The Walt Disney Company is gearing up to unveil its first-quarter fiscal 2024 results on Feb 7.
The Zacks Consensus Estimate for earnings has seen a downward shift, settling at 97 cents per share over the past 30 days. This signifies a 2.02% year-over-year decline.
Revenue consensus stands at $23.47 billion, hinting at a 0.16% decrease from the previous year’s reported figure.
In each of the last four quarters, Disney has surpassed the Zacks Consensus Estimate for earnings, with an average positive surprise of 18.6%.
As the stage is set for the upcoming earnings call, it’s time to delve into the factors shaping this announcement.
Factors Influencing the Figures
Disney’s Q1 results are likely to reflect a stagnant growth trajectory for Disney+ subscribers. With 150 million paid subscribers as of Sep 30, 2023, against 146.7 million as of Jul 1, 2023, Disney+ is expected to display modest expansion.
Intensified competition from streaming behemoths like Netflix and Amazon Prime Video, along with the emergence of services by tech giants such as Apple and Comcast-owned Peacock, might have contributed to a slower growth rate for Disney+ in the quarter in review.
The Zacks Consensus Estimate for Disney+ paid subscribers is pegged at 148 million, indicating an 8.6% year-over-year drop and a 1.3% sequential decline.
At the end of the last quarter, Netflix reported a global paid subscriber base of 260.28 million, marking a 12.8% annual uptick. Meanwhile, Peacock witnessed a nearly 50% surge in paid subscribers, reaching 31 million, with a net addition of three million in the fourth quarter.
According to Kantar, Apple TV+ dominated new SVOD subscriptions, commanding an 18% share in the fourth quarter of 2023, overshadowing Amazon Prime Video and Disney+.
Disney is anticipated to face a downturn in advertising revenues in the quarter under review. In fiscal 2023, revenues plummeted by 15% year over year, primarily attributed to fewer impressions, especially in Hulu and Disney+.
The Zacks Consensus Estimate for Media and Entertainment Distribution revenues is pinned at $10.26 billion, indicating a 30.6% annual decline.
Despite the challenges, Disney is experiencing a strong resurgence in its domestic and international theme park businesses. Recent attractions like the Frozen theme land at Hong Kong Disneyland, Walt Disney Park in Paris, and the Zootopia theme land at Shanghai Disney are likely to have galvanized the outlook for this Zacks Rank #3 (Hold) company’s theme park segment in the quarter under review.
The Zacks Consensus Estimate for Parks, Experiences & Consumer Products revenues foresees a 2.3% year-over-year growth, signaling a promising trajectory.
As the investment community awaits Disney’s Q1 earnings report, it’s essential to stay up-to-date with upcoming announcements through the Zacks Earnings Calendar.
While the investment scenario is ripe with opportunity, investors should exercise caution and not be swayed by unsubstantiated claims or overly optimistic projections.