Disney has had a strong third quarter, largely thanks to the success of “Toy Story 5,” which has grossed over $1 billion at the box office. This success, combined with the popularity of U.S. theme parks, helped offset some ongoing challenges from international tourism.
In addition, Disney announced a new partnership with TikTok, which will allow fan-created Disney content from TikTok to be shared on the Disney+ app. This is an exciting development for fans who love to create and share content related to their favorite Disney characters and stories.
On the stock market, shares of Disney rose more than 4% in early trading on Wednesday, reflecting confidence from investors in the company’s performance.
Earlier this year, Disney’s leadership warned that their theme parks division would likely see only modest growth, mainly due to a drop in international tourism. Factors like tariffs, immigration policies, and political tensions have affected the number of foreign visitors to the U.S.
Disney’s Experiences division, which includes its six global theme parks, cruise lines, and merchandise, reported a significant increase in operating income, which climbed 20% to $3.02 billion, with total revenue reaching $9.97 billion. Domestic parks saw a 27% rise in operating income, while international parks faced a 13% decline.
Attendance at U.S. parks increased by 3% compared to last year, driven by more domestic tourists and annual pass holders. The company credited summer promotions and new experiences for this growth.
Josh D’Amaro, who became the CEO of Disney after Bob Iger, mentioned during a conference call that spending at domestic parks has increased despite economic uncertainties. He emphasized the unique and valuable experiences Disney offers to its fans.
Although U.S. residents are driving the growth in park attendance, Disney is also observing an uptick in visitors from abroad.
“Toy Story 5” has not only performed well at the box office but has also renewed interest in other Toy Story films on Disney+. Merchandise sales related to the franchise contributed to the strongest quarter in consumer products revenue for Disney in the past five years. Furthermore, “The Devil Wears Prada 2” also performed well, especially in international markets.
In the streaming segment, which includes Disney+ and Hulu, revenue climbed 11% to $5.53 billion, thanks to a growing subscriber base, price increases, and higher advertising revenue.
For the three months ending June 27, Disney reported earnings of $2.64 billion, or $1.51 per share, a decrease from $5.26 billion or $2.92 per share a year earlier. When excluding one-time charges, earnings were at $2.06 per share, surpassing analysts’ expectations.
Total revenue for Disney rose 7% to $25.25 billion, slightly missing Wall Street’s expectations of $25.39 billion.
Disney also received a $100 million tariff refund following a Supreme Court ruling that impacted some of the tariffs imposed during President Trump’s administration. While more refunds may come in future quarters, they are expected to be relatively small.
