Key Financial Data
- Total revenue: $22.46 billion (no year-over change)
- Segment operating income: $3.48 billion (-5%)
- Entertainment revenue: $10.21 billion (-6%)
- Linear networks revenue: $2.058 billion (-16%)
- Domestic linear networks revenue: $1.856 billion
- Disney Plus subscribers: 131.6 million
- Disney Plus ARPU: $8.09
- Hulu SVOD subscribers: 59.7 million
- Hulu with Live TV subscribers: 4.4 million
- ESPN & Sports revenue: $3.98 billion (+2%)
- Theme parks & consumer products revenue: $8.77 billion (+6%)
- Read more Q3 2025 media earnings coverage
The Walt Disney Company reported a mixed bag of results for its fiscal fourth quarter (Q4, coincides with calendar Q3) on Thursday, as the company’s streaming business continued to show strong signs of health while its traditional television networks unit continued to suffer from ongoing softness in the advertising and pay TV markets.
During Q4, Disney earned $22.46 billion in revenue, below analyst expectations that ranged from $22.75 billion to $22.83 billion and roughly flat with the year-ago period. Adjusted earnings per share (EPS) were $1.11, ahead of consensus forecasts that ran between $1.05 and $1.07. Net income rose sharply year over year to $1.44 billion, up from $564 million during the same quarter last year, which proved Disney’s decision to focus on its streaming services and reign in ancillary costs was working.
Disney’s entertainment division posted a 6 percent revenue decline to $10.21 billion, weighed down by a 16 percent drop in linear network revenue and ongoing softness in theatrical results. Operating income for the TV networks fell 21 percent to $391 million as cord-cutting accelerated, political advertising declined by approximately $40 million and domestic viewership slipped. The company also noted year-over-year comparability issues tied to the sale of its Star India assets, which contributed $84 million in the prior-year quarter.
The most immediate operational challenge remains a distribution dispute with Google-owned YouTube TV, which has left millions of subscribers without access to Disney channels since October 31. CEO Bob Iger said Disney’s proposal is “equal to or better than what other large distributors have already agreed to,” adding that YouTube and Google have acknowledged Disney’s value relative to other programmers.
Stock Price
As for when YouTube TV customers will regain access to ESPN and ABC, it isn’t clear: Hugh Johnston, Disney’s Chief Financial Officer, warned that the dispute could “go on for a little while,” an indication that Disney — like Google — is in it for the long haul, and only willing to concede on certain points if other factors are overall favorable to their business goals.
According to reports, Disney and Google have mostly agreed on how much the streaming platform will pay for sports-filled ESPN, but are still far apart on the value of carrying local ABC stations and affiliates. Disney, like some of its peers, negotiates carriage of its eight owned-and-operated stations and handles distribution of independently-owned ABC affiliates, like those operated by Nexstar Media Group, Sinclair, the E. W. Scripps Company, TEGNA and Gray Media.
Some YouTube TV customers have moved on to other services, including Disney-owned Fubo or the new streaming sports plan called ESPN Unlimited. Other platforms that offer ESPN and Disney’s networks include Dish Network’s Sling TV and DIRECTV.
Streaming continued to offset some of the declines elsewhere. The direct-to-consumer segment reported operating income of $352 million, up 39 percent from the prior year. Disney Plus added 3.8 million subscribers on a sequential basis, bringing Disney Plus and Hulu to a combined 196 million customers. The company will stop reporting firm subscriber numbers in January.
Disney met its fiscal 2025 goal of $1.3 billion in streaming operating income, posting $1.33 billion for the year. The company is targeting roughly $375 million in streaming profit for Q1 2026 and plans to merge Hulu into Disney Plus next year. (The two will continue to offer separate streaming plans.)
Disney’s experiences division again delivered strong results, with revenue up 6 percent to $8.77 billion and operating income up 13 percent to $1.88 billion. Domestic parks revenue increased 6 percent to $5.86 billion, and international parks revenue rose 10 percent to $1.74 billion, driven by growth at Disneyland Paris. Cruise demand remained robust, with occupancy holding steady even as Disney expands its fleet. Iger said new ships Disney Destiny and Disney Adventure will begin service in the coming months.
Disney reiterated expectations for double-digit adjusted earnings growth in fiscal 2026 and said it will double its share repurchase target to $7 billion next year. The company also announced a $0.50 increase to its annual cash dividend, raising it to $1.50.
