To The Moon

$Walt Disney(DIS)$ is scheduled to release its fiscal Q2 2025 financial results (for the quarter ending March 2025) on Wednesday, 07 May 2025, before the market opens.

A live audio webcast to discuss the results will follow at 8:30 a.m. Eastern Time (ET) / 5:30 a.m. Pacific Time (PT) on May 7th.

Revenue: Revenue expectations are for growth compared to the prior year. Consensus estimates are around $23.14 billion to $23.17 billion, which would represent a year-over-year increase of about 4.8% to 4.9%.

Earnings Per Share (EPS): Wall Street analysts generally expect adjusted EPS to be slightly lower than the same quarter last year. Consensus estimates range from approximately $1.18 to $1.20 per share. This compares to $1.21 per share reported in fiscal Q2 2024. Some recent analyst revisions have trended slightly lower.

Walt Disney (DIS) Last Positive Earnings Call Saw A Decline Of 19.73% In Share Price

Disney had a positive call on 05 Feb 2025 which saw its share price declined by 19.73% since.

Disney's earnings call highlighted significant achievements in their film studios, streaming profitability, ESPN's ratings, and Disney Experiences. Despite some concerns regarding the NBA contract costs and potential restructuring of linear networks, the overall performance and strategic initiatives position the company positively for future growth.

Walt Disney (DIS) Guidance

During The Walt Disney Company's First Quarter 2025 Financial Results Conference Call, CEO Bob Iger highlighted several key metrics and strategic initiatives. The company achieved notable success in its film studios, with the top three movies of 2024 at the global box office, contributing to robust financial performance. Additionally, Disney reported growth in streaming profitability, with a focus on technological enhancements and personalization to drive further gains. The company also maintained a positive outlook for its Experiences and Parks segment, projecting a 6% to 8% increase for the year, bolstered by strong Q1 results and upcoming attractions.

Furthermore, Disney's direct-to-consumer segment saw operating profit growth, with expectations of achieving over $1 billion in profit for the fiscal year. Overall, the call underscored Disney's strategic focus on leveraging its diverse portfolio and technological advancements to sustain growth across its various business segments.

Key Factors to Analyze in Q2 2025 :

Disney's film studios had the top 3 movies of 2024 at the global box office, showcasing their creative strength and success.

Streaming Performance (Disney+, Hulu, ESPN+):

Subscriber growth/decline and average revenue per user (ARPU). Significant growth in streaming profitability, highlighted by technological advancements and strategic planning for ESPN and Disney+.

Progress toward streaming profitability (reduced losses or breakeven).

Impact of ad-supported tiers and pricing changes.

Parks & Experiences:

Revenue and margin trends in domestic (U.S.) and international parks.

Consumer demand post-pandemic and pricing strategies.

Media & Entertainment:

Linear TV performance (declining traditional cable/satellite revenues).

Box office results (e.g., Marvel, Pixar, Star Wars releases).

Financial Health:

Cost-cutting progress (e.g., Disney’s $5.5B savings target by 2024). Disney's Experiences business showed strong and enduring appeal, with bookings up for the summer and Disney Treasure launch being a success. Disney continues to identify and implement cost-cutting opportunities, contributing to their financial management and profitability.

Free cash flow and debt management. While currently an asset, there is an ongoing consideration for restructuring smaller linear networks, indicating potential future challenges.

Strategic Initiatives:

ESPN’s transition to direct-to-consumer (DTC) streaming. ESPN achieved historic ratings, contributing positively to Disney's overall performance.

Partnerships or acquisitions (e.g., potential Hulu/Comcast resolution). Concerns about the step-up in rights costs for the NBA contract, though the company remains confident in its growth strategy.

Walt Disney (DIS) Price Target

Based on 27 analysts from Tiger Brokers offering 12 month price targets for Walt Disney in the last 3 months. The average price target is $125.53 with a high forecast of $147.00 and a low forecast of $79.00. The average price target represents a 37.39% change from the last price of $91.17.

In the previous quarter (Q1 2025, reported February 5, 2025), Disney reported strong results, beating expectations with adjusted EPS of $1.76 (up 44.3% YoY) and revenue of $24.7 billion (up 5.1% YoY). Despite this, the stock price saw a decline following the announcement.

Technical Analysis - Exponential Moving Average (EMA)

We are seeing momentum building up from the increase in RSI, but that does not seem to be enough to push DIS share price over the 26-EMA level, this level is important as the bears are still in control, and especially with the consumer data showing decrease, this might affect how market see DIS before its earnings next week.

Currently DIS is trading sideway this week, as investors might be waiting for more data coming this week, Initial jobless claims on Thursday and nonfarm payrolls on Friday. This should give an indication whether consumer would be back in confidence to spend on discretionary items.

I am expecting DIS to continue trading sideway and we need to see DIS giving results on its cost-cutting opportunities, contributing to their financial management and profitability.

There is an increase in short interest which is indicating investors might sell to exit their DIS shares if there is a significant increase after the earnings, this might cause a selloff on DIS shares pushing the price down.

Summary

Analysts and investors will likely focus on subscriber numbers for Disney+ and Hulu, the profitability trajectory of the direct-to-consumer (streaming) segment, performance in the Parks and Experiences division (especially considering any lingering impacts from previous hurricanes or economic factors), and updates on the Sports segment (ESPN).

The key focus I would be watching is DIS cost-cutting opportunities whether this quarter could lead them into better profitability.

Appreciate if you could share your thoughts in the comment section whether you think DIS could show better cost-cutting measure leading to better profitability.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.