The Walt Disney Co. recently reported a loss in its second quarter due to restructuring and impairment charges, but the adjusted profit exceeded expectations, with the streaming business turning a profit. Despite the loss, Disney foresees a softening in its streaming business in the current quarter, primarily due to its platform in India, but expects combined streaming businesses to be profitable in the fourth quarter.
Disney+ and Hulu posted an operating income of $47 million compared to a loss of $587 million the previous year. CEO Bob Iger attributed the positive results to the turnaround and growth initiatives implemented last year. Analysts have praised Disney’s efforts to turn its streaming division profitable, drawing comparisons to a more global, low-production-cost Netflix-like model.
Revenue at Disney’s domestic theme parks rose by 7%, and overseas parks reported a 29% increase. However, the company acknowledged higher costs at its theme parks during the quarter due to inflation. In February, Disney announced significant cost reductions and cut thousands of jobs in 2023. Shareholders recently rejected efforts by activist investor Nelson Peltz to claim seats on the company board.
For the period ended March 30, Disney reported a loss of $20 million compared to a profit of $1.27 billion in the previous year. Adjusted earnings per share exceeded analyst predictions, and the company’s revenue increased to $22.08 billion from $21.82 billion the previous year. Shares of Disney dropped 5% before the market open following the earnings report.
In other news, a settlement was reached in March between allies of Gov. Ron DeSantis and Disney regarding the development of Walt Disney World. Additionally, character performers at Disneyland in California have filed a petition for union recognition with the Actors’ Equity Association.
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