Walt Disney Co (NYSE:DIS, XETRA:WDP) is expected to report modestly improving attendance trends at its domestic theme parks in its fiscal third quarter, Bank of America analysts have projected ahead of the entertainment giant’s upcoming report.
The bank’s analysts wrote that Disney's Experiences segment likely benefited from a slight improvement in US attendance compared with the fiscal second quarter, despite broader industry commentary pointing to mixed demand trends at theme parks.
The analysts also noted that lower fuel prices could provide an additional boost to consumer spending through the summer months.
Bank of America noted that gains from stronger attendance are expected to be partially offset by costs associated with cruise ship dry docks, though comparisons should also benefit from lower pre-opening expenses than a year earlier.
Within Disney's Sports business, the bank wrote that strong viewership for the NBA Finals likely supported results, but shorter playoff series and the blackout of NFL Network programming on some distributors may have weighed on performance.
In the studio segment, analysts said Star Wars: The Mandalorian and Grogu performed below expectations.
Bank of America also highlighted Disney's progress in its direct-to-consumer streaming business, noting that the company has expanded margins in recent years and remains on track to achieve double-digit subscription video-on-demand margins in fiscal 2026. However, the bank expects Disney to continue investing in growth initiatives, particularly international content production, which could support subscriber and revenue growth while moderating the pace of future margin expansion.
The firm maintained its fiscal third-quarter estimates for Disney, projecting revenue of $25.38 billion, operating income of $5.30 billion and earnings per share of $1.87.
It also left unchanged its fiscal 2026 earnings forecast of $6.88 per share.
Bank of America reiterated its ‘Buy’ rating on Disney shares and a price target of $125, above current levels of about $102, citing expected growth in streaming profitability, a recovery in parks attendance, long-term opportunities in sports, and the company's management team.
The company will report its Q3 earnings on August 5.