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Mar 30, 2024
Disney Q2 2024 Earnings Report
Disney's financial performance in Q2 2024 showed mixed results with revenue increase, EPS loss due to goodwill impairments, and strong adjusted EPS growth.
Key Takeaways
The Walt Disney Company reported its Q2 2024 earnings, with revenues increasing to $22.1 billion. However, diluted EPS was a loss of $0.01, though adjusted EPS increased to $1.21. The Entertainment Direct-to-Consumer business was profitable, and Disney+ Core subscribers increased by more than 6 million. The company is on track to generate approximately $14 billion of cash provided by operations and over $8 billion of free cash flow this fiscal year.
Revenues increased to $22.1 billion, up from $21.8 billion in the prior-year quarter.
Adjusted EPS increased to $1.21, a 30% increase compared to the prior year.
Disney+ Core subscribers increased by more than 6 million, and Disney+ Core ARPU increased sequentially by 44 cents.
The Entertainment Direct-to-Consumer business was profitable in the second quarter.
Revenue by Segment
Forward Guidance
Disney anticipates softer Entertainment DTC results in Q3 due to Disney+ Hotstar, but expects combined streaming businesses to be profitable in Q4 and a meaningful growth driver in fiscal 2025. The new full year adjusted EPS growth target is now 25%.
Positive Outlook
- Combined streaming businesses are expected to be profitable in the fourth quarter.
- Combined streaming businesses are expected to be a meaningful future growth driver.
- Further improvements in profitability are expected in fiscal 2025.
- New full year adjusted EPS growth target is now 25%.
- Company remains on track to generate approximately $14 billion of cash provided by operations and over $8 billion of free cash flow this fiscal year.
Challenges Ahead
- Softer Entertainment DTC results are expected in Q3, driven by Disney+ Hotstar.
- Sports operating income declined slightly versus the prior year, reflecting the timing impact of College Football Playoff games at ESPN.
- Third quarter’s segment operating income at Experiences is expected to come in roughly comparable to the prior year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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