The Walt Disney Company (DIS) fell in early investor reaction to the company’s FQ4 earnings report. Revenue dipped 0.5% year-over-year, including gains across the Sports (+2%) and Experiences (+6%) segments, while the Entertainment segment saw revenue decline 6%.
Disney (DIS) reported total segment operating income of $3.48 billion for the quarter that ended on September 28, vs. $3.47 billion consensus and $3.65 billion a year ago. The total was broken down by entertainment segment operating income of $691 million vs. $704 million, sports segment operating income of $911 million vs. $879 million consensus, and experiences operating income estimate of $1.88 billion vs. $1.91 billion.
Disney’s (DIS) EPS for the quarter landed at $1.11 vs. $1.02 consensus and $1.14 a year ago. Free cash flow was down 37% during the quarter to $2.56 billion. Of note, the theatrical slate is expected to drive an adverse impact to segment operating income of $400 million compared to FQ1 a year ago.
Disney+ Core subscribers were up 2.4% year-over-year to 131.6 million, vs. 130.1 million consensus. Average monthly revenue per paid Disney+ subscriber was up 2% Y/Y to $8.04 in FQ4 to top the consensus expectation of $7.70. The company will not report the subscriber and average revenue per user numbers going forward.
“This was another year of great progress as we strengthened the company by leveraging the value of our creative and brand assets and continued to make meaningful progress in our direct-to-consumer businesses,” stated Disney (DIS) CEO Robert Iger. “Our strategy, coupled with our portfolio of complementary businesses and a strong balance sheet, enables us to continue investing in high-quality offerings for our consumers and increasing our returns to shareholders,” he added.
Looking ahead, Disney (DIS) sees 2026 cash flow from operations of $19 billion to top the consensus expectation of $16.9 billion.
Shares of Disney (DIS) were down 4.0% in early premarket action to $112.00 vs. the 52-week trading range of $80.10 to $124.69.