 a share, that the company reported for the same period last year. Adjusting for one-time items, primarily related to tax benefits associated with Disney’s purchase of Comcast’s Hulu stake, Disney reported earnings per share of $1.61. 

Disney’s overall revenue rose 2% to $23.65 billion, missing analyst expectations for the first time since May 2024. 

The company reported continued growth in its streaming business despite headwinds in the traditional TV bundle, which has suffered from declining customers. 

Disney upped its fiscal 2025 guidance on Wednesday and now expects adjusted EPS of $5.85 – an increase of 18% from fiscal 2024. In May, Disney issued guidance for expected full-year adjusted EPS of $5.75.

Revenue for Disney’s experiences segment, which includes theme parks, resorts and cruises as well as consumer products, increased 8% to $9.09 billion. Domestic theme parks revenue was up 10% to $6.4 billion, in particular as there was an increase in spending at theme parks and higher volumes in passenger cruise days and resort stays. 

Johnston told “Squawk Box” on Wednesday that Walt Disney World had its “biggest” third quarter ever, adding that traffic at the Orlando, Florida, park was solid.

“I know there’s a lot of concern about the consumer in the U.S. right now. We don’t see it. Our consumer is doing very, very well,” he said.

International parks and experiences revenue was up 6% to about $1.7 billion. In May, Disney announced it reached a deal to bring a theme park and resort to Abu Dhabi. The expansion into the United Arab Emirates is not part of the earlier Disney pledge to spend $60 billion on theme parks over the next decade.

Meanwhile, revenue for Disney’s entertainment segment, which includes traditional TV networks, direct-to-consumer streaming and films, was up 1% to $10.7 billion. 

While revenue for the direct-to-consumer streaming business rose 6% to $6.18 billion, the entertainment segment as a whole was weighed down by the traditional TV business, which saw revenue dip 15% to $2.27 billion. 

The direct-to-consumer streaming business was lifted, however, by the company’s flagship service, Disney+, which added 1.8 million subscribers, bringing its total to nearly 128 million. Total Hulu subscribers grew 1% to 55.5 million. 

The company said it expects a modest increase in Disney+ subscribers in its fiscal fourth quarter compared with its fiscal third quarter. Total Disney+ and Hulu subscriptions are expected to increase more than 10 million during the current period. 

Disney also raised its operating income expectation for direct-to-consumer streaming to $1.3 billion for fiscal year 2025.

Domestic revenue for ESPN increased 1% to $3.93 billion, while its domestic operating income dropped 7% to $1.01 billion. Those results were impacted by higher programming and production costs, particularly due to NBA and college sports rights. 

ESPN on Tuesday announced a deal with the NFL in which the pro football league will take a 10% stake in the company. 

And separately on Wednesday, ESPN announced that its forthcoming full-service streaming app will launch on Aug. 21 and that WWE live events are coming to the app and in some cases to the linear ESPN network. 

Johnston said he expects the new streaming service to be “accretive to overall earnings growth.”

The traditional TV business once again dragged down the entertainment unit. Total operating income for the linear networks – which includes broadcaster ABC as well as pay TV channels like FX – fell 28% to $697 million, impacted by a decline in advertising revenue due to lower viewership and rates. 

Disney’s theatrical unit, comprised of content sales and licensing, suffered from tough comparisons to the year-earlier period, which saw the release of “Inside Out 2.” The Pixar movie was the highest-grossing animated movie ever, surpassing Disney’s “Frozen II.”

The division reported an operating loss of $21 million for the most recent period, compared with operating income of $254 million in the same period last year.

Revenue for the unit was up 7% to $2.26 billion during the quarter, as Disney released “Elio,” “Thunderbolts*” and “Lilo & Stitch.” The original animated film “Elio” set a record low for the Pixar animation studio, notching just $21 million in ticket sales during its first three days in theaters.

– CNBC’s Robert Hum contributed to this report. 

Disclosure: Comcast is the parent company of CNBC. 

Correction: This story has been updated to correct that Disney raised its operating income expectation for direct-to-consumer streaming to $1.3 billion for fiscal year 2025. A previous version misstated the guidance.