Disney Posts Better-Than-Expected Profits; Disney+ Subscribers Drop by 700,000

Entrance to The Walt Disney Studios in Burbank, Calif. JHVEPhoto/Shuttertock

Disney posted its first-quarter earnings for fiscal year 2025 on Feb. 5. While its Disney+, Hulu, and ESPN+ streaming platforms reported a profit of $293 million, subscribers to Disney+ streaming service dropped by 700,000.

For the quarter ended Dec. 28, 2024, Disney’s revenues increased 5 percent, to $24.7 billion, up from $23.5 billion a year earlier. Pretax income rose 27 percent, from $2.9 billion to $3.7 billion, and earnings per share increased to $1.76.

“Our results in the first quarter demonstrate our creative and financial strength, and they reflect the success of our strategic initiatives that we set in motion over the past two years,” Disney CEO Bob Iger said in a recorded earnings call.

Disney’s film studio recorded earnings of $312 million, fueled by the popularity of the animated sequel “Moana 2,” which generated $1.04 billion in global box-office sales during the quarter, according to prepared management remarks.

“One of the great highlights of the quarter was the performance of our film studios,” Iger said. “We have the top three movies of 2024 at the global box office, and I want to thank and congratulate our creative teams on such an incredible year.”

The family comedy “Inside Out 2,” the action comedy “Deadpool & Wolverine,” and the animated “Mufasa: The Lion King” were among the other films thanked in the management remarks.

The drop in Disney+ subscribers arrives on the heels of a price increase on the company’s various subscription plans nearly four months ago.

Disney posted on its website in October 2024 that Disney+ subscriptions increased by $2 per month, to $9.99 for the Basic plan and to $15.99 for the premium plan which contains no advertising.

In the management remarks, company executives said that live sports studio shows would be added exclusively to Disney+ later this year.

Disney’s Experiences segment, which includes its U.S. parks and cruise ship businesses, was impacted by hurricanes Milton and Helene to the tune of $120 million and $75 million, respectively, to launch the company’s sixth cruise ship, Disney Treasure.

“We obviously have lots going on in terms of our ships coming on as of this quarter, which will support the results for the fourth quarter going forward and in addition to that, as we built our plans we did anticipate some small impact, which we effectively hedged … so overall, our level of confidence in Experiences is high,” Iger added.

Seven additional cruise ships are expected to launch by 2031.

Disney’s shares dropped upon the issuance of the first-quarter earnings statement but Iger remains optimistic about Disney’s future performance.

“We’re very encouraged by our results this quarter,” he said.

Iger projected that operations will provide some $15 billion in cash throughout 2025.

“We continue to expect fiscal 2025 results to reflect the progress we are making across our strategic priorities,” he said. “We will expect to deliver high single-digit adjusted earning per share growth for the year.”