Disney on Monday reported quarterly revenue and profits that beat analysts’ expectations, driven by its theme parks, resorts and cruise segment.
The Experiences unit reported more than $10 billion in quarterly revenue for the first time, Chief Financial Officer Hugh Johnston told CNBC.
Disney’s domestic theme parks reported $6.91 billion in revenue, while its international parks reported $1.75 billion in revenue, each up 7% from the year-ago period. In particular, Disney saw attendance increase at its domestic theme parks, while “international attendance was lower,” Johnston said.
Here’s how Disney performed in its fiscal first quarter, ended Dec. 27, compared to Wall Street expectations, according to LSEG:
- Earnings per share: $1.63 adjusted vs. $1.57 expected
- Income: $25.98 billion versus $25.74 billion expected
Net income for the quarter was $2.48 billion, or $1.34 per share, down from $2.64 billion, or $1.40 per share, for the same period a year earlier. Accounting for one-time items, including tax charges related to a deal with Fubo, Disney reported earnings per share of $1.63.
Overall revenue for the company’s fiscal first quarter was about $26 billion, up 5% year over year.
In Disney’s fiscal 2026 outlook, the company said it was on track to repurchase $7 billion worth of stock. It also expects double-digit growth in adjusted earnings per share and $19 billion in cash from operations.
For its fiscal second quarter, Disney said it expects its streaming unit — which includes Disney+ and Hulu — to generate operating income of about $500 million, an increase of about $200 million from the same period last year.
Its experiences unit, however, is expected to see “modest” growth in operating income due to headwinds in international attendance at national parks, as well as pre-launch costs for a new Disney cruise line and pre-opening costs for “World of Frozen” at Disneyland Paris.
“Overall, our results this quarter reflect our hard work and strategic investments in each of our priorities, and I am incredibly proud of everything we have accomplished over the past three years to put Disney on a path for continued growth,” CEO Bob Iger said during Monday’s call with investors. “I am inspired and energized by the opportunities that lie ahead for this wonderful company.”
Disney shares were down nearly 3% in premarket trading following the release.
Successor signs
In the background of Disney’s earnings report released Monday is the question of who will be named Iger’s successor.
This is the second time Disney has chosen a replacement for Iger after naming Bob Chapek as CEO in 2020 and then quickly firing him in 2022, returning Iger to the top spot. At this point, Disney shares had declined as the company and Iger faced Disney’s improving position in the theatrical landscape, as well as the parks’ valuation.
“Invigorating the parks, bringing streaming to double-digit profitability and margins, and improving the theatrical business, bodes well for a new CEO,” Johnston said.
Johnston declined to comment on speculation about Iger’s replacement.
Disney’s board meets this week and is expected to vote on Iger’s successor, according to people familiar with the matter who spoke on condition of anonymity on internal matters. The company previously said it would announce a replacement in the first quarter of this year.
“I also believe that in a world that is changing so much, in one form or another, trying to preserve the status quo was a mistake, and I am certain that my successor will not do that,” Iger said on Monday’s call. He added that Disney’s next CEO will get “a good helping hand” when it comes to the strength of the company and the opportunities that lie ahead.
Two of Iger’s deputies: Josh D’Amaro, president of Disney Experiences; and Dana Walden, co-chairman of Disney Entertainment, are considered the favorites in the succession race.
D’Amaro, however, is the driving force behind the company’s profits.
Employees celebrate Disneyland Resort’s 70th anniversary.
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During Disney’s fiscal first quarter, the Experiences division reported operating income three times that of the Entertainment division. Experiments accounted for $3.31 billion in profits, 6% more than the previous year.
In contrast, the entertainment division has long pointed to the decline of Disney’s traditional television network business and reported an operating profit of $1.1 billion, down 35% from the previous year.
Streaming force, sports pressure
The entertainment segment also includes streaming and theatrical releases. The unit’s overall revenue was $11.61 billion during the period, up 7% year-on-year.
The company attributed the unit’s increased revenue to higher subscription and affiliate fees, as well as the inclusion of the Fubo transaction in Disney’s earnings. Disney acquired a 70% stake in the Internet TV package provider in a deal reached in October.
Disney also saw an uptick in its film unit, especially after dominating the box office in 2025. The company noted “Zootopia 2” as well as new franchise installments “Avatar” and “Predator” during the quarter.
This was the first quarter in which Disney stopped releasing certain details about the entertainment segment, such as the breakdown of revenue and operating profit from its linear television networks, streaming and cinema businesses. Disney also stopped reporting streaming subscriber numbers this quarter, following Netflix’s lead last year.
Disney said revenue from its streaming business rose 11% to $5.35 billion in the fiscal first quarter.
Disney has recently made various changes when it comes to streaming. Last year, ESPN launched its direct-to-consumer streaming platform and Disney began integrating Hulu into Disney+. Investors will be eager to hear updates on ESPN’s streaming service and the possible effects of price hikes and changes to Disney+ when executives hold an earnings conference call at 8:30 a.m. ET.
Disney is now splitting ESPN into the sports segment, separate from its other linear TV networks, its movie business, as well as Disney+ and Hulu.
Sports segment revenue increased 1% to $4.91 billion, while operating profit decreased 23% to $191 million.
The sports segment was penalized by increased programming and production costs from new sports rights deals, as well as lower subscription and affiliation fees due to the loss of subscribers to traditional packages. Advertising revenues, however, increased due to the price increase.
The unit was also affected by the temporary outage of Disney Networks on YouTube TV during the fall, which resulted in an approximately $110 million impact on its operating income.