Operating profit in Disney’s streaming business jumped for the first three months of 2025, as Disney+ unexpectedly added 1.4 million subscribers in the quarter. Despite gathering economic storm clouds, chief Bob Iger said the Mouse House remains “optimistic” about its current fiscal year guidance.
Overall, the company reported $23.62 billion in revenue, up 7%, for the quarter ended March 29 (Disney’s fiscal Q2 2025). Disney posted net income of $3.28 billion versus a net loss of $20 million in the year-ago period, which translated to adjusted earnings per share of $1.41 (up 20%). The results — fueled by the higher streaming profit, domestic theme parks and home video sales of “Moana 2” — easily topped Wall Street expectations.
For fiscal year 2025, Disney expects adjusted earnings per share of $5.75, which would be up 16% year over year. The media conglom forecast cash provided by operations of $17 billion (versus $14 billion in fiscal 2024), up $2 billion from prior guidance driven by a deferral of tax payment. Disney also expects double-digit increases in operating income for its entertainment and sports segments, and 6%-8% growth in operating income for its theme park and consumer products biz.
Even so, Disney cautioned in announcing the earnings, “We continue to monitor macroeconomic developments for potential impacts to our businesses and recognize that uncertainty remains regarding the operating environment for the balance of the fiscal year,” which ends in late September 2025.
Iger, in prepared remarks, sounded an upbeat note. “Overall, we remain optimistic about the direction of the company and our outlook for the remainder of the fiscal year,” he said.
“Our outstanding performance this quarter — with adjusted EPS up 20% from the prior year driven by our Entertainment and Experiences businesses — underscores our continued success building for growth and executing across our strategic priorities,” Iger said. “Following an excellent first half of the fiscal year, we have a lot more to look forward to, including our upcoming theatrical slate, the launch of ESPN’s new DTC offering, and an unprecedented number of expansion projects underway in our Experiences segment.”
Investors will be eager to hear additional commentary from Iger and other execs about how Disney expects to be affected by President Trump’s aggressive global tariffs — including his vague threat to impose a 100% levy on films produced overseas — and the company’s strategy in the face of an economic downturn.
For the quarter, Wall Street analysts on average expected revenue of $23.14 billion and adjusted earnings per share of $1.20, according to LSEG Data & Analytics.
Disney previously told the Street it anticipated a “modest decline” in total Disney+ subscribers for the March quarter, and analysts had forecast Disney+ subs declining by 1.1 million, per StreetAccount. Instead, the service gained 1.4 million — including 1 million in the U.S. and Canada — to end the quarter at 126.0 million. The company attributed Disney+’s subscriber growth to a strong content slate that included the addition of blockbuster “Moana 2” as well as “Mufasa: The Lion King,” as well as the debut of original series “Daredevil: Born Again,” which drew 7.5 million views in the first five days of release.
The company is guiding for a “modest increase” in Disney+ subs for the June 2025 quarter.
In addition, Hulu subs rose by 1.1 million, to 54.7 million in the quarter. Total revenue from Disney+ and Hulu increased 8%, to $6.12 billion, driven in part by higher retail pricing, and operating income shot up more than sevenfold, to $336 million.
Disney’s domestic linear TV business, which includes ABC, saw revenue fall 3% to $2.2 billion while operating income grew 20% to $625 million. The improved profitability was due to lower marketing and programming costs at Disney’s cable networks because of “fewer new shows” as well as decreased technology costs, the company said. Domestic TV ad revenue dropped in the quarter because of “lower rates and fewer impressions attributable to lower average viewership.” Affiliate revenue for the quarter was flat, with higher rates offsetting a drop in subscribers.
At ESPN, revenue was up 5%, to $4.53 billion, while operating income fell 16%, which the company attributed to costs associated with airing three additional college football playoff games and one additional NFL game. In addition, profitability in Disney’s sports segment was hurt by a write-off from exiting the Venu Sports joint venture. ESPN domestic ad revenue was up 29% year over year for the period. Paid subscribers to ESPN+ declined by 800,000, to 24.1 million.
Disney’s Content Sales/Other business in the entertainment segment swung to an operating profit of $153 million (versus a loss of $18 million a year ago) as revenue jumped 54%, to $2.15 billion. The company said theatrical distribution revenue was flat, with the “carryover” performance of “Moana 2” and “Lion King: Mufasa” from the last quarter of 2024 offset by relatively disappointing results of “Snow White” and “Captain America: Brave New World.” The unit had higher sales of TV and streaming episodic content and higher home entertainment revenue thanks to “Moana 2.”
Revenue rose 6% to $8.89 billion in Disney’s experiences segment, which includes theme parks, cruises, resorts and consumer products. Total segment operating profit was up 9%, to $2.49 billion, with 13% growth in domestic parks and experiences and a 14% rise for consumer products offsetting a 23% decline in international theme parks.
In the quarter, Disney took a $109 million charge for unspecified “content impairments.”
(Pictured above: Charlie Cox in Disney+ original series “Daredevil: Born Again”)
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