Disney earnings summary

by visvya

 

$DIS | #Disney Q2 20 Earnings:

  • Revenue: $11.78B (exp $12.39B) (previous year $20.35B)
  • Adj EPS: +$0.08 (exp -$0.63). GAAP EPS of -$2.61 (about a $4.72 bn loss) – thanks /u/CapitalGains
  • Media networks Revenue: $6.6B (exp $6.38B)
  • Disney+ Subscribers: 57.5 mil (exp 59.4 mil) at quarter end. 60.5 mil currently, as of yesterday.
  • ESPN 8.5 mil, up >100 % y/y from 2.4 in 2019
  • Hulu 35.5 mil, up 27% y/y from 27.9 in 2019
  • Still made 983 million from the Parks, Experiences and Products department
  • $454M in free cash flow at quarter end. 23B in cash and cash equivalents.
  • In total, estimates “the net adverse impact of COVID-19 on our current quarter 2 segment operating income across all of our businesses was approximately $2.9 billion, inclusive of the impact at Parks, Experiences and Products.”

Highlights from the call:

  • Disney introduces a new streaming platform, Star, that’s like Hulu but for other countries. Chose Star brand over Hulu because of the Star brand’s international recognition. Star will not route third-party content like Hulu does but will route Disney-owned content (ABC, 20th century, etc) not published on Disney+.
  • Star is expected to drive adoption of Disney+ in other countries.
  • Live-action Mulan will be released on D+ on 9/4 as a pay-per-view for $29.99. Will also be released theatrically in markets where theaters are viable. I would expect this to be combined with the Disney native “Netflix Party” feature that was previously announced to be in development so that families can still watch the movie “together”.
  • Reopened Disney parks are profitable even at reduced capacity. Disney Shanghai has been consistently profitable. Disney World is less profitable than expected, blamed on Florida coronavirus outbreak, but still profitable. Execs previously said they would not reopen unless they thought they could be profitable and delivered.
  • Attendance at Disney World is 50% locals and 50% out-of-state. Chapek says Disney World will be “in good shape” when consumer confidence returns. Execs say they’re seeing pent up demand.
  • Expects a 1 billion cost to ramp up media production in a way that is safe for workers, including coronavirus tests etc.
  • Bringing Hotstar (Indian version of Hulu with content like new Bollywood films) to Indonesia and other markets.
  • Recognizes that one of the biggest drivers of user acquisition for streaming is new content and plans to invest big into this area.

 

Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.