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By Lisa Richwine and Dawn Chmielewski
May 7, 2025 – 7:31 AM PDT
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LOS ANGELES (Reuters) – In an earnings quarter teeming with uncertainty around tariffs, Walt Disney’s (DIS.N) quarterly results are looking like the happiest place on earth.
The media giant exceeded expectations in its most recent quarter, bolstered by an unexpected boost in its Disney+ streaming business and strong results from its theme parks that suggested consumer resilience despite a turbulent global economic environment.
“Despite questions around any macroeconomic uncertainty or the impact of competition, I’m encouraged by the strength and resilience of our business,” Disney CEO Bob Iger said.
The entertainment giant released its earnings report shortly before announcing plans for a new theme park in United Arab Emirates capital Abu Dhabi. Shares of the company rose nearly 10% in early trading as it posted adjusted earnings per share of $1.45 for the January-to-March quarter, beating the $1.20 analysts’ consensus as polled by LSEG.
“At a time when so many businesses in the U.S. are worried about the potential impact of tariffs on consumer spending, on household budgets, Disney is feeling confident,” said Danni Hewson, head of financial analysis at AJ Bell.
The company – unlike many other blue-chip companies – voiced a lofty outlook for the rest of the year. Disney is leaning on its streaming business to grow profits as traditional television declines and to expand its popular theme parks and cruise line in the midst of a shaky U.S. economy.
Revenue rose 7% to $23.6 billion. Analysts had expected $23.14 billion. Operating income came in at $4.4 billion.
Disney forecast adjusted earnings per share of $5.75 for fiscal 2025, an increase of 16% from the prior fiscal year.
The company reiterated guidance for 6% to 8% operating income growth in the parks-led Experiences division during the fiscal year, and for double-digit percentage operating income growth during that time in the entertainment unit.
Disney Chief Financial Officer Hugh Johnston told investors that “the outlook is actually still quite strong” for the company’s Experiences unit, with bookings up in the fiscal third and fourth quarters. Theme park attendance “is actually still quite good.” The lone exception is at Shanghai Disney Resort and Hong Kong Disneyland, where attendance has dropped, which he attributed to the Chinese economy.
Iger said Disney’s newest cruise ship, Disney Treasure, has attracted “sky high” consumer ratings; and the new vessel to be ported in Singapore is already attracting interest. He predicted the cruise line would become a growth driver for the Experiences segment over the next three to four years.
Disney said it picked up 1.4 million customers for the Disney+ streaming service during the just-ended quarter. Three months ago, it had warned of a modest decline in Disney+ subscribers following a price increase.
Its Hulu service added 1.1 million customers during the quarter, and operating income at the streaming division rose to $336 million. A year earlier, operating income stood at $47 million.
Iger told investors Disney is optimistic it can turn its streaming business into a “true growth business,” as it adds ESPN’s flagship live sports streaming, improves technology to allow for greater personalization, and invests in content outside of the U.S.
The entertainment unit reported total operating income of $1.3 billion, a 61% increase from the prior year.
Johnston told investors Disney continues to see “robust demand” from advertisers, particularly from restaurants and healthcare.
Iger touted the box office performance of the latest Marvel movie, “Thunderbolts*,” and the strength of the coming film slate, which includes a new Pixar Animation movie, “Elio,” Walt Disney Animation’s “Zootopia 2,” and “Avatar: Fire and Ash.”
At the Experiences unit, operating income rose 9% to $2.5 billion. The company also saw an increase in cruise ship bookings with the launch of a new vessel, the Disney Treasure.
Disney stock has fallen 17% this year compared with a 4.7% decline in the S&P 500 (.SPX). The shares have fallen 6.6% since April.
Reporting by Lisa Richwine; Editing by Muralikumar Anantharaman, Nick Zieminski, Chizu Nomiyama and Franklin Paul
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