In this handout photo provided by Walt Disney World Resort, guests stop to take a selfie at Magic Kingdom Park at Walt Disney World Resort on July 11, 2020 in Lake Buena Vista, Florida.
Matt Stroshane | Walt Disney World Resort | Getty Images
Disney reported second quarter results Thursday, posting lower-than-expected revenue and subscriber counts for its streaming service.
The company’s stock dipped more than 4% in after-hours trading.
- Earnings per share: 79 cents vs 27 cents expected in a Refinitiv survey of analysts
- Revenue: $15.61 billion vs $15.87 billion expected in the survey
The company missed on subscriber estimates for Disney+, coming in at 103.6 million paid subscribers. It was expected to post 109 million. Average monthly revenue per user also dipped 29% year over year to $3.99, which the company attributed to the launch of Disney+ Hotstar. The service has lower average monthly revenue per paid subscriber than traditional Disney+ in other markets, pulling down the overall average for the quarter.
The streaming service had been bolstering the company’s success as it was losing out on business from Covid restrictions, but it seems the rapid growth is starting to slow.
Average monthly revenue per paid subscriber also grew slightly for Disney’s other direct-to-consumer platforms, ESPN+ and Hulu.
The company said it now has around 159 million total subscribers across its streaming services as of the end of the second quarter.
Revenue at Disney’s parks, experiences and products segment fell 44% to $3.2 billion, as many of its theme parks were either closed or operating at reduced capacity and its cruise ships and guided tours were suspended.
The company said the outbreak cost this division around $1.2 billion in lost operating income during the latest quarter.
Disney reopened its two California-based parks on April 30, so any revenue garnered over the last few weeks is not reflected in the fiscal second-quarter results. However, the parks’ reopening could boost expectations for the fiscal third quarter. As of Thursday, Disney’s Paris-based theme park is the only location that has not reopened to the public.
In February, Disney’s Chief Financial Officer Christine McCarthy said that for the parks that have been open during the pandemic, the company was able to make “a net incremental positive contribution” from the guests who visited despite reduced capacity levels.
Content sales and licensing revenues fell 36% for the quarter to $1.9 billion. “Nomadland” was Disney’s only theatrical release in the U.S. over the quarter (it debuted simultaneously on Hulu). “Raya and the Last Dragon,” Disney’s latest animated feature, also debuted in some theaters internationally. It was made available on Disney+ Premier Access for $30.
Several Marvel titles are on the horizon, such as “Black Widow,” “Eternals,” “Shang-Chi and the Ten Rings,” and “Spider-Man: No Way Home” as well as “Cruella,” “Jungle Cruise,” “Free Guy,” “Encanto” and “West Side Story.”
Segment operating results increased from a loss of $25 million to income of $312 million.
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