The Walt Disney Company (NYSE: DIS) today announced robust financial results for its second fiscal quarter ended March 29, 2025, reporting significant increases in income and earnings per share, primarily propelled by strong performance in its Entertainment and Experiences divisions.
For the second quarter of fiscal 2025, Disney reported revenues of $23.6 billion, a 7% increase compared to $22.1 billion in the same period last year. Income before income taxes saw a dramatic rise, reaching $3.1 billion, up from $0.7 billion in the second fiscal quarter of 2024.
Total segment operating income grew 15% year-over-year, climbing to $4.4 billion from $3.8 billion.
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The company reported diluted earnings per share (EPS) of $1.81 for the quarter, a substantial improvement from a loss per share of $0.01 in the prior-year quarter. Adjusted EPS, a non-GAAP measure, also saw strong growth, increasing 20% to $1.45 from $1.21 in the second fiscal quarter of 2024.
“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,” said Robert A. Iger, Chief Executive Officer, The Walt Disney Company. “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. Overall, we remain optimistic about the direction of the company and our outlook for the remainder of the fiscal year.”
Looking at the segment breakdown:
Entertainment: The segment reported operating income of $1.3 billion, a significant $0.5 billion increase compared to the prior-year quarter. This improvement was driven by enhanced results in Direct-to-Consumer (DTC) and Content Sales/Licensing and Other. The DTC business saw its operating income increase by $289 million to $336 million. The company added 2.5 million total Disney+ and Hulu subscriptions sequentially from Q1 fiscal 2025, bringing the total to 180.7 million. Disney+ specifically added 1.4 million subscribers, reaching 126.0 million.
Linear Networks operating income grew 2%, although this growth includes a comparison impacted by the absence of Star India operating income in the current quarter following the joint venture transaction. Content Sales/Licensing and Other operating income improved significantly, reaching $153 million compared to a loss of $18 million in the prior year, boosted by higher TV/VOD and home entertainment distribution results.
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Sports: This segment’s operating income decreased by $91 million compared to the prior-year quarter, totaling $687 million. The decrease was primarily attributed to higher programming and production costs, largely due to airing three additional College Football Playoff games and one additional NFL game.
Despite the lower operating income, Sports revenue increased 5%, reflecting 7% domestic ESPN revenue growth, significantly aided by a 29% increase in domestic advertising revenue driven by the change in the College Football Playoff format and the additional games aired.
Experiences: The Experiences segment continued its strong performance, with operating income increasing by $0.2 billion to $2.5 billion. Domestic Parks & Experiences operating income grew 13% to $1.8 billion, driven by higher volumes across passenger cruise days (benefiting from the launch of the Disney Treasure), theme park attendance, occupied room nights, and Disney Vacation Club unit sales, alongside increased guest spending at theme parks.
These gains were partially offset by increased costs related to the Disney Cruise Line fleet expansion and inflation. International Parks saw a decrease in operating income, mainly at Shanghai Disney Resort and Hong Kong Disneyland Resort, due to lower attendance and increased costs. Consumer Products operating income grew 14% to $0.4 billion, boosted by higher licensing revenue, including from the licensed game Marvel Rivals.
Other notable financial highlights include share repurchases of $1 billion during the quarter, keeping the company on pace to repurchase $3 billion for the full fiscal year. The company also noted a significant decrease in restructuring and impairment charges in the current quarter ($109 million for content impairments) compared to the prior-year quarter ($2,052 million, primarily for goodwill impairments related to Star India and entertainment linear networks).
Cash provided by operations for the first six months of fiscal 2025 increased substantially to $10.0 billion from $5.9 billion in the prior-year period. This $4.1 billion increase was driven by lower tax payments (due to deferrals related to winter storms in FY24 and wildfires in FY25), higher operating income, and lower content spending at Entertainment. Investments in parks, resorts, and other property increased to $4.3 billion from $2.6 billion over the six-month period, primarily due to higher spend on the cruise ship fleet expansion. Free cash flow for the first six months improved significantly to $5.6 billion from $3.3 billion.
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Looking ahead, Disney provided guidance for fiscal year 2025, projecting adjusted EPS of $5.75, representing a 16% increase over fiscal 2024.
The company updated its cash provided by operations guidance to $17 billion, a $2 billion increase over prior guidance, driven by the deferral of tax payments. Segment operating income growth is expected to be double-digit percentage for Entertainment, 18% for Sports, and 6% to 8% for Experiences for the full fiscal year.
Disney acknowledged that it continues to monitor macroeconomic developments and recognizes that uncertainty remains regarding the operating environment for the balance of the fiscal year.
The company noted that Direct-to-Consumer results are presented excluding certain items and amortization of intangible assets, which are non-GAAP measures.
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