📌 WHAT HAPPENED

Walt Disney Company (NYSE: DIS) reported stronger-than-expected results for its fiscal fourth quarter ended September 30, 2025. Earnings per share excluding items came in at $0.82, ahead of the $0.71 consensus estimate. Revenue stood at $21.24 billion, broadly in line with analyst projections.

A key highlight was the significant improvement in Disney’s Direct-to-Consumer (DTC) segment—streaming operating losses narrowed more than 70% year-over-year to just $420 million. Disney+ core subscribers declined marginally to 112.6 million, attributed to recent price increases, while ARPU rose in North America. Meanwhile, content sales and licensing revenue fell 17% as theatrical results underwhelmed.

The company’s Experiences segment continues to shine, with Parks, Experiences and Products revenue climbing 13% to $8.16 billion. Operating income for the unit rose 31% to $1.76 billion, underpinned by strength at international parks and Disney Cruise Line.

💡 WHY IT MATTERS

These results mark a significant step forward in Disney’s transformation plan. CEO Bob Iger’s strategy of margin expansion through cost cuts, disciplined spending, and pricing optimisation is taking root. Dramatically reduced DTC losses signal progress towards a 2024 streaming breakeven goal—core to the company’s long-term valuation reset.

Growth across Disney's theme park businesses reaffirms the Experiences segment as a reliable earnings engine amid cyclical content volatility. With the linear TV unit still under pressure and content sales lagging, resilience in parks and improving streaming economics could rebalance Disney's earnings mix.

📈 INVESTMENT PERSPECTIVE

Disney shares are up over 7% in post-earnings trading, with investors responding positively to tightened operational discipline. While challenges remain—notably in the Studio Entertainment and Linear Networks divisions—improved visibility on streaming profitability reduces risk around the firm's largest pivot.

If Disney sustains this momentum and unlocks value from ESPN and Hulu, shares could continue to re-rate. Capital discipline, potential cost savings of $7.5 billion, and increasing pricing power provide longer-term upside. Investors should watch subscriber trends closely in upcoming quarters, particularly post-price increase churn and engagement.

🎯 BOTTOM LINE

Disney’s comeback story is taking shape. With losses narrowing, costs falling, and core assets performing, the risk/reward profile is improving. Long-term investors may find the current levels appealing, especially if DTC breakeven is achieved by FY 2024.