Walt Disney Co (NYSE:DIS, XETRA:WDP) reported stronger-than-expected fiscal second-quarter results on Wednesday, driven by improved profitability at its streaming unit and higher guest spending at its theme parks, sending shares up nearly 8%.
The entertainment giant posted revenue of $25.17 billion for the quarter, topping analyst estimates of $24.87 billion and marking a 6.6% increase from the same period a year earlier.
Adjusted earnings per share came in at $1.57, ahead of the $1.51 consensus estimate.
Total segment operating income reached $4.6 billion, up 3.8% year-over-year and above estimates of $4.38 billion.
Net income attributable to Disney fell 31.4% to $2.25 billion. The company ended the quarter with $5.68 billion in cash and cash equivalents.
Disney raised its full-year adjusted EPS growth outlook to approximately 12%.
All three of the company's reporting segments topped estimates. Entertainment revenue rose 9.7% to $11.72 billion, against expectations of $11.39 billion. Experiences revenue climbed 6.7% to $9.49 billion, edging past the $9.4 billion estimate. Sports revenue grew 1.7% to $4.61 billion, in line with the $4.59 billion forecast.
Domestic theme park attendance declined 1% in the quarter, which executives attributed to the impact of international travel trends. The company said it expects improvement in the second half of the fiscal year.
CFO Hugh Johnston said forward bookings show no material impact from elevated fuel prices, though he cautioned the company is not immune to further increases.
Disney said the majority of capital expenditures over the next decade will be directed toward expanding its Experiences segment capacity.
On the earnings call, CEO Josh D'Amaro identified reducing Disney+ subscriber churn as the company's most significant near-term opportunity.
The company also noted that vertical video on Disney+ is generating deeper user engagement, and that it remains open, though selective, to third-party content distribution.