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Investing.com - Walt Disney (NYSE:DIS) has reported better-than-anticipated income and revenue in the fourth quarter, boosting shares in the media giant in premarket trading on Thursday.
The company was bolstered in particular by strength at its key streaming business, which helped power a 14% jump in revenue at its entertainment segment versus the year-ago period to $10.83 billion.
Disney has targeted growth at its offerings like Disney+ and Hulu despite fierce competition among streaming video services. The number of Disney+ subscribers rose by 4% compared to the prior quarter to 122.7 million, ahead of Wall Street expectations of 119.85 million. Paying customers at Hulu and the group's Disney+ Hotstar unit also topped projections.
When folding in its ESPN+ sports service, overall streaming operating profit came in at $321 million, rebounding from a loss of $387 million a year earlier.
Operating income at the entertainment division also more than doubled to $1.07 billion thanks in part to the box office success of its Marvel's summer superhero movie "Deadpool&Wolverine."
The result helped mitigate the impact of a 5.7% dip in operating profit at Disney's experiences division to $1.66 billion, which includes its theme parks and cruise ships. Following an initial post-pandemic surge in demand, the business has been hit by many Americans choosing to rein in spending in response to cost-of-living constraints.
In a statement, CEO Bob Iger, who returned to the helm of Disney in 2022 promising to carry out a sweeping turnaround of the business through cost cuts and a revamp of its film and TV studios, said the overhaul has seen "significant progress."
"[W]e have emerged from a period of considerable challenges and disruption well positioned for growth and optimistic about our future,” Iger said.
Total revenue expanded by 6.3% year-over-year to $22.57 billion, above expectations of $22.47 billion. Adjusted per-share earnings of $1.14 beat estimates as well.
In its current fiscal year, Disney said it is confident in its long-term prospects and believes it is "well positioned for growth." Full-year adjusted per-share profit is seen increasing in the high-single digits, although it flagged a "modest decline" in Disney+ subscribers compared to the fourth quarter.
Disney predicted double-digit growth in adjusted per-share earnings in both its 2026 and 2027 fiscal years as well.
