The Walt Disney Co. swung to a loss in its second quarter because of restructuring and impairment charges, but its adjusted profit topped expectations and its streaming business turned a profit. Theme parks also continued to do well and the company boosted its outlook for the year.
For the combined streaming businesses, which includes Disney+, Hulu and ESPN+, second-quarter operating loss shrunk to $18 million from $659 million, while revenue improved to $6.19 billion from $5.51 billion.Yet the improved picture for Disney on streaming arrives with its cable business in decline. That segment saw revenue slide 8% in the most recent quarter.
Thomas Monteiro, senior analyst at Investing.com, said that some Disney investors may have been expecting more from the quarterly report, but that “the company has tilted its operation back to its core business model, which is more conservative by nature.”“The big surprise of the day came on the streaming front, which finally managed to bring profits - way ahead of predictions - amid Hollywood’s massive strike period,” Monteiro said.
The company said that there was increased spending by guests at Walt Disney World due to higher ticket prices, while Disneyland guests boosted their spending due to an increase in ticket prices and hotel room rates. Restructuring and impairment charges surged to $2.05 billion from $152 million in the prior-year period.
The Burbank, California, company's revenue rose to $22.08 billion from $21.82 billion a year earlier, but was slightly lower than Wall Street estimates of $22.13 billion.