The Walt Disney Company reported Wednesday that its revenue increased 7% year on year to $25.25 billion in its fiscal third quarter, supported by growth in its theme parks, cruise, and streaming businesses.
Total segment operating income rose 21% to $5.56 billion during the quarter, which ended on June 27, while adjusted earnings per share increased 28% to $2.06 from $1.61 a year earlier.
Net income attributable to Disney fell to $2.64 billion, or $1.51 per share, from $5.26 billion, or $2.92 per share, in the same period last year.
The comparison was affected by a $3.28 billion non-cash tax benefit Disney recorded in the prior-year quarter following a change in Hulu’s US tax classification.
Theme parks, cruises boost Experiences business
Revenue from Disney’s Experiences segment, which includes its theme parks, cruise line, and consumer products operations, increased 10% to $9.97 billion.
The segment’s operating income climbed 20% to $3.02 billion.
Theme park admissions revenue grew 9%, supported by higher attendance and ticket revenue, while revenue from resorts and vacations increased 17%.
Disney said attendance at its domestic parks increased 3%, with per-capita spending rising 4%.
The company’s cruise business also contributed to the growth. The Disney Destiny and Disney Adventure increased the company’s available stateroom capacity by about 50% compared with the same quarter last year.
Strong performances at Disney’s US parks, cruise line, consumer products division, and Disneyland Paris helped offset weaker results at its Asian parks.
Disney also recorded an approximately $100 million refund for tariffs paid earlier in its fiscal year. The refund contributed around four percentage points to the Experiences segment’s operating income growth but had no effect on revenue.
Streaming revenue increases 11%
Disney’s Entertainment segment, which includes streaming, television networks and film operations, generated $11.35 billion in revenue, up 6% from a year earlier.
Operating income in the segment jumped 64% to $1.68 billion.
Revenue from Disney’s subscription streaming operations, primarily Disney+ and Hulu, rose 11% to $5.53 billion. Subscription revenue increased 15%, driven by higher customer numbers and prices, while advertising revenue grew 3%.
Streaming operating income more than doubled to $712 million from $329 million, producing an operating margin of about 13%.
Disney said Toy Story 5, released in June, had surpassed $1 billion at the global box office, lifting the franchise’s cumulative worldwide ticket sales above $4 billion.
The movie also increased viewing of earlier Toy Story titles on Disney+ and helped Disney record its strongest year-on-year growth in consumer products revenue in 20 quarters.
- Sports income declines despite revenue growth
Revenue from Disney’s Sports segment, which primarily includes ESPN, increased 4% to $4.5 billion, supported by higher subscription, affiliate, and advertising revenue.
However, operating income declined 17% to $858 million because higher subscription revenue was outweighed by increased programming and production costs, including expenses related to new sports rights and the renewal of Disney’s NBA agreement.
Disney said audiences for both the NBA and NHL championship series on ABC and ESPN more than doubled from a year earlier. The 2026 NBA and NHL playoffs were the most watched ever across the company’s networks.
Share repurchase target raised
Disney increased its fiscal 2026 share repurchase target to at least $9 billion.
The company plans to use about $1.2 billion in proceeds from the proposed sale of its 50% stake in A+E Global Media to Hearst Corporation to repurchase additional shares. The transaction is expected to close by the end of the fiscal year, subject to regulatory approval.
Beginning in the first quarter of fiscal 2027, Disney plans to transfer much of its consumer products business from the Experiences segment to Entertainment, bringing merchandise operations closer to the studios that create the company’s intellectual property.
Disney also announced an agreement with TikTok under which a curated selection of fan-created videos featuring Disney characters and stories will appear on Disney+.
For its fiscal fourth quarter, Disney expects total segment operating income of approximately $4.9 billion.
The company maintained its forecast for fiscal 2026 adjusted earnings-per-share growth of about 12%, excluding the effect of an additional 53rd week in its financial calendar, or approximately 16% when the extra week is included.
