The Walt Disney Co. saw its revenues and profits rise in its latest quarter, as it prepares to launch a new streaming push built around ESPN and Hulu.
The company reported its fiscal Q3 earnings Wednesday morning, reporting revenue of $23.7 billion, up 2% from a year ago, and segment operating income of $4.6 billion, up 8% from a year ago.
The company is set to put a fresh focus on ESPN, with the sports behemoth set to launch its first fully-featured streaming service in the coming weeks, and with the company inking a blockbuster deal with the NFL, which will give the league equity in the sports media giant.
And Wednesday morning, ESPN announced an expanded content deal with the NFL, including an extension of the NFL Draft, as well as a major new deal to stream WWE premium live events like WrestleMania and SummerSlam beginning next year.
Disney’s direct-to-consumer revenue increased by 6% to $6.2 billion, with operating income rising to $346 million. The company added 2.6 million Disney+ and Hulu subscribers, with essentially all that growth coming from international markets. Disney expects to add about 10 million subscribers this quarter, thanks largely to its new deal with Charter Communications, which bundles the product with its TV packages.
Disney’s entertainmetn division had revenue of $10.7 billion, up 1%, and operating income of $1 billion, down 15%, due to declines in the linear TV networks, offset by the growth in streaming and some improvements in content licensing.
In the experiences division, the opening of Universal’s Epic Universe did not appear to phase Disney, with revenue surging 8% to $9.1 billion, and operating income rising by 13% to $2.5 billion. That growth was mostly domestic, with higher guest spending at U.S. parks, and an expansion of the Disney Cruise Line.
And in sports, revenue fell 5% to $4.3 billion, with operating income rising by 29% to $1 billion.
Disney also adjusted guidance for fiscal 2025, telling Wall Street that it now expected an adjusted EPS of $5.85, up from $5.75 last quarter, and targeting direct-to-consumer operating income of $1.3 billion.
“We are pleased with our creative success and financial performance in Q3 as we continue to execute across our strategic priorities,” said Disney CEO Bob Iger in a statement. “The company is taking major steps forward in streaming with the upcoming launch of ESPN’s direct-to consumer service, our just-announced plans with the NFL, and our forthcoming integration of Hulu into Disney+, creating a truly differentiated streaming proposition that harnesses the highestcaliber brands and franchises, general entertainment, family programming, news, and industry-leading sports content. And we have more expansions underway around the world in our parks and experiences than at any other time in our history. With ambitious plans ahead for all our businesses, we’re not done building, and we are excited for Disney’s future.”