Walt Disney (DIS) stock jumped nearly 8% in early trading on Wednesday after the company reported stronger-than-expected earnings for Q2 fiscal 2026, the first quarterly results under new CEO Josh D’Amaro.
DISNEY $DIS Q2’26 EARNINGS HIGHLIGHTS
Revenue: $25.17B (Est. $24.87B)
; +6.6% YoY
Segment Performance:
— Wall St Engine (@wallstengine) May 6, 2026
Disney posted revenue of $25.2 billion for the January to March quarter, up 7% year over year. That came in ahead of the $24.78 billion analysts had expected. Adjusted EPS landed at $1.57, beating the $1.49 consensus estimate.
D’Amaro, who took over from Bob Iger in mid-March, used the earnings call to lay out his strategic priorities. His plan centers on creative content, growing the streaming business, leveraging live sports, and continued investment in theme parks and cruise lines.
The company is targeting at least $8 billion in stock buybacks for the fiscal year.
The Entertainment segment was a clear bright spot. SVOD operating income hit $582 million, an 88% jump year over year. That pushed streaming margin above 10% for the first time — a target Disney had originally set for the full fiscal year.
SVOD revenue grew 13%, driven by subscriber growth and higher effective subscription rates. Advertising revenue from Disney+ also contributed to the gain. Box-office performances from “Zootopia 2” and “Avatar: Fire and Ash” continued to add to results during the quarter.
CFO Hugh Johnston noted that streaming now generates double the revenue of the company’s traditional TV business, which he described as getting “smaller and smaller every quarter.”
The Experiences division — parks, cruise ships, and consumer products — set Q2 records in both revenue and operating income, at $9.5 billion and $2.6 billion respectively. Operating income for the division rose 5% compared with a year earlier.
Guests spent more per visit at U.S. theme parks, and cruise ships saw higher volume. However, Johnston flagged that domestic park attendance was down, partly due to fewer international visitors and competition from Universal’s new Epic Universe theme park in Orlando.
D’Amaro called current domestic demand “healthy” but said Disney is “mindful of the macroeconomic uncertainty consumers are facing.” Johnston added that rising gas prices are something the company is watching.
Sports was the weakest segment. ESPN’s division posted a 5% drop in operating income to $652 million, hurt by higher rights costs and production expenses.
Johnston positioned ESPN as a content brand rather than just a traditional network — one that can distribute widely and monetize across platforms. He said the sports business is earlier in its streaming transition than the entertainment side.
D’Amaro guided fiscal 2026 adjusted EPS growth to approximately 12%, up from the earlier “double digits” projection. Q3 segment operating income is targeted at $5.3 billion. He also reaffirmed expectations for double-digit adjusted EPS growth in fiscal 2027.
On AI, D’Amaro said the technology presents “meaningful long-term opportunities” for Disney, particularly in production efficiency, while emphasizing that human creativity remains central to the company’s work.
Disney stock was trading up around 7% as of Wednesday afternoon.
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