How Analysts Got Disney Earnings So Wrong

The Walt Disney Co. (NYSE: DIS) released fiscal third-quarter financial results after markets closed Tuesday. The Mouse House said that it had $0.08 in earnings per share (EPS) and $11.78 billion in revenue, compared with consensus estimates that called for a net loss of $0.64 per share and $12.39 billion in revenue. The same period from last year had $1.35 in EPS and $20.25 billion in revenue.

Something interesting to note is that while many analysts were calling for a net loss this quarter, a Disney loss would have been the first quarterly loss since 1984.

Media Networks revenues for the quarter decreased 2% to $6.56 billion, and segment operating income increased 48% to $3.15 billion. This segment comprises Cable Networks and Broadcasting which had revenues of $4.03 billion and $2.53 billion, respectively.

Parks, Experiences and Products revenues for the quarter decreased 85% year over year to $983 million, and segment operating income, or loss, in this case, came in at $1.96 billion. The operating loss for the quarter was due to closures at both the domestic and international parks.

Studio Entertainment revenues decreased 55% to $1.74 billion and segment operating income decreased 16% to $668 million.

Direct-to-Consumer & International revenues for the quarter increased 2% to $3.97 billion and segment operating loss increased from $562 million to $706 million.

Disney reported that it had 57.5 million subscribers for its Disney+ streaming service. ESPN+ had a total of 8.5 million subscribers and Hulu subscribers totaled 35.5 million.

Disney stock closed Tuesday at $117.42, within a 52-week range of $79.07 to $153.41. The consensus analyst price target is $122.96. Following the announcement, the stock was up about 2% at $119.80 in the after-hours session.

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